DOKK Library

Patterns of Information Law (Version 1.1)

Authors James Grimmelmann

License CC-BY-4.0

       1BUUFSOT PG


Introduction                                                             25

1 Undeveloped Ideas                                                   37
             Desny v. Wilder . . . . . . . . . . . . . . . . . .    . 37
             Michael J. Burstein, Exchanging Information
                Without Intellectual Property . . . . . . . . .     .    39
             Apfel v. Prudential-Bache Securities, Inc. . . . .     .    40
             Bizarro World Problem . . . . . . . . . . . . .        .    43
             Debt Collection Problem . . . . . . . . . . . .        .    43

2 Trade Secret                                                           45
   A Subject Ma er . . . . . . . . . . . . . . . . . . . . . . . .       45
               Restatement (Third) of Unfair Competition § 39            45
               UTSA § 1(4) . . . . . . . . . . . . . . . . . . . .       46
               Religious Technology Center v. Netcom On-Line
                  Communications Services, Inc. . . . . . . . . .        47
   B Ownership . . . . . . . . . . . . . . . . . . . . . . . . . .       51
       1 Actual Secrecy . . . . . . . . . . . . . . . . . . . . .        51
               United States v. Lange . . . . . . . . . . . . . . .      51
               Religious Technology Center v. Netcom On-Line
                  Communications Services, Inc. . . . . . . . . .        54
               Learning Curve Toys, Inc. v. PlayWood Toys, Inc.          56
               Exploits Problem . . . . . . . . . . . . . . . . .        68
       2 Priority . . . . . . . . . . . . . . . . . . . . . . . . .      68
       3 Collaborations . . . . . . . . . . . . . . . . . . . . .        68
               Restatement (Third) of Unfair Competition §
                   42 cmt. e . . . . . . . . . . . . . . . . . . . .     68
   C Procedures . . . . . . . . . . . . . . . . . . . . . . . . . .      70
               United States v. Lange . . . . . . . . . . . . . . .      70
               Religious Technology Center v. Netcom On-Line
                  Communications Services, Inc. . . . . . . . . .        70
               Rockwell Graphic Systems, Inc. v. DEV Indus-
                   tries, Inc. . . . . . . . . . . . . . . . . . . . .   71
   D Infringement: Similarity . . . . . . . . . . . . . . . . . .        74
               Big Vision Private, Ltd. v. E.I. Dupont De
                   Nemours & Co. . . . . . . . . . . . . . . . . .       74
   E Infringement: Prohibited Conduct . . . . . . . . . . . .          75
      1 Proving Infringement . . . . . . . . . . . . . . . . .         75
             Grynberg v. BP, PLC . . . . . . . . . . . . . . . .       75
      2 Direct Infringement . . . . . . . . . . . . . . . . . .        76
             Restatement (Third) of Unfair Competitition §
                 43 . . . . . . . . . . . . . . . . . . . . . . . .    76
             UTSA § 1(1) . . . . . . . . . . . . . . . . . . . .       76
             E.I. du Pont de Nemours & Co. v. Christopher . .          77
             Kamin v. Kuhnau . . . . . . . . . . . . . . . . . .       80
      3 Secondary Infringement . . . . . . . . . . . . . . .           84
             UTSA § 1(2) . . . . . . . . . . . . . . . . . . . .       84
   F Defenses . . . . . . . . . . . . . . . . . . . . . . . . . . .    84
   G Problems . . . . . . . . . . . . . . . . . . . . . . . . . . .    85
             Flaming Moe’s Problem . . . . . . . . . . . . .           85
             Sports Secrets Problem . . . . . . . . . . . . . .        86
             Questions . . . . . . . . . . . . . . . . . . . . . .     86
             Locksmiths Problem . . . . . . . . . . . . . . .          86
   H Other Secrecy Laws . . . . . . . . . . . . . . . . . . . . .      87
      1 Trespass . . . . . . . . . . . . . . . . . . . . . . . . .     87
             Food Lion, Inc. v. Capital Cities/ABC, Inc. . . . .       87
      2 Insider Trading . . . . . . . . . . . . . . . . . . . . .      90
             United States v. O’Hagan . . . . . . . . . . . . .        90
             Salman v. United States . . . . . . . . . . . . . .       95
      3 Privacy . . . . . . . . . . . . . . . . . . . . . . . . . .    97
             Neil M. Richards, Reconciling Data Privacy and
                 the First Amendment . . . . . . . . . . . . . .        97
             Restatement (Second) of Torts § 652B . . . . . .           98
             Neil M. Richards & Daniel J. Solove, Privacy’s
                 Other Path: Recovering the Law of Confiden-
                 tiality . . . . . . . . . . . . . . . . . . . . . .   100
             Florida v. Riley . . . . . . . . . . . . . . . . . . .    101
             Kyllo v. United States . . . . . . . . . . . . . . .      102
      4 Government Secrets . . . . . . . . . . . . . . . . . .         104
             Freedom of Information Act . . . . . . . . . . .          104
             U.S. Dept. of Justice v. Tax Analysts . . . . . . . .     105
             Chrysler Corp. v. Brown . . . . . . . . . . . . . .       106
             Coastal States Gas Corp. v. Department of Energy          109
             Congressional Research Service, The Protec-
                 tion of Classified Information: The Legal
                 Framework . . . . . . . . . . . . . . . . . . .       113
             Phillippi v. Central Intelligence Agency . . . . . .      117

3 Patent                                                           119
             United States Constitution, art. I, § 8, cl. 8 . . . 119
   A Subject Ma er . . . . . . . . . . . . . . . . . . . . . . . . 120
          Patent Act § 101 . . . . . . . . . . . . . . . . .     .   120
   1 Utility . . . . . . . . . . . . . . . . . . . . . . . . .   .   120
          Juicy Whip, Inc. v. Orange Bang, Inc. . . . . . .      .   120
          MPEP §§ 2701, 2701.01 . . . . . . . . . . . . .        .   124
   2 Statutory Subject Ma er . . . . . . . . . . . . . .         .   128
          MPEP § 2106 . . . . . . . . . . . . . . . . . . .      .   128
          Tun-Jen Chiang, The Rules and Standards of
              Patentable Subject Ma er . . . . . . . . . . .     .   128
          Mayo Collaborative v. Prometheus Labs . . . . .        .   129
          Tax Planning Patent Problem . . . . . . . . .          .   133
B Procedures . . . . . . . . . . . . . . . . . . . . . . . . .   .   133
   1 Claims . . . . . . . . . . . . . . . . . . . . . . . . .    .   137
          Patent Act § 112(b)-(d) . . . . . . . . . . . . .      .   137
          T.J. Chiang, The Levels of Abstraction Problem in
              Patent Law . . . . . . . . . . . . . . . . . .     .   137
          Mark A. Lemley, Point of Novelty . . . . . . .         .   138
       a Indefiniteness . . . . . . . . . . . . . . . . . .       .   138
          Nautlius, Inc. v. Biosig Instruments Inc. . . . .      .   138
          Freeny v. Apple Inc. . . . . . . . . . . . . . . .     .   139
          Datamize, LLC v. Plumtree Software, Inc. . . . .       .   141
       b Claim Drafting . . . . . . . . . . . . . . . . .        .   143
          Catalina Marketing Intern. v. .        .   143
          MPEP §§ 2111, 2173 . . . . . . . . . . . . . . .       .   143
   2 Disclosure . . . . . . . . . . . . . . . . . . . . . . .    .   144
          Patent Act § 112(a) . . . . . . . . . . . . . . . .    .   144
       a Enablement . . . . . . . . . . . . . . . . . . .        .   145
          O’Reilly v. Morse . . . . . . . . . . . . . . . . .    .   145
          Wyeth & Cordis Corp. v. Abbo Labs. . . . . . .         .   146
          Plastic Dye Problem . . . . . . . . . . . . . . .      .   149
       b Wri en Description . . . . . . . . . . . . . .          .   150
          Ariad Pharmaceuticals, Inc. v. Eli Lilly and Co .      .   150
       c Best Mode . . . . . . . . . . . . . . . . . . . .       .   150
          MPEP § 2165 . . . . . . . . . . . . . . . . . . .      .   150
       d Problem . . . . . . . . . . . . . . . . . . . . .       .   151
          Salt Shaker Problem . . . . . . . . . . . . . . .      .   151
   3 Patent Prosecution . . . . . . . . . . . . . . . . . .      .   152
          Cuozzo Speed Technologies, LLC v. Lee . . . . .        .   152
          Patent Act § 122 . . . . . . . . . . . . . . . . .     .   152
          37 C.F.R. pt 1 . . . . . . . . . . . . . . . . . . .   .   153
          Therasense, Inc. v. Becton, Dickinson and Co. . .      .   153
       a Priority Dates . . . . . . . . . . . . . . . . . .      .   154
          USPTO, General Information Concerning
              Patents . . . . . . . . . . . . . . . . . . . .    . 154
       b Multiple Applications . . . . . . . . . . . . .         . 155
          Patent Act § 121 . . . . . . . . . . . . . . . . .     . 155
          MPEP §§ 201.07 . . . . . . . . . . . . . . . . . .       155
        c Judicial Review . . . . . . . . . . . . . . . . . .      156
        d Post-Grant Proceedings . . . . . . . . . . . . .         156
          Patent Act § 251 . . . . . . . . . . . . . . . . . .     156
          Cuozzo Speed Technologies, LLC v. Lee . . . . . .        156
   4 Term . . . . . . . . . . . . . . . . . . . . . . . . . . .    158
          Patent Act § 135(a)(2) . . . . . . . . . . . . . . .     158
C Ownership . . . . . . . . . . . . . . . . . . . . . . . . . .    158
   1 Collaborations . . . . . . . . . . . . . . . . . . . . .      158
          MPEP § 2137.01 . . . . . . . . . . . . . . . . . .       158
          Patent Act § 135 . . . . . . . . . . . . . . . . . .     160
   2 Priority: Novelty and Statutory Bars . . . . . . . .          160
        a Anticipation . . . . . . . . . . . . . . . . . . . .     162
          MPEP § 2131 . . . . . . . . . . . . . . . . . . . .      162
          Titanium Metals Corp. of America v. Banner . . .         163
        b Categories of Prior Art . . . . . . . . . . . . . .      168
        1 ”patented” . . . . . . . . . . . . . . . . . . . . .     168
        2 ”described in a printed publication” . . . . . .         168
          In re Klopfenstein . . . . . . . . . . . . . . . . . .   168
        3 ”in public use” . . . . . . . . . . . . . . . . . . .    173
          Egbert v. Lippmann . . . . . . . . . . . . . . . . .     173
          Mark A. Lemley, Does “Public Use” Mean the
              Same Thing It Did Last Year? . . . . . . . . .       176
          Lough v. Brunswick Corp . . . . . . . . . . . . . .      178
        4 ”on sale” . . . . . . . . . . . . . . . . . . . . . .    180
          MPEP §§ 2152.02(d), 2133.03(b) & (c) . . . . . .         180
          Helsinn Healthcare S.A. v. Teva Pharmaceuticals
              USA, Inc. . . . . . . . . . . . . . . . . . . . .    181
        5 ”otherwise available to the public” . . . . . . .        182
        c Priority . . . . . . . . . . . . . . . . . . . . . . .   182
        1 Old § 102 . . . . . . . . . . . . . . . . . . . . . .    182
          Patent Act § 102 (pre-AIA . . . . . . . . . . . .        182
          MPEP § 2138 . . . . . . . . . . . . . . . . . . . .      183
          Morway v. Bondi . . . . . . . . . . . . . . . . . .      184
        2 New § 102 . . . . . . . . . . . . . . . . . . . . .      186
          Patent Act § 102 . . . . . . . . . . . . . . . . . .     186
          Questions . . . . . . . . . . . . . . . . . . . . . .    187
          Pleistocene Park Problem . . . . . . . . . . . . .       187
   3 Nonobviousness . . . . . . . . . . . . . . . . . . . .        188
          Patent Act § 103 . . . . . . . . . . . . . . . . . .     188
          KSR Intern. Co. v. Teleflex Inc. . . . . . . . . . .      188
          In re Clay . . . . . . . . . . . . . . . . . . . . . .   199
          KSR Problem . . . . . . . . . . . . . . . . . . . .      201
D Infringement: Similarity . . . . . . . . . . . . . . . . . .     202
          Jeanne C. Fromer, Claiming Intellectual Property         202
          N.D. Cal. Model Patent Jury Instructions . . .             203
   1 Claim Construction . . . . . . . . . . . . . . . . . .          204
          Phillips v. AWH Corp. . . . . . . . . . . . . . . .        204
          Thorner v. Sony Computer Entertainment Amer-
              ica LLC . . . . . . . . . . . . . . . . . . . . .      209
   2 Literal Infringement . . . . . . . . . . . . . . . . . .        215
          Angelo Mongiello’s Children, LLC v. Pizza Hut,
              Inc. . . . . . . . . . . . . . . . . . . . . . . .     215
          Abbo Laboratories v. Sandoz, Inc. . . . . . . . . .        217
   3 Doctrine of Equivalents . . . . . . . . . . . . . . . .         218
          Freedman Seating Co. v. American Seating Co. . .           218
          Festo Corp. v. Shoketsu Kinzoku Kogyo Kabushiki
              Co. . . . . . . . . . . . . . . . . . . . . . . . .    225
          Johnson & Johnston Associates v. R.E. Service Co.          227
   4 A Hybrid: Means-Plus-Function Claims . . . . . .                228
          Kemco Sales, Inc. v. Control Papers Co., Inc. . . .        228
          Super Soaker Problem . . . . . . . . . . . . . .           230
E Infringement: Prohibited Conduct . . . . . . . . . . . .           230
          Herman v. Youngstown Car Mfg. Co. . . . . . . .            230
   1 Direct Infringement . . . . . . . . . . . . . . . . . .         231
          Patent Act § 271(a) . . . . . . . . . . . . . . . . .      231
          Blazer v. eBay, Inc. . . . . . . . . . . . . . . . . .     231
          Telectronics Pacing Systems v. Ventritex, Inc. . . .       232
          Akamai Technologies, Inc. v. Limelight Networks,
              Inc. . . . . . . . . . . . . . . . . . . . . . . .     232
   2 Indirect Infringement . . . . . . . . . . . . . . . . .         233
          Patent Act § 271(b)-(c) . . . . . . . . . . . . . . .      233
          Limelight Networks, Inc. v. Akamai Technologies,
              Inc. . . . . . . . . . . . . . . . . . . . . . . .     233
          Global-Tech Appliances, Inc. v. SEB S.A. . . . . .         234
          Commil USA, LLC v. Cisco Systems Inc. . . . . .            235
          Lucent Technologies, Inc. v. Gateway, Inc. . . . . .       235
          Questions . . . . . . . . . . . . . . . . . . . . . .      237
F Defenses . . . . . . . . . . . . . . . . . . . . . . . . . . .     237
   1 Invalidity . . . . . . . . . . . . . . . . . . . . . . . .      237
          Microsoft Corp. v. i4i Ltd. Partnership . . . . . .        237
   2 Exhaustion . . . . . . . . . . . . . . . . . . . . . . .        237
          Impression Products, Inc. v. Lexmark Interna-
              tional, Inc. . . . . . . . . . . . . . . . . . . . .   237
          Quanta Computer, Inc. v. LG Electronics, Inc. . .          242
          Aktiebolag v. E.J. Co. . . . . . . . . . . . . . . . .     246
   3 Miscellaneous . . . . . . . . . . . . . . . . . . . . .         250
          Patent Act §§ 273, 287 . . . . . . . . . . . . . . .       250
          Madey v. Duke University . . . . . . . . . . . . .         250
4 Copyright                                                          253
   A Subject Ma er . . . . . . . . . . . . . . . . . . . . . . . . 253
             Copyright Act § 102(a) . . . . . . . . . . . . . . 253
             Feist Publications, Inc. v. Rural Telephone Service
                 Co. . . . . . . . . . . . . . . . . . . . . . . . . 254
      1 Creativity: How Much Is a Modicum? . . . . . . . 254
             37 C.F.R. § 202.1(a) . . . . . . . . . . . . . . . . 254
             Feist Publications, Inc. v. Rural Telephone Service
                 Co. . . . . . . . . . . . . . . . . . . . . . . . . 255
             Arrows Problem . . . . . . . . . . . . . . . . . . 259
             Baseball Card Price Report Problem . . . . . . 259
      2 Aesthetic Nondiscrimination . . . . . . . . . . . . . 259
             Bleistein v. Donaldson Lithographing Co. . . . . . 259
             Copyright Compendium § 310 . . . . . . . . . 261
             Mitchell Bros. Film Group v. Cinema Adult Theater262
             Belcher v. Tarbox . . . . . . . . . . . . . . . . . . 263
      3 Idea and Expression . . . . . . . . . . . . . . . . . . 263
             Copyright Act § 102(b) . . . . . . . . . . . . . . 263
             Blehm v. Jacobs . . . . . . . . . . . . . . . . . . . 263
             Walker v. Time Life Films, Inc. . . . . . . . . . . . 270
             Hula Problem . . . . . . . . . . . . . . . . . . . 270
             Baker v. Selden . . . . . . . . . . . . . . . . . . . 271
             Bikram’s Yoga College of India v. Evolation Yoga . 273
             Concrete Machinery Co. v. Classic Lawn Orna-
                 ments . . . . . . . . . . . . . . . . . . . . . . 277
             Cooking for Kids Problem . . . . . . . . . . . . 277
   B Ownership . . . . . . . . . . . . . . . . . . . . . . . . . . 278
             Sheldon v. Metro-Goldwyn Pictures Corp. . . . . . 278
      1 Authorship . . . . . . . . . . . . . . . . . . . . . . . 278
             Burrow-Giles Lithographic Co. v. Sarony . . . . . 278
             Monkey Selfie Problem . . . . . . . . . . . . . . 280
             Copyright Act § 105 . . . . . . . . . . . . . . . . 280
      2 Collaborations . . . . . . . . . . . . . . . . . . . . . 280
             Copyright Act §§ 201, 202 . . . . . . . . . . . . 280
             Thomson v. Larson . . . . . . . . . . . . . . . . . 281
             Greene v. Ablon . . . . . . . . . . . . . . . . . . . 286
             Community for Creative Non-Violence v. Reid . . 287
             Warren v. Fox Family Worldwide, Inc. . . . . . . . 291
             Garcia v. Google, Inc. . . . . . . . . . . . . . . . . 292
             Blizzard Entertainment, Inc. v. Lilith Games
                 (Shanghai) Co. . . . . . . . . . . . . . . . . . . 294
      3 Derivative Works . . . . . . . . . . . . . . . . . . . 295
             Copyright Act § 103 . . . . . . . . . . . . . . . . 295
             DC Comics v. Towle . . . . . . . . . . . . . . . . 295
             Picke v. Prince . . . . . . . . . . . . . . . . . . . 296
          Keeling v. Hars . . . . . . . . . . . . . . . . . . . 298
C Procedures . . . . . . . . . . . . . . . . . . . . . . . . . . 299
   1 Formalities Then . . . . . . . . . . . . . . . . . . . . 299
          Christopher Sprigman, Reform(aliz)ing Copyright299
          Estate of Martin Luther King v. CBS, Inc. . . . . . 300
          Estate of Martin Luther King v. CBS, Inc. . . . . . 302
          Wildman v. New York Times Co. . . . . . . . . . . 302
   2 Formalities Now . . . . . . . . . . . . . . . . . . . . 303
        a Fixation . . . . . . . . . . . . . . . . . . . . . . . 303
          Copyright Compendium § 305 . . . . . . . . . 303
          Stern Electronics, Inc. v. Kaufman . . . . . . . . . 305
          Questions . . . . . . . . . . . . . . . . . . . . . . 307
          Photoshoot Problem . . . . . . . . . . . . . . . 307
        b Registration . . . . . . . . . . . . . . . . . . . . 308
          Copyright Compendium § 202 . . . . . . . . . 308
        c Deposit . . . . . . . . . . . . . . . . . . . . . . . 309
          Copyright Compendium §§ 1502, 1511 . . . . . 309
        d Notice . . . . . . . . . . . . . . . . . . . . . . . . 310
          Copyright Compendium §§ 2202, 2204 . . . . . 310
   3 Term . . . . . . . . . . . . . . . . . . . . . . . . . . . 311
          Copyright Act §§ 302, 305 . . . . . . . . . . . . 311
          Eldred v. Ashcroft . . . . . . . . . . . . . . . . . . 312
          Klinger v. Conan Doyle Estate . . . . . . . . . . . 314
D Infringement: Similarity . . . . . . . . . . . . . . . . . . 316
          Sheldon v. Metro-Goldwyn Pictures Corp. . . . . . 316
          Nichols v. Universal Pictures Corporation . . . . . 316
          Arnstein v. Porter . . . . . . . . . . . . . . . . . 319
          Children’s Book Problem . . . . . . . . . . . . . 320
          Go lieb Development LLC v. Paramount Pictures . 320
          Boisson v. Banian, Ltd. . . . . . . . . . . . . . . . 323
          New Yorker Problem . . . . . . . . . . . . . . . 327
E Infringement: Prohibited Conduct . . . . . . . . . . . . 327
   1 Proof of Copying . . . . . . . . . . . . . . . . . . . . 327
          Three Boys Music Corp. v. Bolton . . . . . . . . . 328
          Bee Gees Problem . . . . . . . . . . . . . . . . . 333
   2 Direct Infringement . . . . . . . . . . . . . . . . . . 335
          Copyright Act § 106 . . . . . . . . . . . . . . . . 335
          Capitol Records, LLC v. ReDigi Inc. . . . . . . . . 335
          CoStar Group, Inc. v. LoopNet, Inc. . . . . . . . . 338
          American Broadcasting v. Aereo, Inc. . . . . . . . 339
          Copyright Act § 110 . . . . . . . . . . . . . . . . 343
   3 Secondary Liability . . . . . . . . . . . . . . . . . . 344
          Fonovisa, Inc. v. Cherry Auction, Inc. . . . . . . . 344
          Sony Corp. of America v. Universal City Studios,
              Inc. . . . . . . . . . . . . . . . . . . . . . . . 348
             Metro-Goldwyn-Mayer Studios Inc. v. Grokster,
                 Ltd. . . . . . . . . . . . . . . . . . . . . . . .   349
             Exclusive Rights Problem . . . . . . . . . . . .         349
      4 Paracopyright . . . . . . . . . . . . . . . . . . . . . .     350
             Copyright Act § 1201 . . . . . . . . . . . . . . .       350
             MDY Industries, LLC. v. Blizzard Entertainment,
                 Inc. . . . . . . . . . . . . . . . . . . . . . . .   350
             Copyright Act § 1202 . . . . . . . . . . . . . . .       355
             Murphy v. Millennium Radio Group LLC . . . . .           356
   F Defenses . . . . . . . . . . . . . . . . . . . . . . . . . . .   357
      1 First Sale . . . . . . . . . . . . . . . . . . . . . . . .    357
             Copyright Act § 109 . . . . . . . . . . . . . . . .      357
             UMG Recordings, Inc. v. Augusto . . . . . . . . .        358
             Lee v. A.R.T. Co. . . . . . . . . . . . . . . . . . .    361
             Muñoz v. Albuquerque A.R.T. Co. . . . . . . . . .        361
             Mirage Editions, Inc. v. Albuquerque A.R.T. Co. .        361
             Doan v. American Book Co. . . . . . . . . . . . .        363
             Capitol Records, LLC v. ReDigi Inc. . . . . . . . .      363
      2 Fair Use . . . . . . . . . . . . . . . . . . . . . . . . .    364
             Copyright Act § 107 . . . . . . . . . . . . . . . .      364
             Fair Use Checklist . . . . . . . . . . . . . . . . .     365
             Harper & Row, Publishers, Inc. v. Nation Enter-
                 prises . . . . . . . . . . . . . . . . . . . . . .   366
             Campbell v. Acuff-Rose Music, Inc. . . . . . . . .        372
             City of Inglewood v. Teixeira . . . . . . . . . . . .    375
             Fox Broadcasting Co., Inc. v. Dish Network LLC .         380
             Capitol Records, LLC v. ReDigi Inc. . . . . . . . .      383
             Chicago HOPE Problem . . . . . . . . . . . . .           384
      3 Section 512 . . . . . . . . . . . . . . . . . . . . . . .     385
             Copyright Act § 512 . . . . . . . . . . . . . . . .      385
             UMG Recordings, Inc. v. Shelter Capital Partners         386
      4 Statutory Licenses . . . . . . . . . . . . . . . . . . .      392
             WPIX, Inc. v. ivi, Inc. . . . . . . . . . . . . . . .    392
             Fox Television Stations, Inc. v. AereoKiller . . . .     394
      5 Miscellaneous . . . . . . . . . . . . . . . . . . . . .       395
             Copyright Act §§ 108, 121 . . . . . . . . . . . .        395

5 Music                                                         397
             Steve Albini, The Problem with Music . . . . . . 397
   A Musical Works and Sound Recordings . . . . . . . . . 398
             Robert Brauneis, Musical Work Copyright for
                the Era of Digital Sound Technology . . . . . . 398
             White-Smith Music Publishing Co. v. Apollo Co. . 399
             Copyright Office, F           C          P        -
                          P -  ₁₉₇₂ S     R             . . . . 400
            Copyright Act §§ 101, 102 . . . . . . . . . . . . 401
            Lydia Pallas Loren, Untangling the Web of Mu-
                sic Copyrights . . . . . . . . . . . . . . . . . . 401
            Newton v. Diamond . . . . . . . . . . . . . . . . 402
B   Reproductions . . . . . . . . . . . . . . . . . . . . . . . . 404
     1 Musical Works . . . . . . . . . . . . . . . . . . . . . 404
            Copyright Act § 115(a) . . . . . . . . . . . . . . 404
            37 C.F.R. pt. 385 . . . . . . . . . . . . . . . . . . 405
            Lydia Pallas Loren, Untangling the Web of Mu-
                sic Copyrights . . . . . . . . . . . . . . . . . . 405
            Leadsinger, Inc. v. BMG Music Pub. . . . . . . . 406
     2 Sound Recordings . . . . . . . . . . . . . . . . . . . 407
            Copyright Act § 114(b) . . . . . . . . . . . . . . 407
            Bridgeport Music, Inc. v. Dimension Films . . . . 407
            VMG Salsoul, LLC v. Ciccone . . . . . . . . . . . 409
C   Performances . . . . . . . . . . . . . . . . . . . . . . . . . 411
            United States v. American Society of Composers,
                Authors, and Publishers . . . . . . . . . . . . . 411
     1 Musical Works . . . . . . . . . . . . . . . . . . . . . 412
          a Broadcasting and Receiving . . . . . . . . . . . 412
            Buck v. Jewell-LaSalle Realty Co. . . . . . . . . . . 412
            Copyright Act § 110(5) . . . . . . . . . . . . . . 414
          b The Performing Rights Organizations . . . . . 414
            Broadcast Music, Inc. v. Columbia Broadcasting
                System, Inc. . . . . . . . . . . . . . . . . . . . 414
            ASCAP 2010 Radio Station License Agreement . . 416
            Range Road Music, Inc. v. East Coast Foods, Inc. . 417
            Robert Stigwood Grp., Ltd. v. Sperber . . . . . . . 418
          c Miscellaneous . . . . . . . . . . . . . . . . . . . 420
            Copyright Act § 116 . . . . . . . . . . . . . . . . 420
            History of the Jukebox License Office . . . . . . . . 420
            Copyright Act § 110 . . . . . . . . . . . . . . . . 421
     2 Sound Recordings . . . . . . . . . . . . . . . . . . . 421
            Copyright Act § 114 . . . . . . . . . . . . . . . . 421
            Copyright Office, C                            M
                M                . . . . . . . . . . . . . . . . . 421
D   State-Law Protection for Pre-1972 Sound Recordings . 424
            Copyright Act §§ 301(c) . . . . . . . . . . . . . . 425
            Copyright Office, F             C            P        -
                          P -₁₉₇₂ S        R               . . . . 425
            Flo & Eddie, Inc. v. Sirius XM Radio, Inc. . . . . 427
            Flo & Eddie, Inc. v. Sirius XM Radio, Inc. . . . . 429
            UMG Recordings, Inc. v. Escape Media Group, Inc.429
            Capitol Records, LLC v. Vimeo, LLC . . . . . . . . 430
E   Bootlegging . . . . . . . . . . . . . . . . . . . . . . . . . 432
                Metropolitan Opera Assoc. v. Wagner-Nichols
                  Recorder Corp. . . . . . . . . . . . . . . . .      .   432
                Copyright Act § 1101(a) . . . . . . . . . . . .       .   433
                United States v. Martignon . . . . . . . . . . .      .   434
                Questions . . . . . . . . . . . . . . . . . . . . .   .   436

6 Trademark                                                               439
             The Trade-Mark Cases . . . . . . . . . . . . . .         .   439
   A Subject Ma er . . . . . . . . . . . . . . . . . . . . . . .      .   440
             Lanham Act § 45 (“trademark”) . . . . . . . .            .   440
             Drug Stamps Problem . . . . . . . . . . . . .            .   440
      1 Word Marks . . . . . . . . . . . . . . . . . . . . .          .   441
             Zatarains, Inc. v. Oak Grove Smokehouse, Inc. .          .   441
             Innovation Ventures, LLC v. N.V.E., Inc. . . . .         .   447
             TMEP § 1202 . . . . . . . . . . . . . . . . . . .        .   448
             Elliot v. Google Inc. . . . . . . . . . . . . . . . .    .   448
             TMEP § 1209.03 . . . . . . . . . . . . . . . . .         .   454
      2 Designs . . . . . . . . . . . . . . . . . . . . . . . .       .   456
             Star Industries, Inc. v. Bacardi & Co. Ltd. . . . .      .   456
             Melting Bad Problem . . . . . . . . . . . . . .          .   457
   B Ownership . . . . . . . . . . . . . . . . . . . . . . . . .      .   458
      1 Priority at Common Law . . . . . . . . . . . . . .            .   458
             Galt House Inc. v. Home Supply Company . . .             .   458
             United Drug Co. v. Theodore Rectanus Co. . . .           .   461
             Planetary Motion, Inc. v. Techsplosion, Inc. . . .       .   463
             Dudley v. HealthSource Chiropractic, Inc. . . . .        .   466
             CreAgri, Inc. v. USANA Health Sciences, Inc. .           .   467
             In re Morgan Brown . . . . . . . . . . . . . . .         .   469
             Bilgewater Bill’s Problem . . . . . . . . . . . .        .   470
      2 Federal Registration . . . . . . . . . . . . . . . . .        .   470
          a Registration . . . . . . . . . . . . . . . . . . .        .   470
             Lanham Act §§ 1(a), 7 . . . . . . . . . . . . . .        .   470
             Burger King of Florida, Inc. v. Hoots . . . . . .        .   471
             Bilgewater Bill’s Problem, Redux . . . . . . .           .   472
          b Intent-to-Use Applications . . . . . . . . . .            .   472
             Lanham Act § 1(b) . . . . . . . . . . . . . . . .        .   472
             Kelly Services, Inc. v. Creative Harbor, LLC [I] .       .   473
             Kelly Services, Inc. v. Creative Harbor, LLC [II]        .   477
             Bilgewater Bill’s Problem, Re-Redux . . . . .            .   478
      3 Collaborations . . . . . . . . . . . . . . . . . . . .        .   478
             Boogie Kings v. Guillory . . . . . . . . . . . . .       .   478
             New Jersey Truth in Music Act . . . . . . . .            .   480
             TMEP § 1201.03 . . . . . . . . . . . . . . . . .         .   481
             Duff Problem . . . . . . . . . . . . . . . . . .          .   481
   C Procedures . . . . . . . . . . . . . . . . . . . . . . . . .     .   482
   1 Registration . . . . . . . . . . . . . . . . . . . . . . .    482
          Lanham Act § 2(a) . . . . . . . . . . . . . . . . .      482
          Lanham Act § 2 . . . . . . . . . . . . . . . . . .       482
          Matal v. Tam . . . . . . . . . . . . . . . . . . . .     482
          In re Boulevard Entertainment, Inc. . . . . . . . .      483
          TMEP §§ 1302–1304 . . . . . . . . . . . . . . . .        483
          TMEP §§ 904, 1401, 1402 . . . . . . . . . . . . .        484
          TMEP § 906 . . . . . . . . . . . . . . . . . . . .       485
   2 Opposition . . . . . . . . . . . . . . . . . . . . . . .      485
          Lanham Act §§ 2(d), 12, 13 . . . . . . . . . . . .       485
          B&B Hardware, Inc. v. Hargis Industries, Inc. . .        486
          B&B Hardware, Inc. v. Hargis Industries, Inc. . .        488
   3 Maintenance . . . . . . . . . . . . . . . . . . . . . .       488
          Lanham Act §§ 8,9 . . . . . . . . . . . . . . . . .      488
   4 Cancellation and Incontestability . . . . . . . . . .         489
          Lanham Act §§ 14, 15 . . . . . . . . . . . . . . .       489
          Park ‘N Fly, Inc. v. Dollar Park & Fly, Inc. . . . .     490
   5 Abandonment . . . . . . . . . . . . . . . . . . . . .         491
          Lanham Act § 45 (“abandoned”) . . . . . . . .            491
          Procter & Gamble Co. v. Johnson & Johnson Inc. .         491
          Trademark Throwback Problem . . . . . . . . .            495
D Infringement: Confusion . . . . . . . . . . . . . . . . .        495
          Lanham Act § 32 . . . . . . . . . . . . . . . . . .      496
          Virgin Enterprises Ltd. v. Nawab . . . . . . . . .       496
          Sally Beauty Co., Inc. v. Beautyco, Inc. . . . . . .     506
          Cheat Sheet Problem . . . . . . . . . . . . . . .        507
          Boats Problem . . . . . . . . . . . . . . . . . . .      507
E Infringement: Prohibited Conduct . . . . . . . . . . . .         508
   1 Threshold Conditions . . . . . . . . . . . . . . . . .        508
          Rescuecom Corp. v. Google Inc. . . . . . . . . . .       508
          Radiance Foundation, Inc. v. NAACP . . . . . . .         514
   2 Theories of Confusion . . . . . . . . . . . . . . . .         518
        a Reverse Confusion . . . . . . . . . . . . . . . .        518
          Restatement (Third) of Unfair Competition §
              20 cmt. f . . . . . . . . . . . . . . . . . . . .    518
        b Initial Interest Confusion . . . . . . . . . . . .       519
          Grotrian, Helfferich, Schul , Th. Steinweg Nachf
              v. Steinway & Sons . . . . . . . . . . . . . . .     519
          Brookfield Communications v. West Coast Enter-
              tainment . . . . . . . . . . . . . . . . . . . . .   519
          Hearts on Fire Company, LLC v. Blue Nile, Inc. . .       520
        c Post-Sale Confusion . . . . . . . . . . . . . . .        522
          General Motors Corp. v. Keystone Automotive In-
              dustries, Inc. . . . . . . . . . . . . . . . . . .   522
   3 Section 43(a) . . . . . . . . . . . . . . . . . . . . . .     525
          Lanham Act § 43(a)(1)(A) . . . . . . . . . . . . .       525
      a Unfair Competition . . . . . . . . . . . . . . .           526
          Margreth Barre , Finding Trademark Use . . . .           526
          William R. Warner & Co. v. Eli Lilly & Co. . . . .       527
          Blinded Veterans Association v. Blinded American
              Veterans Foundation . . . . . . . . . . . . . .      528
      b False Endorsement . . . . . . . . . . . . . . . .          531
          Yale Electric Corp. v. Robertson . . . . . . . . . .     531
          Conan Properties, Inc. v. Conans Pizza, Inc. . . .       532
          International Order of Job’s Daughters v. Linde-
              burg & Co. . . . . . . . . . . . . . . . . . . .     534
      c Failure to A ribute . . . . . . . . . . . . . . . .        537
          Dastar Corp. v. Twentieth Century Fox Film Corp          537
   4 Dilution . . . . . . . . . . . . . . . . . . . . . . . . .    541
          Frank I. Schechter, The Rational Basis of Trade-
              mark Protection . . . . . . . . . . . . . . . . .    542
          Jeremy N. Sheff, The (Boundedly) Rational Basis
              of Trademark Liability . . . . . . . . . . . . .     543
          Ty Inc. v. Perryman . . . . . . . . . . . . . . . .      543
          Lanham Act § 43(c) . . . . . . . . . . . . . . . .       544
          Nike, Inc. v. Nikepal Intern., Inc. . . . . . . . . .    545
          Dilution Lightning Round . . . . . . . . . . . .         552
   5 Problems . . . . . . . . . . . . . . . . . . . . . . . .      555
          Ambush Marketing Problem . . . . . . . . . . .           555
          Jack Daniel’s Problem . . . . . . . . . . . . . . .      555
          Paper Handbag Problem . . . . . . . . . . . . .          556
   6 Secondary Liability . . . . . . . . . . . . . . . . . .       556
          Inwood Laboratories, Inc. v. Ives Laboratories, Inc.     556
          Philip Morris USA Inc. v. Lee . . . . . . . . . . .      557
F Defenses . . . . . . . . . . . . . . . . . . . . . . . . . . .   560
          Lanham Act § 43(c)(3) . . . . . . . . . . . . . . .      560
   1 Descriptive Fair Use . . . . . . . . . . . . . . . . . .      560
          Zatarains, Inc. v. Oak Grove Smokehouse, Inc. . .        560
   2 Nominative Fair Use . . . . . . . . . . . . . . . . . .       562
          New Kids on the Block v. New America Pub., Inc. .        562
          Smith v. Chanel, Inc. . . . . . . . . . . . . . . . .    567
   3 Exhaustion . . . . . . . . . . . . . . . . . . . . . . .      571
          Champion Spark Plug Co. v. Sanders . . . . . . .         571
          Hart v., Inc. . . . . . . . . . . . . .       573
   4 Expressive Use . . . . . . . . . . . . . . . . . . . . .      573
          Louis Vui on Malletier v. Haute Diggity Dog . .          573
          Louis Vui on Mallatier v. Warner Bros. . . . . . .       583
   5 Miscellaneous . . . . . . . . . . . . . . . . . . . . .       589
          Lanham Act § 32(2) . . . . . . . . . . . . . . . .       589
          Trademark Defenses Lightning Round . . . . .             590
G Other Identifier Registries . . . . . . . . . . . . . . . . . 596
   1 Phone Numbers . . . . . . . . . . . . . . . . . . . . 596
          Holiday Inns, Inc. v. 800 Reservation, Inc. . . . . 596
          Diana Lock, Toll-Free Vanity Telephone Num-
              bers: Structuring a Trademark Registration
              and Dispute Se lement Regime . . . . . . . . . 598
          Jahn v., Inc. . . . . . . . . . . 599
   2 Radio Callsigns . . . . . . . . . . . . . . . . . . . . . 601
          In re WSM, Inc. . . . . . . . . . . . . . . . . . . . 601
   3 Business Names . . . . . . . . . . . . . . . . . . . . 603
          Model Business Corporation Act . . . . . . . . 604
          Harvard Business Services v. Coyle . . . . . . . . 605
          Cooper v. Goodman . . . . . . . . . . . . . . . . . 606
          Friedman v. Rogers . . . . . . . . . . . . . . . . . 606
   4 Ticker Symbols . . . . . . . . . . . . . . . . . . . . . 608
          Eric Levenson, Investors Buy Up Worthless
              Stock After Confusing It for an Actual Success-
              ful Company . . . . . . . . . . . . . . . . . . 608
          FINRA Uniform Practice Advisory # 39 -13 . . . . 609
          Central Parking Corp. v. Park One Inc. . . . . . . 609
          Exxon Corp. v. Xoil Energy Resources, Inc. . . . . 610
          MDT Corp. v. New York Stock Exchange, Inc. . . 612
          Comments of James Angel on General Portability
              Filing . . . . . . . . . . . . . . . . . . . . . . 614
   5 ISBNs . . . . . . . . . . . . . . . . . . . . . . . . . . 620
, FAQs: General Questions . . . . . . . 620
   6 License Plates . . . . . . . . . . . . . . . . . . . . . . 622
          Wooley v. Maynard . . . . . . . . . . . . . . . . . 622
          Mitchell v. Maryland Motor Vehicle Administration623
          Nevada Administrative Code § 482.320 . . . . 628
   7 Domain Names . . . . . . . . . . . . . . . . . . . . . 629
          TMEP § 1209.03(m) . . . . . . . . . . . . . . . . 629
          Anticybersqua ing Consumer Protection Act . 630
          Uniform Domain-Name Dispute Resolution
              Policy . . . . . . . . . . . . . . . . . . . . . . 632
          Philip Morris USA Inc. v. Computer Services, Inc. 635
          Bosley Medical Institute v. Kremer . . . . . . . . . 636
   8 Online Accounts . . . . . . . . . . . . . . . . . . . . 639
          Twi er Rules . . . . . . . . . . . . . . . . . . . . 639
   9 Stage Names . . . . . . . . . . . . . . . . . . . . . . 640
          Professional Name Policy . . . . . . . . . . . . . . 640
          David Fagundes, Talk Derby to Me: Intellec-
              tual Property Norms Governing Roller Derby
              Pseudonyms . . . . . . . . . . . . . . . . . . . 641
7 Advertising                                                            649
   A False Advertising . . . . . . . . . . . . . . . . . . . . . .       650
              Lanham Act § 43(a)(1)(B) . . . . . . . . . . . . .         650
      1 ”Ownership”: Competitor Standing . . . . . . . .                 650
              American Washboard Co. v. Saginaw Mfg. Co. . .             651
              Ely-Norris Safe Co. v. Mosler Safe Co. . . . . . . .       651
              Mosler Safe Co. v. Ely-Norris Safe Co. . . . . . . .       652
              Lexmark International, Inc. v. Static Control
                  Components, Inc. . . . . . . . . . . . . . . . .       652
      2 ”Infringement”: Prohibited Conduct . . . . . . . .               656
              Greater Houston Transportation Company v.
                  Uber Technologies, Inc. . . . . . . . . . . . . .      656
              Procter & Gamble Co. v. Haugen . . . . . . . . .           658
      3 ”Infringement”: Falsity and Materiality . . . . . .              659
              Pizza Hut, Inc. v. Papa John’s Intern., Inc. . . . .       659
              McNeil-PPC, Inc. v. Pfizer Inc. . . . . . . . . . .         673
              Satellite TV Problem . . . . . . . . . . . . . . .         675
      4 Secondary Liability . . . . . . . . . . . . . . . . . .          676
              Duty Free Americas, Inc. v. Estee Lauder Compa-
                  nies, Inc. . . . . . . . . . . . . . . . . . . . . .   676
   B Alternatives to Competitor Suits . . . . . . . . . . . . .          680
      1 Commercial Disparagement and Related Torts . .                   680
              HipSaver, Inc. v. Kiel . . . . . . . . . . . . . . . .     680
              Aviation Charter, Inc. v. Aviation Research . . . .        681
      2 Consumer Suits . . . . . . . . . . . . . . . . . . . .           684
              Perrine v. Sega of America, Inc. . . . . . . . . . .       684
      3 FTC Enforcement . . . . . . . . . . . . . . . . . . .            687
              Federal Trade Commission v. Winsted Hosiery
                  Company . . . . . . . . . . . . . . . . . . . .        687
              Kraft, Inc. v. FTC . . . . . . . . . . . . . . . . . .     689
              Le er from Federal Trade Commission to Mi-
                  crosoft Corp. and Starcom MediaVest Group . .          690
   C Other Sources of Advertising Law . . . . . . . . . . . .            692
      1 Trademark . . . . . . . . . . . . . . . . . . . . . . .          692
              Lanham Act §§ 2(e)(1), (f) . . . . . . . . . . . .         693
              In re Budge Mfg. Co. . . . . . . . . . . . . . . . .       693
      2 Certifications . . . . . . . . . . . . . . . . . . . . . .        695
              Lanham Act § 45 (“certification mark”) . . . . .            695
              TMEP § 1306 . . . . . . . . . . . . . . . . . . . .        696
              Fair Trade USA Farm Workers Standard . . . . .             697
              Jeanne C. Fromer, The Unregulated Certification
                  Mark(et) . . . . . . . . . . . . . . . . . . . . .     698
              Understanding the FCC Regulations for Low-
                  Power, Non-Licensed Transmi er . . . . . . .           699
                  Inspection & Grading of Meat and Poultry: What
                     Are the Differences? . . . . . . . . . . . . . . .     700
         3   Geographic Indications . . . . . . . . . . . . . . . .        701
                  Justin Hughes, Champagne, Feta, and Bourbon –
                     The Spirited Debate About Geographical Indi-
                     cations . . . . . . . . . . . . . . . . . . . . . .   701
                  TRIPS arts. 22–24 . . . . . . . . . . . . . . . . .      703
                  Lanham Act § 2 . . . . . . . . . . . . . . . . . .       704
                  Guantanamera Cigar Co. v. Corporacion Habanos            705
                  Labeling and Advertising of Distilled Spirits,
                     27 C.F.R Part 5 . . . . . . . . . . . . . . . . .     709
                  Textile Products Identification Act . . . . . . .         710
                  Melting Bad Problem, Redux . . . . . . . . . .           711
         4   Regulation . . . . . . . . . . . . . . . . . . . . . . .      711
                  POM Wonderful LLC v. The Coca-Cola Company               712
                  Rebecca Tushnet, It Depends on What the Mean-
                     ing of ”False” is: Falsity and Misleadingness
                     in Commercial Speech Doctrine . . . . . . . . .       714
                  Commack Self-Service Kosher Meats, Inc. v. Weiss         716
                  Levy v. Kosher Overseers Ass’n of America, Inc. .        719
         5   Mandatory Disclosures . . . . . . . . . . . . . . . .         720
                  American Meat Institute v. Dept. of Agriculture .        720
                  National Ass’n of Mfrs. v. Securities and Ex-
                     change Commission [I] . . . . . . . . . . . . .       722
                  National Ass’n of Mfrs. v. Securities and Ex-
                     change Commission [II] . . . . . . . . . . . . .      723
         6   Self-Regulation . . . . . . . . . . . . . . . . . . . . .     724
                  Mead Johnson Nutritionals (Enfamil LIPIL) . . . .        724
                  CARU Press Release . . . . . . . . . . . . . . . .       727
         7   Problems . . . . . . . . . . . . . . . . . . . . . . . .      728
                  Scavenger Hunt Problem . . . . . . . . . . . . .         728
                  problems/fortunetelling . . . . . . . . . . . . .        728

8 Personality Rights                                                       729
   A Right of Publicity . . . . . . . . . . . . . . . . . . . . . .        729
               Eric E. Johnson, Disentangling the Right of Pub-
                  licity . . . . . . . . . . . . . . . . . . . . . . .     729
       1 Ownership . . . . . . . . . . . . . . . . . . . . . . .           730
            a Privacy Theories . . . . . . . . . . . . . . . . .           730
               Roberson v. Rochester Folding Box Co. . . . . . .           731
               New York Civil Rights Law § 51 . . . . . . . . .            733
               Pavesich v. New England Life Ins. Co. . . . . . . .         734
               O’Brien v. Pabst Sales Co. . . . . . . . . . . . . .        737
            b Property Theories . . . . . . . . . . . . . . . . .          738
               Haelan Laboratories v. Topps Chewing Gum . . .              738
          Joseph R. Grodin, Note: The Right of Publicity:
              A Doctrinal Innovation . . . . . . . . . . . . . 740
          Fraley v. Facebook, Inc. . . . . . . . . . . . . . . . 741
   2 Subject Ma er . . . . . . . . . . . . . . . . . . . . . 743
          Midler v. Ford Motor Co. . . . . . . . . . . . . . . 743
          White v. Samsung Electronics America, Inc. . . . . 746
          White v. Samsung Electronics America, Inc. . . . . 749
   3 Procedures . . . . . . . . . . . . . . . . . . . . . . . 751
          Hebrew University of Jerusalem v. General Motors 751
   4 Infringement: Similarity . . . . . . . . . . . . . . . 756
          Hooker v. Columbia Pictures Industries, Inc. . . . 756
   5 Infringement: Prohibited Conduct . . . . . . . . . 758
       a Direct Infringement . . . . . . . . . . . . . . . 758
          Stephano v. News Group Publications, Inc. . . . . 758
          Washington v. Brown & Williamson Tobacco Corp. 762
       b Secondary Liability . . . . . . . . . . . . . . . . 764
          Perfect 10, Inc. v. Cybernet Ventures, Inc. . . . . . 764
   6 Defenses . . . . . . . . . . . . . . . . . . . . . . . . . 766
          Allison v. Vintage Sports Plaques . . . . . . . . . 766
          Rosa and Raymond Parks Institute for Self Devel-
              opment v. Target Corp. . . . . . . . . . . . . . 768
          No Doubt v. Activision Publishing, Inc. . . . . . . 772
   7 Problems . . . . . . . . . . . . . . . . . . . . . . . . 781
          Governator Problem . . . . . . . . . . . . . . . 781
          Tony Twist Problem . . . . . . . . . . . . . . . . 782
B Moral Rights . . . . . . . . . . . . . . . . . . . . . . . . . 783
          Peter Baldwin, T C                  W      : T
              C               T     -A           B         . . . 784
          Roberta Rosenthal Kwall, Copyright and the
              Moral Right: Is an American Marriage Possible?784
          Berne Convention art. 6bis . . . . . . . . . . . . 787
          Copyright Act § 106A . . . . . . . . . . . . . . . 787
   1 Integrity . . . . . . . . . . . . . . . . . . . . . . . . . 789
          Massachuse s Museum of Contemporary Art
              Foundation v. Büchel . . . . . . . . . . . . . . 789
          Philips v. Pembroke Real Estate, Inc. . . . . . . . . 797
          Clean Flicks of Colorado, LLC v. Soderbergh . . . . 801
          Prepared Statement of Taylor Hackford on Behalf
              of the Directors Guild of America . . . . . . . . 802
   2 A ribution . . . . . . . . . . . . . . . . . . . . . . . 804
          Williams v. UMG Recordings, Inc. . . . . . . . . . 804
          Catherine L. Fisk, Credit Where It’s Due: The
              Law and Norms of A ribution . . . . . . . . . 805
C People as Trademarks . . . . . . . . . . . . . . . . . . . 807
          Lanham Act §§ 2(c), (d)(4) . . . . . . . . . . . . 807
                 Peaceable Planet, Inc. v. Ty, Inc. . . . . . . . . . . 807
                 David B. Findlay, Inc. v. Findlay . . . . . . . . . 808
                 Hebrew University of Jerusalem v. General Mo-
                     tors LLC . . . . . . . . . . . . . . . . . . . . . 812
                 Brown v. Electronic Arts, Inc. . . . . . . . . . . . 813
                 Melting Bad Problem, Re-Redux . . . . . . . . 815
    D   Personal Names . . . . . . . . . . . . . . . . . . . . . . . 815
                 Laura A. Heymann, Naming, Identity, and
                     Trademark Law . . . . . . . . . . . . . . . . . 815
                 Carlton F.W. Larson, Naming Baby: The Consti-
                     tutional Dimensions of Parental Naming Rights 816
                 In re Mokiligon . . . . . . . . . . . . . . . . . . . 819
                 Petition of Variable . . . . . . . . . . . . . . . . . 819
                 In re Ravitch . . . . . . . . . . . . . . . . . . . . 820
                 In re Serpentfoot . . . . . . . . . . . . . . . . . . 821
                 Weingand v. Lorre . . . . . . . . . . . . . . . . . 822
                 Application of Clark . . . . . . . . . . . . . . . . . 824
                 In re Name Change of Handley . . . . . . . . . . . 824
                 In re Porter . . . . . . . . . . . . . . . . . . . . . 825
    E   Defamation and False Light . . . . . . . . . . . . . . . . 826
                 Milkovich v. Lorain Journal Co. . . . . . . . . . . 826
                 Restatement (Second) of Torts § 652E . . . . . . 830
                 Tyne ex rel. Tyne v. Time Warner Entertainment
                     Co., L.P. . . . . . . . . . . . . . . . . . . . . . 832
                 Restatement (Second) of Torts § 564 cmt. d . . 835
                 Jessica Litman, Information Privacy/Information
                     Property . . . . . . . . . . . . . . . . . . . . . 836
    F   Identity Theft . . . . . . . . . . . . . . . . . . . . . . . . 836
                 Flores-Figueroa v. United States . . . . . . . . . . 836
                 White v. Ortiz . . . . . . . . . . . . . . . . . . . . 838
    G   Plagiarism . . . . . . . . . . . . . . . . . . . . . . . . . . 839
                 Stuart P. Green, Plagiarism, Norms, and the Lim-
                     its of Theft Law: Some Observations on the
                     Use of Criminal Sanctions in Enforcing Intel-
                     lectual Property Rights . . . . . . . . . . . . . 839
                 Jonathan Band & Ma Schruers, Dastar, A ri-
                     bution, and Plagiarism . . . . . . . . . . . . . 843
                 Gregory N. Mandel, Anne A. Fast & Kristina
                     R. Olson, Intellectual Property Law’s Plagia-
                     rism Fallacy . . . . . . . . . . . . . . . . . . . 845

9 Design                                                                847
   A Patent . . . . . . . . . . . . . . . . . . . . . . . . . . . . .   847
   B Copyright . . . . . . . . . . . . . . . . . . . . . . . . . . .    847
       1 Useful Articles . . . . . . . . . . . . . . . . . . . . .      848
          Mazer v. Stein . . . . . . . . . . . . . . . . . . .     848
          Copyright Act § 101 (”useful article”) . . . . . .       849
          H.R. Rep No. 94-1476 . . . . . . . . . . . . . . .       850
          Star Athletica, LLC v. Varsity Brands, Inc. . . . .      851
          Eames Chair Problem . . . . . . . . . . . . . . .        858
          Copyright Act § 113 . . . . . . . . . . . . . . . .      858
          Report of the Register of Copyrights on the
              General Revision of the Copyright Law
              (1961) . . . . . . . . . . . . . . . . . . . . . .   859
          Model Car Problem . . . . . . . . . . . . . . . .        860
   2 Architecture . . . . . . . . . . . . . . . . . . . . . . .    860
          Kevin Emerson Collins, Economically Defeasi-
              ble Rights to Facilitate Information Disclosure:
              The Hidden Wisdom of Pre-AWCPA Copyright             860
          Copyright Act § 120 . . . . . . . . . . . . . . . .      861
          37 C.F.R. § 202.11 . . . . . . . . . . . . . . . . .     862
          Intervest Construction., Inc. v. Canterbury Estate
              Homes . . . . . . . . . . . . . . . . . . . . . .    862
          Zalewski v. Cicero Builder Dev., Inc. . . . . . . . .    863
          Embassy Problem . . . . . . . . . . . . . . . . .        866
   3 Moral Rights . . . . . . . . . . . . . . . . . . . . . .      866
          Cheffins v. Stewart . . . . . . . . . . . . . . . . .      866
C Trademark . . . . . . . . . . . . . . . . . . . . . . . . . .    871
          Wal-Mart Stores, Inc. v. Samara Brothers, Inc. . .       872
          Lanham Act §§ 2(e)(5), 43(a)(3) . . . . . . . . .        875
          TrafFix Devices, Inc. v. Marketing Displays, Inc. .      875
          In re Florists’ Transworld Delivery, Inc. . . . . . .    880
          Maker’s Mark Distillery, Inc. v. Diageo North
              America, Inc. . . . . . . . . . . . . . . . . . .    882
          Eames Chair Problem, Revisited . . . . . . . .           883
          Pez Dispenser Problem . . . . . . . . . . . . . .        883
D Design Patent . . . . . . . . . . . . . . . . . . . . . . . .    883
          Patent Act §§ 171, 173 . . . . . . . . . . . . . . .     884
   1 Subject Ma er . . . . . . . . . . . . . . . . . . . . .       889
       a Articles of Manufacture . . . . . . . . . . . . .         889
          In re Hruby . . . . . . . . . . . . . . . . . . . . .    889
          In re AlSabah . . . . . . . . . . . . . . . . . . . .    892
       b Ornamentality . . . . . . . . . . . . . . . . . . .       894
          In re Webb . . . . . . . . . . . . . . . . . . . . . .   894
          Rosco, Inc. v. Mirror Lite Co. . . . . . . . . . . .     896
          In re Koehring . . . . . . . . . . . . . . . . . . . .   898
   2 Procedures . . . . . . . . . . . . . . . . . . . . . . .      899
          MPEP § 1503 . . . . . . . . . . . . . . . . . . . .      899
          Patent Act § 173 . . . . . . . . . . . . . . . . . .     901
   3 Ownership . . . . . . . . . . . . . . . . . . . . . . .       902
         aNovelty . . . . . . . . . . . . . . . . . . . . . . . 902
          International Seaway Trading Corp. v. Walgreens
              Corp. . . . . . . . . . . . . . . . . . . . . . . . 902
       b Obviousness . . . . . . . . . . . . . . . . . . . . 904
          MRC Innovations, Inc. v. Hunter Mfg., LLP, . . . 904
   4 Infringement: Similarity . . . . . . . . . . . . . . . 908
          Egyptian Goddess, Inc. v. Swisa, Inc. . . . . . . . 909
          Wing Shing Products (BVI) Co. v. Sunbeam Prod-
              ucts, Inc. . . . . . . . . . . . . . . . . . . . . . 913
          OddzOn Products, Inc. v. Just Toys, Inc. . . . . . 918
          L.A. Gear, Inc. v. Thom McAn Shoe Co. . . . . . . 919
   5 Infringement: Prohibited Conduct . . . . . . . . . 919
          Patent Act § 289 . . . . . . . . . . . . . . . . . . 919
   6 Defenses . . . . . . . . . . . . . . . . . . . . . . . . . 920
          Jazz Photo Corp. v. International Trade Com’n . . 920
          Ralph D. Clifford & Richard J. Pel -Steele, The
              Constitutionality of Design Patents . . . . . . 921
          Eames Chair Problem, Re-revisited . . . . . . . 923
E Sui Generis Regimes . . . . . . . . . . . . . . . . . . . . 923
   1 Semiconductor Masks . . . . . . . . . . . . . . . . . 923
          Pamela Samuelson, Creating a New Kind of In-
              tellectual Property: Applying the Lessons of
              the Chip Law to Computer Programs . . . . . . 923
          Kal Raustiala & Christopher Sprigman, The
              Piracy Paradox, Innovation and Intellectual
              Property in Fashion Design . . . . . . . . . . . 925
          Altera Corp. v. Clear Logic, Inc. . . . . . . . . . . 926
   2 Vessel Hulls . . . . . . . . . . . . . . . . . . . . . . . 928
          Bonito Boats, Inc. v. Thunder Craft Boats, Inc. . . 928
          Copyright Act ch. 13 . . . . . . . . . . . . . . . 930
          Maverick Boat Co., Inc. v. American Marine
              Holdings, Inc. . . . . . . . . . . . . . . . . . . 933
F Fashion . . . . . . . . . . . . . . . . . . . . . . . . . . . . 936
   1 Copyright . . . . . . . . . . . . . . . . . . . . . . . . 936
          Jack Adelman, Inc. v. Sonners & Gordon, Inc. . . . 936
          Cheney Bros. v. Doris Silk Corporation . . . . . . 937
          Fashion Originators’ Guild of America v. Federal
              Trade Commission . . . . . . . . . . . . . . . 938
          Peter Pan Fabrics, Inc. v. Brenda Fabrics, Inc. . . . 941
   2 Trademark . . . . . . . . . . . . . . . . . . . . . . . 942
          Christian Louboutin v. Yves Saint Laurent America942
          Christian Louboutin v. Yves Saint Laurent America949
   3 Design Patent . . . . . . . . . . . . . . . . . . . . . . 952
               Kal Raustiala & Christopher Sprigman, The
                   Piracy Paradox, Innovation and Intellectual
                   Property in Fashion Design . . . . . . . . . . .    952
         4 Sui Generis Protection? . . . . . . . . . . . . . . . .     953
               James Surowiecki, The Piracy Paradox . . . . . .        953
               C. Sco Hemphill & Jeannie Suk, The Law, Cul-
                   ture, and Economics of Fashion . . . . . . . . .    954
               Innovative Design Protection Act of 2012 . . .          956

10 Software                                                             963
    A Trade Secret . . . . . . . . . . . . . . . . . . . . . . . . . 963
               Barr-Mullin, Inc. v. Browning . . . . . . . . . . . 964
               Silvaco Data Systems v. Intel Corp. . . . . . . . . 964
    B Patent . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 968
        1 Subject Ma er . . . . . . . . . . . . . . . . . . . . . 968
            a Then . . . . . . . . . . . . . . . . . . . . . . . . 968
               In re Bernhart . . . . . . . . . . . . . . . . . . . . 968
               In re Alappat . . . . . . . . . . . . . . . . . . . . 969
               State Street Bank & Trust Co. v. Signature Finan-
                   cial Group . . . . . . . . . . . . . . . . . . . . 972
            b Now . . . . . . . . . . . . . . . . . . . . . . . . . 973
               Alice Corp. v. CLS Bank Int’l . . . . . . . . . . . 973
               McRO, Inc. v. Bandai Namco Games America Inc. 979
               Synopsys, Inc. v. Mentor Graphics Corp. . . . . . 984
        2 Procedures . . . . . . . . . . . . . . . . . . . . . . . 989
               Williamson v. Citrix Online, LLC . . . . . . . . . 989
               Mark A. Lemley, Software Patents and the Re-
                   turn of Functional Claiming . . . . . . . . . . 991
        3 Obviousness . . . . . . . . . . . . . . . . . . . . . . 992
               Apple Inc. v. Samsung Electronics Co., Ltd. . . . . 992
    C Copyright . . . . . . . . . . . . . . . . . . . . . . . . . . . 997
        1 Subject Ma er . . . . . . . . . . . . . . . . . . . . . 997
               Apple Computer, Inc. v. Franklin Computer Corp. 998
               Adobe Systems Inc. v. Southern Software Inc. . . . 1000
               Whelan Associates, Inc. v. Jaslow Dental Labora-
                   tory, Inc. . . . . . . . . . . . . . . . . . . . . . 1001
               Computer Associates Intern., Inc. v. Altai, Inc. . . 1003
               Oracle America, Inc. v. Google Inc. . . . . . . . . 1007
               Oracle America, Inc. v. Google Inc. . . . . . . . . 1014
               Tetris Problem . . . . . . . . . . . . . . . . . . . 1020
        2 Defenses . . . . . . . . . . . . . . . . . . . . . . . . .1020
               Copyright Act § 117 . . . . . . . . . . . . . . . . 1020
               Sega Enterprises Ltd. v. Accolade, Inc. . . . . . . . 1021
               Universal City Studios, Inc. v. Corley . . . . . . . 1023
    D Trademark . . . . . . . . . . . . . . . . . . . . . . . . . .1026
              Apple Inc. v. Samsung Electronics Co., Ltd. . . .     . 1026
    E Design Patent . . . . . . . . . . . . . . . . . . . . . . .   .1027
              Michael Risch, Functionality and Graphical User
                 Interface Design Patents . . . . . . . . . . .     . 1027
              Smartphone Problem . . . . . . . . . . . . . .        . 1029

11 Biotechnology                                                      1031
    A Patent . . . . . . . . . . . . . . . . . . . . . . . . . . . . .1031
        1 Subject Ma er . . . . . . . . . . . . . . . . . . . . .1031
               Association for Molecular Pathology v. Myriad
                   Genetics, Inc. . . . . . . . . . . . . . . . . . . 1031
               In re Roslin Institute (Edinburgh) . . . . . . . . . 1033
               Ariosa Diagnostics, Inc. v. Sequenom, Inc. . . . . 1036
               DNA Copyright Problem . . . . . . . . . . . . . 1039
        2 Ownership . . . . . . . . . . . . . . . . . . . . . . .1039
               Schering Corp. v. Geneva Pharmaceuticals . . . . 1039
               Eli Lilly and Co. v. Zenith Goldline Pharm. Inc. . 1041
        3 Infringement: Similarity . . . . . . . . . . . . . . .1042
               Boehringer Ingelheim Vetmedica, Inc. v. Schering-
                   Plough Corp. . . . . . . . . . . . . . . . . . . 1042
        4 Defenses . . . . . . . . . . . . . . . . . . . . . . . . .1045
               Bowman v. Monsanto Co. . . . . . . . . . . . . . 1045
    B Plants . . . . . . . . . . . . . . . . . . . . . . . . . . . . .1050
        1 Plant Patents . . . . . . . . . . . . . . . . . . . . . .1050
               Imazio Nursery, Inc. v. Dania Greenhouses . . . . 1050
               Mark D. Janis & Jay P. Kesan, U.S. Plant Variety
                   Protection: Sound and Fury ... ? . . . . . . . . 1051
               Patent Act §§ 161–163 . . . . . . . . . . . . . . . 1052
               37 CFR § 1.164 . . . . . . . . . . . . . . . . . . . 1052
            a Subject Ma er . . . . . . . . . . . . . . . . . . .1058
               In re Arzberger . . . . . . . . . . . . . . . . . . . 1058
            b Procedures . . . . . . . . . . . . . . . . . . . . .1059
               In re Greer . . . . . . . . . . . . . . . . . . . . . . 1059
            c Ownership . . . . . . . . . . . . . . . . . . . . .1062
               Ex parte Moore . . . . . . . . . . . . . . . . . . . 1062
               Dunn v. Ragin v. Carlile . . . . . . . . . . . . . . 1063
               In re LeGrice . . . . . . . . . . . . . . . . . . . . 1066
               Yoder Bros., Inc. v. California-Florida Plant Corp. 1068
            d Infringement . . . . . . . . . . . . . . . . . . .1070
               Imazio Nursery, Inc. v. Dania Greenhouses . . . . 1070
               Armstrong Nurseries, Inc. v. Smith . . . . . . . . 1074
        2 Plant Variety Protection Act . . . . . . . . . . . . .1075
               S. Rep. 91-1246 (1970) . . . . . . . . . . . . . . . 1075
            a Subject Ma er . . . . . . . . . . . . . . . . . . .1088
               PVPA § 42 . . . . . . . . . . . . . . . . . . . . . 1088
      b Procedures . . . . . . . . . . . . . . . . . . . . .1088
         PVPA § 52 . . . . . . . . . . . . . . . . . . . . . 1088
         Genecorp, Inc. v. Progeny Advanced Genetics, Inc. 1089
         PVPA § 83 . . . . . . . . . . . . . . . . . . . . . 1091
      c Ownership . . . . . . . . . . . . . . . . . . . . .1092
         PVPA § 42 . . . . . . . . . . . . . . . . . . . . . 1092
      d Defenses . . . . . . . . . . . . . . . . . . . . . .1094
         PVPA §§ 44, 112–115 . . . . . . . . . . . . . . . 1094
         Jim Chen, The Parable of the Seeds . . . . . . . . 1095
      e Infringement . . . . . . . . . . . . . . . . . . .1100
         PVPA § 111 . . . . . . . . . . . . . . . . . . . . . 1100
         Delta and Pine Land Co. v. Sinkers Corp. . . . . . 1102
   3 The Punchline . . . . . . . . . . . . . . . . . . . . .1112
         JEM Ag Supply, Inc. v. Pioneer Hi-Bred Interna-
             tional, Inc. . . . . . . . . . . . . . . . . . . . . 1112
C Drug Approval . . . . . . . . . . . . . . . . . . . . . . . .1114
   1 Patent Issues . . . . . . . . . . . . . . . . . . . . . .1115
         Kara B. Swanson, Food and Drug Law as Intel-
             lectual Property Law . . . . . . . . . . . . . . 1115
         Merck KGaA v. Integra Lifesciences I, Ltd. . . . . 1118
         Eli Lilly & Co. v. Medtronic, Inc. . . . . . . . . . 1118
   2 Hatch-Waxman . . . . . . . . . . . . . . . . . . . . .1120
         United States v. Generix Drug Corp. . . . . . . . 1121
         FTC v. Actavis, Inc. . . . . . . . . . . . . . . . . 1122
         Actavis Elizabeth LLC v. U.S. Food and Drug Ad-
             min. . . . . . . . . . . . . . . . . . . . . . . . 1122
         Erika Lie an, The Myths of Data Exclusivity . . 1125
         Caraco Pharmaceutical Labs v. Novo Nordisk . . . 1126
         FTC v. Actavis, Inc. . . . . . . . . . . . . . . . . 1130
   3 Orphan Drugs . . . . . . . . . . . . . . . . . . . . .1133
         Genentech, Inc. v. Bowen . . . . . . . . . . . . . . 1133
         Sigma-Tau Pharmaceuticals, Inc. v. Schwe           . . . 1136
   4 Biologics . . . . . . . . . . . . . . . . . . . . . . . . .1137
         Janet Freilich, Patent Infringement in the Con-
             text of Follow-On Biologics . . . . . . . . . . . 1137
D Drug Marketing . . . . . . . . . . . . . . . . . . . . . . .1139
   1 Names . . . . . . . . . . . . . . . . . . . . . . . . . .1139
         Note on Drug Naming . . . . . . . . . . . . . . 1139
         S. Rep. 87-448 (1961) . . . . . . . . . . . . . . . 1144
         21 C.F.R. § 201.10 . . . . . . . . . . . . . . . . . 1145
         Kos Pharmaceuticals, Inc. v. Andrx Corp. . . . . . 1145
         666 Problem . . . . . . . . . . . . . . . . . . . . 1148
   2 Design . . . . . . . . . . . . . . . . . . . . . . . . . .1149
         Shire US Inc. v. Barr Laboratories, Inc. . . . . . . 1149
                                               5"#-& 0' $0/5&/54

              Jeremy A. Greene & Aaron S. Kesselheim,
                  Why Do the Same Drugs Look Different? Pills,
                 Trade Dress, and Public Health . . . . . . . .     . 1152
        3 Labeling and Advertising . . . . . . . . . . . . . .      .1154
              Consumer-Directed Broadcast Advertisements:
                  Guidance for Industry . . . . . . . . . . . . .   . 1154
              Le er from Robert Dean, Division Director,
                  OPDP, FDA, to Eric Gervais . . . . . . . . .      .   1156
              United States v. Caronia . . . . . . . . . . . . .    .   1158
              Wyeth v. Levine . . . . . . . . . . . . . . . . . .   .   1161
              PLIVA, Inc. v. Mensing . . . . . . . . . . . . .      .   1162
              SmithKline Beecham v. Watson Pharmaceuticals          .   1163
              Bizarro World Redux Problem . . . . . . . . .         .   1167

Appendices                                                          1169

Table of Cases                                                      1170

Table of Problems                                                   1194

This book takes its subtitle from Sheldon Axler’s Linear Algebra Done
Right and its inspiration from a line by the great mathematician Emil
Artin: ”It is my experience that proofs involving matrices can be
shortened by 50% if one throws the matrices out.” Matrices are nu-
merical representations of mathematical operations; proofs involving
them tend to look something like:
   ⎡                                 ⎤ ⎡                                     ⎤
      a1,1 · · ·   a1,i   ···   a1,n       ca1,1 · · ·   ca1,i   ···   ca1,n
    ⎢ ..            ..           .. ⎥ ⎢ ..                 ..            .. ⎥
    ⎢ .              .            . ⎥ ⎢ .                   .             . ⎥
    ⎢                                ⎥ ⎢                                     ⎥
  c ⎢ aj,1 · · ·   aj,i   ···   aj,n ⎥ = ⎢ caj,1 · · ·   caj,i   ···   caj,n ⎥
    ⎢ .             ..            .. ⎥   ⎢ .               ..             .. ⎥
    ⎣ ..             .             . ⎦ ⎣ ..                 .              . ⎦
      am,1 · · ·   am,i · · ·   am,n      cam,1 · · ·    cam,i · · ·   cam,n

Axler’s book throws most of the matrices out, and as a result, is one
of the clearest college mathematics textbooks ever wri en. There are
matrices and proofs using them, but they are secondary to the alge-
braic explanations and proofs, which tend to look more like:

                                 cT (v) = T (cv)

This book is my a empt to take intellectual property law and throw
the matrices out. The matrices aren’t literal matrices, of course, or
IP would be much less fun and interesting to study, to teach, and to
practice. Instead, the matrices consist of built-up expectations about
how the subject is structured, and how it should be taught. But many
of these traditions have nothing but tradtion to support them. Cast
them aside, and what emerges is simpler, richer, and more elegant.

The first tradition to is the assumption that ”intellectual property” pri-
marily means patent, copyright, and trademark. These three fields
                                                                                          5"#-& 0' $0/5&/54

                                         dominate most IP courses and most casebooks. Trade secret law usu-
                                         ally makes a walk-on appearance, as does the right of publicity, but
                                         that is typically it. Design patents, false advertising, and idea protec-
                                         tion may be mentioned as afterthoughts. I don’t mean to denigrate
                                         patent, copyright, and trademark. They are important, and an IP
                                         course that omi ed one of them would be seriously deficient. But
                                         they are not so much more important than other fields of IP that they
                                         should push those other fields out of the picture.
                                             For one thing, these other fields are important in regular ”IP” prac-
                                         tice: just ask any observer of the smartphone design-patent wars, any
                                         employment lawyer negotiating an NDA, or any business lawyer re-
*U QSPCBCMZ EPFT OPU IFMQ UIBU UIF #JH   viewing ad copy for substantiation. A professor who lets students
5ISFF BSF BMM GFEFSBM SFHJNFT MFBEJOH    leave the IP survey unaware these bodies of law even exist commits
                                         academic malpractice.
                                             If that weren’t enough, these other fields help illuminate the tra-
                                         ditional ones. Trademark law’s treatment of descriptive and mis-
                                         descriptive marks looks very different after a trip through false-
                                         advertising law: the difference between an arbitrary mark and a mis-
                                         descriptive one is whether consumers are in on the joke. Recognizing
                                         that the reverse engineering privilege in trade secret law is a form of
                                         exhaustion helps clarify exhaustion in patent law.
                                             Thus, this book casts an extremely broad net when including IP
                                         regimes. In my view, intellectual property consists of any private
                                         right to prevent other people from using information. This encom-
                                         passes contracts for the use of information, trade secrets, copyrights,
                                         trademarks, unfair competition, parts of false advertising law, geo-
                                         graphic indications, rights of publicity, moral rights, design patents,
                                         and a miscellany of federal and state regimes like boat-hull protec-
                                         tions and common-law misappropriation. They are all given serious
                                         a ention.
                                             Having cast a wide net to gather in IP regimes, the book then casts
                                         its net widely again within each system. My working mo o when
                                         debating what to include was no unpleasant surprises. It is fine to ges-
                                         ture at something big and messy whose details are not filled in in the
                                         slightest – like the compulsory copyright license for satellite broad-
                                         casting, whose rules fill dozens of pages in sections 119 and 122 of title
                                         17. But it is not fine to pass by something that comes up regularly, is
                                         important when it does, and whose existence is not easily predictable
                                         –like the exemption in section 110 for many in-person noncommercial
                                         public performances. Thus, the book is unusually detailed in cov-
                                         ering theories of liability and major defenses: examples include the
                                         DMCA’s prohibition on removing copyright management informa-
                                         tion, the unfair-competition cause of action for deliberate passing off
                                         even in the absence of trademark rights, and the limitation of patent
                                         remedies against medical practitioners.
5"#-& 0' $0/5&/54                                                     

    And finally, the book casts its net widely a third time to sweep
in bodies of law that are not traditionally regarded as ”intellectual
property” at all, but have something to teach about how intellectual
property law works. Sometimes, this is because they provide use-
ful points of comparison: FOIA and classification effectively create a
body of secrecy law for the government, and seeing how they work
clarifies what is distinctive about trade secret law. Sometimes, it is
because they provide the backdrop against which ”intellectual prop-
erty” law plays out: pharmaceutical patent law is unintelligible with-
out a grounding in the drug-approval process. And sometimes, it
is because they really are intellectual property law: Actors Equity
gives out stage names on a first-come first-served basis, and while
the resulting rights are narrow and privately created, they are abso-
lute within the relevant domain. Thus, the book includes such un-
usual topics as FOIA, privacy torts, drug approval and labeling, state
business name registries, country-of-origin labeling statutes, the law
of personal name changes, and the BBB’s advertising self-regulatory
    Given this wide range of subjects, the book does not cover each of
them in equal depth. Instead, I have tried to do two things. On the
one hand, I try to give a good conceptual sense for how each body
of IP law thinks about the world. Students should know that copy-
right is built around originality and similarity; that trademark is built
around distinctiveness, priority, and confusion; that advertising is
built around truth; and so on. The cases and materials are selected
and arranged to build this intuition, even at the expense of detail. The
point is to leave readers in a position where they can make plausible
interpolations in the parts of the subjects they have not seen. A good
first guess and good research skills will take you surprisingly far.
    On the other hand, the book is relentlessly comparative. I don’t
mean that it’s internationally comparative, although some sections
do sketch the major distinctions between the U.S. approach and other
countries’ (e.g. on geographic indications and moral rights). In-
stead, it draws every possible comparison within American IP law.
It does this at a macro level, emphasizing the similarities and the
differences between the basic principles undergirding each body of
IP law. For example, patent and copyright think similarly about in-
centives, while trademark and false advertising think similarly about
consumers. And it does this at a micro level, se ing up similar doc-
trines across IP fields to compare and contrast. For example, trade
secret law shares with copyright law the requirement that the defen-
dant must have copied from the plaintiff to infringe, which plays out in
their similarly permissive a itude in allowing multiple independent
parties to lay claim to the same information simultaneously. They
stand in sharp contrast to patent and trademark, where subsequent
                                                                                             5"#-& 0' $0/5&/54

                                            independent creation can only mitigate the consequences of infringe-
                                            ment, rather than negating it entirely.

                                            " 5BYPOPNZ PG *1
                                            To make the internal logic of each IP field clearer, and to facilitate
                                            comparisons between them, I have imposed a rigorous structure on
5IF POMZ FYDFQUJPOT BSF UIPTF öFMET         them. The two basic issues for any form of IP are protection and
MJLF HFPHSBQIJD JOEJDBUJPOT EJTDVTTFE       infringement; as far as possible, I try to keep them distinct. I insist
                                            on the division even for areas, like rights of publicity, where it is not
                                            conventionally made. But whether the defendants are trading on the
                                            plaintiff’s identity is a different question than which aspects of that
                                            identity are protectable at all, and separating them clarifies what is at
                                            stake in each.
                                                I further divide protection into subject ma er, ownership, and
                                            procedures, or, roughly ”what?”, ”who?” and ”how?” In copyright,
                                            for example, subject ma er includes Feist’s famous ”modicum of cre-
                                            ativity” and the idea/expression dichotomy; ownership includes joint
                                            works, works made for hire, and derivative works; and procedures
                                            include term, registration, deposit, notice, and fixation. Yes, fixation.
                                            It isn’t a question of what information is copyrightable so much as
                                            what one must do to obtain a copyright in that information (answer:
                                            not much). This arrangement is a bit unconventional, but I think it’s
                                            clearer. I tend to break up subject ma er doctrines into thresholds,
                                            which ask whether something is [creative, secret, distinctive, etc.]
                                            enough for an IP field to care about, and boundary conditions like
                                            functionality, which declare something the wrong kind of thing for
                                            an IP field. Ownership rules subdivide into rules to allocate owner-
                                            ship with collaborations, rules to assign priority among competitors,
/POF PG UIFTF EJWJTJPOT BSF BT GVMMZ JN    and rules for derivative creation that builds on others’ information.
QMFNFOUFE BT * XPVME MJLF JO UIF DVSSFOU    Procedures are too diverse to taxonomize systematically, although
                                            registration and notice are common that I have tried to flag them
                                            wherever they appear, and their absence wherever they don’t.
                                                I subdivide infringement into similarity, prohibited conduct, and
                                            defenses. The distinction between the first two is all-important. Sim-
                                            ilarity is a test of the relationship between the plaintiff’s information
                                            and the defendant’s; prohibited conduct deals with what the defen-
                                            dant did with that information. Similarity is the domain of claim con-
                                            struction and the every-element rule, of substantial similarity, and
                                            of the likelihood of confusion. Prohibited conduct is the domain
                                            of ”makes, uses, offers to sell, or sells” and of the exclusive rights.
                                            It further breaks down into threshold conditions like Lanham Act
                                            § 43(a)(1)(B)’s ”in commercial advertising or promotion,” into intent
                                            requirements (or their absence), (sometimes) into proof of copying
                                            from the plaintiff, into the specific enumerated or unenumerated the-
5"#-& 0' $0/5&/54                                                     

ories of direct infringement, and into various secondary liability doc-
trines. Here is where I have found the comparative method most use-
ful; it has forced me to find and present cases on topics like secondary
liability for right of publicity violations and on proving copying in
trade secret misappropriation. They exist, and they display interest-
ing and revealing variations from their more familiar cousins.
    Some IP defenses are idiosyncratic, like the compulsory mechan-
ical license in copyright or the vestigial experimental use defense in
patent. But others display systematic consistency across almost all of
IP. The exhaustion defenses, which define the interface between intel-
lectual property rights in information and personal property rights in
tangible things, are essentially universal – and especially revealing,
because while every IP field embraces the exhaustion principle, each
IP field puts characteristically different limits on it. Another cluster
of common defenses protect expressive uses. Sometimes these lim-
its are internal to the doctrinal logic of an IP field; sometimes they
appear as separate defenses; sometimes they are explicitly stated as
First Amendment requirements. Again, both the similarities and the
differences are instructive.

There are three natural ways to organize material on intellectual prop-
erty. One could – like most casebooks – present it by field: trade se-
cret, patent, copyright, trademark, etc., in each case starting with pro-
tectability and moving through infringement. One could present it
by subject ma er: literature, music, characters, industrial design, soft-
ware, etc., in each case discussing all of the relevant IP fields. Or one
could present it by doctrine: subject ma er, ownership, procedure,
similarity, etc., in each case moving through relevant IP fields. I have
used all three.
    Large parts of the book are organized by IP field: there are chap-
ters (or major sections) devoted to trade secret, patent, copyright,
trademark, false advertising, right of publicity, and design patents.
Each of them takes a single IP field and marches through the sex-
partite taxonomy of topics. The order varies a bit (the complexity
and centrality of patent prosecution means it makes sense to address
patent procedures before patent ownership), sometimes the divisions
aren’t worth insisting on (in trademark, similarity tests are just one
factor in multiple likelihood of confusion tests), and some areas omit
one or more entirely (there are no meaningful procedural prerequi-
sites to protection against false advertising). But these sections all
more or less stick to this structure. These six topics – subject ma er,
ownership, procedures, similarity, prohibited conduct, and defenses
– suffice to give a reasonably clear account of how an IP field looks at
                                                                                           5"#-& 0' $0/5&/54

                                          the world.
                                              Mixed in with these in-depth treatments are quicker hits on re-
* XPVME IBWF MJLFE UP JODMVEF B DIBQUFS   lated fields of IP and IP-adjacent law. The general rule is that they
PO GFEFSBM QSFFNQUJPO UIBU BMTP DPWFST    are presented in connection with the major IP fields they shed light
                                          on. Thus intrusion on seclusion, FOIA, and classification show up
OPU BMSFBEZ DPWFSFE FMTFXIFSF * EJE      in the trade secret chapter; phone numbers, radio callsigns, and busi-
OPU DPNQMFUF UIBU DIBQUFS JO UJNF GPS     ness name registries in the trademark chapter; FTC and consumer
NZ GBMM  DPVSTF                      false advertising suits in the advertising chapter; and so on.
                                              Conversely, I have also distributed out subject-ma er-specific
                                          parts of traditional IP fields to chapters dedicated to IP fields that
                                          more squarely address those subject ma ers. This first happens in
                                          the advertising chapter; I deliberately hold over the material on cer-
                                          tification marks and deceptive marks from the trademark chapter so
                                          that I can juxtapose it with the false advertising materials. Materiality
                                          in the context of Lanham Act § 2(a) makes more sense once readers
                                          have seen it at work in § 43(a)(1)(B) cases. I pull similar stunts by
                                          pu ing moral rights in the ”personality rights” chapter rather than
                                          the copyright chapter; geographically descriptive and misdescriptive
                                          marks in the geographic indications chapter; useful articles, architec-
                                          tural works, and functional marks in the design chapter alongside
                                          design patents.
                                              The extreme examples of this approach are the chapters devoted
                                          to software and to biotechnology, both of which are immensely im-
                                          portant and can only properly be understood by considering how
                                          different IP fields interact. Software requires consideration of trade
                                          secret, copyright, and patent; biotechnology law involves patent and
                                          trademark, but also discussion of the FDA drug approval process and
                                          regulation of drug marketing and labeling. (Again, my broad under-
                                          standing of what is relevant to IP means that I have no compunction
                                          against treating these regulatory regimes as establishing de facto IP
5IJT SFTU PG UIF CPPL SFNBJOT IZQP         The rest of the book consists of chapters devoted to cross-cu ing
UIFUJDBM GPS OPX                         topics where there is more insight to be gained from se ing out gen-
                                          eral principles and then seeing how different IP fields play out vari-
                                          ations on the theme: litigation, remedies, transactions, and interna-
                                          tional IP. One could include these issues within each substantive
                                          chapter, but for the most part, I find it clearer just to save these is-
                                          sues for dedicated chapters.

                                          8IBU 5IJT #PPL *T /PU
                                          This is, as I said, a book about the structure of IP law. Traditional
                                          casebooks try to do many other things, and I want to be clear on the
                                          sacrifies I have made.
                                             This is not a book on learning to think like a lawyer. I have made
5"#-& 0' $0/5&/54                                                     

no concessions to making cases ”teachable” in a standard Socratic
sense. I have cut out procedural postures. I have cut out reason-
ing from precedent. I have cut out dissents, even brilliant and well-
argued ones. I have cut judges’ names, and sometimes cut parties’
names. In extreme cases, I have cut out all the facts, or all of the rea-
soning supporting a holding.
    Part of this is a sense that traditional case reading and analysis –
valuable skills that they are – are overvalued in most law schools. Part
of it also is the freedom that comes from teaching IP to LLM students,
for whom ”thinking like a lawyer” is not something to be learned but
one of the prerequisites for admission. And part of it is the critical
distance that I have gained on the enterprise of legal education since
moving to an institution where most of my colleagues are not law
professors. Things that once seemed natural to me are strange now.
    This is also not a book on IP policy. My discussions of the policy
rationales for IP fields are exceedingly brief. I have cut substantial
chunks of the policy discussions from the cases I excerpt. In some
cases, the policy arguments are essential to understanding the hold-
ings and the concepts they rely on. But if this book is at all useful for
teeing up discussions of IP policy, it is entirely by accident.

The overriding principle for my selection of cases and other materi-
als was clarity. Accordingly, I have tried hard to find cases that are
either broadly representative of the doctrinal point they stand for or
that state it succinctly. In my years of teaching the IP survey I came
to loathe the memorable but unusual cases, because students invari-
ably remembered them for the wrong points. I have tried to avoid
including cases that go off on tangents that haven’t been picked up
on; they give an incorrect impression of where the action is.
    Where there is a genuine doctrinal split in contemporary caselaw,
I have tried to make this clear in the materials I have chosen: either by
pairing cases on either side of an issue, by picking a case with a strong
and well-taken dissent, or by picking a case that respectfully presents
the other side of the debate before disagreeing with it. Where there is
not a major split in the caselaw, I have tried hard to present the false
impression of one.
    I have also tried to strike a balance between teachability and au-
thority. My sense is that most casebooks tend too much towards re-
spectful but excessive quotation from Supreme Court opinions. But
for various institutional reasons – including the Supreme Court’s rar-
ified docket, its emphasis on following its own precedents to the ex-
clusion of ”inferior” courts’ wisdom, its frequent unwillingness to re-
solve the actual case before it, and some Justices’ regre able writerly
                                                 5"#-& 0' $0/5&/54

habits – Supreme Court opinions are often terrible teaching cases. I
have responded by excerpting these cases with extreme brevity, or
by presenting them in reflection – as other courts apply the Supreme
Court’s holdings to crisper fact pa erns.

My editorial technique is borrowed from Sweeney Todd: extensive
and shocking cuts. These are pedagogical materials, not a legal brief.
I have not put words in anyone else’s mouth, but I have been uncon-
cerned with the usual editorial apparatus of ellipses and brackets. I
drop words from sentences, sentences from paragraphs, paragraphs
from opinions – all with no indication that anything is gone. I also
reorder paragraphs and sometimes sentences as needed to improve
the readability of a passage. My goal is to make it easy for the reader.
If it ma ers to you what the original said, consult the original.
     Similarly, I have been ruthless in pruning citations. Editorial con-
ventions that make sense in briefs and opinions are not appropriate
for teaching materials. Generally, I have kept citations only when
the case being cited is important in its own right or when the citation
is impossible to remove without great awkwardness. I have had no
qualms about a ributing to courts things they quoted other courts as
     I also discarded the tradition that a case should be presented as
a case. There are cases with wonderful discursive passages – like
Judge Posner’s musings on the protectability of names as trademarks
in Peaceable Planet – embedded in larger messes. My edit of peaceable-
planet keeps this discussion of name marks and discards everything
else, including the facts and holding. There are also cases that are
important for their holdings, like Grokster and AWH, but which take
their damn time ge ing there. I kept the holdings and cut everything
     Sometimes, the best way to make a point isn’t with a case at all.
The federal government has published outstanding guides to patent,
copyright, and trademark law: the MPEP, Compendium, and TMEP,
respectively. I have freely drawn from them, along with Restatement
sections, regulations, and law-review articles whenever I thought
that they covered the ground be er than the cases I had to work with.
For rarely-litigated ma ers like the deposit requirement, these sec-
ondary materials are far and away the best option. I have wri en
notes and introductory materials where necessary, but I tried to keep
them focused on bringing out structural issues, rather than saying
again what others have already said be er.
5"#-& 0' $0/5&/54                                                     

Another crucial early decision was to format the text with a two-
and-three-quarter-inch outer margin, placing notes and illustrations
in the margin alongside the text they pertain to. The design is not
original; I had seen it used very effectively in Donald Knuth et al’s
Concrete Mathematics, Robert Bringhurst’s The Elements of Typographic
Style, and Edward Tufte’s books on information design. From my
point of view, it solved three problems simultaneously:
    First, the narrower text column is typographically a ractive. With      5IFSF JT B SFBTPO UIBU MBX SFWJFXT QSJOU
such a larger outer margin, the resulting column is five inches wide,        PO QBHFT UIBU BSF OBSSPXFS UIBO 
which makes for lines that have a comfortable font size and a com-
fortable length. Extended reading is easier and the page looks nice.
    Second, margins are for marginalia. A note in the margin is less
intrusive than a box cut out of the text and easier to glance back and
forth to than a footnote. The result is that I have been free to annotate
the text liberally and a li le Talmudically. I have extensively deco-
rated the margin with illustrations from the cases being excerpted. I
have also included quotations and case summaries that might have
gone in the notes after a case in a traditional casebook, or been pre-
sented as squib cases. Having the margin available lets me include
them precisely where they are relevant. Sometimes I include see also
citations to interesting articles. And occasionally I pop in with a lead-
ing question or just a straight-up joke.
    And third, the margin enables me to remove citations and other
unnecessary apparatus from the body of cases themselves. For the
most part, cases are presented with only the name of the case in the
main text: the citation is evacuated to the margin. This is another
way of clarifying of the cases themselves; citations are a remarkable
hindrance to readability. By pu ing citations alongside the text (as
in some law reviews’ online supplements), I believe I have resolved
the Garner-Posner debate over whether citations belong in text or in
footnotes. The best answer is neither: they belong in the margin.

I used the XeLaTeX document preparation system to prepare the
manuscript of this book. XeLaTeX is a computer typse ing system
derived from Leslie Lamport’s LATEXand built on Donald Knuth’s TEX.
I type out the text of the book in a set of individual text files, marked
up with tags like

ȇ/ 3/$/ȃ/#$. $. $) $/'$.Ȅ

. XeLaTeX then assembles the hundreds of individual files into a sin-
gle PDF output.
                                                   5"#-& 0' $0/5&/54

    This approach has several advantages compared with a more tra-
ditional word processor. First, where Word or might have
choked or slowed down on a document this size, XeLaTeX has no
trouble at all. True, I needed to take a minute to recompile the PDF
each time I make changes. But the editing itself is fast and responsive.
    Second, this method gave me fine-grained control over every as-
pect of how the book appears. My choice of a wide margin, for ex-
ample, with sidenotes that float with the main text, would have been
extremely difficult to implement in a word processor. With XeLaTeX,
it was a ma er of specifying the width of the margins and then writ-
ing a few commands to place materials in them in particular ways. I
have been able to customize the fonts, the colors, the forma ing of
trademarks and the captioning of images. I have also been able to hy-
perlink the short forms of cases back to the full citation introducing
them – all while automatically pulling them into the indices at the
back of the book.
    Some of my more specific forma ing choices are also worth com-
menting on. At the moment, the book is set primarily in Palatino,
which I chose because it is an a ractive typeface that is widely avail-
able and happens to be Cornell’s principal typeface. (Similarly, the
accent color is Cornell red.) The header typeface, used for the running
heads, the marginal notes and captions, and case names, is Myriad,
which is also widely available.
    I think the choice to use splashes of color is a no-brainer. It doesn’t
print out on black-and-white printers, but given that so many people
read so much on screens already, it livens up the experience for the
majority. I also think the use of a contrasting sans-serif font is eas-
ily defensible; it makes entirely clear what is part of the excerpted
material and what is editoral apparatus.

Excerpts from cases and statutes are in the public domain as edicts of
government. Congressional reports, excerpts from the MPEP, Copy-
right Compendium and TMEP, and other federal materials are in the
public domain as government works. All other excerpted materials
are used under the fair use provisions of 17 U.S.C. § 107. If you dis-
agree with my interpretation of fair use as applied to any particular
materials, please get in touch with me to discuss.
    All of my own contributions to these materials – including any
original writing, edits to existing materials, and the selection and ar-
rangement of those materials – are hereby made available for free
reuse under the terms of the $SFBUJWF $PNNPOT "UUSJCVUJPO  *OUFSOB
UJPOBM license. Credit is not important to me, but I do care that you
preserve the license notice if you redistribute these materials.
5"#-& 0' $0/5&/54                                                  

Although I respectfully disagree with the organizational choices and
emphases of all existing casebooks, I have learned a great deal from
them. Many cases in these materials came to my a ention as good
teaching prospects because I found them in other books and admired
how the authors used them. I am grateful to everyone else who has
blazed a trail through the overgrowth that is IP law; I hope they will
not begrudge me blazing one more.
    These materials were assembled for my Fall 2016 Intellectual Prop-
erty survey course at Cornell Tech. I may revise and update them the
next time I teach the course. I am sure that many errors remain (in-
deed, I have marked many on my printouts of the chapters) – but
I have not had the to go back and fix even the ones I know of, let
alone to look for the rest. I welcome any comments, suggestions, and
corrections and will try to incorporate them if I am able to make re-
visions. If you would like to customize these materials for your own
use or others’, please get in touch so we can discuss the mechanics.
    I hope that you enjoy working with these materials as much as I
have enjoyed assembling them.

   August 4, 2017

James Grimmelmann
Cornell Tech and Cornell Law School
%( .ǡ"-$(( '())ȓ*-) ''ǡ 0
   5"#-& 0' $0/5&/54

                  6OEFWFMPQFE *EFBT

To understand intellectual property law, it is necessary to understand
the problems it tries to solve. And thus we start with one of the neg-
ative spaces of intellectual property: the submission of undeveloped        4FF &MJ[BCFUI - 3PTFOCMBUU " 5IFPSZ PG
ideas. These ideas – for reasons we will study in detail later – fail to    *1hT /FHBUJWF 4QBDF  $PMVN + - 
qualify for protection under the various bodies of intellectual prop-
erty law. And yet they still have value, which means there are re-
wards to be reaped by anyone who can create them and get them
into the right hands.

                             %FTOZ W 8JMEFS
                            $BM E  
In November, 1949, plaintiff telephoned Wilder’s office. Wilder’s sec-         #JMMZ 8JMEFS XBT UIF GBNPVT EJSFDUPS PG
retary, who was also employed by Paramount, answered, and plain-            öMNT TVDI BT %PVCMF *OEFNOJUZ 
tiff stated that he wished to see Wilder. At the secretary’s insistence      BOE 4PNF -JLF *U )PU 
that plaintiff explain his purpose, plaintiff “told her about this fantas-
tic unusual story. ... I described to her the story in a few words. ... I
told her that it was the life story of Floyd Collins who was trapped
and made sensational news for two weeks ... and I told her the plot....
I described to her the entrapment and the death, in ten minutes, prob-
ably. She seemed very much interested and she liked it.” Plaintiff           *O  'MPZE $PMMJOT XBT FYQMPSJOH
sought to send Wilder a copy of the story but when the secretary            B DBWF JO ,FOUVDLZ XIFO B SPDL GFMM
learned of its length of some 65 pages she stated that Wilder would         PO IJT MFH QJOOJOH IJN XIFSF IF XBT
                                                                            )F XBT USBQQFE BCPVU  GFFU VOEFS
not read it, that he wanted stories in synopsis form, that the story
                                                                            HSPVOE BOE IJT GSJFOET XFSF GPS TFW
would first be sent to the script department, and “in case they think        FSBM EBZT BCMF UP SFBDI IJN GSPN UIF
it is fantastic and wonderful, they will abbreviate it and condense it      DBWFT FOUSBODF CVU OFJUIFS $PMMJOT OPS
in about three or four pages, and the producers and directors get to        IJT XPVMECF SFTDVFST DPVME HFU BU UIF
see it.” Plaintiff protested that he preferred to do the abbreviating        SPDL 5IF TUPSZ PG UIF USBQQFE DBWFS
                                                                            CFDBNF B NFEJB TFOTBUJPO 6OGPSUV
of the story himself, and the secretary suggested that he do so. Two        OBUFMZ CZ UIF UJNF B SFTDVF TIBGU EVH
days later plaintiff, after preparing a three or four page outline of the    GSPN UIF TVSGBDF SFBDIFE IJN BGUFS UXP
story, telephoned Wilder’s office a second time and told the secretary        XFFLT PG XPSL $PMMJOT IBE BMSFBEZ EJFE
the synopsis was ready. The secretary requested plaintiff to read the
synopsis to her over the telephone so that she could take it down in
                                                                               $)"15&3  6/%&7&-01&% *%&"4

                                           shorthand, and plaintiff did so. During the conversation the secretary
                                           told plaintiff that the story seemed interesting and that she liked it.
                                           “She said that she would talk it over with Billy Wilder and she would
                                           let me know.” Plaintiff on his part told the secretary that defendants
                                           could use the story only if they paid him “the reasonable value of it
                                           ... I made it clear to her that I wrote the story and that I wanted to
                                           sell it. ... I naturally mentioned again that this story was my story
                                           which has taken me so much effort and research and time, and there-
                                           fore if anybody used it they will have to pay for it ... She said that if
                                           Billy Wilder of Paramount uses the story, ‘naturally we will pay you
                                           for it.’” Plaintiff’s only subsequent contact with the secretary was a
                                           telephone call to her in July, 1950, to protest the alleged use of his
"DF JO 5IF )PMF  EJSFDUFE BOE DP      composition and idea in a photoplay. The photoplay, as hereinafter
XSJUUFO CZ 8JMEFS                          shown in some detail, closely parallels both plaintiff’s synopsis and
                                           the historical material concerning the life and death of Floyd Collins.
                                                We conclude that conveyance of an idea can constitute valuable
                                           consideration and can be bargained for before it is disclosed to the
                                           proposed purchaser, but once it is conveyed, i.e., disclosed to him
                                           and he has grasped it, it is henceforth his own and he may work with
                                           it and use it as he sees fit. In the field of entertainment the producer
                                           may properly and validly agree that he will pay for the service of
                                           conveying to him ideas which are valuable and which he can put to
5IF DPVSU BMTP TUBUFE UIBU EJTDMPTVSF      profitable use. But, assuming legality of consideration, the idea pur-
NJHIU DPOTUJUVUF B CFOFöU TVóDJFOU UP      veyor cannot prevail in an action to recover compensation for an ab-
                                           stract idea unless (a) before or after disclosure he has obtained an ex-
 i" QSPNJTF NBEF JO SFDPHOJUJPO PG         press promise to pay, or (b) the circumstances preceding and a end-
B CFOFöU QSFWJPVTMZ SFDFJWFE CZ UIF        ing disclosure, together with the conduct of the offeree acting with
QSPNJTPS GSPN UIF QSPNJTFF JT CJOEJOH      knowledge of the circumstances, show a promise of the type usually
UP UIF FYUFOU OFDFTTBSZ UP QSFWFOU JO     referred to as “implied” or “implied-in-fact.”
                                                Such inferred or implied promise, if it is to be found at all, must
                                           be based on circumstances which were known to the producer at and
                                           preceding the time of disclosure of the idea to him and he must vol-
                                           untarily accept the disclosure, knowing the conditions on which it
                                           is tendered. The idea man who blurts out his idea without having
                                           first made his bargain has no one but himself to blame for the loss
                                           of his bargaining power. The law will not imply a promise to pay
                                           for an idea from the mere facts that the idea has been conveyed, is
                                           valuable, and has been used for profit; this is true even though the
                                           conveyance has been made with the hope or expectation that some
                                           obligation will ensue. So, if the plaintiff here is claiming only for the
                                           conveyance of the idea of making a dramatic production out of the
                                           life of Floyd Collins he must fail unless in conformity with the above
                                           stated rules he can establish a contract to pay.
                                                From plaintiff’s testimony, as epitomized above, it does not ap-
                                           pear that a contract to pay for conveyance of the abstract photoplay

idea had been made, or that the basis for inferring such a contract
from subsequent related acts of the defendants had been established,
at the time plaintiff disclosed his basic idea to the secretary. Defen-
dants, consequently, were at that time and from then on free to use
the abstract idea if they saw fit to engage in the necessary research
and develop it to the point of a usable script.
    [The court held that Desny was entitled to a trial on a different
Carter, Justice:
    I concur only in the result reached in the majority opinion.
    When we consider the difference in economic and social back-
grounds of those offering such merchandise for sale and those pur-
chasing the same, we are met with the inescapable conclusion that it
is the seller who stands in the inferior bargaining position. It should
be borne in mind that producers are not easy to contact; that those
with authority to purchase for radio and television are surrounded
by a coterie of secretaries and assistants; that magazine editors and
publishers are not readily available to the average person. It should
also be borne in mind that writers have no way of advertising their
wares – that, as is most graphically illustrated by the present opinion,
no producer, publisher, or purchaser for radio or television, is going
to buy a pig in a poke. And, when the writer, in an earnest endeavor
to sell what he has wri en, conveys his idea or his different interpre-
tation of an old idea, to such prospective purchaser, he has lost the
result of his labor, definitely and irrevocably. And, in addition, there
is no way in which he can protect himself. If he says to whomever
he is permi ed to see, or, as in this case, talk with over the telephone,
“I won’t tell you what my idea is until you promise to pay me for it,”
it takes no Sherlock Holmes to figure out what the answer will be!
This case is a beautiful example of the practical difficulties bese ing
a writer with something to sell.
    It seems to me that in the ordinary situation, when the so-called
“idea man” has an opportunity to see, or talk with, the prospective
purchaser, or someone in his employ, it is at that time, without any-
thing being said, known to both parties that the one is there to sell,
and the other to buy. This is surely true of a department store when
merchandise is displayed on the counter – it is understood by anyone
entering the store that the merchandise so displayed is for sale – it is
completely unnecessary for the storekeeper, or anyone in his employ,
to state to anyone entering the store that all articles there are for sale.
I am at a loss to see why any different rules should apply when it is
ideas for sale rather than normal run of merchandise.

                                                                                $)"15&3  6/%&7&-01&% *%&"4

                                                                      5FY - 3FW  
                                             An inventor seeking funds or development expertise may be reluc-
                                             tant to disclose information about her invention for fear that the re-
                                             cipients of the information can take it for themselves. On the other
                                             side of the transaction, the funders or developers will be unwilling
                                             to commit money or resources to the project unless or until they can
4FF ,FOOFUI + "SSPX &DPOPNJD 8FMGBSF        assess its value. Arrow observed this dynamic and deemed it a “fun-
BOE UIF "MMPDBUJPO PG 3FTPVSDFT GPS *OWFO   damental paradox”: the value of information “for the purchaser is
                                             not known until he has the information, but then he has in effect ac-
DBMMFE i"SSPXT *OGPSNBUJPO 1BSBEPYw JO      quired it without cost.” More recently, Cooter and his collaborators
IJT IPOPS                                   have described this phenomenon as a “double trust dilemma”: “To
                                             develop an innovation, the innovator must trust the investor not to
                                             steal his idea, and the investor must trust the innovator not to steal
                                             his capital.”

                                                             "QGFM W 1SVEFOUJBM#BDIF 4FDVSJUJFT *OD
                                             Defendant, an investment bank, seeks to avoid an agreement to pur-
                                             chase plaintiffs’ idea for issuing and selling municipal bonds. Its prin-
                                             cipal contention is that plaintiffs had no property right in the idea be-
                                             cause it was not novel and, therefore, consideration for the contract
                                             was lacking. For reasons which follow, we conclude that a showing of
                                             novelty is not required to validate the contract. The decisive question
                                             is whether the idea had value, not whether it was novel.
                                             In 1982, plaintiffs, an investment banker and a lawyer, approached
                                             defendant’s predecessor with a proposal for issuing municipal secu-
                                             rities through a system that eliminated paper certificates and allowed
                                             bonds to be sold, traded, and held exclusively by means of comput-
                                             erized “book entries”. Initially, the parties signed a confidentiality
                                             agreement that allowed defendant to review the techniques as de-
                                             tailed in a 99-page summary. Nearly a month of negotiations fol-
                                             lowed before the parties entered into a sale agreement under which
                                             plaintiffs conveyed their rights to the techniques and certain trade
                                             names and defendant agreed to pay a stipulated rate based on its use
                                             of the techniques for a term from October 1982 to January 1988. Un-
                                             der the provisions of the contract, defendant’s obligation to pay was
                                             to remain even if the techniques became public knowledge or stan-
                                             dard practice in the industry and applications for patents and trade-
                                             marks were denied. Plaintiffs asserted that they had not previously
                                             disclosed the techniques to anyone and they agreed to maintain them
                                             in confidence until they became public.
                                                 From 1982 until 1985, defendant implemented the contract, al-

though the parties dispute whether amounts due were fully paid.
Defendant actively encouraged bond issuers to use the computerized
“book entry” system and, for at least the first year, was the sole under-
writer in the industry employing such a system. However, in 1985,
following a change in personnel, defendant refused to make any fur-
ther payments. It maintained that the ideas conveyed by plaintiffs
had been in the public domain at the time of the sale agreement and
that what plaintiffs sold had never been theirs to sell. Defendant’s
a empts to patent the techniques proved unsuccessful. By 1985, in-
vestment banks were increasingly using computerized systems, and
by 1990 such systems were handling 60% of the dollar volume of all
new issues of municipal securities.
    Plaintiffs commenced this litigation seeking $45 million in com-
pensatory and punitive damages.
Under the traditional principles of contract law, the parties to a con-
tract are free to make their bargain, even if the consideration ex-
changed is grossly unequal or of dubious value. Absent fraud or un-
conscionability, the adequacy of consideration is not a proper subject
for judicial scrutiny. It is enough that something of “real value in the
eye of the law” was exchanged. The fact that the sellers may not have
had a property right in what they sold does not, by itself, render the
contract void for lack of consideration.
    Manifestly, defendant received something of value here; its own
conduct establishes that. After signing the confidentiality agreement,
defendant thoroughly reviewed plaintiffs’ system before buying it.
Having done so, it was in the best position to know whether the idea
had value. It decided to enter into the sale agreement and aggres-
sively market the system to potential bond issuers. For at least a year,
it was the only underwriter to use plaintiffs’ “book entry” system for
municipal bonds, and it handled millions of such bond transactions
during that time. Having obtained full disclosure of the system, used
it in advance of competitors, and received the associated benefits of
precluding its disclosure to others, defendant can hardly claim now
the idea had no value to its municipal securities business. Indeed, de-
fendant acknowledges it made payments to plaintiffs under the sale
agreement for more than two years, conduct that would belie any
claim it might make that the idea was lacking in value or that it had
actually been obtained from some other source before plaintiffs’ dis-
Defendant’s position rests on Downey v. General Foods Corp., Soule v.      %PXOFZ  /:E  
Bon Ami Co. and similar decisions. It contends those cases establish       4PVMF  "QQ %JW  
                                    $)"15&3  6/%&7&-01&% *%&"4

an exception to traditional principles of contract law and require that
the idea must be novel before it can constitute valid consideration for
a contract.
    In Downey, plaintiff submi ed an idea for an advertising cam-
paign. A short time later, defendant General Foods mounted a cam-
paign that was similar to the one plaintiff had suggested and plaintiff
sought damages in a complaint alleging several theories for recovery.
We ordered the dismissal of the complaint on two separate grounds:
first, the lack of novelty and, second, defendant’s prior possession of
the idea – i.e., its lack of novelty as to defendant. To the extent plain-
tiff’s causes of action were grounded on assertions of a property right,
we found that they were untenable “if the elements of novelty and
originality [were] absent, since the property right in an idea is based
upon these two elements.” Second, we concluded that the defendant
possessed plaintiff’s ideas prior to plaintiff’s disclosure. Thus, the
ideas could have no value to defendant and could not supply consid-
eration for any agreement between the parties.
    In Soule, plaintiff made an express contract with Bon Ami to
disclose a way to increase profits. The idea consisted largely of a
proposal to raise prices. The Appellate Division, in a frequently
cited opinion, denied plaintiff any recovery, finding that the bargain
lacked consideration because the idea was not novel. This Court af-
firmed but it did so on a different basis: it held that plaintiff had failed
to show that profits resulted from the disclosure.
    These decisions do not support defendant’s contention that nov-
elty is required in all cases involving disclosure of ideas. Indeed, we
have explicitly held that it is not. Downey, Soule and cases in that line
of decisions involve a distinct factual pa ern: the buyer and seller
contract for disclosure of the idea with payment based on use, but no
separate postdisclosure contract for use of the idea has been made.
Thus, they present the issue of whether the idea the buyer was using
was, in fact, the seller’s.
    Such transactions pose two problems for the courts. On the one
hand, how can sellers prove that the buyer obtained the idea from
them, and nowhere else, and that the buyer’s use of it thus consti-
tutes misappropriation of property? Unlike tangible property, an
idea lacks title and boundaries and cannot be rendered exclusive by
the acts of the one who first thinks it. On the other hand, there is no
equity in enforcing a seemingly valid contract when, in fact, it turns
out upon disclosure that the buyer already possessed the idea. In
such instances, the disclosure, though freely bargained for, is mani-
festly without value. A showing of novelty, at least novelty as to the
buyer, addresses these two concerns. Novelty can then serve to estab-
lish both the a ributes of ownership necessary for a property-based
claim and the value of the consideration – the disclosure – necessary

for contract-based claims.
    There are no such concerns in a transaction such as the one before
us. Defendant does not claim that it was aware of the idea before
plaintiffs disclosed it but, rather, concedes that the idea came from
them. When a seller’s claim arises from a contract to use an idea en-
tered into after the disclosure of the idea, the question is not whether
the buyer misappropriated property from the seller, but whether the
idea had value to the buyer and thus constitutes valid consideration.
In such a case, the buyer knows what he or she is buying and has
agreed that the idea has value, and the Court will not ordinarily go be-
hind that determination. The lack of novelty, in and of itself, does not
demonstrate a lack of value. To the contrary, the buyer may reap ben-
efits from such a contract in a number of ways — for instance, by not
having to expend resources pursuing the idea through other channels
or by having a profitmaking idea implemented sooner rather than
later. The law of contracts would have to be substantially rewri en
were we to allow buyers of fully disclosed ideas to disregard their
obligation to pay simply because an idea could have been obtained
from some other source or in some other way.

                         #J[BSSP 8PSME 1SPCMFN
Apfel and Desny give us a glimpse of a world without intellectual
property laws. Suppose that you lived in such a world. A client            /PUF UIBU UIF EFGFOEBOU JO "QGFM USJFE
comes to you with one of the following. How would you advise her           BOE GBJMFE UP PCUBJO B QBUFOU PO UIF
                                                                           DPNQVUFSJ[FECPPLFOUSZ JEFB BOE
to proceed?
                                                                           UIBU UIF QMBJOUJòT TVJU QSPDFFEFE
   • A 75,000-word novel about a boy who discovers that he is a wiz-       VOEFS HFOFSBM QSJODJQMFT PG DPOUSBDU
      ard                                                                  MBX *EFBT TVDI BT B NPWJF BCPVU
                                                                           UIF EFBUI PG 'MPZE $PMMJOT  BSF OPU
   • A new drug for treating heart disease, which will cost $100 mil-      DPQZSJHIUBCMF
      lion to test in humans
   • An easier-to-hold design for a pipe wrench
   • A process for producing pure aluminum from aluminum ore
      that reduces the cost by 85%
   • A catchy song about taking revenge on a cheating boyfriend,
      recorded in the client’s kitchen with lots of background noise
   • A recut version of a popular action movie, which takes five min-
      utes off the running time and makes it more suspenseful
   • A sketch for an elegant off-the-shoulder dress
   • A joke about traffic in Los Angeles
   • The perfect name for a laundromat

                       %FCU $PMMFDUJPO 1SPCMFN
Debt collection is a shady, high-pressure business. Collection agen-
cies buy unpaid debts in bulk from lenders and from each other, usu-
                                                                          $)"15&3  6/%&7&-01&% *%&"4

                                     ally for a fraction of the face value of the debts. The buyer typically re-
                                     ceives a spreadsheet listing the debtors, their addresses, the amounts
                                     they owe, and perhaps some information about previous failed at-
                                     tempts at collection, along with an assignment of the seller’s right to
                                     collect the debt. Then the buyer goes to work, calling the debtor, send-
                                     ing le ers, negotiating payment schedules or write-downs of the debt
                                     in exchange for partial payment, and threatening legal action and per-
                                     haps following through, Unsurprisingly, debt collectors are known to
                                     use sharp tactics, including issuing unfounded legal threats, making
                                     repeated calls, trying to collect on debts that have been discharged
                                     in bankruptcy or where the statute of limitations has expired, and
                                     sometimes even intimating the possibility of violence. The federal
                                     Fair Debt Collection Practices Act and numerous state laws try to pre-
                                     vent these abusive tactics. Here is another:
+BLF )BMQFSO 1BQFS #PZT /: 5JNFT         Around the same time that Theresa was ge ing phone
"VH                                calls from a mysterious law firm, Siegel received an email
                                           from the owner of an agency that he had hired to do his
                                           collecting. The collectors at this agency were ge ing the
                                           same message from many debtors: We just paid off these
                                           accounts – to someone else. Siegel was both flummoxed
                                           and concerned. Was this the work of a renegade collector
                                           at one of his agencies who was collecting on his own and
                                           pocketing the cash? Or had the paper simply been stolen
                                           from his offices?
                                               The notion that a portfolio of debt could be stolen may
                                           seem improbable, but plenty of debt brokers are all too
                                           willing to sell “bad paper.” Such brokers sometimes “dou-
                                           ble sell” or “triple sell” the same file to multiple unsuspect-
                                           ing buyers. Other times, a broker may sell paper that he
                                           does not own and obtained by nefarious means. I spoke
                                           at length with one debt broker from Buffalo, who told me
                                           that he had hired a hacker from China to break into a for-
                                           mer client’s email account and obtain his password. Once
                                           he had the client’s password, the broker had access to his
                                           paper. He then simply took a portfolio and, subsequently,
                                           sold it to another buyer — who didn’t know and didn’t ask
                                           where it came from.
                                     Is this an ”intellectual property” problem? Does it have anything in
                                     common with the problems discussed in Desny and Apfel?

                         5SBEF 4FDSFU

Trade secret law protects against the theft of valuable business secrets.   5IF MFBEJOH USBEF TFDSFU USFBUJTFT BSF
Doctrinally, trade secret law has deep common-law roots as a branch         3PHFS . .JMHSJN  &SJD #FOTFO .JM
                                                                            HSJN PO 5SBEF 4FDSFUT .BUUIFX #FOEFS
of “unfair competition” law. Over time it has become more statutory
                                                                            PO -FYJT -PVJT "MUNBO  .BMMB 1PM
and more federal. The Uniform Trade Secrets Act has been adopted            MBDL $BMMNBOO PO 6OGBJS $PNQFUJUJPO
in some form by 47 states. The federal Economic Espionage Act crimi-        5SBEFNBSLT BOE .POPQPMJFT 5IPNTPO
nalized an important subset of trade secret misappropriation, and the       8FTU PO 8FTUMBX BOE .FMWJO ' +BHFS
2016 Defend Trade Secrets Act added a federal civil cause of action         5SBEF 4FDSFUT -BX 5IPNTPO 8FTU PO
                                                                            8FTUMBX  5IF PMEFS 3FTUBUFNFOU 'JSTU
and an important seizure remedy.
                                                                            PG 5PSUT BOE UIF OFXFS 3FTUBUFNFOU
    Why protect trade secrets? At least four stories rub elbows in the       5IJSE PG 6OGBJS $PNQFUJUJPO BSF SFHV
cases and commentary.                                                       MBSMZ DJUFE
    • Contracting: protecting trade secrets helps resolve Arrow’s In-
      formation Paradox by making it possible to contract securely
      for disclosing them.
    • Innovation: keeping secrets safe gives companies incentives to
      invest in creating valuable information in the first place.
    • Arms Race: unless trade secrets received legal protection, com-
      panies would inefficiently overinvest in self-help to protect
      them, and other companies would inefficiently overinvest in
      stealing them.
    • Competition: trade secret law deters unethical business prac-
      tices and encourages companies to compete with each other



A trade secret is any information that can be used in the operation of      f 
a business or other enterprise and that is sufficiently valuable and se-      %FöOJUJPO PG 5SBEF 4FDSFU
cret to afford an actual or potential economic advantage over others.
                                                          $)"15&3  53"%& 4&$3&5

             cmt. e   Subject ma er. – A trade secret can consist of a formula, pa ern,
                      compilation of data, computer program, device, method, tech-
                      nique, process, or other form or embodiment of economically
                      valuable information. A trade secret can relate to technical mat-
                      ters such as the composition or design of a product, a method of
                      manufacture, or the know-how necessary to perform a particu-
                      lar operation or service. A trade secret can also relate to other
                      aspects of business operations such as pricing and marketing
                      techniques or the identity and requirements of customers.
                          The prior Restatement of this topic limited the subject ma er
                      of trade secret law to information capable of ”continuous use in
                      the operation of a business,” thus excluding information relat-
                      ing to single events such as secret bids and impending business
                      announcements or information whose secrecy is quickly de-
                      stroyed by commercial exploitation. Both the case law and the
                      prior Restatement, however, offered protection against the ”im-
                      proper” acquisition of such short-term information under rules
                      virtually identical to those applicable to trade secrets. The def-
                      inition of ”trade secret” adopted in the Uniform Trade Secrets
                      Act does not include any requirement relating to the duration
                      of the information’s economic value. The definition adopted in
                      this Section similarly contains no requirement that the informa-
                      tion afford a continuous or long-term advantage.

                                      6OJGPSN 5SBEF 4FDSFUT "DU

                (4)   “Trade secret” means information, including a formula, pa ern,
                      compilation, program, device, method, technique, or process,
                       (i) derives independent economic value, actual or potential,
                            from not being generally known to, and not being readily
                            ascertainable by proper means by, other persons who can
                            obtain economic value from its disclosure or use, and
                      (ii) is the subject of efforts that are reasonable under the cir-
                            cumstances to maintain its secrecy.

               Not every secret is a trade secret. When one fifth-grader asks another
               to cross her heart and hope to die before revealing a bit of gossip
               about a mutual friend, this is not the kind of secret the courts will
               take an interest in. The economic value requirement performs this
               screening function.
                   In theory, economic value could be a threshold test: the courts
               could ask whether particular information is valuable enough for
" 46#+&$5 ."55&3                                                     

trade secret law to protect. But in practice, the threshold of value
is so low it rarely ma ers. “It is sufficient if the secret provides an ad-
vantage that is more than trivial.” Instead, economic value expresses       3FTUBUFNFOU 5IJSE PG 6OGBJS $PNQFUJ
a categorical exclusion from trade secret subject ma er. Personal –         UJPO f  DNU F
rather than professional – secrets are the wrong sort of thing for trade
secret law.

                             4FSWJDFT *OD
                    ' 4VQQ  /% $BM 
Plaintiffs, two Scientology-affiliated organizations claiming copy-
right and trade secret protection for the writings of the Church’s
founder, L. Ron Hubbard, brought this suit against defendant Den-
nis Erlich, a former Scientology minister turned vocal critic of the
Church, who allegedly put plaintiffs’ protected works onto the In-
                            I. B
Defendant Dennis Erlich was a member of the Church of Scientol-
ogy from approximately 1968 until 1982. During his years with the
Church, Erlich received training to enable him to provide ministerial
counseling services, known as “auditing.” While with the Church, Er-
lich had access to various Scientology writings, including those of the
Church’s founder, L. Ron Hubbard, which the Church alleges include
published literary works as well as unpublished confidential materi-
als (the “Advanced Technology works”). According to plaintiffs, Er-
lich had agreed to maintain the confidentiality of the Advanced Tech-
nology works.
    Since leaving the Church, Erlich has been a vocal critic of Scien-
tology and he now considers it part of his calling to foster critical de-
bate about Scientology through humorous and critical writings. Er-
lich has expressed his views about the Church by contributing to the
Internet “Usenet news-group” called “alt.religion.scientology” (“the
newsgroup’’), which is an on-line forum for the discussion of issues
related to Scientology.
    Plaintiff Religious Technology Center (“RTC’’), a nonprofit reli-
gious corporation, “was formed by Scientologists, with the approval
of Hubbard, to act as the protector of the religion of Scientology and
to own, protect, and control the utilization of the Advanced Technol-
ogy in the United States.”
    RTC allege[s] that Erlich misappropriated its trade secrets in the
works, the confidentiality of which it alleges has been the subject of
elaborate security measures. RTC further claims that those works are
extremely valuable to the Church. Erlich admits to having posted ex-
cerpts from some of the works, but argues that the quotations were
                                                                                 $)"15&3  53"%& 4&$3&5

                                      used to provide context for debate and as a basis for his criticism. Er-
                                      lich further argues that he has neither claimed authorship of any of
                                      the works nor personally profited from his critique, satire, and com-
                                      mentary. Erlich contends that all of the documents he posted had
                                      been previously posted anonymously over the Internet, except for
                                      one, which he claims he received anonymously through the mail.
                                                   C. Likelihood of Success on Trade Secret Claim
                                      In the third cause of action, plaintiff RTC alleges that Erlich misap-
$BM $JW $PEF f  FU TFR       propriated its trade secrets. California has adopted a version of the
                                      Uniform Trade Secret Act.
                                          To establish its trade secret claim, RTC must show, inter alia,
                                      that the Advanced Technology works (1) have independent economic
                                      value to competitors and (2) have been kept confidential.
                                      1. Nature of Works
                                      As a preliminary ma er, Erlich argues that the Advanced Technol-
                                      ogy works cannot be trade secrets because of their nature as religious
8PMMFSTIFJN  'E  UI $JS   scriptures. In Religious Technology Center v. Wollersheim, the Ninth Cir-
                                  cuit rejected the Church’s application for a preliminary injunction on
                                      the basis of a trade secret claim against a splinter Scientology group
                                      that had acquired stolen copies of the Advanced Technology. The
                                      Church argued not that the works gave them a competitive market
                                      advantage but that disclosure of the works would cause its adher-
                                      ents “religious harm from premature unsupervised exposure to the
                                      materials.” Although the Ninth Circuit rejected plaintiffs’ trade se-
                                      cret argument based on the spiritual value of the harm, it later noted
                                      that it had left open the question of whether the Advanced Technol-
                                      ogy works could qualify as trade secrets, assuming plaintiffs could
                                      prove that the secrets confer on them an actual economic advantage
                                      over competitors. Nonetheless, the court noted that such an allega-
                                      tion would “raise grave doubts about the Church’s claim as a religion
                                      and a not-for-profit corporation.”
                                          The Church contends that the Advanced Technology works con-
                                      sist of “processes and the theory behind those processes that are to
                                      be used precisely as set forth by L. Ron Hubbard to assist the parish-
                                      ioner in achieving a greater spiritual awareness and freedom.” Erlich
                                      responds that the works are essentially religious texts. Erlich argues
                                      that the Church cannot have trade secrets because trade secret law
                                      is necessarily related to commerce. The Church contends that, like
                                      other organizations, it must pay bills, and that licensing fees from
                                      these documents allow it to continue operating.
                                          The Church’s status as a religion does not itself preclude it from
                                      holding a trade secret. R              § 39 cmt. d (“[N]onprofit entities
                                      such as ... religious organizations can also claim trade secret protec-
" 46#+&$5 ."55&3                                                     

tion for economically valuable information such as lists of prospec-
tive members or donors.’’); UTSA § 3426.1(c) (defining “person” to
include a “corporation ... or any other legal or commercial entity”).
With the exception of Bridge Publications, Inc. v. Vien [(another Sci-      7JFO  ' 4VQQ  4% $BM 
entology case)], there is li le authority to support a finding that re-
ligious materials can constitute trade secrets. However, there is “no
category of information [that] is excluded from protection as a trade
secret because of its inherent qualities.” Clark v. Bunker (upholding as    $MBSL  'E  UI $JS
a trade secret a “detailed plan for the creation, promotion, financing,
and sale of contracts for ‘prepaid’ or ‘pre-need’ funeral services”).
    Nor is there any authority to support Erlich’s argument that the
Church’s religious texts cannot be trade secrets because, unlike most
trade secrets, these secrets are not used in the production or sales
of a commodity but are the commodities themselves. The Church’s Ad-
vanced Technology “course” materials, which are an integral part of
the Church’s spiritual counseling techniques, do not appear funda-
mentally different from the course manuals upheld as trade secrets
in SmokEnders, Inc. v. Smoke No More, Inc.:                                 4NPL&OEFST  6412  4% 'MB
     The SmokEnders (“SE’’) program requires a endees to
     follow a rigid structured regimen comprised of specific
     assignments and detailed concepts as recited in the man-
         The SE program is a step-by-step regimented program
     which requires that each person a ending a SE program
     perform each act of the program at a particular time. Each
     act required by a SE seminar a endee must be performed
     by a endees at the same time in the program, with each a
     minimum departure from the program.
         The SE trade secret resides in the composite program
     as it is arranged for step-by-step delivery to the a endees.
SmokEnders is arguably distinguishable because only the “modera-
tors” and not the a endees were given access to the course materi-
als in that case. However, the adherents of the Church, unlike the
a endees and like the moderators in SmokEnders, are under a duty
of confidentiality as to the materials. This case is analogous to Smok-
Enders because in both cases the “commodity” that is produced from
the trade secrets is the result achieved by the person using the course
materials and their techniques (whether it be stopping smoking or
reaching a “higher spiritual existence”).
    Thus, there is at least some precedent for granting trade secret sta-
tus to works that are techniques for improving oneself (though not
specifically spiritually). Conversely, there is no authority for exclud-
ing religious materials from trade secret protection because of their
nature. Indeed, there is no authority for excluding any type of in-
                                                                                   $)"15&3  53"%& 4&$3&5

                                       formation because of its nature. While the trade secret laws did not
                                       necessarily develop to allow a religion to protect a monopoly in its re-
                                       ligious practices, the laws have nonetheless expanded such that the
                                       Church’s techniques, which clearly are “used in the operation of the
3FTUBUFNFOU 5IJSE PG 6OGBJS $PNQFUJ   enterprise,” are deserving of protection if secret and valuable.
UJPO f                                   Although trade secret status may apply to works that are tech-
                                       niques for spiritually improving oneself, the secret aspect of those
f  DNU E                            techniques must be defined with particularity. See R                 (re-
                                       quiring plaintiff to define the information claimed as a trade secret
                                       with sufficient definiteness). It appears that plaintiffs are claiming
                                       that the entire works themselves, which they describe as “processes
                                       and the theory behind those processes,” constitute the trade secrets.
                                       This definition is problematic because it is impossible to determine
                                       when the “secret” has been lost after portions of the works have been
                                       disclosed. Although plaintiffs’ definition has at least some support
                                       in SmokEnders, where the court upheld as a trade secret a “composite
                                       stop-smoking program” found in an instructional manual, this court
                                       is not satisfied that plaintiffs have identified their trade secrets with
                                       sufficient definiteness to support injunctive relief.
                                       2. Independent Economic Value
                                       A trade secret requires proof of independent economic value, actual
                                       or potential, from not being generally known to the public or to other
                                       persons who can obtain economic value from its disclosure or use. A
                                       trade secret must have sufficient value in the owner’s operation of its
                                       enterprise such that it provides an actual or potential advantage over
                                       others who do not possess the information.
                                           RTC’s president, Warren McShane, a ests that
                                             The Advanced Technology is a source of substantial rev-
                                             enue for RTC in the form of licensing fees paid by
                                             Churches that are licensed to use the Advanced Tech-
                                             nology. These Churches themselves receive a significant
                                             amount of their income from donations by parishioners
                                             for services based upon the Advanced Technology. These
                                             Churches pay RTC a percentage of the donations paid by
                                             parishioners for the services based upon the Advanced
                                             Technology. These donations and fees provide the major-
                                             ity of operating expenses of these various Church organi-
                                       The Church’s need for revenues to support its services is no less be-
                                       cause of its status as a religion. RTC points out that it receives six per-
                                       cent of what the individual churches receive in licensing fees. This
                                       evidence is sufficient to establish the value of the Advanced Technol-
                                       ogy works to the Church.
# 08/&34)*1                                                           

    Erlich also argues that, to constitute a trade secret, information
must give its owner a competitive advantage, which implies that the
Church must have competitors. Although Erlich is clearly not a “com-         8IBU JG &SMJDI IBE DPQJFE BOE EJT
petitor” of the Church, there is no requirement that a trade secret have     USJCVUFE UIF EPDVNFOUT UP UIF
                                                                             NFNCFST PG B CSFBLBXBZ 4DJFOUPMPHZ
any value to the defendant; the value can be to others who do not pos-
                                                                             TFDU GPS VTF JO UIFJS SFMJHJPVT TFSWJDFT
sess it. This evidence can be shown by direct evidence of the impact         $PNQBSF 8PSMEXJEF $IVSDI PG (PE
of the information on the business or by circumstantial evidence of          W 1IJMBEFMQIJB $IVSDI PG (PE *OD
the resources invested in producing the information, the precautions          'E  UI $JS  XIFSF
taken to protect its secrecy, and the willingness of others to pay for       B DIVSDI EJTDPOUJOVFE UIF VTF PG B
                                                                             CPPL XSJUUFO CZ JUT GPVOEFS CFDBVTF
its access. The several past instances of breakaway Scientology-like
                                                                             JU DPOWFZFE PVUEBUFE WJFXT UIBU
groups exploiting RTC’s Advanced Technology works for their profit            XFSF SBDJTU JO OBUVSF  UIFO TVFE GPS
constitute reasonable circumstantial evidence that these works give          DPQZSJHIU JOGSJOHFNFOU B OFX DIVSDI
the Church a competitive advantage. In fact, McShane’s declaration           UIBU SFHBSEFE UIF CPPL BT DFOUSBM
constitutes direct evidence that the works have a significant impact          UP JUT SFMJHJPVT QSBDUJDF BOE SFRVJSFE
                                                                             SFBEJOH GPS BMM NFNCFST
on the donations received by the Church, providing a majority of its
operating expenses. The status of the Advanced Technology works
as trade secrets should not depend on Erlich’s use of them. Accord-
ingly, this court finds support for the court’s conclusion in Vien that
the Church has shown independent economic value.

It is clear, uncontroversial, and unsurprising that the essential re-
quirement for owning a trade secret is actual secrecy: the information
must not be widely known. The concept is not complicated, but it is
subtle. “Secrecy” is something of a term of art; whether something is
considered secret as a factual ma er depends heavily on what kinds
of observation and disclosure trade secret law will protect against.
    But because this book is, well, this book, we will also direct our at-
tention to two other important facts about the way the actual-secrecy
element operates. It resolves priority questions by allowing multiple
independent parties each to have a trade secret in the same informa-
tion. And it resolves questions of allocating ownership within collab-
orations by looking to contract, agency, and employment law.


                         6OJUFE 4UBUFT W -BOHF
                        'E  UI $JS 
Ma hew Lange has been convicted of violating 18 U.S.C. § 1832, part
of the Economic Espionage Act of 1996. This statute makes it a felony
to sell, disseminate, or otherwise deal in trade secrets, or a empt to
do so, without the owner’s consent. Lange stole computer data from
Replacement Aircraft Parts Co. (RAPCO), his former employer, and
                                                              $)"15&3  53"%& 4&$3&5

                   a empted to sell the data to one of RAPCO’s competitors. He allows
                   that his acts violated § 1832, if the data contained “trade secrets,” but
                   denies that the data met the statutory definition [that the] ”informa-
                   tion derives independent economic value, actual or potential, from
                   not being generally known to, and not being readily ascertainable
 64$ f    through proper means by, the public.”
                        RAPCO is in the business of making aircraft parts for the after-
                   market. It buys original equipment parts, then disassembles them to
                   identify (and measure) each component. This initial step of reverse
                   engineering, usually performed by a drafter such as Lange, produces
                   a set of measurements and drawings. Because this case involves an
                   effort to sell the intellectual property used to make a brake assembly,
                   we use brakes as an illustration.
                        Knowing exactly what a brake assembly looks like does not enable
                   RAPCO to make a copy. It must figure out how to make a substitute
                   with the same (or be er) technical specifications. Aftermarket manu-
                   facturers must experiment with different alloys and compositions un-
                   til they achieve a process and product that fulfils requirements set by
                   the Federal Aviation Administration for each brake assembly. Com-
                   pleted assemblies must be exhaustively tested to demonstrate, to the
                   FAA’s satisfaction, that all requirements have been met; only then
                   does the FAA certify the part for sale. For brakes this entails 100 de-
                   structive tests on prototypes, bringing a spinning 60-ton wheel to a
                   halt at a specified deceleration measured by a dynamometer. Fur-
                   ther testing of finished assemblies is required. It takes RAPCO a
                   year or two to design, and obtain approval for, a complex part; the
                   dynamometer testing alone can cost $75,000. But the process of ex-
                   perimenting and testing can be avoided if the manufacturer demon-
                   strates that its parts are identical (in composition and manufacturing
                   processes) to parts that have already been certified. What Lange, a
                   disgruntled former employee, offered for sale was all the informa-
                   tion required to obtain certification of several components as identi-
                   cal to parts for which RAPCO held certification. Lange included with
                   the package – which he offered via the Internet to anyone willing to
                   pay his price of $100,000 – a pirated copy of AutoCAD, the computer-
                   assisted drawing software that RAPCO uses to maintain its drawings
                   and specifications data. One person to whom Lange tried to peddle
                   the data informed RAPCO, which turned to the FBI. Lange was ar-
                   rested following taped negotiations that supply all the evidence nec-
                   essary for conviction – if the data satisfy the statutory definition of
                   trade secrets.
                        According to Lange, all data obtained by reverse engineering
                   some other product are “readily ascertainable ... by the public” be-
                   cause everyone can do what RAPCO did: buy an original part, disas-
                   semble and measure it, and make a copy. The prosecutor responds
# 08/&34)*1                                                         

to this contention by observing that “the public” is unable to reverse
engineer an aircraft brake assembly.
    The prosecutor’s assumption is that the statutory reference in
§ 1839(3) to “the public” means the general public – the man in the
street. Ordinary people don’t have AutoCAD and 60-ton flywheels
ready to hand. But is the general public the right benchmark?
    A problem with using the general public as the reference group
for identifying a trade secret is that many things unknown to the pub-
lic at large are well known to engineers, scientists, and others whose
intellectual property the Economic Espionage Act was enacted to pro-
tect. This makes the general public a poor benchmark for separating
commercially valuable secrets from obscure (but generally known)
information. Suppose that Lange had offered to sell Avogadro’s num-
ber for $1. Avogadro’s number, 6.02×1023 , is the number of molecules
per mole of gas. It is an important constant, known to chemists since
1909 but not to the general public (or even to all recent graduates of a
chemistry class). We can’t believe that Avogadro’s number could be
called a trade secret. Other principles are known without being com-
prehended. Most people know that E = mc2 , but a pop quiz of the
general public would reveal that they do not understand what this
means or how it can be used productively.
    One might respond that the context of the word “public” ad-
dresses this concern. The full text of § 1839(3)(B) is: “the informa-
tion derives independent economic value, actual or potential, from
not being generally known to, and not being readily ascertainable
through proper means by, the public”. Avogadro’s number and other
obscure knowledge is not “generally known to” the man in the street
but might be deemed “readily ascertainable to” this hypothetical per-
son. It appears in any number of scientific handbooks. Similarly one
can visit a library and read Einstein’s own discussion of his famous
equation. Members of the general public can ascertain even abstruse
information, such as Schrodinger’s quantum field equation, by con-
sulting people in the know – as high school dropouts can take advan-
tage of obscure legal rules by hiring lawyers.
    Section 1839(3)(B) as a whole refers to the source of economic
value – that the information is not known to or easily discoverable
by persons who could use it productively. And for purposes of this
case those people would be engineers and manufacturers of aircraft
parts, who have ample means to reverse engineer their competitors’
products. It is by keeping secrets from its rivals that RAPCO captures
the returns of its design and testing work. Thus it is unnecessary here
to decide whether “general” belongs in front of “public” – for even if
it does, the economically valuable information is not “readily ascer-
tainable” to the general public, the educated public, the economically
relevant public, or any sensible proxy for these groups.
                                                                                 $)"15&3  53"%& 4&$3&5

                                          Lange wants us to proceed as if all he tried to sell were measure-
                                      ments that anyone could have taken with calipers after disassembling
                                      an original-equipment part. Such measurements could not be called
                                      trade secrets if, as Lange asserts, the assemblies in question were easy
                                      to take apart and measure. But no one would have paid $100,000
                                      for metes and bounds, while Lange told his customers that the data
                                      on offer were worth more than that asking price. Which they were.
                                      What Lange had, and tried to sell, were the completed specifications
                                      and engineering diagrams that reflected all the work completed af-
                                      ter the measurements had been taken: the metallurgical data, details
                                      of the sintering, the results of the tests, the plans needed to produce
                                      the finished goods, everything required to get FAA certification of a
                                      part supposedly identical to one that had been approved. Those de-
                                      tails “derived independent economic value, actual or potential, from
                                      not being generally known to, and not being readily ascertainable
                                      through proper means by, the public.” Every firm other than the
                                      original equipment manufacturer and RAPCO had to pay dearly to
                                      devise, test, and win approval of similar parts; the details unknown to
                                      the rivals, and not discoverable with tape measures, had considerable
                                      “independent economic value … from not being generally known”. A
                                      sensible trier of fact could determine that Lange tried to sell trade se-
                                      crets. It was his customer’s cooperation with the FBI, and not public
                                      access to the data, that prevented closing of the sale.

                                         3FMJHJPVT 5FDIOPMPHZ $FOUFS W /FUDPN 0O-JOF $PNNVOJDBUJPOT
                                                                       4FSWJDFT *OD
                                                             ' 4VQQ  /% $BM 
                                      Erlich raises a number of objections to the Church’s claims of confi-
                                      dentiality. Erlich argues that the Church’s trade secrets have been
                                      made available to the public through various means. The unpro-
                                      tected disclosure of a trade secret will cause the information to for-
                                      feit its trade secret status, since “information that is generally known
                                      or readily ascertainable through proper means by others is not pro-
3FTUBUFNFOU f  DNU G              tectable as a trade secret.” Once trade secrets have been exposed to
                                      the public, they cannot later be recalled.
                                          Erlich argues that many of the Advanced Technology documents
'JTINBO /P  $% $BM    have been available in open court records in another case, Church
                                      of Scientology Int’l v. Fishman, destroying the necessary element of
                                      secrecy. However, the Fishman court recently issued an order seal-
                                      ing the file pending a decision on whether the documents are trade
                                      secrets. Even if those records were temporarily open to the public,
                                      the court will not assume that their contents have been generally dis-
                                      closed, especially when this question is still pending before the dis-
                                      trict court in Fishman. Such a disclosure, without evidence that the se-
                                      crets have become generally known, does not necessarily cause RTC
# 08/&34)*1                                                          

to forfeit its trade secrets. The contrary result would mean that if doc-
uments were ever filed without a sealing order, even for a short time,
the court would not be able to decide that they should be sealed be-
cause the documents would have lost their potential trade secret sta-
tus by virtue of the temporary unsealing. The only fair result would
be to allow trade secret status for works that are otherwise protectable
as trade secrets unless they were somehow made generally available
to the public during the period they were unsealed, such as by publi-
    Erlich further asserts that the Advanced Technology has been
largely disclosed in the popular press. These articles may reveal in-
formation referring to or hinting at the trade secrets, but may not dis-
close the secrets themselves. However, as previously noted, the court
is not certain how to properly define the “secrets.” To the extent that
someone uses or discloses any information taken from any of these
articles, there is clearly no trade secret claim. However, much of Er-
lich’s postings copied all or almost all of sections of the Advanced
Technology works, which is far more than has ever been disclosed
in the popular press. In fact, several of the works posted by Erlich
are not mentioned in any of the clippings in the Berger declaration.
Arguably, the Church’s alleged secrets are such that their value de-
pends on the availability of the complete courses and not mere frag-
ments, thus disclosures that describe parts of the works or disclose
isolated portions do not necessarily suffice to ruin the value of the en-
tire works as secrets. However, without a clearer definition of what
constitute the “secrets,” the court is unable to determine whether
some have been made generally known to the public.
    Finally, Erlich newly emphasizes in his Reply that the works he
posted were not secrets because he received them through proper
means: eight of the documents were allegedly previously posted
anonymously to a public portion of the Internet and one of the doc-
uments allegedly came to Erlich anonymously through the U.S. mail.
Erlich claims that because the alleged trade secrets were received
from “public sources,” they should lose their trade secret protection.
Although the Internet is a new technology, it requires no great leap
to conclude that because more than 25 million people could have ac-
cessed the newsgroup postings from which Erlich alleges he received
the works, these works would lose their status as secrets. While the
Internet has not reached the status where a temporary posting on a
newsgroup is akin to publication in a major newspaper or on a tele-
vision network, those with an interest in using the Church’s trade se-
crets to compete with the Church are likely to look to the newsgroup.
Thus, posting works to the Internet makes them “generally known”
to the relevant people – the potential “competitors” of the Church.
    The court is troubled by the notion that any Internet user, includ-
                                                                    $)"15&3  53"%& 4&$3&5

                          ing those using “anonymous remailers” to protect their identity, can
                          destroy valuable intellectual property rights by posting them over the
                          Internet, especially given the fact that there is li le opportunity to
                          screen postings before they are made. Nonetheless, one of the Inter-
                          net’s virtues, that it gives even the poorest individuals the power to
                          publish to millions of readers, can also be a detriment to the value of
                          intellectual property rights. The anonymous (or judgment proof) de-
                          fendant can permanently destroy valuable trade secrets, leaving no
                          one to hold liable for the misappropriation. Although a work posted
                          to an Internet newsgroup remains accessible to the public for only a
                          limited amount of time, once that trade secret has been released into
                          the public domain there is no retrieving it. While the court is per-
                          suaded by the Church’s evidence that those who made the original
                          postings likely gained the information through improper means, as
                          no one outside the Church or without a duty of confidence would
                          have had access to those works, this does not negate the finding that,
                          once posted, the works lost their secrecy. Although Erlich cannot
                          rely on his own improper postings to support the argument that the
                          Church’s documents are no longer secrets, evidence that another in-
                          dividual has put the alleged trade secrets into the public domain pre-
                          vents RTC from further enforcing its trade secret rights in those mate-
                          rials. Because there is no evidence that Erlich is a privy of any of the
                          alleged original misappropriators, he is not equitably estopped from
                          raising their previous public disclosures as a defense to his disclo-
                          sure. The court is thus convinced that those postings made by Erlich
                          were of materials that were possibly already generally available to
                          the public. Therefore, RTC has not shown a likelihood of success on
                          an essential element of its trade secret claim.

                                      -FBSOJOH $VSWF 5PZT *OD W 1MBZ8PPE 5PZT *OD
                                                 ' E  UI $JS 
                          PlayWood Toys, Inc. (“PlayWood”) obtained a jury verdict against
                          Learning Curve Toys, Inc. and its representatives, Roy Wilson, Harry
                          Abraham and John Lee (collectively, “Learning Curve”), for misap-
                          propriation of a trade secret in a realistic looking and sounding toy
 *-$4  FU TFR   railroad track under the Illinois Trade Secrets Act
                                                     I. B
                          In 1992, Robert Clausi and his brother-in-law, Sco Moore, began cre-
                          ating prototypes of wooden toys under the name PlayWood Toys,
                          Inc., a Canadian corporation. Clausi was the sole toy designer and
                          Moore was the sole officer and director of PlayWood. Neither Clausi
                          nor Moore had prior experience in the toy industry, but Clausi had
                          “always been a bit of a doodler and designer,” and the two men de-
                          sired to “create high-quality hardwood maple toys for the indepen-
# 08/&34)*1                                                        

dent toy market.” As a newly formed corporation, PlayWood did not
own a facility in which it could produce toys. Instead, it worked in
conjunction with Mario Borsato, who owned a wood-working facil-
ity. Subject to a wri en confidentiality agreement with PlayWood,
Borsato manufactured prototypes for PlayWood based on Clausi’s
design specifications.
    PlayWood’s first a empt to market publicly its toys was at the
Toronto Toy Fair on January 31, 1992. PlayWood received favorable
reviews from many of the toy retailers in a endance; PlayWood also
learned that the best way to get recognition for its toys was to a end
the New York Toy Fair (“Toy Fair”) the following month. Based on
this information, Clausi and Moore secured a position at the Toy Fair
in order to display PlayWood’s prototypes. It was during this Toy
Fair that Clausi and Moore first encountered Learning Curve repre-
sentatives Roy Wilson, Harry Abraham and John Lee.
    On the morning of February 12, 1993, the first day of the Toy
Fair, Roy Wilson stopped at PlayWood’s booth and engaged Clausi
and Moore in conversation. Wilson identified himself as Learning
Curve’s toy designer and explained that his company had a license
from the Bri Allcroft Company to develop Thomas the Tank Engine
& Friends™ (hereinafter “Thomas”) trains and accessories. Wilson
commented that he was impressed with the look and quality of Play-
Wood’s prototypes and raised the possibility of working together un-
der a custom manufacturing contract to produce Learning Curve’s
line of Thomas products. Clausi and Moore responded that such
an arrangement would be of great interest to PlayWood. Later that
same day, Harry Abraham, Learning Curve’s vice president, and
John Lee, Learning Curve’s president, also stopped by PlayWood’s
booth. They too commented on the quality of PlayWood’s prototypes
and indicated that PlayWood might be a good candidate for a manu-
facturing contract with Learning Curve.
    Clausi and Moore continued to have discussions with Learning
Curve’s representatives over the remaining days of the Toy Fair,
which ended on February 14. During these discussions, Lee indicated
that he would like two of his people, Abraham and Wilson, to visit
PlayWood in Toronto the day after the Toy Fair ended in order to
determine whether the two parties could work out a manufacturing
arrangement for some or all of Learning Curve’s wooden toys.
    On February 18, 1993, Abraham and Wilson visited PlayWood
in Toronto as planned. The meeting began with a tour of Borsato’s
woodworking facility, where the prototypes on display at the Toy
Fair had been made. After the tour, the parties went to the confer-
ence room at Borsato’s facility. At this point, according to Clausi and
Moore, the parties agreed to make their ensuing discussion confiden-
tial. Clausi testified:
                                          $)"15&3  53"%& 4&$3&5

     After we sat down in the board room, Harry [Abraham of
     Learning Curve] immediately said: “Look, we’re going to
     disclose confidential information to you guys, and we’re
     going to disclose some designs that Roy [Wilson of Learn-
     ing Curve] has that are pre y confidential. If Brio were to
     get their hands on them, then we wouldn’t like that. And
     we’re going to do it under the basis of a confidential un-
         And I said: “I also have some things, some ideas on
     how to produce the track and produce the trains now that
     I’ve had a chance to look at them for the last couple of
     days, and I think they’re confidential as well. So if we’re
     both okay with that, we should continue.” So we did.
Moore testified to the existence of a similar conversation:
     It was at this point that Harry Abraham told us that
     they were going to disclose some confidential documents,
     drawings, pricing, margins, and asked us if we would
     keep that information confidential. ...
         I believe it was Robert [Clausi] who said that, you
     know, absolutely, we would keep it confidential. In fact,
     we had some ideas that we felt would be confidential we
     would be disclosing to them, and would they keep it, you
     know, confidential? Would they reciprocate? And Harry
     [Abraham] said: “Absolutely.” And then we proceeded
     to go along with the meeting.
Immediately after the parties agreed to keep their discussion confi-
dential, Wilson, at Abraham’s direction, showed Clausi and Moore
drawings of various Thomas characters and provided information on
the projected volume of each of the products. Clausi testified that he
considered the documents disclosed by Learning Curve during the
meeting confidential because they included information on products
not yet released to the public, as well as Learning Curve’s projected
volumes, costs and profit margins for various products.
    The parties’ discussion eventually moved away from train pro-
duction and focused on track design. Wilson showed Clausi and
Moore drawings of Learning Curve’s track and provided samples
of their current product. At this point, Abraham confided to Clausi
and Moore that track had posed “a bit of a problem for Learning
Curve.” Abraham explained that sales were terrific for Learning
Curve’s Thomas trains, but that sales were abysmal for its track.
Abraham a ributed the lack of sales to the fact that Learning Curve’s
track was virtually identical to that of its competitor, Brio, which had
the lion’s share of the track market. Because there was “no differenti-
# 08/&34)*1                                                             

ation” between the two brands of track, Learning Curve’s track was
not even displayed in many of the toy stores that carried Learning
Curve’s products. Learning Curve had worked unsuccessfully for
several months a empting to differentiate its track from that of Brio.
     After detailing the problems with Learning Curve’s existing track,
Abraham inquired of Clausi whether “there was a way to differenti-
ate” its track from Brio’s track. Clausi immediately responded that he
“had had a chance to look at the track and get a feel for it [over] the last
few days” and that his “thoughts were that if the track were more real-
istic and more functional, that kids would enjoy playing with it more
and it would give the retailer a reason to carry the product, especially
if it looked different than the Brio track.” Clausi further explained
that, if the track “made noise and [] looked like real train tracks, that
the stores wouldn’t have any problem, and the Thomas the Tank line,
product line would have [] its own different track” and could “effec-
tively compete with Brio.” Abraham and Wilson indicated that they
were “intrigued” by Clausi’s idea and asked him what he meant by
“making noise.”
     Clausi decided to show Abraham and Wilson exactly what he
meant. Clausi took a piece of Learning Curve’s existing track
from the table, drew some lines across the track (about every three-
quarters of an inch), and stated: “We can go ahead and machine
grooves right across the upper section, which would look like railway
tracks, and down below machine li le indentations as well so that it
would look more like or sound more like real track. You would roll
along and bumpity-bumpity as you go along.” Clausi then called Bor-
sato into the conference room and asked him to cut grooves into the
wood “about a quarter of an inch deep from the top surface.” Borsato
left the room, complied with Clausi’s request, and returned with the
cut track three or four minutes later. Clausi ran a train back and forth
over the cut piece of track. The track looked more realistic than before,
but it did not make noise because the grooves were not deep enough.
Accordingly, Clausi instructed Borsato to cut the grooves “just a li le
bit deeper so that they go through the rails.” Borsato complied with
Clausi’s request once again and returned a few minutes later with
the cut piece of track. Clausi proceeded to run a train back and forth
over the track. This time the track made a “clickety-clack” sound,
but the train did not run smoothly over the track because the grooves
were cut “a li le bit too deep.” Based on the sound produced by the
track, Clausi told Abraham and Moore that if PlayWood procured a
contract with Learning Curve to produce the track, they could call it
“Clickety-Clack Track.”
     Both Abraham and Wilson indicated that Clausi’s concept of cut-
ting grooves into the track to produce a clacking sound was a novel
concept. Thereafter, Wilson and Clausi began to discuss how they
                                          $)"15&3  53"%& 4&$3&5

could improve the idea to make the train run more smoothly on the
track, but Abraham interrupted them and stated: “No, focus. You
guys have to get the contract for the basic product first, and then we
can talk about new products, because it takes [our licensor] a long
time to approve new products and new designs.”
     The meeting ended shortly thereafter without further discussion
about Clausi’s concept for the noise-producing track. Before he left,
Wilson asked Clausi if he could take the piece of track that Bor-
sato had cut with him while the parties continued their discussions.
Clausi gave Wilson the piece of track without hesitation. The piece
of track was the only item that Abraham and Wilson took from the
meeting. Clausi and Moore did not ask Wilson for a receipt for the
cut track, nor did they seek a wri en confidentiality agreement to
protect PlayWood’s alleged trade secret. After the meeting, Clausi
amended PlayWood’s confidentiality agreement with Borsato to en-
sure that materials discussed during the meeting would remain confi-
dential. Clausi also stamped many of the documents that he received
from Learning Curve during the meeting as confidential because they
included information on products not yet released to the public. Play-
Wood never disclosed the contents of Learning Curve’s documents to
     During March of 1993, PlayWood and Learning Curve met on
three separate occasions to discuss further the possibility of Play-
Wood manufacturing Learning Curve’s Thomas products. At one of
the meetings, and at Learning Curve’s request, PlayWood submi ed
a manufacturing proposal for the Thomas products. Learning Curve
rejected PlayWood’s proposal. Learning Curve told Clausi that its li-
censor wanted the Thomas products to be made in the United States.
     Thereafter, PlayWood had no contact with Learning Curve un-
til late October of 1993, when Abraham contacted Clausi to discuss
another possible manufacturing contract because Learning Curve’s
secondary supplier was not providing enough product. Again, Play-
Wood submi ed a manufacturing proposal at Learning Curve’s re-
quest, but it too was rejected. Learning Curve later stated that its new
business partner had decided to manufacture the product in China.
     Clausi and Moore continued to work on PlayWood’s toy concepts.
After the 1994 New York Toy Fair, which was not particularly suc-
cessful for PlayWood, Clausi and Moore began to focus their efforts
on refining PlayWood’s concept for the noise-producing track. Dur-
ing this time, Clausi and Moore made no a empt to license or sell the
concept to other toy companies because they believed that PlayWood
still had “an opportunity to get in the door” with Learning Curve if
they could perfect the concept and also because they believed that
they were bound by a confidentiality agreement.
     In December of 1994, while shopping for additional track with
# 08/&34)*1                                                         

which to experiment, Moore discovered that Learning Curve was sell-
ing noise-producing track under the name “Clickety-Clack Track.”
Like the piece of track that Clausi had Borsato cut during PlayWood’s
February 18, 1993, meeting with Learning Curve, Clickety-Clack
Track™ has parallel grooves cut into the wood, which cause a “clack-
ing” sound as train wheels roll over the grooves. Learning Curve was
promoting the new track as
     the first significant innovation in track design since the in-
     ception of wooden train systems.... It is quite simply the
     newest and most exciting development to come along re-
     cently in the wooden train industry, and it’s sure to cause
     a sensation in the marketplace.... [I]t brings that sound
     and feel of the real thing to a child’s world of make-believe
     without bells, whistles, electronic sound chips or moving
PlayWood promptly wrote a cease and desist le er to Learning Curve.
The le er accused Learning Curve of stealing PlayWood’s concept
for the noise-producing track that it disclosed to Learning Curve “in
confidence in the context of a manufacturing proposal.” Learning
Curve responded by seeking a declaratory judgment that it owned
the concept.
    Previously, on March 16, 1994, Learning Curve had applied for
a patent on the noise-producing track. The patent, which was ob-          64 1BU /P   
tained on October 3, 1995, claims the addition of parallel impressions
or grooves in the rails, which cause a “clacking” sound to be emi ed
as train wheels roll over them. The patent identifies Roy Wilson of        0O UIF GBDUT BT GPVOE CZ UIF KVSZ
Learning Curve as the inventor.                                           8JMTPO XBT OPU UIF JOWFOUPS BOE UIF
                                                                          QBUFOU TIPVME OPU IBWF JTTVFE
    Clickety-Clack Track™provided an enormous boost to Learning
Curve’s sales. Learning Curve had $20 million in track sales by the
first quarter of 2000, and $40 million for combined track and accessory
                            II. D
The parties agree that their dispute is governed by the Illinois Trade
Secrets Act (“Act”). To prevail on a claim for misappropriation of a      5IF SFMFWBOU QPSUJPOT PG UIF *54" USBDL
trade secret under the Act, the plaintiff must demonstrate that the        UIF 654"
information at issue was a trade secret, that it was misappropriated
and that it was used in the defendant’s business. The issue currently
before us is whether there was legally sufficient evidence for the jury
to find that PlayWood had a trade secret in its concept for the noise-
producing toy railroad track that it revealed to Learning Curve on
February 18, 1993.
    Although the Act explicitly defines a trade secret in terms of [ac-
tual secrecy and reasonable efforts], Illinois courts frequently refer
                                          $)"15&3  53"%& 4&$3&5

to six common law factors (which are derived from § 757 of the Re-
statement (First) of Torts) in determining whether a trade secret ex-
ists: (1) the extent to which the information is known outside of the
plaintiff’s business; (2) the extent to which the information is known
by employees and others involved in the plaintiff’s business; (3) the
extent of measures taken by the plaintiff to guard the secrecy of the
information; (4) the value of the information to the plaintiff’s busi-
ness and to its competitors; (5) the amount of time, effort and money
expended by the plaintiff in developing the information; and (6) the
ease or difficulty with which the information could be properly ac-
quired or duplicated by others.
    Contrary to Learning Curve’s contention, we do not construe the
foregoing factors as a six-part test, in which the absence of evidence
on any single factor necessarily precludes a finding of trade secret
protection. Instead, we interpret the common law factors as instruc-
tive guidelines for ascertaining whether a trade secret exists under
the Act.
1. Extent to which PlayWood’s concept for noise-producing toy railroad
track was known outside of PlayWood’s business
PlayWood presented substantial evidence from which the jury could
have determined that PlayWood’s concept for noise-producing toy
railroad track was not generally known outside of Playwood’s busi-
ness. It was undisputed at trial that no similar track was on the
market until Learning Curve launched Clickety-Clack Track™ in late
1994, more than a year after PlayWood first conceived of the concept.
Of course, as Learning Curve correctly points out, merely being the
first or only one to use particular information does not in and of itself
transform otherwise general knowledge into a trade secret. If it did,
the first person to use the information, no ma er how ordinary or
well known, would be able to appropriate it to his own use under the
guise of a trade secret. However, in this case, there was additional ev-
idence from which the jury could have determined that PlayWood’s
concept was not generally known within the industry.
    First, there was substantial testimony that Learning Curve had at-
tempted to differentiate its track from that of its competitors for sev-
eral months, but that it had been unable to do so successfully.
    Furthermore, PlayWood’s expert witness, Michael Kennedy, tes-
tified that PlayWood’s concept, as embodied in Clickety-Clack
Track™, was unique and permi ed “its seller to differentiate itself
from a host of competitors who [were] making a generic product.”
Kennedy explained that the look, sound and feel of the track made
it distinct from other toy railroad track: “[W]hen a child runs a train
across this track, he can feel it hi ing those li le impressions. And
when you’re talking about young children[,] having the idea that they
# 08/&34)*1                                                         

can see something that they couldn’t see before, feel something that
they couldn’t feel before, hear something that they couldn’t hear be-
fore, that is what differentiates this toy from its other competitors.”
    Finally, PlayWood presented evidence that Learning Curve
sought and obtained a patent on the noise-producing track. It goes
without saying that the requirements for patent and trade secret pro-
tection are not synonymous. Unlike a patentable invention, a trade
secret need not be novel or unobvious. The idea need not be com-
plicated; it may be intrinsically simple and nevertheless qualify as a
secret, unless it is common knowledge and, therefore, within the pub-
lic domain. However, it is commonly understood that if an invention
has sufficient novelty to be entitled to patent protection, it may be
said a fortiori to be entitled to protection as a trade secret.
2. Extent to which PlayWood’s concept was known to employees and others
involved in PlayWood’s business
We agree with PlayWood that the evidence was sufficient to establish
that its concept for noise-producing track was known only by key
individuals in its business.
    At the outset, we note briefly that PlayWood was a small business,
consisting only of Clausi and Moore. Illinois courts have recognized
on several occasions that the expectations for ensuring secrecy are
different for small companies than for large companies. Apart from
Clausi (PlayWood’s sole toy designer and the person who conceived
of the concept for noise-producing track) and Moore (PlayWood’s
sole officer and director), the only person who knew about the con-
cept was Borsato, the person who physically produced PlayWood’s
prototype at Clausi’s direction. The concept was disclosed to Borsato
in order for PlayWood to develop fully its trade secret. Moreover,
Borsato’s actions were governed by a wri en confidentiality agree-
ment with PlayWood. Indeed, as an extra precaution, Clausi even
amended PlayWood’s confidentiality agreement with Borsato imme-
diately after the February 18, 1993, meeting to ensure that materials
discussed during the meeting would remain confidential.
3. Measures taken by PlayWood to guard the secrecy of its concept
There also was sufficient evidence for the jury to determine that Play-
Wood took reasonable precautions to guard the secrecy of its concept.
The Act requires the trade secret owner to take actions that are “rea-
sonable under the circumstances to maintain [the] secrecy or confi-
dentiality” of its trade secret; it does not require perfection. Whether
the measures taken by a trade secret owner are sufficient to satisfy the
Act’s reasonableness standard ordinarily is a question of fact for the
jury. Indeed, we previously have recognized that only in an extreme
case can what is a “reasonable” precaution be determined, because
                                            $)"15&3  53"%& 4&$3&5

the answer depends on a balancing of costs and benefits that will vary
from case to case.
    Here, the jury was instructed that it must find “by a preponder-
ance of the evidence that PlayWood’s trade secrets were given to
Learning Curve as a result of a confidential relationship between
the parties.” By returning a verdict in favor of PlayWood, the jury
necessarily found that Learning Curve was bound to PlayWood by
a pledge of confidentiality. The jury’s determination is amply sup-
ported by the evidence. Both Clausi and Moore testified that they
entered into an oral confidentiality agreement with Abraham and
Wilson before beginning their discussion on February 18, 1993. In
particular, Clausi testified that he told Abraham and Wilson: “I also
have some things, some ideas on how to produce the track and pro-
duce the trains now that I’ve had a chance to look at them for the last
couple of days, and I think they’re confidential as well. So if we’re
both okay with that, we should continue.” In addition to this testi-
mony, the jury heard that Learning Curve had disclosed substantial
information to PlayWood during the February 18th meeting, includ-
ing projected volumes, costs and profit margins for various products,
as well as drawings for toys not yet released to the public. The jury
could have inferred that Learning Curve would not have disclosed
such information in the absence of a confidentiality agreement. Fi-
nally, the jury also heard (from several of Learning Curve’s former
business associates) that Learning Curve routinely entered into oral
confidentiality agreements like the one with PlayWood.
    PlayWood might have done more to protect its secret. As Learn-
ing Curve points out, PlayWood gave its only prototype of the noise-
producing track to Wilson without first obtaining a receipt or writ-
ten confidentiality agreement from Learning Curve—a decision that
proved unwise in hindsight. Nevertheless, we believe that the jury
was entitled to conclude that PlayWood’s reliance on the oral confi-
dentiality agreement was reasonable under the circumstances of this
case. First, it is well established that the formation of a confidential re-
lationship imposes upon the disclosee the duty to maintain the infor-
mation received in the utmost secrecy and that the unprivileged use
or disclosure of another’s trade secret becomes the basis for an action
in tort. Second, both Clausi and Moore testified that they believed
PlayWood had a realistic chance to “get in the door” with Learning
Curve and to produce the concept as part of Learning Curve’s line of
Thomas products. Clausi and Moore did not anticipate that Learn-
ing Curve would violate the oral confidentiality agreement and uti-
lize PlayWood’s concept without permission; rather, they believed in
good faith that they “were going to do business one day again with
Learning Curve with respect to the design concept.” Finally, we be-
lieve that, as part of the reasonableness inquiry, the jury could have
# 08/&34)*1                                                         

considered the size and sophistication of the parties, as well as the
relevant industry. Both PlayWood and Learning Curve were small
toy companies, and PlayWood was the smaller and less experienced
of the two.
4. Value of the concept to PlayWood and to its competitors
There was substantial evidence from which the jury could have de-
termined that PlayWood’s concept had value both to PlayWood and
to its competitors. It was undisputed at trial that Learning Curve’s
sales skyrocketed after it began to sell Clickety-Clack Track™. In
addition, PlayWood’s expert witness, Michael Kennedy, testified
that PlayWood’s concept for noise-producing track had tremendous
value. Kennedy testified that the “cross-cuts and changes in the
[track’s] surface” imparted value to its seller by causing the track to
“look different, feel different and sound different than generic track.”
Kennedy further testified that, in his opinion, the track would have
commanded a premium royalty under a negotiated license agree-
ment because the “invention allows its seller to differentiate itself
from a host of competitors who are making a generic product with
whom it is competing in a way that is proprietary and exclusive, and
it gives [the seller] a significant edge over [its] competition.”
    Despite this evidence, the district court concluded that Play-
Wood’s concept had no economic value. The court’s conclusion was
based, in part, on the fact that PlayWood’s prototype did not work
perfectly; as noted by the court, the first set of cuts were too shallow
to produce sound and the second set of cuts were too deep to per-
mit the train to roll smoothly across the track. In the district court’s
view, even if the concept of cu ing grooves into the wooden track
in order to produce noise originated with Clausi, the concept lacked
value until it was refined, developed and manufactured by Learning
    We cannot accept the district court’s conclusion because it is be-
lied by the evidence. At trial, Kennedy was asked whether, in his
opinion, the fact that PlayWood’s prototype did not work perfectly af-
fected the value of PlayWood’s concept, and he testified that it did not.
Kennedy testified that he would assign the same value to PlayWood’s
concept as it was conceived on February 18, 1993, as he would the
finished product that became known as Clickety-Clack Track™ be-
cause, at that time, he would have known “that most of the design
[had] already been done and that [he] just need[ed] to go a li le bit
further to make it really lovely.” Kennedy further testified that it was
standard practice in the industry for a license to be negotiated based
on a prototype (much like the one PlayWood disclosed to Learning
Curve) rather than a finished product and that the license generally
would cover the prototypical design, as well as any enhancements
                                                               $)"15&3  53"%& 4&$3&5

                    or improvements of that design. Based on this testimony, we cannot
                    accept the district court’s conclusion that PlayWood’s concept pos-
                    sessed no economic value.
                        It is irrelevant under Illinois law that PlayWood did not actually
                    use the concept in its business. The proper criterion is not ‘actual use’
                    but whether the trade secret is “of value” to the company. Kennedy’s
                    testimony was more than sufficient to permit the jury to conclude that
                    the concept was “of value” to PlayWood. It is equally irrelevant that
                    PlayWood did not seek to patent its concept. So long as the concept
                    remains a secret, i.e., outside of the public domain, there is no need for
.JMHSJN f <>   patent protection. Professor Milgrim makes this point well: “Since
                    every inventor has the right to keep his invention secret, one who has
                    made a patentable invention has the option to maintain it in secrecy,
                    relying upon protection accorded to a trade secret rather than upon
                    the rights which accrue by a patent grant.” It was up to PlayWood,
                    not the district court, to determine when and how the concept should
                    have been disclosed to the public.
                    5. Amount of time, effort and money expended by PlayWood in developing
                    its concept
                    PlayWood expended very li le time and money developing its con-
                    cept; by Clausi’s own account, the cost to PlayWood was less than
                    one dollar and the time spent was less than one-half hour. The dis-
                    trict court determined that “such an insignificant investment is insuf-
                    ficient as a ma er of Illinois law to establish the status of a ‘trade
                    secret.’” We believe that the district court gave too much weight to
                    the time, effort and expense of developing the track.
                        A significant expenditure of time and/or money in the production
                    of information may provide evidence of value. However, we do not
                    understand Illinois law to require such an expenditure in all cases.
                        As pointed out by the district court, several Illinois cases have
                    emphasized the importance of developmental costs. However, no-
                    tably, none of those cases concerned the sort of innovative and cre-
                    ative concept that we have in this case. Indeed, several of the cases in
                    Illinois that emphasize developmental costs concern compilations of
                    data, such as customer lists. In that context, it makes sense to require
                    the expenditure of significant time and money because there is noth-
                    ing original or creative about the alleged trade secret. Given enough
                    time and money, we presume that the plaintiff’s competitors could
                    compile a similar list.
                        Here, by contrast, we are dealing with a new toy design that has
                    been promoted as “the first significant innovation in track design
                    since the inception of wooden train systems.” Toy designers, like
                    many artistic individuals, have intuitive flashes of creativity. Often,
                    that intuitive flash is, in reality, the product of earlier thought and
# 08/&34)*1                                                          

practice in an artistic craft. We fail to see how the value of PlayWood’s
concept would differ in any respect had Clausi spent several months
and several thousand dollars creating the noise-producing track.
6. Ease or difficulty with which PlayWood’s concept could have been prop-
erly acquired or duplicated by others
Finally, we also believe that there was sufficient evidence for the jury
to determine that PlayWood’s concept could not have been easily ac-
quired or duplicated through proper means. PlayWood’s expert wit-
ness, Michael Kennedy, testified: “This is a fairly simple product if
you look at it. But the truth is that because it delivers feeling and
sound as well as appearance, it isn’t so simple as it first appears. It’s
a li le more elegant, actually, than you might think.” In addition to
Kennedy’s testimony, the jury heard that Learning Curve had spent
months a empting to differentiate its track from Brio’s before Clausi
disclosed PlayWood’s concept of noise-producing track. From this
evidence, the jury could have inferred that, if PlayWood’s concept
really was obvious, Learning Curve would have thought of it earlier.
    Despite this evidence, the district court concluded that Play-
Wood’s concept was not a trade secret because it could have been
easily duplicated, stating that “[h]ad PlayWood succeeded in produc-
ing and marketing [the] notched track, the appearance of the track
product itself would have fully revealed the concept PlayWood now
claims as a secret.” Of course, the district court was correct in one
sense; PlayWood’s own expert recognized that, in the absence of
patent or copyright protection, the track could have been reverse en-
gineered just by looking at it. However, the district court failed to
appreciate the fact that PlayWood’s concept was not publicly avail-
able. As Professor Milgrim states: “A potent distinction exists be-         .JMHSJN f <>
tween a trade secret which will be disclosed if and when the product
in which it is embodied is placed on sale, and a ’trade secret’ embod-
ied in a product which has been placed on sale, which product admits
of discovery of the ’secret’ upon inspection, analysis, or reverse engi-
neering. Until disclosed by sale the trade secret should be entitled to
protection.” see also Callmann (“The fact that a secret is easy to dupli-   $BMMNBOO f 
cate after it becomes known does not militate against its being a trade
secret prior to that time.”). Reverse engineering can defeat a trade se-
cret claim, but only if the product could have been properly acquired
by others, as is the case when the product is publicly sold. Here, Play-
Wood disclosed its concept to Learning Curve (and Learning Curve
alone) in the context of a confidential relationship; Learning Curve
had no legal authority to reverse engineer the prototype that it re-
ceived in confidence. Accordingly, we must conclude that the jury
was entitled to determine that PlayWood’s concept could not easily
                                                                                 $)"15&3  53"%& 4&$3&5

                                      have been acquired or duplicated through proper means.

                                                                  &YQMPJUT 1SPCMFN
                                      Exploit brokers are in the business of helping people defeat computer
                                      security. Governments want to thumb through the hard drives of ter-
                                      rorists, criminals, and dissidents. Identity thieves want passwords
                                      and bank account numbers. Extortionists want to delete data and
                                      hold it for ransom. Corporate spies want access to competitors’ com-
                                      puters. All of them are willing to pay handsomely for the technical
                                      tools that enable them to do so. These tools are typically built around
                                      ”exploits”: short pieces of software that take advantage of bugs in
                                      commonly-used software like Windows, Adobe Flash, and iOS. As
                                      soon as as software companies learn about these bugs, they race to
                                      issue updates to fix them; once that happens, any exploits based on
                                      those bugs stop working. Thus, secrecy is essential to the exploit busi-
                                      ness in two ways: many of the uses are illegal, and exploits become
                                      worthless soon after they become public knowledge.
                                          Can exploit brokers – who buy exploits from the computer secu-
                                      rity experts who discover them and then resell those exploits to vari-
                                      ous clients – rely on trade secret law? Should they be able to? Do the
                                      materials in this chapter and the previous one shed any light on how
                                      you would expect the exploit business to work, and how it ought to
                                      be regulated?

                                      Because there is no requirement that a trade secret be unique – more
                                      than one person can have the same information and each has a valid
                                      and independent trade secret provided the other requirements are
                                      met – trade secret does not generally raise difficult issues about which
                                      of several competing claimants developed the information first.


                                                        3FTUBUFNFOU 5IJSE PG 6OGBJS $PNQFUJUJPO

                                   cmt. e.    Allocation of ownership between employers and employees. – The
#SFBDI PG $POöEFODF CZ &NQMPZFFT              law of agency has established rules governing the ownership of
                                              valuable information created by employees during the course of
                                              an employment relationship. See Restatement, Second, Agency
                                              § 397. In the absence of a contrary agreement, the law ordinar-
                                              ily assigns ownership of an invention or idea to the person who
                                              conceives it. However, valuable information that is the prod-
                                              uct of an employee’s assigned duties is owned by the employer,
   # 08/&34)*1                                                        

        even when the information results from the application of the
        employee’s personal knowledge or skill.
            An employee is ordinarily entitled to claim ownership of
        patents and trade secrets developed outside the scope of the
        employee’s assigned duties, even if the invention or idea re-
        lates to the employer’s business and was developed using the
        employer’s time, personnel, facilities, or equipment. In the lat-
        ter circumstances, however, the employer is entitled to a “shop
        right”—an irrevocable, nonexclusive, royalty-free license to use
        the innovation. Similarly, employees retain ownership of infor-
        mation comprising their general skill, knowledge, training, and
            Although the rules governing ownership of valuable infor-
        mation created during an employment relationship are most
        frequently applied to inventions, the rules are also applicable to
        information such as customer lists, marketing ideas, and other
        valuable business information. If an employee collects or devel-
        ops such information as part of the assigned duties of the em-
        ployment, the information is owned by the employer. Thus, if
        the information qualifies for protection as a trade secret, unau-
        thorized use or disclosure will subject the employee to liability.
cmt. g. Contractual protection. – Absent an applicable statutory prohi-
        bition, agreements relating to the ownership of inventions and
        discoveries made by employees during the term of the employ-
        ment are generally enforceable according to their terms. Em-
        ployment agreements sometimes include provisions granting
        the employer ownership of all inventions and discoveries con-
        ceived by the employee during the term of the employment. In
        some situations, however, it may be difficult to prove when a
        particular invention was conceived. The employee may have an
        incentive to delay disclosure of the invention until after the em-
        ployment is terminated in order to avoid the contractual or com-
        mon law claims of the employer. It may also be difficult to es-
        tablish whether a post-employment invention was improperly
        derived from the trade secrets of the former employer. Some
        employment agreements respond to this uncertainty through
        provisions granting the former employer ownership of inven-
        tions and discoveries relating to the subject ma er of the for-
        mer employment that are developed by the employee even af-
        ter the termination of the employment. Such agreements can
        restrict the former employee’s ability to exploit the skills and
        training desired by other employers and may thus restrain com-
        petition and limit employee mobility. The courts have therefore
        subjected such “holdover” agreements to scrutiny analogous to
                                                                                      $)"15&3  53"%& 4&$3&5

                                                  that applied to covenants not to compete. Thus, the agreement
                                                  may be unenforceable if it extends beyond a reasonable period
                                                  of time or to inventions or discoveries resulting solely from the
                                                  general skill and experience of the former employee.

                                          $ 1SPDFEVSFT
                                          The most important – and arguably the only – procedural prerequi-
                                          site to having a valid trade secret is making reasonable efforts to pre-
5IF 3FTUBUFNFOUT USFBUFE SFBTPOBCMF       serve its secrecy. There is no requirement that the owner of a trade
FòPSUT BT QBSU PG UIF TFDSFDZ BOBMZTJT   secret register it as one with a government agency, or take other for-
6OEFS UIF 654" &&" BOE %54" JU JT B
                                          mal steps to identify the secret in advance. Remember that everyone
                                          agrees a trade secret must actually be secret to be protected; what
                                          does a reasonable efforts requirement add? Why?

                                                                  6OJUFE 4UBUFT W -BOHF
                                                                  'E  UI $JS 
                                          One ingredient of a trade secret is that “the owner thereof has taken
                                          reasonable measures to keep such information secret”. Lange con-
                                          tends that the proof fell short, but a sensible trier of fact could have
                                          concluded that RAPCO took “reasonable measures to keep the infor-
                                          mation secret”. RAPCO stores all of its drawings and manufactur-
                                          ing data in its CAD room, which is protected by a special lock, an
                                          alarm system, and a motion detector. The number of copies of sensi-
                                          tive information is kept to a minimum; surplus copies are shredded.
                                          Some information in the plans is coded, and few people know the
                                          keys to these codes. Drawings and other manufacturing information
                                          contain warnings of RAPCO’s intellectual property rights; every em-
                                          ployee receives a notice that the information with which he works is
                                          confidential. None of RAPCO’s subcontractors receives full copies
                                          of the schematics; by dividing the work among vendors, RAPCO en-
                                          sures that none can replicate the product. This makes it irrelevant
                                          that RAPCO does not require vendors to sign confidentiality agree-
                                          ments; it relies on deeds (the spli ing of tasks) rather than promises
                                          to maintain confidentiality. Although, as Lange says, engineers and
                                          drafters knew where to get the key to the CAD room door, keeping
                                          these employees out can’t be an ingredient of “reasonable measures
                                          to keep the information secret”; then no one could do any work. So
                                          too with plans sent to subcontractors, which is why dissemination to
                                          suppliers does not undermine a claim of trade secret.

                                               3FMJHJPVT 5FDIOPMPHZ $FOUFS W /FUDPN 0O-JOF $PNNVOJDBUJPOT
                                                                         4FSWJDFT *OD
                                                                ' 4VQQ  /% $BM 
$ 130$&%63&4                                                                     

Information is protectable as a trade secret where the owner has taken
efforts that are reasonable under the circumstances to maintain its se-
crecy. “Reasonable efforts” can include advising employees of the ex-
istence of a trade secret, limiting access to the information on a “need
to know basis,” and keeping secret documents under lock. The court
finds that RTC has put forward sufficient evidence that it took steps
that were reasonable under the circumstances to protect its purported
trade secrets. RTC’s president describes elaborate means taken to en-
sure the confidentiality of the Advanced Technology works, includ-
ing use of locked cabinets, safes, logging and identification of the ma-
terials, availability of the materials at only a handful of sites world-
wide, electronic sensors a ached to documents, locked briefcases for
transporting works, alarms, photo identifications, security personnel,
and confidentiality agreements for all of those given access to the ma-
terials. McShane testifies that all copies of the Advanced Technology
works that are outside of the Church were gained through improper
means, such as by theft. Thirty-five other declarants confirm that the
measures mentioned by McShane have been used, though not in ex-
actly the same manner, in other Churches and at other times. There
is further evidence that Erlich himself signed confidentiality agree-
ments with respect to the Advanced Technology materials and, specif-
ically, the upper-level “NOTS” course materials. The court is unper-
suaded by Erlich’s claims that the Church’s measures have not cov-
ered all locations where the Advanced Technology works are found
and do not cover crucial time periods. Efforts at maintaining secrecy
need not be extreme, just reasonable under the circumstances. The
Church has made more than an adequate showing on this issue.25

                         'E  UI $JS                                        3PDLXFMM XIJDI NBOVGBDUVSFT QSJOU
The requirement of reasonable efforts has both evidentiary and reme-                      JOH QSFTTFT TVFE %&7 B DPNQFUJOH
                                                                                         NBOVGBDUVSFS GPS NBLJOH SFQMBDFNFOU
dial significance, and this regardless of which of the two different con-
                                                                                         QBSUT GPS 3PDLXFMM QSFTTFT " LFZ DPN
ceptions of trade secret protection prevails. (Both conceptions have                     QPOFOU PG 3PDLXFMMT DMBJNT XT UIBU
footholds in Illinois law, as we shall see.) The first and more common                    %&7 IBE JO JUT QPTTFTTJPO BCPVU 
merely gives a remedy to a firm deprived of a competitively valu-                         iQJFDF QBSU ESBXJOHTw EFUBJMFE NBOV
able secret as the result of an independent legal wrong, which might                     GBDUVSJOH EJBHSBNT GPS QBSUT UP 3PDL
                                                                                         XFMM QSFTTFT 3PDLXFMM BMMFHFE UIBU UIF
    The notion that the Church’s trade secrets are disclosed to thousands of parish-     QJFDF QBSU ESBXJOHT IBE CFFO TUPMFO
ioners makes this a rather unusual trade secrets case. However, because parish-          CZ GPSNFS 3PDLXFMM FNQMPZFFT JODMVE
ioners are required to maintain the secrecy of the materials, the court sees no rea-     JOH 'MFDL BOE 1FMPTP CPUI PG XIPN
son why the mere fact that many people have seen the information should negate           XFSF TVCFRVFOUMZ FNQMPZFE CZ %&7
the information’s trade secret status. While it is logically more likely that a secret   "MPOH UIF XBZ %&7 BSHVFE UIBU 3PDL
will leak out when more people are entrusted with it, absent evidence of leakage         XFMM GBJMFE UP NBLF SFBTPOBCMF FòPSUT
the court finds that giving out the secrets to a large number of people, though no        UP LFFQ UIF EJBHSBNT TFDSFU XIJDI MFE
more than necessary, is not itself an unreasonable security step.                        +VEHF 1PTOFS UP EJTDVTT UIF QVSQPTF PG
                                                                                         UIF SFBTPOBCMF FòPSUT SFRVJSFNFOU
                                            $)"15&3  53"%& 4&$3&5

be conversion or other trespass or the breach of an employment con-
tract or of a confidentiality agreement. Under this approach, because
the secret must be taken by improper means for the taking to give
rise to liability, the only significance of trade secrecy is that it allows
the victim of wrongful appropriation to obtain damages based on the
competitive value of the information taken. The second conception
of trade secrecy is that “trade secret” picks out a class of socially valu-
able information that the law should protect even against nontrespas-
sory or other lawful conduct.
    It should be apparent that the two different conceptions of trade
secret protection are be er described as different emphases. The first
emphasizes the desirability of deterring efforts that have as their sole
purpose and effect the redistribution of wealth from one firm to an-
other. The second emphasizes the desirability of encouraging inven-
tive activity by protecting its fruits from efforts at appropriation that
are, indeed, sterile wealth-redistributive – not productive – activities.
The approaches differ, if at all, only in that the second does not limit
the class of improper means to those that fit a preexisting pigeonhole
in the law of tort or contract or fiduciary duty – and it is by no means
clear that the first approach assumes a closed class of wrongful acts,
    Under the first approach, at least if narrowly interpreted so that
it does not merge with the second, the plaintiff must prove that the
defendant obtained the plaintiff’s trade secret by a wrongful act, il-
lustrated here by the alleged acts of Fleck and Peloso in removing
piece part drawings from Rockwell’s premises without authorization,
in violation of their employment contracts and confidentiality agree-
ments, and using them in competition with Rockwell. Rockwell is
unable to prove directly that the 100 piece part drawings it got from
DEV in discovery were stolen by Fleck and Peloso or obtained by
other improper means. But if it can show that the probability that
DEV could have obtained them otherwise – that is, without engaging
in wrongdoing – is slight, then it will have taken a giant step toward
proving what it must prove in order to recover under the first theory
of trade secret protection. The greater the precautions that Rockwell
took to maintain the secrecy of the piece part drawings, the lower
the probability that DEV obtained them properly and the higher the
probability that it obtained them through a wrongful act; the owner
had taken pains to prevent them from being obtained otherwise.
    Under the second theory of trade secret protection, the owner’s
precautions still have evidentiary significance, but now primarily as
evidence that the secret has real value. For the precise means by
which the defendant acquired it is less important under the second
theory, though not completely unimportant; remember that even the
second theory allows the unmasking of a trade secret by some means,
$ 130$&%63&4                                                        

such as reverse engineering. If Rockwell expended only paltry re-
sources on preventing its piece part drawings from falling into the
hands of competitors such as DEV, why should the law, whose ma-
chinery is far from costless, bother to provide Rockwell with a rem-
edy? The information contained in the drawings cannot have been
worth much if Rockwell did not think it worthwhile to make serious
efforts to keep the information secret.
    The remedial significance of such efforts lies in the fact that if the
plaintiff has allowed his trade secret to fall into the public domain,
he would enjoy a windfall if permi ed to recover damages merely
because the defendant took the secret from him, rather than from the
public domain as it could have done with impunity. It would be like
punishing a person for stealing property that he believes is owned
by another but that actually is abandoned property. If it were true,
as apparently it is not, that Rockwell had given the piece part draw-
ings at issue to customers, and it had done so without requiring the
customers to hold them in confidence, DEV could have obtained the
drawings from the customers without commi ing any wrong. The
harm to Rockwell would have been the same as if DEV had stolen the
drawings from it, but it would have had no remedy, having parted
with its rights to the trade secret. This is true whether the trade se-
cret is regarded as property protected only against wrongdoers or as
property protected against the world. In the first case, a defendant is
perfectly entitled to obtain the property by lawful conduct if he can,
and he can if the property is in the hands of persons who themselves
commi ed no wrong to get it. In the second case the defendant is per-
fectly entitled to obtain the property if the plaintiff has abandoned it
by giving it away without restrictions.
    It is easy to understand therefore why the law of trade secrets re-
quires a plaintiff to show that he took reasonable precautions to keep
the secret a secret. If analogies are needed, one that springs to mind
is the duty of the holder of a trademark to take reasonable efforts to
police infringements of his mark, failing which the mark is likely to
be deemed abandoned, or to become generic or descriptive (and in
either event be unprotectable). The trademark owner who fails to po-
lice his mark both shows that he doesn’t really value it very much
and creates a situation in which an infringer may have been unaware
that he was using a proprietary mark because the mark had drifted
into the public domain, much as DEV contends Rockwell’s piece part
drawings have done.
    But only in an extreme case can what is a “reasonable” precaution
be determined on a motion for summary judgment, because the an-
swer depends on a balancing of costs and benefits that will vary from
case to case and so require estimation and measurement by persons
knowledgeable in the particular field of endeavor involved. On the
                                                 $)"15&3  53"%& 4&$3&5

one hand, the more the owner of the trade secret spends on prevent-
ing the secret from leaking out, the more he demonstrates that the
secret has real value deserving of legal protection, that he really was
hurt as a result of the misappropriation of it, and that there really was
misappropriation. On the other hand, the more he spends, the higher
his costs. The costs can be indirect as well as direct. The more Rock-
well restricts access to its drawings, either by its engineers or by the
vendors, the harder it will be for either group to do the work expected
of it. Suppose Rockwell forbids any copying of its drawings. Then
a team of engineers would have to share a single drawing, perhaps
by passing it around or by working in the same room, huddled over
the drawing. And how would a vendor be able to make a piece part
– would Rockwell have to bring all that work in house? Such recon-
figurations of pa erns of work and production are far from costless;
and therefore perfect security is not optimum security.

The essence of trade secret misappropriation is to obtain or use se-
cret information acquired through “improper means.” Note that this
essence includes an implicit requirement that the information the de-
fendant obtained or used is the same information the plaintiff claims
as a trade secret.

                      ' 4VQQ E  4%/: 
Big Vision’s second argument is that DuPont’s recyclable banner
product lines misappropriate Big Vision’s trade secret. Quite sim-
ply, Big Vision cannot demonstrate that its recyclable banners are
substantially similar to DuPont’s. The parties do not dispute that
DuPont’s recyclable banner products are not made by either lamina-
tion or coextrusion. None of DuPont’s recyclable banner products
use the three-layer structures tested at the Trials, the range of CaCO3
tested at the Trials, or “minimal” amounts of Entira (to the extent it
has been defined), since DuPont’s products either use 100% or 0%
Entira. Furthermore, DuPont’s recyclable banner products are not
printable with solvent ink. Thus, to the extent Big Vision’s trade se-
cret is discernible, DuPont’s products implicate almost none of its
    Plaintiff argues that because DuPont’s banners do not exhibit the four-item
“wish list” that Big Vision’s trade secret is supposed to cause, DuPont must have
ineptly misappropriated its trade secret. While clever, this argument is not a fair
reading of the record, which makes clear that DuPont’s recyclable banners are sim-
ply not substantially similar to Big Vision’s alleged trade secret.
& */'3*/(&.&/5 130)*#*5&% $0/%6$5                                   

Before you dive into the new cases, look back at Netcom, Lange, Rock-
well, and Learning Curve. You read them as cases on the existence of
trade secrets. They are also cases on misappropriation. What did the
defendants in each case do? Was it misappropriation? This duality
is typical of intellectual property cases. Both protectability and mis-
appropriation are required to find a defendant liable, which means
that both protectability and misappropriation are potentially in play
in every case. A trade secret defendant can win by showing that the         'PS NPSF PO UIF SFMBUJPOTIJQ CFUXFFO
plaintiff lacked a valid protectable trade secret in the first place, or by   QSPUFDUJPO BOE JOGSJOHFNFOU TFF .BSL
                                                                            " -FNMFZ  .BSL 1 .D,FOOB 4DPQF 
showing that the defendant did not misappropriate that trade secret.
                                                                            8N  .BSZ - 3FW   


                            (SZOCFSH W #1 1-$
/P  $JW  3+)  64 %JTU -&9*4  4%/: .BS  
In the enormous record before the court, there is no direct evidence
that ARCO used Grynberg’s information in evaluating Tengiz or the
Caspian pipeline. How ARCO came to make those investments is no
mystery however: engineers and executives alike have testified in de-
tail as to the evaluation and decision-making process. With respect to
both investments, publically available resources were used initially,
and then supplemented at length in data rooms set up by the orga-
nizations managing the investment – for Tengiz the Chevron data
room and for the Caspian Pipeline the Oman data room. Further, al-
though plaintiff’s experts state generally that the publically available
sources were inferior to Grynberg’s information, plaintiff concedes
that his information – obtained in 1989-90 – was ”outdated” by 1996.
Moreover, plaintiff admits that when Chevron invested in Tengiz it
had been given access by the Kazakhs to all the information to which
Grynberg was privy, information that would have been available in
the comprehensive and up to date data rooms prepared for ARCO
when it reviewed the Tengiz investment years later.
    Plaintiff argues that ARCO’s alleged use can be proven circum-
stantially, in much the same way that “use of a trade secret can be
proven by showing access to the trade secret plus the subsequent sim-
ilarity of the trade secret and a Defendant’s product.” Indeed, the law
of trade secrets acknowledges the basic logic that when two prod-
ucts look alike, there is probably more than a coincidental connec-
tion between them. See Electro-Miniatures Corp. v. Wendon Co. (mis-         &MFDUSP.JOJBUVSFT  'E   E
appropriation provable by circumstantial evidence where company             $JS 
that had struggled to produce printed circuit slip rings suddenly “is-
sued a catalog depicting an entire line of printed circuit slip ring as-
semblies, resembling those built by the plaintiff”). Nor is there any
                                                                                  $)"15&3  53"%& 4&$3&5

                                        inherent reason to limit this approach to cases involving products
                                        (electrical or otherwise). Logically, in any case where what is done
                                        or produced by the alleged thief bears some unique markers of the
                                        allegedly stolen secrets, it may be inferred that the thief used the se-
3PDIFTUFS .JEMBOE /P DW        crets. Thus in Rochester Midland Corp. v. Enerco Corp., use of pricing,
 64 %JTU -&9*4   8-     product, and customer information could be inferred where eighteen
  8% .JDI +VOF  
                                        accounts associated with a poached employee switched to the defen-
                                        dant company shortly after the confidential information was brought
                                        over. However, the inference is only as strong as logic demands –
                                        where an alleged thief’s products lack a suspicious similarity to the
                                        secrets, the inference would not lie.
                                            Grynberg could make a circumstantial case for use under this the-
                                        ory, then, only to the extent that ARCO’s actions bore the unique
                                        marks of his information, or showed a suspicious similarity to it.
                                        ARCO did eventually make investments in Tengiz and the Caspian
                                        pipeline, which were among the investments that Grynberg had en-
                                        dorsed and relayed information about. However ARCO also de-
                                        clined to pursue other investments Grynberg had advocated, such as
                                        the Karachaganak oil field also in the area of mutual interest. More-
                                        over nothing about ARCO’s investments bears the markers of the
                                        Grynberg information in such a way as to justify inferring the use
                                        of that information. It is not as if ARCO built wells at particular loca-
                                        tions previously suggested by Grynberg, worked primarily through
                                        contacts developed by Grynberg, or tied its investments to Gryn-
                                        berg’s numbers in a suspiciously similar way. Rather, an oil company
                                        chose to invest in one of the largest oil fields in the world, in a manner
                                        different from that envisioned by Grynberg at the time he developed
                                        his proposed consortium. That it did so is unsurprising and does not
                                        evince the kind of suspicious similarity present in Electro-Miniatures
                                        and Rochester Midland. Accordingly an inference of use based on sim-
                                        ilarity is not appropriate here.

                                            %JSFDU *OGSJOHFNFOU

                                                      3FTUBUFNFOU 5IJSE PG 6OGBJS $PNQFUJUJPO

                                        “Improper” means of acquiring another’s trade secret ... include theft,
*NQSPQFS "DRVJTJUJPO PG 5SBEF 4FDSFUT   fraud, unauthorized interception of communications, inducement of
                                        or knowing participation in breach of confidence, and other means
                                        either wrongful in themselves or wrongful under the circumstances
                                        of the case. Independent discovery and analysis of publicly available
                                        products or information are not improper means of acquisition.

                                                              6OJGPSN 5SBEF 4FDSFUT "DU
& */'3*/(&.&/5 130)*#*5&% $0/%6$5                                  

“Improper means” includes theft, bribery, misrepresentation, breach        f 
or inducement of a breach of a duty to maintain secrecy, or espionage      %FöOJUJPOT
through electronic or other means;

These lists of ”improper means” can be roughly divided into two
types of wrongful conduct. On the one hand there is espionage, which
often involves theft, trespass, or computer hacking. On the other
hand there is breach of confidence, which often involves violating a
promise to keep someone else’s secrets. It is tempting to to conclude
that “improper means” consist of torts (espionage) and breach of con-
tract (breach of confidence), but this equation is a li le too pat.

              &* EV 1POU EF /FNPVST  $P W $ISJTUPQIFS
                         'E  UI $JS 
This is a case of industrial espionage in which an airplane is the cloak
and a camera the dagger. The defendants-appellants, Rolfe and Gary
Christopher, are photographers in Beaumont, Texas. The Christo-
phers were hired by an unknown third party to take aerial pho-
tographs of new construction at the Beaumont plant of E. I. DuPont de
Nemours & Company, Inc. Sixteen photographs of the DuPont facil-
ity were taken from the air on March 19, 1969, and these photographs
were later developed and delivered to the third party.                     &ENVOE ,JUDI JO 5IF -BX BOE &DP
    DuPont subsequently filed suit against the Christophers, alleging       OPNJDT PG 3JHIUT JO 7BMVBCMF *OGPSNBUJPO
                                                                            + -FHBM 4UVE   TQFDVMBUFT
that the Christophers had wrongfully obtained photographs reveal-
                                                                           UIBU 5IF BQQFBSBODF PG UIF BJSQMBOF
ing DuPont’s trade secrets which they then sold to the undisclosed         BU TVDI BO PQQPSUVOF NPNFOU <NBZ
third party. DuPont contended that it had developed a highly se-           IBWF> TVHHFTUFE UP %V1POU UIBU TPNF
cret but unpatented process for producing methanol, a process which        LJOE PG JOTJEF MFBL IBE UJQQFE Pò UIF
gave DuPont a competitive advantage over other producers. This             QIPUPHSBQIFST PS UIFJS DMJFOU UP UIF
process, DuPont alleged, was a trade secret developed after much
expensive and time-consuming research, and a secret which the com-
pany had taken special precautions to safeguard. The area pho-
tographed by the Christophers was the plant designed to produce
methanol by this secret process, and because the plant was still un-
der construction parts of the process were exposed to view from di-
rectly above the construction area. Photographs of that area, DuPont
alleged, would enable a skilled person to deduce the secret process
for making methanol. DuPont thus contended that the Christophers
had wrongfully appropriated DuPont trade secrets by taking the pho-
tographs and delivering them to the undisclosed third party.
    The Christophers argued both at trial and before this court that
they commi ed no “actionable wrong” in photographing the DuPont
facility and passing these photographs on to their client because they
                                                                                   $)"15&3  53"%& 4&$3&5

                                        conducted all of their activities in public airspace, violated no gov-
                                        ernment aviation standard, did not breach any confidential relation,
                                        and did not engage in any fraudulent or illegal conduct. In short, the
                                        Christophers argue that for an appropriation of trade secrets to be
                                        wrongful there must be a trespass, other illegal conduct, or breach of
                                        a confidential relationship. We disagree.
                                            It is true, as the Christophers assert, that the previous trade secret
                                        cases have contained one or more of these elements. However, we do
                                        not think that the Texas courts would limit the trade secret protection
                                        exclusively to these elements.
                                            Although the previous cases have dealt with a breach of a confi-
                                        dential relationship, a trespass, or other illegal conduct, the rule is
                                        much broader than the cases heretofore encountered. Not limiting
                                        itself to specific wrongs, Texas adopted subsection (a) of the Restate-
                                        ment which recognizes a cause of action for the discovery of a trade
                                        secret by any “improper” means.
                                            The question remaining, therefore, is whether aerial photography
                                        of plant construction is an improper means of obtaining another’s
                                        trade secret. We conclude that it is and that the Texas courts would
                                        so hold. The Supreme Court of that state has declared that “the un-
                                        doubted tendency of the law has been to recognize and enforce higher
)ZEF  48E  5FY           standards of commercial morality in the business world.” Hyde Cor-
                                        poration v. Huffines. That court has quoted with approval articles indi-
                                        cating that the proper means of gaining possession of a competitor’s
                                        secret process is through inspection and analysis of the product in
                                        order to create a duplicate. Later another Texas court explained:
                                             The means by which the discovery is made may be obvi-
                                             ous, and the experimentation leading from known factors
                                             to presently unknown results may be simple and lying
                                             in the public domain. But these facts do not destroy the
                                             value of the discovery and will not advantage a competi-
                                             tor who by unfair means obtains the knowledge without
                                             paying the price expended by the discoverer.”
'PXMFS  48E  5FY $JW "QQ
                                        Brown v. Fowler. We think, therefore, that the Texas rule is clear. One

                                        may use his competitor’s secret process if he discovers the process
                                        by reverse engineering applied to the finished product; one may use
                                        a competitor’s process if he discovers it by his own independent re-
                                        search; but one may not avoid these labors by taking the process from
                                        the discoverer without his permission at a time when he is taking rea-
                                        sonable precautions to maintain its secrecy. To obtain knowledge of
                                        a process without spending the time and money to discover it inde-
                                        pendently is improper unless the holder voluntarily discloses it or
                                        fails to take reasonable precautions to ensure its secrecy.
                                            In the instant case the Christophers deliberately flew over the
& */'3*/(&.&/5 130)*#*5&% $0/%6$5                                  

DuPont plant to get pictures of a process which DuPont had at-
tempted to keep secret. The Christophers delivered their pictures to
a third party who was certainly aware of the means by which they
had been acquired and who may be planning to use the information
contained therein to manufacture methanol by the DuPont process.
The third party has a right to use this process only if he obtains this
knowledge through his own research efforts, but thus far all informa-
tion indicates that the third party has gained this knowledge solely by
taking it from DuPont at a time when DuPont was making reasonable
efforts to preserve its secrecy. In such a situation DuPont has a valid
cause of action to prohibit the Christophers from improperly discov-
ering its trade secret and to prohibit the undisclosed third party from
using the improperly obtained information.
    In taking this position we realize that industrial espionage of the
sort here perpetrated has become a popular sport in some segments
of our industrial community. However, our devotion to free wheel-
ing industrial competition must not force us into accepting the law
of the jungle as the standard of morality expected in our commercial
relations. Our tolerance of the espionage game must cease when the
protections required to prevent another’s spying cost so much that
the spirit of inventiveness is dampened. Commercial privacy must
be protected from espionage which could not have been reasonably
anticipated or prevented. We do not mean to imply, however, that
everything not in plain view is within the protected vale, nor that all
information obtained through every extra optical extension is forbid-
den. Indeed, for our industrial competition to remain healthy there
must be breathing room for observing a competing industrialist. A
competitor can and must shop his competition for pricing and exam-
ine his products for quality, components, and methods of manufac-
ture. Perhaps ordinary fences and roofs must be built to shut out in-
cursive eyes, but we need not require the discoverer of a trade secret
to guard against the unanticipated, the undetectable, or the unpre-
ventable methods of espionage now available.
    In the instant case DuPont was in the midst of constructing a plant.
Although after construction the finished plant would have protected
much of the process from view, during the period of construction the
trade secret was exposed to view from the air. To require DuPont to
put a roof over the unfinished plant to guard its secret would impose
an enormous expense to prevent nothing more than a school boy’s
trick. We introduce here no new or radical ethic since our ethos has
never given moral sanction to piracy. The marketplace must not de-
viate far from our mores. We should not require a person or corpora-
tion to take unreasonable precautions to prevent another from doing
that which he ought not do in the first place. Reasonable precautions
against predatory eyes we may require, but an impenetrable fortress
                                                                                    $)"15&3  53"%& 4&$3&5

                                           is an unreasonable requirement, and we are not disposed to burden
                                           industrial inventors with such a duty in order to protect the fruits
                                           of their efforts. “Improper” will always be a word of many nuances,
                                           determined by time, place, and circumstances. We therefore need
                                           not proclaim a catalogue of commercial improprieties. Clearly, how-
                                           ever, one of its commandments does say “thou shall not appropri-
                                           ate a trade secret through deviousness under circumstances in which
                                           countervailing defenses are not reasonably available.”
                                               Having concluded that aerial photography, from whatever alti-
                                           tude, is an improper method of discovering the trade secrets exposed
MJUF QIPUPT GSPN (PPHMF &BSUI UP PC       during construction of the DuPont plant, we need not worry about
TFSWF UIF UIF DPOTUSVDUJPO PG UIF QMBOU    whether the flight pa ern chosen by the Christophers violated any
8IBU JG UIFZ øFX B TNBMM UFOQPVOE         federal aviation regulations. Regardless of whether the flight was le-
                                           gal or illegal in that sense, the espionage was an improper means of
OFJHICPShT GFODFE CBDLZBSE BOE QIP        discovering DuPont’s trade secret.
                                                                       ,BNJO W ,VIOBV
                                                                     1E  0S 
                                           For approximately 25 years plaintiff had been employed by a kni ing
                                           mill as a mechanic. In 1953 he entered into the garbage collection
                                           business. From the time plaintiff entered into the garbage collection
                                           business he began thinking of methods of facilitating the loading of
                                           garbage trucks and of compressing or packing the materials after they
                                           were loaded. By 1955 he had done some experimental work on his
                                           own truck, devising a hoist mechanism operated by hydraulic cylin-
                                           ders to lift a bucket from the ground to the top of the truck box. By
                                           this time he had also arrived at the conclusion that the packing of the
                                           loaded materials could best be effected through the use of a hydrauli-
                                           cally operated plow which would move against the loaded materials
                                           and compress them against the interior of the truck. At the time plain-
                                           tiff conceived this solution there were on the market garbage truck
                                           bodies containing various “packer” mechanisms, including hydrauli-
                                           cally operated plows. However, plaintiff and defendant apparently
                                           were not aware of the use of hydraulic cylinders for this purpose and
                                           thought that plaintiff’s idea was novel in this respect.
                                               In January, 1955, plaintiff made arrangements with defendant
                                           Kuhnau, president and manager of Oregon Rental Equipment Com-
                                           pany, to use the company’s machine shop and one or more of its em-
                                           ployees to assist plaintiff in carrying on further experimental work in
                                           developing plaintiff’s ideas. This experimental work was carried on
                                           for approximately one year. According to plaintiff’s evidence, all of
                                           the experimental work was done under his supervision and Kuhnau
                                           had no voice or control as to the manner in which the developmen-
                                           tal work was to be carried on. It is Kuhnau’s contention that he and
                                           the employees of Oregon Rental Equipment Company contributed
& */'3*/(&.&/5 130)*#*5&% $0/%6$5                                

suggestions and ideas which were used in the development and im-
provement of the truck body and compressor mechanism.
    In the course of working on the project several persons who were
engaged in the garbage collection business came to the defendant’s
machine shop, observed the progress being made by plaintiff and
made suggestions as to the practical application of plaintiff’s idea.
Sometime in the summer of 1956 the truck and compressor mecha-
nism which plaintiff was seeking to develop was crystallized substan-
tially in the form in which it now exists.
    When plaintiff had completed his experimental work he began to
receive orders for truck bodies embodying his improvements. The
first two units sold were manufactured by Oregon Rental Equipment
Company. After the sale of these two units (in the spring of 1956)
Kuhnau terminated his connections with Oregon Rental Equipment
Company. He rented a machine shop at another location and began
business under the name of R.K. Truck Sales. Between May and Octo-
ber, 1956, he manufactured ten units for plaintiff. For each unit Kuh-
nau received an amount agreed upon by the parties. Plaintiff fixed
the selling price of the unit and his profit consisted of the difference
between the selling price and the amount he paid Kuhnau.
    On or about October 1, 1956, Kuhnau informed plaintiff that he
was going to manufacture truck bodies in competition with plaintiff.
Kuhnau testified that the relationship was terminated as a result of a
disagreement over the amount he was to receive for manufacturing
the unit for plaintiff. Plaintiff contends that Kuhnau terminated the
relationship for the purpose of entering into competition with plain-
tiff. The units manufactured by Kuhnau were similar to those which
he had previously manufactured for plaintiff. However, there were
some differences in the design of the two units. The principal differ-
ence was that Kuhnau mounted the hydraulic cylinder operating the
plow or blade under the truck bed whereas the cylinder in plaintiff’s
truck was above the bed. There was testimony supporting plaintiff’s
assertion that it was his idea to place the cylinder under the bed of
the truck but that suggestion was not adopted because Kuhnau did
not think it was feasible.
    Whether the information disclosed was intended to be appropri-
able by the disclosee will depend upon the relationship of the parties
and the circumstances under which the disclosure was made. It is
not necessary to show that the defendant expressly agreed not to use
the plaintiff’s information; the agreement may be implied. And the
implication may be made not simply as a product of the quest for
the intention of the parties but as a legal conclusion recognizing the
need for ethical practices in the commercial world. In the case at bar
the relationship between plaintiff and Kuhnau was such that an obli-
gation not to appropriate the plaintiff’s improvements could be im-
                                                                            $)"15&3  53"%& 4&$3&5

                                  plied. Kuhnau was paid to assist plaintiff in the development of the
                                  la er’s idea. It must have been apparent to Kuhnau that plaintiff was
                                  a empting to produce a unit which could be marketed. Certainly it
                                  would not have been contemplated that as soon as the packer unit
                                  was perfected Kuhnau would have the benefit of plaintiff’s ideas and
                                  the perfection of the unit through painstaking and expensive experi-
                                  mentation. It is to be remembered that the plaintiff’s experimentation
                                  was being carried on, not on the assumption that he was duplicating
                                  an existing machine, but upon the assumption that he was creating a
                                  new product. It has been recognized in the cases that a manufacturer
                                  who has been employed to develop an inventor’s ideas is not entitled
                                  to appropriate those ideas to his own use.
                                      Hyde is closely in point. In that case the defendant manufacturer,
                                  having gained knowledge of a garbage compressor through a licens-
                                  ing agreement with the plaintiff inventor, repudiated the agreement
                                  and proceeded to manufacture and sell on its own account a compres-
                                  sor of similar design. Defendant was enjoined. The court held that
                                  the parties were in a confidential relationship and that the informa-
                                  tion relating to the compressor acquired by the defendant incident to
                                  that relationship could not be appropriated by him. In that case, as in
                                  the present case, plaintiff obtained a patent during the course of the
                                  trial. The defendant argued that since plaintiff’s process was revealed
                                  by the patent the process could not be regarded as a trade secret. The
                                  court held that the public disclosure of plaintiff’s process did not re-
                                  move defendant’s duty not to exploit the economic advantage gained
                                  through the information initially disclosed to him by plaintiff. We see
                                  no essential difference between the facts in the Hyde case and the case
                                  at bar.
                                      The principles applied in the foregoing cases have been recog-
.D,JO[JF  1E  0S    nized by this court. In McKinzie v. Cline, the plaintiff employed the de-
                                  fendants to manufacture a gun swivel which one of the plaintiffs had
                                  invented. The defendants discontinued manufacturing the swivel for
                                  the plaintiffs and proceeded to manufacture and sell it for their own
                                  account. It was held that defendants violated a confidential relation-
                                  ship which existed between the parties and that therefore plaintiffs
                                  were entitled to an injunction and damages. In that case, as in the
                                  present one, plaintiffs had placed their product on the market and
                                  had discussed its manufacture with various machinists. The court
                                  noted that there was no “evidence in the record that anyone other
                                  than defendant Cline and the plaintiffs had any knowledge of the in-
                                  side workings of the gadget.” The court went further and held that
                                  even though others might have become acquainted with the manufac-
                                  turing process this would not entitle the defendants to violate the con-
                                  fidence reposed in them by the plaintiffs. With respect to this point,
                                  defendants in the present case argue that the McKinzie case is distin-
& */'3*/(&.&/5 130)*#*5&% $0/%6$5                                 

guishable from the case at bar in that the mechanism of the gun swivel
was complex, whereas the mechanism of the garbage truck was not.
The evidence does not support this contention. The description of the
packer mechanism, particularly the manner in which the blade was
a ached (the proper adjustment of which was one of the principal im-
provements claimed by plaintiff), would indicate that it was of such
complexity that more than a general inspection of the unit would be
required to reveal the secret of plaintiff’s improvements. The McK-
inzie case followed the line of authority previously discussed which
de-emphasizes the elements of secrecy and novelty and stresses the
breach of the confidential relation between the parties. The court
adopted the higher standard of commercial ethics to which we have
already alluded:
     If our system of private enterprise on which our nation has
     thrived, prospered and grown great is to survive, fair deal-
     ing, honesty and good faith between contracting parties
     must be zealously maintained; therefore, if one who has
     learned of another’s invention through contractual rela-
     tionship, such as in the present case, takes unconscionable
     and inequitable advantage of the other to his own enrich-
     ment and at the expense of the la er, a court of equity will
     extend its broad equitable powers to protect the party in-
We reaffirm this declaration of business ethics and hold that defen-
dant Kuhnau violated his duty to plaintiff by appropriating the infor-
mation derived through their business relationship.
    Defendants contend that there was no proof that their product
contained the improvements alleged to have been developed by
plaintiff. There is evidence that the plaintiff’s and defendants’ trucks
were similar in structure and design. The trial judge, who inspected
the trucks, concluded that defendants’ trucks used the improvements
developed by plaintiff. Where a person develops a product similar to
that developed by his discloser, the proof of similarity may be suffi-
cient to impose upon the disclosee the burden of proving that there
was no misappropriation. Hoeltke v. C.M. Kemp Mfg. Co. stated: “The       )PFMULF  'E  UI $JS 
similarity of defendant’s device to that of complainant is strong proof
that one was copied from the other; for it is hardly probable that dif-
ferent persons should independently of each other invent devices so
nearly similar at so nearly the same time.” In the same case the court
said that “one who admi edly receives a disclosure from an inven-
tor, proceeds thereafter to manufacture articles of similar character,
and, when called to account, makes answer that he was using his own
ideas and not the ideas imparted to him” must sustain his position
by proof that is “clear, satisfactory, and beyond a reasonable doubt.”
                                                        $)"15&3  53"%& 4&$3&5

             We are of the opinion that there was sufficient evidence to support the
             conclusion that defendants appropriated plaintiff’s improvements.

                  4FDPOEBSZ *OGSJOHFNFOU
             If a vice-president at MatrixCorp receives an email from someone call-
             ing himself Cypher offering to provide details of a computer graph-
             ics technology similar to one used by its competitor NeoCorp, can he
             take the deal? A moment’s thought should suggest that the answer
             depends on how Cypher obtained the information and on what Ma-
             trixCorp knows about it. What about MatrixCorp’s customers? Do
             they need to worry that their widgets were produced using a misap-
             propriated trade secret?

                                    6OJGPSN 5SBEF 4FDSFUT "DU

             (2)   “Misappropriation” means:
%FöOJUJPOT          (i) acquisition of a trade secret of another by a person who
                         knows or has reason to know that the trade secret was ac-
                         quired by improper means; or
                   (ii) disclosure or use of a trade secret of another without ex-
                         press or implied consent by a person who
                       (A) used improper means to acquire knowledge of the
                              trade secret; or
                        (B) at the time of disclosure or use, knew or had reason to
                              know that his knowledge of the trade secret was
                             (I) derived from or through a person who had utilized
                                  improper means to acquire it;
                            (II) acquired under circumstances giving rise to a duty
                                  to maintain its secrecy or limit its use; or
                           (III) derived from or through a person who owed a
                                  duty to the person seeking relief to maintain its se-
                                  crecy or limit its use; or
                       (C) before a material change of his [or her] position, knew
                              or had reason to know that it was a trade secret and
                              that knowledge of it had been acquired by accident or

             ' %FGFOTFT
             The two most significant “defenses” to trade secret infringement are
             independent discovery and reverse engineering. I put “defenses” in
             quotation marks to emphasize that neither adds anything to the doc-
             trines you have already seen. The defendant who establishes that
( 130#-&.4                                                          

she independently came up with the same information has actually
defeated a crucial element of the plaintiff’s case-in-chief: that the de-
fendant stole the information from the plaintiff.                           'PS NPSF TFF (SZOCFSH BOE UIF MBTU
    Similarly, the usual definitions of “improper means” simply ex-         QBSBHSBQI PG ,BNJO
clude reverse engineering: the plaintiff who proves only that the de-
fendant reverse engineered her product has again failed to show an
act of misappropriation. Reverse engineering is conventionally de-
fined as “starting with the known product and working backward
to divine the process which aided in its development or manufac-
ture.” Kewanee Oil Co. v. Bicron Corp. Courts sometimes add that the       ,FXBOFF  64  
“known product” must have been obtained lawfully: it is no defense
to argue that you reverse engineered the widget-making-machine
you stole from your competitor’s factory.
    Why allow reverse engineering? For one thing, it reflects a policy
of recognizing personal property owners’ rights over their things. If
you buy it, you can break it down. Reverse engineering also promotes
the same values as trade secret law itself. In the words of the Supreme
Court, it is “an essential part of innovation” that “often leads to sig-
nificant advances in technology.” Bonito Boats, Inc. v. Thunder Craft       #POJUP #PBUT  64  
Boats, Inc.

(     1SPCMFNT

                         'MBNJOH .PFT 1SPCMFN
                                                                           #BTFE PO .BTPO W +BDL %BOJFM %JTUJMMFSZ
Moe Szyslak is the owner of Moe’s Tavern, where the specialty drink
                                                                            4PE  "MB $U $JW "QQ 
is a “Flaming Moe.” Moe mixes the drinks in a back room, then sets
them on fire in front of customers.
   1. Representatives from Tipsy McStagger’s Good-Time Drinking
      and Eating Emporium meet with Moe to discuss licensing the
      recipe. As part of the negotiations, Moe tells them how it’s
      made. Tipsy McStagger’s breaks off talks and start selling its
      own version. What result?
   2. A Tipsy’s employee orders a Flaming Moe, pours it into a ther-
      mos, and uses a gas chromatograph to analyze its chemical com-
      position. By so doing, he learns that the secret ingredient is
      cough syrup. What result?
   3. A Tipsy’s employee goes to Moe’s Tavern and bribes a bar-
      tender to tell her the formula. What result?
   4. Same facts as before, except that anyone who tastes the drink
      can recognize that it’s cough syrup. The Tipsy’s employee still
      bribes the bartender to tell them. What result?
   5. Woud Moe be be er off trying to patent the formula for the
      Flaming Moe? Would society be be er off if he did?
                                                                                    $)"15&3  53"%& 4&$3&5

                                                                 4QPSUT 4FDSFUT 1SPCMFN

                                            1. In 2007, the New England Patriots football team videotaped the
                                               hand signals used by coaches for the New York Jets to send in-
                                               structions to players on the field. Anyone in the stadium with
                                               a clear line of sight is able to see the signals. The National Foot-
                                               ball League’s rules allow for such videotaping, but only from
                                               specific areas not including the areas the Patriots taped from
                                               (which had be er views). Did the Patriots misappropriate a
                                               trade secret?
                                            2. In 2011, the Houston Astros baseball team hired Jeff Luhnow
                                               as their new general manager. Previously, Luhnow had been
                                               an executive with the St. Louis Cardinals. While with the Car-
                                               dinals, Luhnow and others build an extensive database with
                                               detailed statistical information about players and reports on
                                               prospective hires. When Luhnow moved to the Astros, several
                                               Cardinals employees went with him. Other Cardinals employ-
                                               ees suspected that Luhnow might have helped design a similar
                                               database for the Astros. They guessed that he and the other ex-
                                               Cardinal employees might have used the same passwords for
                                               the new Astros system, a guess that turned out to be correct.
                                               The Cardinals employees logged into the Astros system using
                                               these passwords and examined some of the information in it.
                                               Identify all of the trade secret issues these facts raise.

                                                                  -PDLTNJUIT 1SPCMFN
 'E  UI $JS              You represent the Chicago Lock Company, whose “Ace” series of
                                       locks is used in vending machines, burglar alarms, and other high-
                                       security se ings. Ace locks use an unusual cylindrical key that re-
                                       quires specialized equipment to cut. Each lock has a serial number
                                       printed on it; the company uses a secret formula to translate the con-
                                       figuration of tumblers inside the lock into a serial number. The com-
                                       pany’s policy is that it will sell replacement keys only to the registered
                                       owner of a lock with a given serial number. All Ace locks and keys
                                       are stamped “Do Not Duplicate.”
                                           For years, locksmiths have known how to analyze Ace locks. After
                                       a few minutes poking at the lock with their tools, they can write down
                                       the configuration of pins and tumblers inside the lock. They can then
                                       go back to their toolkits and grind a replacement key, which will open
                                       the lock. If the locksmiths keep the configuration information on file,
                                       they can grind replacement keys in the future without needing to go
) 05)&3 4&$3&$: -"84                                                 

back to the lock and analyze it again. Individual locksmiths have, for
years, kept such files for their local customers.
    Recently, Morris and Victor Fanberg, two locksmiths, published
a book entitled “AA Advanced Locksmith’s Tubular Lock Codes.”
They asked locksmiths around the country to send them lists of Ace
lock serial numbers and the corresponding tumbler configurations.
Based on that information, they were able to program a computer to
reconstruct Chicago’s secret formula. The book contains a table that
shows how to turn an Ace serial number into a key configuration,
which any locksmith with the proper equipment could then use to
cut a key opening the lock with that serial number.
    Because the serial numbers on Ace locks are frequently printed
on the outside, Chicago is concerned that the publication of this book
will undermine the security of Ace locks. It has asked you whether it
can and should sue the Fanbergs for damages and to halt publication
of the book. What is your advice? Is there anything further it would
be helpful for you to know? Are there changes that Chicago Lock can
and should make to its procedures in the future?

This section isn’t about trade secret law. Instead, it covers near misses
to trade secret law: other laws protecting secrets (or in some cases, re-
quiring them to be disclosed). As you read these materials, consider
whether it is appropriate to describe each of these bodies of law as a
kind of ”intellectual property.” Why or why not?


               'PPE -JPO *OD W $BQJUBM $JUJFT"#$ *OD
                       'E  UI $JS 
Two ABC television reporters, Lynne Dale and Susan Barne , after
using false resumes to get jobs at Food Lion supermarkets, secretly
videotaped what appeared to be unwholesome food handling prac-
tices. Specifically, they sought to document Food Lion employees
engaging in unsanitary practices, treating products to hide spoilage,
and repackaging and redating out-of-date products. Some of the
video footage was used by ABC in a PrimeTime Live broadcast that
was sharply critical of Food Lion. [Food Lion sued and received $1
in compensatory damages for breach of loyalty, $1 in compensatory
damages for trespass, and $5,547,150 in compensatory and punitive
damages for fraud. The fraud claim was set aside because Dale and
Barne made no express representations about how long they would
                                                                                     $)"15&3  53"%& 4&$3&5

                                         work and because ”Dale and Barne were not paid their wages be-
                                         cause of misrepresentations on their job applications.”]
                                         In North and South Carolina, as elsewhere, it is a trespass to enter
5IF DPVSU BMTP VQIFME UIF  BXBSE GPS   upon another’s land without consent. Accordingly, consent is a de-
CSFBDI PG MPZBMUZ FYQMBJOJOH 5IF JO    fense to a claim of trespass. Even consent gained by misrepresenta-
                                         tion is sometimes sufficient. See Desnick v. American Broad. Cos.. The
                                         consent to enter is canceled out, however, if a wrongful act is done in
-JPO UIF FNQMPZFS UP XIPN UIFZ XFSF      excess of and in abuse of authorized entry.
VOGBJUIGVM                                 We turn first to whether Dale and Barne ’s consent to be in non-
%FTOJDL  'E  UI $JS       public areas of Food Lion property was void from the outset because
 1PTOFS $+                             of the resume misrepresentations. Consent to an entry is often given
                                         legal effect even though it was obtained by misrepresentation or con-
                                         cealed intentions. Without this result,
                                               a restaurant critic could not conceal his identity when he
                                               ordered a meal, or a browser pretend to be interested
                                               in merchandise that he could not afford to buy. Dinner
                                               guests would be trespassers if they were false friends who
                                               never would have been invited had the host known their
                                               true character, and a consumer who in an effort to bargain
                                               down an automobile dealer falsely claimed to be able to
                                               buy the same car elsewhere at a lower price would be a
                                               trespasser in a dealer’s showroom. Desnick.
                                         We like Desnick’s thoughtful analysis about when a consent to enter
                                         that is based on misrepresentation may be given effect. In Desnick
                                         ABC sent persons posing as patients needing eye care to the plain-
                                         tiffs’ eye clinics, and the test patients secretly recorded their exami-
8IBU JT JU BCPVU "#$ BOE 1SJNF5JNF       nations. Some of the recordings were used in a PrimeTime Live seg-
-JWF                                     ment that alleged intentional misdiagnosis and unnecessary cataract
                                         surgery. Desnick held that although the test patients misrepresented
                                         their purpose, their consent to enter was still valid because they did
                                         not invade ”any of the specific interests [relating to peaceable posses-
                                         sion of land] the tort of trespass seeks to protect:” the test patients en-
                                         tered offices ”open to anyone expressing a desire for ophthalmic ser-
                                         vices” and videotaped doctors engaged in professional discussions
                                         with strangers, the testers; the testers did not disrupt the offices or
                                         invade anyone’s private space; and the testers did not reveal the ”inti-
                                         mate details of anybody’s life.” Desnick supported its conclusion with
                                         the following comparison:
                                               ”Testers” who pose as prospective home buyers in order
                                               to gather evidence of housing discrimination are not tres-
                                               passers even if they are private persons not acting under
                                               color of law. The situation of ABC’s ”testers” is analo-
) 05)&3 4&$3&$: -"84                                                  

      gous. Like testers seeking evidence of violation of anti-
      discrimination laws, ABC’s test patients gained entry into
      the plaintiffs’ premises by misrepresenting their purposes
      (more precisely by a misleading omission to disclose those
      purposes). But the entry was not invasive in the sense of
      infringing the kind of interest of the plaintiffs that the law
      of trespass protects; it was not an interference with the
      ownership or possession of land.
We have not found any case suggesting that consent based on a re-
sume misrepresentation turns a successful job applicant into a tres-
passer the moment she enters the employer’s premises to begin
work. Moreover, if we turned successful resume fraud into tres-
pass, we would not be protecting the interest underlying the tort of
trespass – the ownership and peaceable possession of land. Accord-
ingly, we cannot say that North and South Carolina’s highest courts
would hold that misrepresentation on a job application alone nullifies
the consent given to an employee to enter the employer’s property,
thereby turning the employee into a trespasser.
    There is a problem, however, with what Dale and Barne did af-
ter they entered Food Lion’s property. The jury also found that the
reporters commi ed trespass by breaching their duty of loyalty to
Food Lion ”as a result of pursuing [their] investigation for ABC.” We
affirm the finding of trespass on this ground because the breach of
duty of loyalty – triggered by the filming in non-public areas, which
was adverse to Food Lion – was a wrongful act in excess of Dale and
Barne ’s authority to enter Food Lion’s premises as employees.
    The Court of Appeals of North Carolina has indicated that secretly
installing a video camera in someone’s private home can be a wrong-
ful act in excess of consent given to enter. In the trespass case of Miller   .JMMFS  4&E  /$ $U "QQ
v. Brooks the (defendant) wife, who claimed she had consent to enter          
her estranged husband’s (the plaintiff’s) house, had a private detec-
tive place a video camera in the ceiling of her husband’s bedroom.
The court noted that ”even an authorized entry can be trespass if a
wrongful act is done in excess of and in abuse of authorized entry.”
The court went on to hold that ”even if the wife had permission to en-
ter the house and to authorize others to do so,” it was a jury question
”whether defendants’ entries exceeded the scope of any permission
given.” We recognize that Miller involved a private home, not a gro-
cery store, and that it involved some physical alteration to the plain-
tiff’s property (installation of a camera). Still, we believe the general
principle is applicable here, at least in the case of Dale, who worked
in a Food Lion store in North Carolina. Although Food Lion con-
sented to Dale’s entry to do her job, she exceeded that consent when
she videotaped in nonpublic areas of the store and worked against
                                          $)"15&3  53"%& 4&$3&5

the interests of her second employer, Food Lion, in doing so.
    We do not have a case comparable to Miller from South Carolina.
Nevertheless, the South Carolina courts make clear that the law of
trespass protects the peaceable enjoyment of property. It is consis-
tent with that principle to hold that consent to enter is vitiated by a
wrongful act that exceeds and abuses the privilege of entry.
    Accordingly, as far as North and South Carolina law is concerned,
the jury’s trespass verdict should be sustained.
In its cross-appeal Food Lion argues that the district court erred in
refusing to allow it to use its non-reputational tort claims (breach
of duty of loyalty, trespass, etc.) to recover compensatory damages
for ABC’s broadcast of the PrimeTime Live program that targeted
Food Lion. The publication damages Food Lion sought (or alleged)
were for items relating to its reputation, such as loss of good will and
lost sales. The district court determined that the publication dam-
ages claimed by Food Lion ”were the direct result of diminished con-
sumer confidence in the store” and that ”it was Food Lion’s food
handling practices themselves – not the method by which they were
recorded or published – which caused the loss of consumer confi-
dence.” The court therefore concluded that the publication damages
were not proximately caused by the non-reputational torts commit-
ted by ABC’s employees. We do not reach the ma er of proximate
cause because an overriding (and se led) First Amendment princi-
ple precludes the award of publication damages in this case.
     Food Lion acknowledges that it did not sue for defamation be-
cause its ”ability to bring an action for defamation ... required proof
that ABC acted with actual malice.” Food Lion thus understood that
if it sued ABC for defamation it would have to prove that the Prime-
Time Live broadcast contained a false statement of fact that was made
with ”actual malice,” that is, with knowledge that it was false or with
reckless disregard as to whether it was true or false. What Food
Lion sought to do, then, was to recover defamation-type damages un-
der non-reputational tort claims, without satisfying the stricter (First
Amendment) standards of a defamation claim.


                       6OJUFE 4UBUFT W 0h)BHBO
James Herman O’Hagan was a partner in the law firm of Dorsey
& Whitney. In July 1988, Grand Metropolitan PLC (Grand Met) re-
) 05)&3 4&$3&$: -"84                                                 

tained Dorsey & Whitney as local counsel to represent Grand Met
regarding a potential tender offer for the common stock of the Pills-
bury Company. Both Grand Met and Dorsey & Whitney took precau-
tions to protect the confidentiality of Grand Met’s tender offer plans.
O’Hagan did no work on the Grand Met representation. Dorsey &
Whitney withdrew from representing Grand Met on September 9,
1988. Less than a month later, on October 4, 1988, Grand Met pub-
licly announced its tender offer for Pillsbury stock.
    On August 18, 1988, while Dorsey & Whitney was still represent-
ing Grand Met, O’Hagan began purchasing call options for Pillsbury
stock. When Grand Met announced its tender offer in October, the
price of Pillsbury stock rose to nearly $60 per share. O’Hagan then
sold his Pillsbury call options and common stock, making a profit of
more than $4.3 million.
    The Securities and Exchange Commission (SEC or Commission)
initiated an investigation into O’Hagan’s transactions, culminating
in a 57-count indictment. The indictment alleged that O’Hagan de-
frauded his law firm and its client, Grand Met, by using for his own
trading purposes material, nonpublic information regarding Grand
Met’s planned tender offer.
In pertinent part, § 10(b) of the Securities Exchange Act of 1934 pro-       6 4 $ f K C
       It shall be unlawful for any person, directly or indirectly, by
       the use of any means or instrumentality of interstate commerce
       or of the mails, or of any facility of any national securities ex-
       change –
       (b) To use or employ, in connection with the purchase or
            sale of any security registered on a national securities ex-
            change or any security not so registered, any manipula-
            tive or deceptive device or contrivance in contravention of
            such rules and regulations as the [Securities and Exchange]
            Commission may prescribe as necessary or appropriate in
            the public interest or for the protection of investors.
The statute thus proscribes (1) using any deceptive device (2) in con-
nection with the purchase or sale of securities, in contravention of
rules prescribed by the Commission. The provision, as wri en, does
not confine its coverage to deception of a purchaser or seller of secu-
rities, rather, the statute reaches any deceptive device used ”in con-
nection with the purchase or sale of any security.”
    Pursuant to its § 10(b) rulemaking authority, the Commission has
                                                                 $)"15&3  53"%& 4&$3&5

 $'3 f C   adopted Rule 10b-5 , which, as relevant here, provides:
                            It shall be unlawful for any person, directly or indirectly, by the
                            use of any means or instrumentality of interstate commerce, or
                            of the mails or of any facility of any national securities exchange,
                            (a) To employ any device, scheme, or artifice to defraud, [or]
                            (c) To engage in any act, practice, or course of business which
                                  operates or would operate as a fraud or deceit upon any
                            in connection with the purchase or sale of any security.”
                     Under the ”traditional” or ”classical theory” of insider trading lia-
                     bility, § 10(b) and Rule 10b-5 are violated when a corporate insider
                     trades in the securities of his corporation on the basis of material, non-
                     public information. Trading on such information qualifies as a ”de-
                     ceptive device” under § 10(b) because a relationship of trust and con-
                     fidence exists between the shareholders of a corporation and those
                     insiders who have obtained confidential information by reason of
                     their position with that corporation. That relationship gives rise to a
                     duty to disclose or to abstain from trading because of the necessity of
                     preventing a corporate insider from taking unfair advantage of unin-
                     formed stockholders. The classical theory applies not only to officers,
                     directors, and other permanent insiders of a corporation, but also to
                     a orneys, accountants, consultants, and others who temporarily be-
                     come fiduciaries of a corporation.
                         The ”misappropriation theory” holds that a person commits fraud
                     ”in connection with” a securities transaction, and thereby violates §
                     10(b) and Rule 10b-5, when he misappropriates confidential informa-
                     tion for securities trading purposes, in breach of a duty owed to the
                     source of the information. Under this theory, a fiduciary’s undis-
                     closed, self-serving use of a principal’s information to purchase or
                     sell securities, in breach of a duty of loyalty and confidentiality, de-
                     frauds the principal of the exclusive use of that information. In lieu
                     of premising liability on a fiduciary relationship between company
                     insider and purchaser or seller of the company’s stock, the misap-
                     propriation theory premises liability on a fiduciary-turned-trader’s
                     deception of those who entrusted him with access to confidential in-
                         The two theories are complementary, each addressing efforts to
                     capitalize on nonpublic information through the purchase or sale of
                     securities. The classical theory targets a corporate insider’s breach of
                     duty to shareholders with whom the insider transacts; the misappro-
                     priation theory outlaws trading on the basis of nonpublic information
                     by a corporate ”outsider” in breach of a duty owed not to a trading
                     party, but to the source of the information. The misappropriation
) 05)&3 4&$3&$: -"84                                                           

theory is thus designed to protect the integrity of the securities mar-
kets against abuses by ‘outsiders’ to a corporation who have access
to confidential information that will affect the corporation’s security
price when revealed, but who owe no fiduciary or other duty to that
corporation’s shareholders.5
We agree with the Government that misappropriation, as just defined,
satisfies § 10(b)’s requirement that chargeable conduct involve a ”de-
ceptive device or contrivance” used ”in connection with” the pur-
chase or sale of securities. We observe, first, that misappropriators,
as the Government describes them, deal in deception. A fiduciary
who pretends loyalty to the principal while secretly converting the
principal’s information for personal gain, ”dupes” or defrauds the
    We addressed fraud of the same species in Carpenter v. United                      $BSQFOUFS  64  
States, which involved the mail fraud statute’s proscription of ”any
scheme or artifice to defraud.” Affirming convictions under that                           64$ f 
statute, we said in Carpenter that an employee’s undertaking not to re-
veal his employer’s confidential information ”became a sham” when
the employee provided the information to his co-conspirators in a
scheme to obtain trading profits. A company’s confidential informa-
tion qualifies as property to which the company has a right of exclu-
sive use. The undisclosed misappropriation of such information, in
violation of a fiduciary duty, constitutes fraud akin to embezzlement –
the fraudulent appropriation to one’s own use of the money or goods
entrusted to one’s care by another.
    Deception through nondisclosure is central to the theory of liabil-
ity for which the Government seeks recognition. As counsel for the
Government stated in explanation of the theory at oral argument: ”To
satisfy the common law rule that a trustee may not use the property
that has been entrusted to him, there would have to be consent. To
satisfy the requirement of the Securities Act that there be no decep-
tion, there would only have to be disclosure.”6
     The Government could not have prosecuted O’Hagan under the classical the-
ory, for O’Hagan was not an ”insider” of Pillsbury, the corporation in whose stock
he traded. Although an ”outsider” with respect to Pillsbury, O’Hagan had an inti-
mate association with, and was found to have traded on confidential information
from, Dorsey & Whitney, counsel to tender offer or Grand Met. Under the mis-
appropriation theory, O’Hagan’s securities trading does not escape Exchange Act
sanction, as it would under Justice Thomas’ dissenting view, simply because he
was associated with, and gained nonpublic information from, the bidder, rather
than the target.
     Under the misappropriation theory urged in this case, the disclosure obligation
runs to the source of the information, here, Dorsey & Whitney and Grand Met.
Chief Justice Burger, dissenting in Chiarella, advanced a broader reading of § 10(b)
                                                                               $)"15&3  53"%& 4&$3&5

                                   We turn next to the § 10(b) requirement that the misappropriator’s
                               deceptive use of information be ”in connection with the purchase or
                               sale of [a] security.” This element is satisfied because the fiduciary’s
                               fraud is consummated, not when the fiduciary gains the confidential
                               information, but when, without disclosure to his principal, he uses
                               the information to purchase or sell securities. The securities transac-
                               tion and the breach of duty thus coincide. This is so even though the
                               person or entity defrauded is not the other party to the trade, but is,
                               instead, the source of the nonpublic information. A misappropriator
                               who trades on the basis of material, nonpublic information, in short,
                               gains his advantageous market position through deception; he de-
                               ceives the source of the information and simultaneously harms mem-
                               bers of the investing public.
                                   The misappropriation theory comports with § 10(b)’s language,
                               which requires deception ”in connection with the purchase or sale
                               of any security,” not deception of an identifiable purchaser or seller.
                               The theory is also well tuned to an animating purpose of the Ex-
                               change Act: to insure honest securities markets and thereby promote
                               investor confidence. Although informational disparity is inevitable
                               in the securities markets, investors likely would hesitate to venture
                               their capital in a market where trading based on misappropriated
                               nonpublic information is unchecked by law. An investor’s informa-
                               tional disadvantage vis-à-vis a misappropriator with material, non-
                               public information stems from contrivance, not luck; it is a disadvan-
                               tage that cannot be overcome with research or skill.
                                   In sum, considering the inhibiting impact on market participation
                               of trading on misappropriated information, and the congressional
                               purposes underlying § 10(b), it makes scant sense to hold a lawyer
                               like O’Hagan a § 10(b) violator if he works for a law firm represent-
                               ing the target of a tender offer, but not if he works for a law firm rep-
                               resenting the bidder. The text of the statute requires no such result.
                               The misappropriation at issue here was properly made the subject of
                               a § 10(b) charge because it meets the statutory requirement that there
                               be ”deceptive” conduct ”in connection with” securities transactions.
                               According to the Eighth Circuit, three of our decisions [including
$IJBSFMMB  64     Chiarella v. United States] reveal that § 10(b) liability cannot be predi-
                               cated on a duty owed to the source of nonpublic information.
                                  Chiarella involved securities trades by a printer employed at a
                               and Rule 10b-5; the disclosure obligation, as he envisioned it, ran to those with
                               whom the misappropriator trades. (”a person who has misappropriated nonpublic
                               information has an absolute duty to disclose that information or to refrain from
                               trading”). The Government does not propose that we adopt a misappropriation
                               theory of that breadth.
) 05)&3 4&$3&$: -"84                                                 

shop that printed documents announcing corporate takeover bids.
Deducing the names of target companies from documents he han-
dled, the printer bought shares of the targets before takeover bids
were announced, expecting (correctly) that the share prices would
rise upon announcement. In these transactions, the printer did not
disclose to the sellers of the securities (the target companies’ share-
holders) the nonpublic information on which he traded. For that trad-
ing, the printer was convicted of violating § 10(b) and Rule 10b-5. We
reversed the Court of Appeals judgment that had affirmed the con-
    The jury in Chiarella had been instructed that it could convict the
defendant if he willfully failed to inform sellers of target company
securities that he knew of a takeover bid that would increase the
value of their shares. Emphasizing that the printer had no agency
or other fiduciary relationship with the sellers, we held that liability
could not be imposed on so broad a theory. There is under § 10(b),
we explained, no ”general duty between all participants in market
transactions to forgo actions based on material, nonpublic informa-
tion.” Under established doctrine, we said, a duty to disclose or ab-
stain from trading ”arises from a specific relationship between two

                        4BMNBO W 6OJUFE 4UBUFT
                           4 $U  
Section 10(b) of the Securities Exchange Act of 1934 and the Securities
and Exchange Commission’s Rule 10b-5 prohibit undisclosed trad-
ing on inside corporate information by individuals who are under
a duty of trust and confidence that prohibits them from secretly us-
ing such information for their personal advantage. Individuals under
this duty may face criminal and civil liability for trading on inside in-
formation (unless they make appropriate disclosures ahead of time).
    These persons also may not tip inside information to others for
trading. The tippee acquires the tipper’s duty to disclose or abstain
from trading if the tippee knows the information was disclosed in
breach of the tipper’s duty, and the tippee may commit securities
fraud by trading in disregard of that knowledge. In Dirks v. SEC,           %JSLT  64  
this Court explained that a tippee’s liability for trading on inside in-
formation hinges on whether the tipper breached a fiduciary duty by
disclosing the information. A tipper breaches such a fiduciary duty,
we held, when the tipper discloses the inside information for a per-
sonal benefit. And, we went on to say, a jury can infer a personal
benefit – and thus a breach of the tipper’s duty – where the tipper
receives something of value in exchange for the tip or ”makes a gift
of confidential information to a trading relative or friend.”
    Petitioner Bassam Salman challenges his convictions for conspir-
                                           $)"15&3  53"%& 4&$3&5

acy and insider trading. Salman received lucrative trading tips from
an extended family member, who had received the information from
Salman’s brother-in-law. Salman then traded on the information. He
argues that he cannot be held liable as a tippee because the tipper
(his brother-in-law) did not personally receive money or property in
exchange for the tips and thus did not personally benefit from them.
    Maher Kara was an investment banker in Citigroup’s healthcare
investment banking group. He dealt with highly confidential infor-
mation about mergers and acquisitions involving Citigroup’s clients.
Maher enjoyed a close relationship with his older brother, Mounir
Kara (known as Michael). After Maher started at Citigroup, he be-
gan discussing aspects of his job with Michael. At first he relied on
Michael’s chemistry background to help him grasp scientific concepts
relevant to his new job. Then, while their father was ba ling cancer,
the brothers discussed companies that dealt with innovative cancer
treatment and pain management techniques. Michael began to trade
on the information Maher shared with him. At first, Maher was un-
aware of his brother’s trading activity, but eventually he began to
suspect that it was taking place.
    Ultimately, Maher began to assist Michael’s trading by sharing in-
side information with his brother about pending mergers and acquisi-
tions. Maher sometimes used code words to communicate corporate
information to his brother. Other times, he shared inside information
about deals he was not working on in order to avoid detection. With-
out his younger brother’s knowledge, Michael fed the information
to others – including Salman, Michael’s friend and Maher’s brother-
in-law. By the time the authorities caught on, Salman had made over
$1.5 million in profits that he split with another relative who executed
trades via a brokerage account on Salman’s behalf.
    In this case, Salman contends that an insider’s gift of confidential
information to a trading relative or friend is not enough to establish
securities fraud. Instead, Salman argues, a tipper does not personally
benefit unless the tipper’s goal in disclosing inside information is to
obtain money, property, or something of tangible value.
    We adhere to Dirks, which easily resolves the narrow issue pre-
sented here.
    In Dirks, we explained that a tippee is exposed to liability for trad-
ing on inside information only if the tippee participates in a breach
of the tipper’s fiduciary duty. Whether the tipper breached that duty
depends ”in large part on the purpose of the disclosure” to the tippee.
”The test,” we explained, ”is whether the insider personally will ben-
efit, directly or indirectly, from his disclosure.” Thus, the disclosure
of confidential information without personal benefit is not enough.
In determining whether a tipper derived a personal benefit, we in-
structed courts to ”focus on objective criteria, i.e., whether the insider
) 05)&3 4&$3&$: -"84                                                 

receives a direct or indirect personal benefit from the disclosure, such
as a pecuniary gain or a reputational benefit that will translate into
future earnings.” This personal benefit can ”often” be inferred ”from
objective facts and circumstances,” we explained, such as ”a relation-
ship between the insider and the recipient that suggests a quid pro
quo from the la er, or an intention to benefit the particular recipient.”
In particular, we held that ”the elements of fiduciary duty and ex-
ploitation of nonpublic information also exist when an insider makes
a gift of confidential information to a trading relative or friend.” In
such cases, ”the tip and trade resemble trading by the insider fol-
lowed by a gift of the profits to the recipient.” We then applied this
gift-giving principle to resolve Dirks itself, finding it dispositive that
the tippers ”received no monetary or personal benefit” from their tips
to Dirks, ”nor was their purpose to make a gift of valuable informa-
tion to Dirks.”
    Our discussion of gift giving resolves this case. Maher, the tipper,
provided inside information to a close relative, his brother Michael.
Dirks makes clear that a tipper breaches a fiduciary duty by making a
gift of confidential information to ”a trading relative,” and that rule is
sufficient to resolve the case at hand. As Salman’s counsel acknowl-
edged at oral argument, Maher would have breached his duty had
he personally traded on the information here himself then given the
proceeds as a gift to his brother. It is obvious that Maher would per-
sonally benefit in that situation. But Maher effectively achieved the
same result by disclosing the information to Michael, and allowing
him to trade on it. Dirks appropriately prohibits that approach, as
well. Dirks specifies that when a tipper gives inside information to
”a trading relative or friend,” the jury can infer that the tipper meant
to provide the equivalent of a cash gift. In such situations, the tipper
benefits personally because giving a gift of trading information is the
same thing as trading by the tipper followed by a gift of the proceeds.
Here, by disclosing confidential information as a gift to his brother
with the expectation that he would trade on it, Maher breached his
duty of trust and confidence to Citigroup and its clients – a duty
Salman acquired, and breached himself, by trading on the informa-
tion with full knowledge that it had been improperly disclosed.


                       6$-" - 3FW  
American law is replete with legal obligations placed on one per-
son not to disclose information about another. While parties are of
course generally free to create contracts that regulate their ability to
                                                                          $)"15&3  53"%& 4&$3&5

                              disclose information, public and private law regimes impose numer-
                              ous mandatory duties of confidentiality that go beyond the contract
                              of the transacting parties to prevent the disclosure of information
                              through speech or other means. For example, doctors, lawyers, and
                              other professionals owe their clients duties of confidentiality, and can
                              be punished through administrative and tort law remedies if they
                              breach these duties by telling confidences to third parties. These du-
                              ties of nondisclosure are bu ressed by analogous evidentiary privi-
                              leges, which give clients the ability to prevent their lawyers and doc-
                              tors from speaking against their interests, presumably even when the
                              content of the testimony would be quite newsworthy. Evidence law
                              goes further and grants testimonial privileges to present and former
                              spouses, psychotherapists, and others.

                                                   3FTUBUFNFOU 4FDPOE PG 5PSUT

f #
                             One who intentionally intrudes, physically or otherwise, upon the
*OUSVTJPO VQPO 4FDMVTJPO     solitude or seclusion of another or his private affairs or concerns, is
                             subject to liability to the other for invasion of his privacy, if the intru-
                             sion would be highly offensive to a reasonable person.
                           cmt. b The invasion may be by physical intrusion into a place in which
                                   the plaintiff has secluded himself, as when the defendant forces
                                   his way into the plaintiff’s room in a hotel or insists over the
                                   plaintiff’s objection in entering his home. It may also be by the
                                   use of the defendant’s senses, with or without mechanical aids,
                                   to oversee or overhear the plaintiff’s private affairs, as by look-
                                   ing into his upstairs windows with binoculars or tapping his
                                   telephone wires. It may be by some other form of investigation
                                   or examination into his private concerns, as by opening his pri-
                                   vate and personal mail, searching his safe or his wallet, exam-
                                   ining his private bank account, or compelling him by a forged
                                   court order to permit an inspection of his personal documents.
                           cmt. c The defendant is subject to liability under the rule stated in
                                   this Section only when he has intruded into a private place, or
                                   has otherwise invaded a private seclusion that the plaintiff has
                                   thrown about his person or affairs. Thus there is no liability
                                   for the examination of a public record concerning the plaintiff,
                                   or of documents that the plaintiff is required to keep and make
                                   available for public inspection. Nor is there liability for observ-
                                   ing him or even taking his photograph while he is walking on
                                   the public highway, since he is not then in seclusion, and his ap-
                                   pearance is public and open to the public eye. Even in a public
                                   place, however, there may be some ma ers about the plaintiff,
                                   such as his underwear or lack of it, that are not exhibited to the
   ) 05)&3 4&$3&$: -"84                                                   

         public gaze; and there may still be invasion of privacy when
         there is intrusion upon these ma ers.

  One who gives publicity to a ma er concerning the private life of an-          f %
  other is subject to liability to the other for invasion of his privacy, if     1VCMJDJUZ (JWFO UP 1SJWBUF -JGF
  the ma er publicized is of a kind that (a) would be highly offensive to
  a reasonable person, and (b) is not of legitimate concern to the public.
cmt. b Private life. – The rule stated in this Section applies only to pub-
        licity given to ma ers concerning the private, as distinguished
        from the public, life of the individual. There is no liability
        when the defendant merely gives further publicity to informa-
        tion about the plaintiff that is already public. Thus there is no
        liability for giving publicity to facts about the plaintiff’s life that
        are ma ers of public record, such as the date of his birth, the fact
        of his marriage, his military record, the fact that he is admi ed
        to the practice of medicine or is licensed to drive a taxicab, or
        the pleadings that he has filed in a lawsuit. On the other hand,
        if the record is one not open to public inspection, as in the case
        of income tax returns, it is not public, and there is an invasion
        of privacy when it is made so.
            Similarly, there is no liability for giving further publicity to
        what the plaintiff himself leaves open to the public eye. Thus he
        normally cannot complain when his photograph is taken while
        he is walking down the public street and is published in the
        defendant’s newspaper. Nor is his privacy invaded when the
        defendant gives publicity to a business or activity in which the
        plaintiff is engaged in dealing with the public. On the other
        hand, when a photograph is taken without the plaintiff’s con-
        sent in a private place, or one already made is stolen from his
        home, the plaintiff’s appearance that is made public when the
        picture appears in a newspaper is still a private ma er, and his
        privacy is invaded.
            Every individual has some phases of his life and his activ-
        ities and some facts about himself that he does not expose to
        the public eye, but keeps entirely to himself or at most reveals
        only to his family or to close friends. Sexual relations, for exam-
        ple, are normally entirely private ma ers, as are family quar-
        rels, many unpleasant or disgraceful or humiliating illnesses,
        most intimate personal le ers, most details of a man’s life in
        his home, and some of his past history that he would rather for-
        get. When these intimate details of his life are spread before the
        public gaze in a manner highly offensive to the ordinary reason-
        able man, there is an actionable invasion of his privacy, unless
        the ma er is one of legitimate public interest.
                                                                                    $)"15&3  53"%& 4&$3&5

                                           /FJM . 3JDIBSET  %BOJFM + 4PMPWF 1SJWBDZhT 0UIFS 1BUI 3FDPWFSJOH UIF
                                                                     -BX PG $POöEFOUJBMJUZ
                                                                      (FP -+  
                                           According to the oft-told legend, the right to privacy was born when
                                           Samuel Warren and Louis Brandeis penned The Right to Privacy in
                                           1890. Spanning just twenty-eight pages in the Harvard Law Review,
                                           the article identified privacy as an implicit concept running through-
                                           out Anglo-American common law. Warren and Brandeis also based
1SJODF "MCFSU   &OH 3FQ       much of their argument for a right to privacy upon Prince Albert v.
$I                                        Strange, an English case from 1848.
                                               The dispute arose when Queen Victoria and her husband Al-
                                           bert, the Prince Consort, sued in equity to prevent the exhibition by
                                           William Strange of etchings that the royal couple had made of their
                                           family. They intended the etchings to be shared only with their fam-
                                           ily and close friends. On appeal, the Lord Chancellor agreed that
                                           Strange had no right to print and sell the etchings or the catalog. The
                                           Chancellor concluded that Prince Albert had a common law literary
                                           property right in the unpublished work – essentially, a common law
1VU UIJT UIPVHIU BTJEF GPS OPX DPN       copyright in unpublished works. Prince Albert suggested that intel-
NPO MBX MJUFSBSZ QSPQFSUZ XJMM SFUVSO JO   lectual property law could afford a remedy of restricting publication
                                           in unpublished works. Warren and Brandeis took this facet of the
                                           opinion and used it to turn Prince Albert from an opinion protecting
                                           intellectual property rights to a case protecting individual feelings
                                           and emotions from the pain of unwanted publicity.
                                               The story of privacy in Britain serves as an interesting contrast to
                                           the American experience. English law, like American law, also de-
                                           veloped a law of “private” information. As in America, this English
                                           strand of the common law also traces its origins back to Prince Albert.
                                           Warren and Brandeis minimized the second basis for the judgment
                                           – breach of confidence. Because Victoria and Albert had circulated
                                           copies of the etchings only to a few friends, and had only sent copies
                                           outside such a circle to the printer for purpose of making these copies,
                                           the Lord Chancellor concluded that Strange’s possession “must have
                                           originated in a breach of trust, confidence, or contract,” most likely
                                           by a clerk to the royal printer. Disclosure represented a breach of con-
                                           fidence because a clerk to trusted professionals like printers and mer-
                                           chants owed the same implied contractual duty as his master “that
                                           he will not make public that which he learns in the execution of his
                                           duty as clerk.” Thus, the printer’s assistant had a duty to the Queen
                                           and the Prince to maintain the confidentiality of their etchings. The
                                           breach of this duty could be enforced against subsequent holders of
                                           the etchings and the plates used to make copies of them.
                                               The English law of confidence is quite different from the Amer-
) 05)&3 4&$3&$: -"84                                               

ican law of privacy. Consider the case of Barrymore v. News Group           #BSSZNPSF <> '43  $I 6,
Newspapers, Ltd.. Actor Michael Barrymore had a homosexual affair
with Paul Winco , who worked for a company Barrymore jointly
owned with his wife. Winco provided details of the affair to a news-
paper, including le ers wri en by Barrymore. The court held that
there was a breach of confidence: “When people enter into a personal
relationship of this nature, they do not do so for the purpose of it sub-
sequently being published in The Sun, or any other newspaper. The
information about the relationship is for the relationship and not for
a wider purpose.”
    The results in these cases would very likely be different under
American privacy law. Courts might dismiss the cases, either con-
cluding that the information was not private since others knew about
it or finding that the information was “of legitimate concern to the
public.” Beyond the privacy torts, the American breach of confiden-
tiality tort would have difficulty because only a few courts have held
that it can make third parties liable for knowingly using information
obtained via a breach. Moreover, the American tort currently has
been applied only to a limited set of relationships; courts have not
yet extended the tort to friends or lovers. In contrast, English law is
much more open-ended in the relationships it protects.

                              'MPSJEB W 3JMFZ
This case originated with an anonymous tip to the Pasco County Sher-
iff’s office that marijuana was being grown on respondent’s prop-
erty. When an investigating officer discovered that he could not see
the contents of [respondent’s] greenhouse from the road, he circled
twice over respondent’s property in a helicopter at the height of 400
feet. With his naked eye, he was able to see through the openings in
the roof and one or more of the open sides of the greenhouse and to
identify what he thought was marijuana growing in the structure. A
warrant was obtained based on these observations, and the ensuing
search revealed marijuana growing in the greenhouse. Respondent
was charged with possession of marijuana under Florida law. The
trial court granted his motion to suppress [for violating the Fourth
Amendment’s prohibition on ”unreasonable searches and seizures.”]
                                                                            $JSBPMP  64  
    California v. Ciraolo controls this case. There, acting on a tip, the
police inspected the backyard of a particular house while flying in a
fixed-wing aircraft at 1,000 feet. With the naked eye the officers saw
what they concluded was marijuana growing in the yard. A search
warrant was obtained on the strength of this airborne inspection, and
marijuana plants were found.
    We recognized that the yard was within the curtilage of the house,
that a fence shielded the yard from observation from the street, and
                                        $)"15&3  53"%& 4&$3&5

that the occupant had a subjective expectation of privacy. We held,
however, that such an expectation was not reasonable and not one
that society is prepared to honor. Our reasoning was that the home
and its curtilage are not necessarily protected from inspection that
involves no physical invasion. What a person knowingly exposes to
the public, even in his own home or office, is not a subject of Fourth
Amendment protection. As a general proposition, the police may see
what may be seen from a public vantage point where they have a
right to be, Thus the police, like the public, would have been free to
inspect the backyard garden from the street if their view had been
unobstructed. They were likewise free to inspect the yard from the
vantage point of an aircraft flying in the navigable airspace as this
plane was.
   We arrive at the same conclusion in the present case.

                          ,ZMMP W 6OJUFE 4UBUFT
This case presents the question whether the use of a thermal-imaging
device aimed at a private home from a public street to detect relative
amounts of heat within the home constitutes a ”search” within the
meaning of the Fourth Amendment.
    In 1991 Agent William Ellio of the United States Department
of the Interior came to suspect that marijuana was being grown in
the home belonging to petitioner Danny Kyllo. Indoor marijuana
growth typically requires high-intensity lamps. In order to determine
whether an amount of heat was emanating from petitioner’s home
consistent with the use of such lamps, at 3:20 a.m. on January 16,
1992, Agent Ellio and Dan Haas used an Agema Thermovision 210
thermal imager to scan the triplex. Thermal imagers detect infrared
radiation, which virtually all objects emit but which is not visible to
the naked eye. The imager converts radiation into images based on
relative warmth—black is cool, white is hot, shades of gray connote
relative differences; in that respect, it operates somewhat like a video
camera showing heat images. The scan of Kyllo’s home took only a
few minutes and was performed from the passenger seat of Agent
Ellio ’s vehicle across the street from the front of the house and also
from the street in back of the house. The scan showed that the roof
over the garage and a side wall of petitioner’s home were relatively
hot compared to the rest of the home and substantially warmer than
neighboring homes in the triplex. Agent Ellio concluded that peti-
tioner was using halide lights to grow marijuana in his house, which
indeed he was. Based on tips from informants, utility bills, and the
thermal imaging, a Federal Magistrate Judge issued a warrant autho-
rizing a search of petitioner’s home, and the agents found an indoor
growing operation involving more than 100 plants.
) 05)&3 4&$3&$: -"84                                               

    One might think that examining the portion of a house that is in
plain public view, while it is a ”search” despite the absence of tres-
pass, is not an ”unreasonable” one under the Fourth Amendment.
But in fact we have held that visual observation is no ”search” at all.
In assessing when a search is not a search, we have applied somewhat
in reverse the principle first enunciated in Ka v. United States. Ka         ,BU[  64  
involved eavesdropping by means of an electronic listening device
placed on the outside of a telephone booth – a location not within
the catalog (”persons, houses, papers, and effects”) that the Fourth
Amendment protects against unreasonable searches. We held that
the Fourth Amendment nonetheless protected Ka from the warrant-
less eavesdropping because he ”justifiably relied” upon the privacy of
the telephone booth. As Justice Harlan’s oft-quoted concurrence de-
scribed it, a Fourth Amendment search occurs when the government
violates a subjective expectation of privacy that society recognizes as
reasonable. We have applied the test on two different occasions in
holding that aerial surveillance of private homes and surrounding
areas does not constitute a search. Ciraolo; Florida v. Riley.
    We think that obtaining by sense-enhancing technology any in-
formation regarding the interior of the home that could not otherwise
have been obtained without physical intrusion into a constitutionally
protected area, constitutes a search – at least where (as here) the tech-
nology in question is not in general public use. This assures preserva-
tion of that degree of privacy against government that existed when
the Fourth Amendment was adopted. On the basis of this criterion,
the information obtained by the thermal imager in this case was the
product of a search.
    The Government also contends that the thermal imaging was con-
stitutional because it did not ”detect private activities occurring in
private areas,” It points out that in Dow Chemical Co. v. United States     %PX $IFNJDBM  64  
we observed that the enhanced aerial photography did not reveal
any ”intimate details.” Dow Chemical, however, involved enhanced
aerial photography of an industrial complex, which does not share
the Fourth Amendment sanctity of the home. The Fourth Amend-
ment’s protection of the home has never been tied to measurement
of the quality or quantity of information obtained. In Silverman v.         4JMWFSNBO  64  
United States, for example, we made clear that any physical invasion
of the structure of the home, ”by even a fraction of an inch,” was too
much, and there is certainly no exception to the warrant requirement
for the officer who barely cracks open the front door and sees nothing
but the nonintimate rug on the vestibule floor. In the home, our cases
show, all details are intimate details, because the entire area is held
                                                                                 $)"15&3  53"%& 4&$3&5

                                         safe from prying government eyes.
                                         Justice Stevens, dissenting:
                                             There is, in my judgment, a distinction of constitutional magni-
                                         tude between ”through-the-wall surveillance” that gives the observer
                                         or listener direct access to information in a private area, on the one
                                         hand, and the thought processes used to draw inferences from in-
                                         formation in the public domain, on the other hand. The Court has
                                         crafted a rule that purports to deal with direct observations of the
                                         inside of the home, but the case before us merely involves indirect
                                         deductions from ”off-the-wall” surveillance, that is, observations of
                                         the exterior of the home.

                                              (PWFSONFOU 4FDSFUT

                                                              'SFFEPN PG *OGPSNBUJPO "DU

 64$ f 
                                         (a) Each agency shall make available to the public information as
JPOT PSEFST SFDPSET BOE QSPDFFEJOHT          (3) (A) … each agency, upon any request for records which
                                                      (i) reasonably describes such records and (ii) is made
                                                       in accordance with published rules stating the time,
                                                       place, fees (if any), and procedures to be followed,
                                                       shall make the records promptly available to any per-
                                         (b) This section does not apply to ma ers that are –
                                             (1) (A) specifically authorized under criteria established by an
                                                  Executive order to be kept secret in the interest of national
                                                  defense or foreign policy and (B) are in fact properly clas-
                                                  sified pursuant to such Executive order;
                                             (2) related solely to the internal personnel rules and practices
                                                  of an agency;
                                             (3) specifically exempted from disclosure by statute …
                                             (4) trade secrets and commercial or financial information ob-
                                                  tained from a person and privileged or confidential;
                                             (5) inter-agency or intra-agency memorandums or le ers
                                                  which would not be available by law to a party other than
                                                  an agency in litigation with the agency;
                                             (6) personnel and medical files and similar files the disclosure
                                                  of which would constitute a clearly unwarranted invasion
                                                  of personal privacy;
                                             (7) records or information compiled for law enforcement pur-
                                                  poses, but only to the extent that the production of such
) 05)&3 4&$3&$: -"84                                                 

          law enforcement records or information (A) could reason-
          ably be expected to interfere with enforcement proceed-
          ings, (B) would deprive a person of a right to a fair trial
          or an impartial adjudication, (C) could reasonably be ex-
          pected to constitute an unwarranted invasion of personal
          privacy, (D) could reasonably be expected to disclose the
          identity of a confidential source … (E) would disclose tech-
          niques and procedures for law enforcement investigations
          or prosecutions … if such disclosure could reasonably be
          expected to risk circumvention of the law, or (F) could rea-
          sonably be expected to endanger the life or physical safety
          of any individual;
      (8) contained in or related to examination, operating, or con-
          dition reports prepared by, on behalf of, or for the use of
          an agency responsible for the regulation or supervision of
          financial institutions; or
      (9) geological and geophysical information and data, includ-
          ing maps, concerning wells.

                   64 %FQU PG +VTUJDF W 5BY "OBMZTUT
The question presented is whether the Freedom of Information Act re-
quires the United States Department of Justice (Department) to make
available copies of district court decisions that it receives in the course
of litigating tax cases on behalf of the Federal Government. We hold
that it does.
    We consider first whether the district court decisions at issue are
”agency records,” a term elaborated upon both in Kissinger v. Re-             ,JTTJOHFS  64  
porters Comm. for Freedom of Press and in Forsham v. Harris. Kissinger        'PSTIBN  64  
involved three separate FOIA requests for wri en summaries of
telephone conversations in which Henry Kissinger had participated
when he served as Assistant to the President for National Security Af-
fairs from 1969 to 1975, and as Secretary of State from 1973 to 1977. At
the time of this request, these summaries were stored in Kissinger’s
office at the State Department in his personal files. We first concluded
that the summaries were not ”agency records” at the time they were
made because the FOIA does not include the Office of the President
in its definition of ”agency.” We further held that these documents
did not acquire the status of ”agency records” when they were re-
moved from the White House and transported to Kissinger’s office at
the State Department, a FOIA-covered agency.
    Forsham, in turn, involved a request for raw data that formed the
basis of a study conducted by a private medical research organization.
Although the study had been funded through federal agency grants,
                                          $)"15&3  53"%& 4&$3&5

the data never passed into the hands of the agencies that provided
the funding, but instead was produced and possessed at all times by
the private organization. We recognized that records of a nonagency
certainly could become records of an agency as well, but the fact that
the study was financially supported by a FOIA-covered agency did
not transform the source material into ”agency records.” Nor did the
agencies’ right of access to the materials under federal regulations
change this result. As we explained, ”the FOIA applies to records
which have been in fact obtained, and not to records which merely
could have been obtained.”
    Two requirements emerge from Kissinger and Forsham, each of
which must be satisfied for requested materials to qualify as ”agency
records.” First, an agency must either create or obtain the requested
materials. In performing their official duties, agencies routinely avail
themselves of studies, trade journal reports, and other materials pro-
duced outside the agencies both by private and governmental orga-
nizations. To restrict the term ”agency records” to materials gener-
ated internally would frustrate Congress’ desire to put within public
reach the information available to an agency in its decision-making
    Second, the agency must be in control of the requested materials
at the time the FOIA request is made. By control we mean that the ma-
terials have come into the agency’s possession in the legitimate con-
duct of its official duties. This requirement accords with Kissinger’s
teaching that the term ”agency records” is not so broad as to include
personal materials in an employee’s possession, even though the ma-
terials may be physically located at the agency.
    Applying these requirements here, we conclude that the re-
quested district court decisions constitute ”agency records.” First, it is
undisputed that the Department has obtained these documents from
the district courts. Second, the Department clearly controls the dis-
trict court decisions that Tax Analysts seeks.

                       $ISZTMFS $PSQ W #SPXO
The expanding range of federal regulatory activity and growth in the
Government sector of the economy have increased federal agencies’
demands for information about the activities of private individuals
and corporations. These developments have paralleled a related con-
cern about secrecy in Government and abuse of power. The Freedom
of Information Act (hereinafter FOIA) was a response to this concern,
but it has also had a largely unforeseen tendency to exacerbate the
uneasiness of those who comply with governmental demands for in-
formation. For under the FOIA third parties have been able to obtain
Government files containing information submi ed by corporations
) 05)&3 4&$3&$: -"84                                               

and individuals who thought that the information would be held in
    This case belongs to a class that has been popularly denominated
”reverse-FOIA” suits. Chrysle seeks to enjoin agency disclosure on
the grounds that it is inconsistent with the FOIA and 18 U.S.C. § 1905,
a criminal statute with origins in the 19th century that proscribes dis-
closure of certain classes of business and personal information. We
agree with the Court of Appeals for the Third Circuit that the FOIA
is purely a disclosure statute and affords Chrysler no private right
of action to enjoin agency disclosure. But we cannot agree with that
court’s conclusion that this disclosure is ”authorized by law” within
the meaning of § 1905.
    As a party to numerous Government contracts, Chrysler is re-
quired to comply with Executive Orders 11246 and 11375, which
charge the Secretary of Labor with ensuring that corporations that
benefit from Government contracts provide equal employment op-
portunity regardless of race or sex. The United States Department of
Labor’s Office of Federal Contract Compliance Programs (OFCCP)
has promulgated regulations which require Government contrac-
tors to furnish reports and other information about their affirmative-
action programs and the general composition of their work forces.
OFCCP regulations require that Chrysler make available to this
agency wri en affirmative-action programs (AAP’s) and annually
submit Employer Information Reports, known as EEO-1 Reports.
    Regulations promulgated by the Secretary of Labor provide for
public disclosure of information from records of the OFCCP and its
compliance agencies. It is the voluntary disclosure contemplated by
this regulation, over and above that mandated by the FOIA, which is
the gravamen of Chrysler’s complaint in this case.
    This controversy began on May 14, 1975, when the [government]
informed Chrysler that third parties had made an FOIA request for
disclosure of the 1974 AAP for Chrysler’s Newark, Del., assembly
    Although we have not had to face squarely the question whether
the FOIA textitex proprio vigore forbids governmental agencies from
disclosing certain classes of information to the public, we have con-
sistently recognized that the basic objective of the Act is disclosure.
    Chrysler contends that the nine exemptions in general, and Ex-
emption 4 in particular, reflect a sensitivity to the privacy interests of
private individuals and nongovernmental entities. That contention
may be conceded without inexorably requiring the conclusion that
the exemptions impose affirmative duties on an agency to withhold
information sought. In fact, that conclusion is not supported by the
language, logic, or history of the Act.
    Enlarged access to governmental information undoubtedly cuts
                                                            $)"15&3  53"%& 4&$3&5

                   against the privacy concerns of nongovernmental entities, and as a
                   ma er of policy some balancing and accommodation may well be de-
                   sirable. We simply hold here that Congress did not design the FOIA
                   exemptions to be mandatory bars to disclosure.
                       Chrysler contends, however, that even if its suit for injunctive re-
                   lief cannot be based on the FOIA, such an action can be premised on
 64$ f    the Trade Secrets Act. The Act provides:
                         Whoever, being an officer or employee of the United
                         States or of any department or agency thereof, publishes,
                         divulges, discloses, or makes known in any manner or to
                         any extent not authorized by law any information coming
                         to him in the course of his employment or official duties
                         or by reason of any examination or investigation made by,
                         or return, report or record made to or filed with, such de-
                         partment or agency or officer or employee thereof which
                         information concerns or relates to the trade secrets, pro-
                         cesses, operations, style of work, or apparatus, or to the
                         identity, confidential statistical data, amount or source of
                         any income, profits, losses, or expenditures of any person,
                         firm, partnership, corporation, or association; or permits
                         any income return or copy thereof or any book containing
                         any abstract or particulars thereof to be seen or examined
                         by any person except as provided by law; shall be fined
                         not more than $1,000, or imprisoned not more than one
                         year, or both; and shall be removed from office or employ-
                   The Court of Appeals held that the Trade Secrets Act was not appli-
                   cable to the agency disclosure at issue here because such disclosure
                   was ”authorized by law” within the meaning of the Act. The court
                   found the source of that authorization to be the OFCCP regulations
                   that DLA relied on in deciding to disclose information on the Ham-
                   tramck and Newark plants. [The Court disagreed.]
                       We reject, however, Chrysler’s contention that the Trade Secrets
                   Act affords a private right of action to enjoin disclosure in violation
                   of the statute. Most importantly, a private right of action is not nec-
                   essary to make effective the congressional purpose, for we find that
                   review of DLA’s decision to disclose Chrysler’s employment data is
                   available under the Administrative Procedures Act.
                       Section 10(a) of the APA provides that ”a person suffering legal
                   wrong because of agency action, or adversely affected or aggrieved
 64$ f     by agency action, is entitled to judicial review thereof.” We conclude
                   that DLA’s decision to disclose the Chrysler reports is reviewable
                   agency action and Chrysler is a person ”adversely affected or ag-
) 05)&3 4&$3&$: -"84                                              

grieved” within the meaning of § 10(a).

                         'E  %$ $JS 
This case raises issues concerning the scope of Exemptions 5 and 7
to the general disclosure requirements of the Freedom of Informa-
tion Act. In 1975 and 1976, plaintiff Coastal States Gas Corporation
(Coastal States) filed Freedom of Information requests with the de-
fendant, seeking copies of agency interpretations of its regulations
which had not been made public. The issue in this appeal is focused
on memoranda from regional counsel to auditors working in DOE’s
field offices, issued in response to requests for interpretations of reg-
ulations within the context of particular facts encountered while con-
ducting an audit of a firm. The plaintiff contends that these memo-
randa constituted a body of ”secret law” which the agency was using
in its dealings with the public and which must be disclosed, while
DOE responds that the documents were properly withheld under Ex-
emption 5, as documents which would not be subject to disclosure
during discovery, and in a few cases, under Exemption 7 as docu-
ments within an investigatory file.
    After the 1973 oil embargo, a compliance program was established
to assure the observance of petroleum pricing and allocation regula-
tions. Ten regional offices were established within which regional
counsel were located. Each regional office also employed auditors
and other investigative personnel, whose job was auditing individual
firms to assure compliance with the regulations. These audits were
not ”investigations;” at that point, no charge had been made nor was
a violation necessarily suspected.
    While the regional counsel has many responsibilities, the partic-
ular task relevant to this case is that of providing interpretations of
the pertinent regulations to the auditors at this early stage of compli-
ance review. If the auditors should encounter a problem of regula-
tory interpretation, a request for advice would be sent to the regional
counsel, couched in a specific factual context, either real or hypothet-
ical. The response would be a legal memorandum, interpreting any
applicable regulations in light of those facts, and often pointing out
additional factors which might make a difference in the application
of the regulation.
    The agency points out that these were not ”formal” interpreta-
tions of the regulations, emphasizing that there is a published pro-
cedure for issuing such interpretations. Also, the agency insists that
the interpretations were not ”binding” on the audit staff; it contends
that the agency staff ”is free to reject the memorandum.” The district
court found, however, that in fact the advice was regularly and consis-
tently followed by the non-legal staff, a conclusion which we find to
                                                                                   $)"15&3  53"%& 4&$3&5

                                         be fully supported by the evidence. There is evidence in the record
                                         that agency staff failed to follow a regional counsel opinion only if
                                         it could be distinguished on the facts, or if the ma er were referred
                                         to a higher authority within the agency. Furthermore, in some of
                                         the offices the documents were indexed by subject ma er and used
                                         as precedent in later cases; they were circulated among the area of-
                                         fices and supplied to new personnel; they were at times ”amended”
                                         or ”rescinded,” which would hardly be necessary if the documents
                                         contained merely informal suggestions to staff which could be disre-
                                         garded; and on at least one occasion a regional counsel memorandum
                                         involving the audit of a different firm was cited to a member of the
                                         public as binding precedent.
                                             The language of Exemption 5 is cast in terms of discovery law; the
                                         agencies need turn over no documents ”which would not be available
                                         by law to a private party in litigation with the agency.” This discovery
                                         standard can only serve as a rough guide to the courts, since decisions
                                         as to discovery are usually based on a balancing of the relative need
                                         of the parties, and standards vary according to the kind of litigation
                                         involved. It is clear, however, that Congress intended that agencies
                                         should not lose the protection traditionally afforded through the ev-
                                         identiary privileges simply because of the passage of the FOIA. The
                                         courts have recognized that Exemption 5 protects, as a general rule,
                                         materials which would be protected under the a orney-client privi-
                                         lege, the a orney work-product privilege, or the executive ”delibera-
                                         tive process” privilege.
                                             We have difficulty in perceiving any purpose which would be
                                         served by applying the a orney-client privilege in this case. While it
                                         is clear that an agency can be a ”client” and agency lawyers can func-
                                         tion as ”a orneys” within the relationship contemplated by the priv-
                                         ilege, this does not seem to be such a case. It is hard to imagine the
                                         ”confidential information” which an auditor might have communi-
                                         cated to the regional counsel. The factual situations the auditor com-
                                         municates to the a orneys are encountered in the course of auditing
                                         third parties, the companies. They do not contain private information
                                         concerning the agency. Rather than ”counseling,” intended to assist
                                         the agency in protecting its interests, the memoranda here seem to
                                         be neutral, objective analyses of agency regulations. They resemble,
                                         in fact, question and answer guidelines which might be found in an
                                         agency manual. In sharp contrast are the documents and memoranda
.FBE %BUB  'E  %$ $JS    in issue in Mead Data Cent., Inc. v. US Dept. of Air Force, in which dis-
                                         closure was sought of material generated in the course of negotiating
                                         a contract between the Air Force and a private company. In such a
                                         case, the Government is dealing with its a orneys as would any pri-
                                         vate party seeking advice to protect personal interests, and needs the
                                         same assurance of confidentiality so it will not be deterred from full
) 05)&3 4&$3&$: -"84                                                

and frank communications with its counselors. This case bears li le
resemblance to that situation.
    Assuming, however, that the purposes of the a orney-client priv-
ilege might be served by extending its protection to the situation here,
we agree with the district court that DOE has failed to demonstrate
a fundamental prerequisite to assertion of the privilege: confidential-
ity both at the time of the communication and maintained since. The
agency has admi ed that it does not know who has had access to the
documents, and there is undisputed testimony that at least in some
regions, copies of the memoranda were circulated to all area offices,
filed and indexed for future use, relied on as precedent and used as
training materials for new personnel.
    Another traditional area of privilege which has been recognized
under Exemption 5 is a orney work-product. This doctrine stands in
contrast to the a orney-client privilege; rather than protecting confi-
dential communications from the client, it provides a working a or-
ney with a ”zone of privacy” within which to think, plan, weigh facts
and evidence, candidly evaluate a client’s case, and prepare legal the-
ories. There is one significant limitation of the doctrine, however,
which defeats the agency’s claim of privilege here; it has uniformly
been held to be limited to documents prepared in contemplation of lit-
igation. o the extent the Government provided some indication in its
index that a specific claim had taken shape in the course of an audit,
so that the a orney’s work could fairly, if generously, be character-
ized as ”in contemplation of litigation,” the district court permi ed
these documents to be withheld. Beyond that, the DOE has failed to
carry its burden of establishing that litigation was fairly foreseeable
at the time the memoranda were prepared, and thus is not entitled to
invoke the exception.
    A privilege unique to the government is one which is variously
described as predecisional or deliberative process privilege. The priv-
ilege has a number of purposes: it serves to assure that subordi-
nates within an agency will feel free to provide the decisionmaker
with their uninhibited opinions and recommendations without fear
of later being subject to public ridicule or criticism; to protect against
premature disclosure of proposed policies before they have been fi-
nally formulated or adopted; and to protect against confusing the is-
sues and misleading the public by dissemination of documents sug-
gesting reasons and rationales for a course of action which were not
in fact the ultimate reasons for the agency’s action.
    In deciding whether a document should be protected by the privi-
lege we look to whether the document is ”predecisional” –whether it
was generated before the adoption of an agency policy – and whether
the document is ”deliberative” – whether it reflects the give-and-take
of the consultative process. The exemption thus covers recommenda-
                                                                               $)"15&3  53"%& 4&$3&5

                                   tions, draft documents, proposals, suggestions, and other subjective
                                   documents which reflect the personal opinions of the writer rather
                                   than the policy of the agency. Documents which are protected by the
                                   privilege are those which would inaccurately reflect or prematurely
                                   disclose the views of the agency, suggesting as agency position that
                                   which is as yet only a personal position. To test whether disclosure
                                   of a document is likely to adversely affect the purposes of the priv-
                                   ilege, courts ask themselves whether the document is so candid or
                                   personal in nature that public disclosure is likely in the future to sti-
                                   fle honest and frank communication within the agency. Human ex-
                                   perience teaches that those who expect public dissemination of their
                                   remarks may well temper candor with a concern for appearances and
                                   for their own interests to the detriment of the decisionmaking process.
                                   We also ask whether the document is recommendatory in nature or is
                                   a draft of what will become a final document, and whether the docu-
                                   ment is deliberative in nature, weighing the pros and cons of agency
                                   adoption of one viewpoint or another. Finally, even if the document
                                   is predecisional at the time it is prepared, it can lose that status if it is
                                   adopted, formally or informally, as the agency position on an issue
                                   or is used by the agency in its dealings with the public.
                                       It is readily apparent that the memoranda in issue bear li le re-
                                   semblance to the types of documents intended to be protected under
                                   the deliberative process privilege. The documents were not sugges-
                                   tions or recommendations as to what agency policy should be. Unlike
.JOL  64               the documents in EPA v. Mink and Murphy v. Dep’t of the ArmyMur-
                                   phymurphy613 F.2d 1151 (1979), the memoranda are not advice to a
(SVNNBO  64           superior, nor are they suggested dispositions of a case, as in Renego-
                                   tiation Bd. v. Grumman Aircraft Engineering Corp.. They are not one
                                   step of an established adjudicatory process, which would result in a
4FBST 3PFCVDL  64     formal opinion, as were the documents held exempt in NLRB v. Sears,
                                   Roebuck & Co. There is nothing subjective or personal about the mem-
                                   oranda; they are simply straightforward explanations of agency reg-
                                   ulations in specific factual situations. They are more akin to a ”re-
                                   source” opinion about the applicability of existing policy to a certain
                                   state of facts, like examples in a manual, to be contrasted to a factual
                                   or strategic advice giving opinion. Nor do they reflect agency give-
                                   and-take – of the deliberative process – by which the decision itself
                                   is made. Characterizing these documents as ”predecisional” simply
                                   because they play into an ongoing audit process would be a serious
                                   warping of the meaning of the word. No ”decision” is being made or
                                   ”policy” being considered; rather the documents discuss established
                                   policies and decisions – the agency regulations – in the light of a spe-
                                   cific, and often hypothetical, fact pa ern.
                                       Exemption 7 affords protection to investigatory files to prevent
                                   harm to the government’s case in court. In 1974, the scope of the
) 05)&3 4&$3&$: -"84                                             

privilege was sharply narrowed when Congress, dissatisfied with the
broad scope given to Exemption 7 by the courts, amended the exemp-
tion to make it clear that the Government must establish not only that
the document was prepared in the course of an ”investigation,” but
that disclosure of the document would ”interfere with enforcement
proceedings.” The Government asserts this privilege as to fifty-three
    We need not decide whether any of these memoranda are of a sort
which would be protected if the Government had demonstrated – or
even conclusorily asserted – that there are presently active investiga-
tions underway or contemplated in each of these fifty-three cases. .
There is no reason to protect yellowing documents contained in long-
closed files. DOE made no effort whatsoever in the district court to
demonstrate that any of these cases are still under investigation or
being actively pursued. The district court was correct in concluding
that DOE had failed generally to meet its burden of establishing the
prerequisites to invocation of Exemption 7.

                   *OGPSNBUJPO 5IF -FHBM 'SBNFXPSL
Congress has directed the President to establish procedures govern-
ing the access to classified material so that no person can gain such
access without having undergone a background check. With the au-
thority to determine classification standards vested in the President,
these standards tend to change whenever a new administration takes
control of the White House.
    The present standards for classifying and declassifying informa-
tion were last amended on December 29, 2009. Under these stan-            &YFD 0SEFS /P   $'3 
dards, the President, Vice President, agency heads, and any other of-       

ficials designated by the President may classify information upon a
determination that the unauthorized disclosure of such information
could reasonably be expected to damage national security. Such in-
formation must be owned by, produced by, or under the control of
the federal government, and must concern one of the following:
   • military plans, weapons systems, or operations;
   • foreign government information;
   • intelligence activities, intelligence sources/methods, cryptol-
   • foreign relations or foreign activities of the United States, in-
      cluding confidential sources;
   • scientific, technological, or economic ma ers relating to na-
      tional security;
                                          $)"15&3  53"%& 4&$3&5

    • federal programs for safeguarding nuclear materials or facili-
    • vulnerabilities or capabilities of national security systems; or
    • weapons of mass destruction.
Information may be classified at one of three levels based on the
amount of danger that its unauthorized disclosure could reasonably
be expected to cause to national security. Information is classified
as ”Top Secret” if its unauthorized disclosure could reasonably be
expected to cause ”exceptionally grave damage” to national secu-
rity. The standard for ”Secret” information is ”serious damage” to
national security, while for ”confidential” information the standard is
”damage” to national security. Significantly, for each level, the orig-
inal classifying officer must identify or describe the specific danger
potentially presented by the information’s disclosure. In case of sig-
nificant doubt as to the need to classify information or the level of
classification appropriate, the information is to remain unclassified
or be classified at the lowest level of protection considered appropri-
    The officer who originally classifies the information establishes
a date for declassification based upon the expected duration of the
information’s sensitivity. If the office cannot set an earlier declassifi-
cation date, then the information must be marked for declassification
in 10 years’ time or 25 years, depending on the sensitivity of the in-
formation. The deadline for declassification can be extended if the
threat to national security still exists.
    Classified information is required to be declassified ”as soon as
it no longer meets the standards for classification.” The original clas-
sifying agency has the authority to declassify information when the
public interest in disclosure outweighs the need to protect that infor-
mation. On December 31, 2006, and every year thereafter, all informa-
tion that has been classified for 25 years or longer and has been deter-
mined to have ”permanent historical value” under Title 44 of the U.S.
Code will be automatically declassified, although agency heads can
exempt from this requirement classified information that continues
to be sensitive in a variety of specific areas.
    Access to classified information is generally limited to those who
demonstrate their eligibility to the relevant agency head, sign a
nondisclosure agreement, and have a need to know the information.
The need-to-know requirement can be waived, however, for former
Presidents and Vice Presidents, historical researchers, and former
policy-making officials who were appointed by the President or Vice
President. The information being accessed may not be removed from
the controlling agency’s premises without permission. Each agency
is required to establish systems for controlling the distribution of clas-
) 05)&3 4&$3&$: -"84                                                

sified information.
    Under E.O. 13526, each respective agency is responsible for main-
taining control over classified information it originates and is respon-
sible for establishing uniform procedures to protect classified infor-
mation and automated information systems in which classified in-
formation is stored or transmi ed. Agencies that receive informa-
tion classified elsewhere are not permi ed to transfer the informa-
tion further without approval from the classifying agency. Persons
authorized to disseminate classified information outside the execu-
tive branch are required to ensure it receives protection equivalent to
those required internally.
    Generally, federal law prescribes a prison sentence of no more
than a year and/or a $1,000 fine for officers and employees of the fed-
eral government who knowingly remove classified material without
the authority to do so and with the intention of keeping that material
at an unauthorized location. Stiffer penalties – fines of up to $10,000
and imprisonment for up to 10 years – a ach when a federal em-
ployee transmits classified information to anyone that the employee
has reason to believe is an agent of a foreign government. A fine
and a 10-year prison term also await anyone, government employee
or not, who publishes, makes available to an unauthorized person,
or otherwise uses to the United States’ detriment classified informa-
tion regarding the codes, cryptography, and communications intelli-
gence utilized by the United States or a foreign government. Finally,
the disclosure of classified information that discloses any informa-
tion identifying a covert agent, when done intentionally by a person
with authorized access to such identifying information, is punishable
by imprisonment for up to 15 years. A similar disclosure by one who
learns the identity of a covert agent as a result of having authorized ac-
cess to classified information is punishable by not more than 10 years’
imprisonment. Under the same provision, a person who undertakes
a ”pa ern of activities intended to identify and expose covert agents”
with reason to believe such activities would impair U.S. foreign intel-
ligence activities, and who then discloses the identities uncovered as
a result is subject to three years’ imprisonment, whether or not viola-
tor has access to classified information.
    In addition to the criminal penalties outlined above, the executive
branch employs numerous means of deterring unauthorized disclo-
sures by government personnel using administrative measures based
on terms of employment contracts. The agency may impose disci-
plinary action or revoke a person’s security clearance. The revocation
of a security clearance is usually not reviewable by the Merit System
Protection Board and may mean the loss of government employment.
Government employees may be subject to monetary penalties for dis-
closing classified information. Violators of the Espionage Act and the
                                                                                $)"15&3  53"%& 4&$3&5

                                      Atomic Energy Act provisions may be subject to loss of their retire-
                                      ment pay.
                                          Agencies also rely on contractual agreements with employees,
                                      who typically must sign non-disclosure agreements prior to obtain-
                                      ing access to classified information, sometimes agreeing to submit
                                      all materials that the employee desires to publish to a review by the
                                      agency. The Supreme Court enforced such a contract against a for-
                                      mer employee of the Central Intelligence Agency (CIA), upholding
                                      the government’s imposition of a constructive trust on the profits of
                                      a book the employee sought to publish without first submi ing it to
4OFQQ W 6OJUFE 4UBUFT  64    CIA for review.
                                          Under some circumstances, the government can also use injunc-
                                      tions to prevent disclosures of information. The courts have gener-
                                      ally upheld injunctions against former employees’ publishing infor-
                                      mation they learned through access to classified information. The
                                      Supreme Court also upheld the State Department’s revocation of
                                      passports for overseas travel by persons planning to expose U.S.
                                      covert intelligence agents, despite the fact that the purpose was to
                                      disrupt U.S. intelligence activities rather than to assist a foreign gov-
)BJH W "HFF  64         ernment.
                                          As noted above, E.O. 13526 sets the official procedures for the de-
                                      classification of information. Once information is declassified, it may
                                      be released to persons without a security clearance. Leaks, by con-
                                      trast, might be defined as the release of classified information to per-
                                      sons without a security clearance, typically journalists. Recent high-
                                      profile leaks of information regarding sensitive covert operations in
                                      news stories that seemed to some to portray the Obama Administra-
                                      tion in a favorable light raised questions regarding the practice of
                                      “instant declassification,” or whether disclosure of classified informa-
                                      tion to journalists may ever be said to be an “authorized disclosure”
                                      by a senior official.
                                          The processes for declassification set forth in E.O. 13526 seem to
                                      presuppose that agencies and classifying officials will not have any
                                      need or desire to disclose classified information in their possession
                                      other than to comply with the regulations. Yet it has long been noted
                                      that there seems to be an informal process for “instant declassifica-
                                      tion” of information whose release to the public serves an immediate
                                          As a practical ma er, there is li le to stop agency heads and other
                                      high-ranking officials from releasing classified information to per-
                                      sons without a security clearance when it is seen as suiting govern-
                                      ment needs. The A orney General has prosecutorial discretion to
                                      choose which leaks to prosecute. If in fact a case can be made that
                                      a senior official has made or authorized the disclosure of classified
                                      information, successful prosecution under current laws may be im-
) 05)&3 4&$3&$: -"84                                                

possible because the scienter requirement (i.e., guilty state of mind)
is not likely to be met.
    Executive branch policy appears to treat an official disclosure as
a declassifying event, while non- a ributed disclosures have no ef-
fect on the classification status of the information. For example, the
Department of Defense instructs agency officials, in the event that
classified information appears in the media, to neither confirm nor
deny the accuracy of the information.

                        'E  %$ $JS 
This is an action under the Freedom of Information Act, in which
plaintiff-appellant seeks to compel the Central Intelligence Agency
to disclose certain records alleged to be in its possession concerning
its relationship with the Hughes Glomar Explorer.
    In March 1975 several news organizations published stories pur-
porting to describe a secret operation conducted by the United States.
The central figure in these stories was the Hughes Glomar Explorer., a
large vessel publicly listed as a research ship owned and operated by
the Summa Corporation. According to the stories, the ship’s actual
owner and operator was the Government of the United States.
    Following publication of these stories, other stories described the
alleged efforts of the CIA to convince the news media not to make
public what they had learned about the Glomar Explorer. The la er
stories interested appellant, a journalist, and she filed a FOIA request
for all Agency records relating to the reported contacts with the me-
dia. That request was denied on two grounds. First, the Agency
claimed that ”any records that might exist which reveal any CIA con-
nection with or interest in the activities of the Glomar Explorer; and,
indeed, any data that might reveal the existence of any such records”
would be classified and therefore exempt from disclosure. Second,
the Agency stated that
     the fact of the existence or non-existence of the records you
     request would relate to information pertaining to intelli-
     gence sources and methods which the Director of Central
     Intelligence has the responsibility to protect from unau-
     thorized disclosure in accordance with the National Secu-
     rity Act of 1947.                                                      64$ f  E 

We are dealing with a case in which the Agency has refused to con-
firm or deny the existence of materials requested under the FOIA.
In effect, the situation is as if appellant had requested and been re-
fused permission to see a document which says either ”Yes, we have
records related to contacts with the media concerning the Glomar Ex-
plorer” or ”No, we do not have any such records.” On appeal appel-
                                        $)"15&3  53"%& 4&$3&5

lant does not assert that the Government may never claim that na-
tional security considerations require it to refuse to disclose whether
or not requested documents exist. Rather, her principal argument,
and the only question we decide, is that the Agency should have been
required to support its position on the basis of the public record.
    It is clear that the FOIA contemplates that the courts will resolve
fundamental issues in contested cases on the basis of in camera ex-
aminations of the relevant documents. Appellant maintains that this
authority does not extend to in camera examination of affidavits, the
procedure used below. In the peculiar context of this case we must re-
ject this contention. When the Agency’s position is that it can neither
confirm nor deny the existence of the requested records, there are no
relevant documents for the court to examine other than the affidavits
which explain the Agency’s refusal. Therefore, to fulfill its congres-
sionally imposed obligation to make a de novo determination of the
propriety of a refusal to provide information in response to a FOIA
request the District Court may have to examine classified affidavits
in camera and without participation by plaintiff’s counsel.
    Before adopting such a procedure, however, the District Court
should a empt to create as complete a public record as is possible.
Adapting these procedures to the present case would require the
Agency to provide a public affidavit explaining in as much detail as
is possible the basis for its claim that it can be required neither to
confirm nor to deny the existence of the requested records.[7] The
Agency’s arguments should then be subject to testing by appellant,
who should be allowed to seek appropriate discovery when neces-
sary to clarify the Agency’s position or to identify the procedures by
which that position was established. Only after the issues have been
identified by this process should the District Court, if necessary, con-
sider arguments or information which the Agency is unable to make


                      6OJUFE 4UBUFT $POTUJUVUJPO

The Congress shall have Power … To promote the Progress of Science        BSU * f  DM 
and useful Arts, by securing for limited Times to Authors and Inven-
tors the exclusive Right to their respective Writings and Discoveries.
                                                                          -PPLJOH BU UIFTF DBTFT JT NVDI MJLF
                                                                          MPPLJOH BU B XPOEFSGVM NBDIJOF #VU
                                                                          PG DPVSTF XIFO MPPLJOH BU B CFBVUJGVM
                                                                          QJFDF PG NBDIJOFSZ UIBU GVODUJPOT MJLF
Patent law provides exclusive rights over new and useful inventions.      B DMPDL PS MJLF DMPDLXPSL UIF OFYU RVFT
Although it structure has shifted over time, the modern synthesis of      UJPO NJHIU CF XIFUIFS UIJT XPOEFSGVM
patent law (appropriately enough) is an intricately interlocking doc-     QSFDJTJPO JOTUSVNFOU CFBST BOZ SFMBUJPO
trinal machine. The mainspring of this system is the claim: a precise     UP SFBMJUZ %BO - #VSL #JPUFDIOPMPHZ JO
                                                                          UIF 'FEFSBM $JSDVJU " $MPDLXPSL -FNPO
statement of the technologies over which the inventor asserts rights.      "SJ[ - 3FW  
The point of of patent prosecution is to generate appropriately clear     /P FDPOPNJTU PO UIF CBTJT PG QSFTFOU
claim language that covers (or ”reads on”) what the inventor actually     LOPXMFEHF DPVME QPTTJCMZ TUBUF XJUI
invented; patent infringement is directed to comparing claims with        DFSUBJOUZ UIBU UIF QBUFOU TZTUFN BT
the defendant’s product or process. As we will see, patent law uses a     JU OPX PQFSBUFT DPOGFST B OFU CFO
                                                                          FöU PS B OFU MPTT VQPO TPDJFUZ *G
handful of basic concepts – e.g., ”prior art reference,” ”the person of
                                                                          XF EJE OPU IBWF B QBUFOU TZTUFN JU
ordinary skill in the art,” and ”equivalent” – but it uses them again     XPVME CF JSSFTQPOTJCMF PO UIF CBTJT PG
and again. The key to understanding patent law is to pay a ention         PVS QSFTFOU LOPXMFEHF PG JUT FDPOPNJD
to these recurring concepts.                                              DPOTFRVFODFT UP SFDPNNFOE JOTUJUVU
    Why patent law? Three stories are usually advanced, two of            JOH POF #VU TJODF XF IBWF IBE B QBUFOU
                                                                          TZTUFN GPS B MPOH UJNF JU XPVME CF JS
which should already be familiar. It is said that patent law serves
                                                                          SFTQPOTJCMF PO UIF CBTJT PG PVS DVSSFOU
an innovation function by giving incentives that enable investors to      LOPXMFEHF UP SFDPNNFOE BCPMJTIJOH
recoup their investment and a contracting function by enabling them       JU 'SJU[ .BDIMVQ
to commercialize their inventions without fear of being ripped off by      5IF MFBEJOH QBUFOU USFBUJTFT BSF %POBME
business partners or imitated by competitors. But patent law also is      4 $IJTVN $IJTVN PO 1BUFOUT .BUUIFX
designed to serve a disclosure function: it requires inventors to make    #FOEFS PO -FYJT 3 $BSM .PZ .PZhT
                                                                          8BMLFS PO 1BUFOUT 5IPNTPO 3FVUFST
public significant information about how their inventions work, and
                                                                          PO 8FTUMBX BOE 3PCFSU $ 'BCFS 'BCFS
multiple doctrines subtly push actors toward greater disclosure.          PO .FDIBOJDT PG 1BUFOU $MBJN %SBGUJOH
                                                                           1-* PO #MPPNCFSH -BX 
                                                                        $)"15&3  1"5&/5

                        " 4VCKFDU .BUUFS

                                                      1BUFOU "DU

 64$ f 
                        Whoever invents or discovers any new and useful process, machine,
*OWFOUJPOT QBUFOUBCMF   manufacture, or composition of ma er, or any new and useful im-
                        provement thereof, may obtain a patent therefor, subject to the con-
                        ditions and requirements of this title.

                        As interpreted by the courts, this section imposes two conditions on
                        patentability: utility and statutory subject ma er. It is conventional
                        to begin with statutory subject ma er. We begin with utility.

                        Utility was at one time a categorical exclusion from patentability. No
                        longer. But it still does some important work as a threshold condition,
                        which can significantly affect the timing of patentability.

                                         +VJDZ 8IJQ *OD W 0SBOHF #BOH *OD
                                              'E  'FE $JS 
                        Juicy Whip, Inc., is the assignee of United States Patent No. 5,575,405,
                        which is entitled “Post-Mix Beverage Dispenser With an Associated
                        Simulated Display of Beverage.” A “post-mix” beverage dispenser
                        stores beverage syrup concentrate and water in separate locations un-
                        til the beverage is ready to be dispensed. The syrup and water are
                        mixed together immediately before the beverage is dispensed, which
                        is usually after the consumer requests the beverage. In contrast, in a
                        “pre-mix” beverage dispenser, the syrup concentrate and water are
                        pre-mixed and the beverage is stored in a display reservoir bowl un-
                        til it is ready to be dispensed. The display bowl is said to stimulate
                        impulse buying by providing the consumer with a visual beverage
                        display. A pre-mix display bowl, however, has a limited capacity and
                        is subject to contamination by bacteria. It therefore must be refilled
                        and cleaned frequently.
                             The invention claimed in the ‘405 patent is a post-mix beverage
                        dispenser that is designed to look like a pre-mix beverage dispenser.
                        The claims require the post-mix dispenser to have a transparent bowl
                        that is filled with a fluid that simulates the appearance of the dis-
                        pensed beverage and is resistant to bacterial growth. The claims also
                        require that the dispenser create the visual impression that the bowl
" 46#+&$5 ."55&3                                                      

is the principal source of the dispensed beverage, although in fact the
beverage is mixed immediately before it is dispensed, as in conven-
tional post-mix dispensers.
    The District Court concluded that the invention lacked utility be-
cause its purpose was to increase sales by deception, i.e., through
imitation of another product. The court explained that the purpose
of the invention “is to create an illusion, whereby customers believe
that the fluid contained in the bowl is the actual beverage that they
are receiving, when of course it is not.” Although the court acknowl-
edged Juicy Whip’s argument that the invention provides an accurate
representation of the dispensed beverage for the consumer’s benefit
while eliminating the need for retailers to clean their display bowls,
the court concluded that those claimed reasons for the patent’s utility
“are not independent of its deceptive purpose, and are thus insuffi-
cient to raise a disputed factual issue to present to a jury.”
The threshold of utility is not high: An invention is “useful” under
section 101 if it is capable of providing some identifiable benefit.
    To be sure, since Justice Story’s opinion in Lowell v. Lewis, it has       -PXFMM  ' $BT  $$% .BTT
been stated that inventions that are “injurious to the well-being, good        
policy, or sound morals of society” are unpatentable. As examples of
such inventions, Justice Story listed “a new invention to poison peo-
ple, or to promote debauchery, or to facilitate private assassination.”
Courts have continued to recite Justice Story’s formulation, but the
principle that inventions are invalid if they are principally designed
to serve immoral or illegal purposes has not been applied broadly in
recent years. For example, years ago courts invalidated patents on
gambling devices on the ground that they were immoral, but that is
no longer the law.
    In holding the patent in this case invalid for lack of utility, the dis-
trict court relied on two Second Circuit cases dating from the early
years of this century, Rickard v. Du Bon, and Sco & Williams v. Aristo         3JDLBSE  '  E $JS 
Hosiery Co.. In the Rickard case, the court held invalid a patent on a         "SJTUP )PTJFSZ  'E  E $JS 
process for treating tobacco plants to make their leaves appear spot-
ted. At the time of the invention, according to the court, cigar smok-
ers considered cigars with spo ed wrappers to be of superior quality,
and the invention was designed to make unspo ed tobacco leaves ap-
pear to be of the spo ed – and thus more desirable – type. The court
noted that the invention did not promote the burning quality of the
leaf or improve its quality in any way; “the only effect, if not the only
object, of such treatment, is to spot the tobacco, and counterfeit the
leaf spo ed by natural causes.”
    The Aristo Hosiery case concerned a patent claiming a seamless
stocking with a structure on the back of the stocking that imitated a
                                                        $)"15&3  1"5&/5

      US. Patent      Nov. 19, 1996       Sheet 1 of 3       5,575,405

                                      55%,. K55
                                                 as?   /

U.S. Patent No. 5,575,405, Post-Mix Beverage Dispenser With an As-
sociated Simulated Display of Beverage.
" 46#+&$5 ."55&3                                                   

seamed stocking. The imitation was commercially useful because at
the time of the invention many consumers regarded seams in stock-
ings as an indication of higher quality. The court noted that the im-
itation seam did not “change or improve the structure or the utility
of the article,” and that the record in the case justified the conclusion
that true seamed stockings were superior to the seamless stockings
that were the subject of the patent. “At best,” the court stated, “the
seamless stocking has imitation marks for the purposes of deception,
and the idea prevails that with such imitation the article is more sal-
able.” That was not enough, the court concluded, to render the inven-
tion patentable.
    We decline to follow Rickard and Aristo Hosiery, as we do not re-
gard them as representing the correct view of the doctrine of utility
under the Patent Act of 1952. The fact that one product can be altered
to make it look like another is in itself a specific benefit sufficient to
satisfy the statutory requirement of utility.
    It is not at all unusual for a product to be designed to appear to
viewers to be something it is not. For example, cubic zirconium is
designed to simulate a diamond, imitation gold leaf is designed to
imitate real gold leaf, synthetic fabrics are designed to simulate ex-
pensive natural fabrics, and imitation leather is designed to look like
real leather. In each case, the invention of the product or process
that makes such imitation possible has “utility” within the meaning
of the patent statute, and indeed there are numerous patents directed
toward making one product imitate another. See, e.g., U.S. Pat. No.
   (method for producing imitation grill marks on food with-
out using heat); U.S. Pat. No.    (laminated flooring imitating
wood); U.S. Pat. No.    (imitation hamburger). Much of the
value of such products resides in the fact that they appear to be some-
thing they are not. Thus, in this case the claimed post-mix dispenser
meets the statutory requirement of utility by embodying the features
of a post-mix dispenser while imitating the visual appearance of a
pre-mix dispenser.
    The fact that customers may believe they are receiving fluid di-
rectly from the display tank does not deprive the invention of utility.
Orange Bang has not argued that it is unlawful to display a repre-
sentation of the beverage in the manner that fluid is displayed in the
reservoir of the invention, even though the fluid is not what the cus-
tomer will actually receive. Moreover, even if the use of a reservoir
containing fluid that is not dispensed is considered deceptive, that is
not by itself sufficient to render the invention unpatentable. The re-
quirement of “utility” in patent law is not a directive to the Patent and
Trademark Office or the courts to serve as arbiters of deceptive trade
practices. Other agencies, such as the Federal Trade Commission and
the Food and Drug Administration, are assigned the task of protect-
                                                                                             $)"15&3  1"5&/5

                                            ing consumers from fraud and deception in the sale of food prod-
8BUTPO  'E  $$1"           ucts. Cf. In re Watson (stating that it is not the province of the Patent
                                            Office to determine, under section 101, whether drugs are safe). As
                                            the Supreme Court put the point more generally, “Congress never in-
                                            tended that the patent laws should displace the police powers of the
                                            States, meaning by that term those powers by which the health, good
                                            order, peace and general welfare of the community are promoted.”
8FCCFS  64  0UUP             Webber v. Virginia.
5IF QBUFOU GPS B EZOBNJUF QPXEFS               Of course, Congress is free to declare particular types of inven-
EPFT OPU QSFWFOU UIF 4UBUF GSPN QSF        tions unpatentable for a variety of reasons, including deceptiveness.
                                            Cf. 42 U.S.C. § 2181(a) (exempting from patent protection inventions
UIF DPNNVOJUZ GSPN UIF EBOHFS PG FY        useful solely in connection with special nuclear material or atomic
QMPTJPO " QBUFOU GPS UIF NBOVGBDUVSF       weapons). Until such time as Congress does so, however, we find no
BOE TBMF PG B EFBEMZ QPJTPO EPFT OPU        basis in section 101 to hold that inventions can be ruled unpatentable
MFTTFO UIF SJHIU PG UIF 4UBUF UP DPOUSPM    for lack of utility simply because they have the capacity to fool some
                                            members of the public. The district court therefore erred in holding
                                            that the invention of the ‘405 patent lacks utility because it deceives
                                            the public through imitation in a manner that is designed to increase
                                            product sales.

                                                  .BOVBM PG 1BUFOU &YBNJOBUJPO 1SPDFEVSF 3FW /PW 

                                            A claimed invention must have a specific and substantial utility. This
(VJEFMJOFT GPS &YBNJOBUJPO PG "QQMJDB      requirement excludes “throw-away,” “insubstantial,” or “nonspe-
UJPOT GPS $PNQMJBODF XJUI UIF 6UJMJUZ 3F   cific” utilities, such as the use of a complex invention as landfill.
RVJSFNFOU                                       Credibility is assessed from the perspective of one of ordinary
                                            skill in the art in view of the disclosure and any other evidence of
                                            record (e.g., test data, affidavits or declarations from experts in the art,
                                            patents or printed publications) that is probative of the applicant’s
                                            assertions. An applicant need only provide one credible assertion of
                                            specific and substantial utility for each claimed invention to satisfy
                                            the utility requirement.

f                                                   I. S           S           R
                                            Courts have recognized that the term “useful” used with reference
                                            to the utility requirement can be a difficult term to define. Where an
                                            applicant has set forth a specific and substantial utility, courts have
                                            been reluctant to uphold a rejection under 35 U.S.C. § 101 solely on
                                            the basis that the applicant’s opinion as to the nature of the specific
                                            and substantial utility was inaccurate.
                                                Practical considerations require the Office to rely on the inventor’s
                                            understanding of his or her invention in determining whether and in
                                            what regard an invention is believed to be “useful.” Because of this,
                                            Office personnel should focus on and be receptive to assertions made
" 46#+&$5 ."55&3                                                   

by the applicant that an invention is “useful” for a particular reason.
                           A. Specific Utility
A “specific utility” is specific to the subject ma er claimed and can
“provide a well-defined and particular benefit to the public.” In re          'JTIFS  'E  'FE $JS 
Fisher. This contrasts with a general utility that would be applicable
to the broad class of the invention. Office personnel should distin-
guish between situations where an applicant has disclosed a specific
use for or application of the invention and situations where the ap-
plicant merely indicates that the invention may prove useful without
identifying with specificity why it is considered useful. For example,
indicating that a compound may be useful in treating unspecified
disorders, or that the compound has “useful biological” properties,
would not be sufficient to define a specific utility for the compound.
Similarly, a claim to a polynucleotide whose use is disclosed simply
as a “gene probe” or “chromosome marker” would not be considered
to be specific in the absence of a disclosure of a specific DNA target.
See Fisher (“Any EST [expressed sequence tag] transcribed from any
gene in the maize genome has the potential to perform any one of the
alleged uses. Nothing about applicant’s seven alleged uses set the
five claimed ESTs apart from the more than 32,000 ESTs disclosed in
the application or indeed from any EST derived from any organism.
Accordingly, we conclude that applicant has only disclosed general
uses for its claimed ESTs, not specific ones that satisfy § 101.”). A gen-
eral statement of diagnostic utility, such as diagnosing an unspecified
disease, would ordinarily be insufficient absent a disclosure of what
condition can be diagnosed. Contrast the situation where an appli-
cant discloses a specific biological activity and reasonably correlates
that activity to a disease condition. Assertions falling within the la er
category are sufficient to identify a specific utility for the invention.
Assertions that fall in the former category are insufficient to define a
specific utility for the invention, especially if the assertion takes the
form of a general statement that makes it clear that a “useful” inven-
tion may arise from what has been disclosed by the applicant.
                         B. Substantial Utility
“[A]n application must show that an invention is useful to the pub-
 lic as disclosed in its current form, not that it may prove useful at
 some future date after further research. Simply put, to satisfy the
‘substantial’ utility requirement, an asserted use must show that the
 claimed invention has a significant and presently available benefit to
 the public.” Fisher. The claims at issue in fisher were directed to ex-
 pressed sequence tags (ESTs), which are short nucleotide sequences
 that can be used to discover what genes and downstream proteins are
                                                 $)"15&3  1"5&/5

expressed in a cell. The court held that “the claimed ESTs can be used
only to gain further information about the underlying genes and the
proteins encoded for by those genes. The claimed ESTs themselves
are not an end of [applicant’s] research effort, but only tools to be used
along the way in the search for a practical utility. Applicant does not
identify the function for the underlying protein-encoding genes. Ab-
sent such identification, we hold that the claimed ESTs have not been
researched and understood to the point of providing an immediate,
well-defined, real world benefit to the public meriting the grant of a
patent.” Thus a “substantial utility” defines a “real world” use. Utili-
ties that require or constitute carrying out further research to identify
or reasonably confirm a “real world” context of use are not substan-
tial utilities. For example, both a therapeutic method of treating a
known or newly discovered disease and an assay method for identi-
fying compounds that themselves have a “substantial utility” define
a “real world” context of use. An assay that measures the presence of
a material which has a stated correlation to a predisposition to the on-
set of a particular disease condition would also define a “real world”
context of use in identifying potential candidates for preventive mea-
sures or further monitoring. On the other hand, the following are
examples of situations that require or constitute carrying out further
research to identify or reasonably confirm a “real world” context of
use and, therefore, do not define “substantial utilities”:
  (A) Basic research such as studying the properties of the claimed
       product itself or the mechanisms in which the material is in-
  (B) A method of treating an unspecified disease or condition;
  (C) A method of assaying for or identifying a material that itself has
       no specific and/or substantial utility;
  (D) A method of making a material that itself has no specific, sub-
       stantial, and credible utility; and
  (E) A claim to an intermediate product for use in making a final
       product that has no specific, substantial and credible utility.
Office personnel must be careful not to interpret the phrase “imme-
diate benefit to the public” or similar formulations in other cases to
mean that products or services based on the claimed invention must
be “currently available” to the public in order to satisfy the utility
requirement. Rather, any reasonable use that an applicant has iden-
tified for the invention that can be viewed as providing a public ben-
efit should be accepted as sufficient, at least with regard to defining
a “substantial” utility.
                           C. Research Tools
" 46#+&$5 ."55&3                                                    

Some confusion can result when one a empts to label certain types
of inventions as not being capable of having a specific and substantial
utility based on the se ing in which the invention is to be used. One
example is inventions to be used in a research or laboratory se ing.
Many research tools such as gas chromatographs, screening assays,
and nucleotide sequencing techniques have a clear, specific and un-
questionable utility (e.g., they are useful in analyzing compounds).
An assessment that focuses on whether an invention is useful only
in a research se ing thus does not address whether the invention is
in fact “useful” in a patent sense. Instead, Office personnel must dis-
tinguish between inventions that have a specifically identified sub-
stantial utility and inventions whose asserted utility requires further
research to identify or reasonably confirm. Labels such as “research
tool,” “intermediate” or “for research purposes” are not helpful in
determining if an applicant has identified a specific and substantial
utility for the invention.
      II. W        I             I           ; ”I          ”U
An invention that is “inoperative” (i.e., it does not operate to produce
the results claimed by the patent applicant) is not a “useful” invention
in the meaning of the patent law. However, as the Federal Circuit has
stated, “[t]o violate 35 U.S.C. § 101 the claimed device must be totally
incapable of achieving a useful result.” Brooktree Corp.v.Advanced Mi-       #SPPLUSFF  'E  'FE          $JS
cro Devices, Inc.. See also E.I. du Pont De Nemours and Co. v. Berkley       
and Co. (“A small degree of utility is sufficient. The claimed inven-          #FSLMFZ  'E  UI $JS 
tion must only be capable of performing some beneficial function. An
invention does not lack utility merely because the particular embodi-
ment disclosed in the patent lacks perfection or performs crudely. A
commercially successful product is not required. Nor is it essential
that the invention accomplish all its intended functions or operate
under all conditions, partial success being sufficient to demonstrate
patentable utility. In short, the defense of non-utility cannot be sus-
tained without proof of total incapacity.”) If an invention is only par-
tially successful in achieving a useful result, a rejection of the claimed
invention as a whole based on a lack of utility is not appropriate.
    Situations where an invention is found to be “inoperative” and
therefore lacking in utility are rare, and rejections maintained solely
on this ground by a Federal court even rarer. In many of these cases,
the utility asserted by the applicant was thought to be incredible in
the light of the knowledge of the art, or factually misleading when
initially considered by the Office. Other cases suggest that on ini-
tial evaluation, the Office considered the asserted utility to be incon-
sistent with known scientific principles or speculative at best as to
whether a ributes of the invention necessary to impart the asserted
utility were actually present in the invention. However cast, the un-
                                                                                          $)"15&3  1"5&/5

                                         derlying finding by the court in these cases was that, based on the fac-
                                         tual record of the case, it was clear that the invention could not and
                                         did not work as the inventor claimed it did. Indeed, the use of many
                                         labels to describe a single problem (e.g., a false assertion regarding
                                         utility) has led to some of the confusion that exists today with regard
$POTJEFS 64 1BU /P    #       to a rejection based on the “utility” requirement. Examples of such
GPS B 4QBDF 7FIJDMF 1SPQFMMFE CZ UIF    cases include: an invention asserted to change the taste of food us-
                                         ing a magnetic field, a perpetual motion machine, a flying machine
BMMZ JTTVFT B QBUFOU PO B EFWJDF UIBU    operating on “flapping or flu er function,” a “cold fusion” process
WJPMBUFT UIF LOPXO MBXT PG QIZTJDT       for producing energy, a method for increasing the energy output of
*O /FXNBO W 2VJHH  'E          fossil fuels upon combustion through exposure to a magnetic field,
 'FE $JS  UIF 64150 PSEFSFE        uncharacterized compositions for curing a wide array of cancers, and
                                         a method of controlling the aging process. These examples are fact
GPS UFTUJOH CZ UIF /BUJPOBM #VSFBV PG    specific and should not be applied as a per se rule. Thus, in view of
4UBOEBSET *U GBJMFE                    the rare nature of such cases, Office personnel should not label an
                                         asserted utility “incredible,” “speculative” or otherwise unless it is
                                         clear that a rejection based on “lack of utility” is proper.

                                              4UBUVUPSZ 4VCKFDU .BUUFS

                                                        .BOVBM PG 1BUFOU &YBNJOBUJPO 1SPDFEVSF

                                         A summary of the four categories of invention, as they have been
1BUFOU 4VCKFDU .BUUFS &MJHJCJMJUZ        defined by the courts, are:
                                            i. Process. – an act, or a series of acts or steps. A process is a mode
                                               of treatment of certain materials to produce a given result. It is
                                               an act, or a series of acts, performed upon the subject-ma er to
                                               be transformed and reduced to a different state or thing.
                                           ii. Machine. – a concrete thing, consisting of parts, or of certain de-
                                               vices and combination of devices. This includes every mechani-
                                               cal device or combination of mechanical powers and devices to
                                               perform some function and produce a certain effect or result.
                                          iii. Manufacture. – an article produced from raw or prepared mate-
                                               rials by giving to these materials new forms, qualities, proper-
                                               ties, or combinations, whether by hand labor or by machinery.
                                          iv. Composition of ma er. – all compositions of two or more sub-
                                               stances and all composite articles, whether they be the results
                                               of chemical union, or of mechanical mixture, or whether they
                                               be gases, fluids, powders or solids, for example.

                                         5VO+FO $IJBOH 5IF 3VMFT BOE 4UBOEBSET PG 1BUFOUBCMF 4VCKFDU .BUUFS
                                                               8JTD - 3FW 
" 46#+&$5 ."55&3                                                    

A close examination of all of the patentable subject-ma er categories
reveals a clear distinction. Virtually all of the restrictions, save two,
have been in the nature of categorical rules. The two exceptions are
the closely-related (indeed, for all practical purposes, identical) prohi-
bitions on patenting “laws of nature” and “abstract ideas.” The laws
of nature and abstract ideas prohibitions account for almost the en-
tirety of patentable subject-ma er case law, and the consequent un-
certainty in the area. Section 101 thus contains a dichotomy: clear
exclusionary rules that have almost never caused administrative dif-
ficulty or litigation; and a vague scope limiting standard that has
caused tremendous difficulty and much litigation.

At present, there are two clear subject-ma er exclusions from
patentability: nuclear weapons and human organisms. Federal
statutes state that and that ”Notwithstanding any other provision of
                                                                             /VDMFBS XFBQPOT           64$ f
law, no patent may issue on a claim directed to or encompassing a             B /P QBUFOU TIBMM IFSFBGUFS CF
human organism.” What policies do these exclusions express?                  HSBOUFE GPS BOZ JOWFOUJPO PS EJTDPWFSZ
    As for laws of nature and abstract ideas, the Supreme Court pro-         XIJDI JT VTFGVM TPMFMZ JO UIF VUJMJ[BUJPO
foundly shifted course in a series of four major decisions between           PG TQFDJBM OVDMFBS NBUFSJBM PS BUPNJD
                                                                             FOFSHZ JO BO BUPNJD XFBQPO
2010 and 2014. Three of them are excerpted in this book: Mayo here,
                                                                             )VNBO PSHBOJTNT "NFSJDB *OWFOUT
Myriad in the biotechnology chapter, and CLS Bank in the software
                                                                             "DU f  B 
chapter. (The fourth, Bilski, is discussed in CLS Bank.)

                          4 $U  
Section 101 of the Patent Act defines patentable subject ma er. The
Court has long held that this provision contains an important implicit
exception. Laws of nature, natural phenomena, and abstract ideas are
not patentable.
The patents before us concern the use of thiopurine drugs in the treat-
ment of autoimmune diseases, such as Crohn’s disease and ulcerative
colitis. When a patient ingests a thiopurine compound, his body me-
tabolizes the drug, causing metabolites to form in his bloodstream.
Because the way in which people metabolize thiopurine compounds
varies, the same dose of a thiopurine drug affects different people
differently, and it has been difficult for doctors to determine whether
for a particular patient a given dose is too high, risking harmful side
effects, or too low, and so likely ineffective.
    At the time the discoveries embodied in the patents were made,
scientists already understood that the levels in a patient’s blood of
                                                $)"15&3  1"5&/5

certain metabolites, including, in particular, 6-thioguanine and its nu-
cleotides (6-TG) and 6-methyl-mercaptopurine (6-MMP), were corre-
lated with the likelihood that a particular dosage of a thiopurine drug
could cause harm or prove ineffective. But those in the field did not
know the precise correlations between metabolite levels and likely
harm or ineffectiveness. The patent claims at issue here set forth pro-
cesses embodying researchers’ findings that identified these correla-
tions with some precision.
    More specifically, the patents – U.S. Patent No.    (623
patent) and U.S. Patent No.    (302 patent) – embody findings
that concentrations in a patient’s blood of 6-TG or of 6-MMP metabo-
lite beyond a certain level (400 and 7000 picomoles per 8 × 108 red
blood cells, respectively) indicate that the dosage is likely too high
for the patient, while concentrations in the blood of 6-TG metabolite
lower than a certain level (about 230 picomoles per 8 × 108 red blood
cells) indicate that the dosage is likely too low to be effective.
    The patent claims seek to embody this research in a set of pro-
cesses. Like the Federal Circuit we take as typical claim 1 of the 623
Patent, which describes one of the claimed processes as follows:

      A method of optimizing therapeutic efficacy for treatment
      of an immune-mediated gastrointestinal disorder, com-
       (a) administering a drug providing 6-thioguanine to a
           subject having said immune-mediated gastrointesti-
           nal disorder; and
       (b) determining the level of 6-thioguanine in said sub-
           ject having said immune-mediated gastrointestinal
      wherein the level of 6-thioguanine less than about 230
      pmol per 8×108 red blood cells indicates a need to increase
      the amount of said drug subsequently administered to
      said subject and
      wherein the level of 6-thioguanine greater than about 400
      pmol per 8 × 108 red blood cells indicates a need to de-
      crease the amount of said drug subsequently adminis-
      tered to said subject.”

Respondent, Prometheus Laboratories, Inc. (Prometheus), is the sole
and exclusive licensee of the 623 and 302 patents. It sells diagnostic
tests that embody the processes the patents describe. For some time
petitioners, Mayo Clinic Rochester and Mayo Collaborative Services
" 46#+&$5 ."55&3                                                     

(collectively Mayo), bought and used those tests. But in 2004 Mayo
announced that it intended to begin using and selling its own test–
a test using somewhat higher metabolite levels to determine toxicity
(450 pmol per 8 × 108 for 6-TG and 5700 pmol per 8 × 108 for 6-MMP).
Prometheus then brought this action claiming patent infringement.
    The District Court found that Mayo’s test infringed claim 7 of the
623 patent. In interpreting the claim, the court accepted Prometheus’
view that the toxicity-risk level numbers in Mayo’s test and the claim
were too similar to render the tests significantly different. The num-
ber Mayo used (450) was too close to the number the claim used (400)
to ma er given appropriate margins of error. The District Court also
accepted Prometheus’ view that a doctor using Mayo’s test could vio-
late the patent even if he did not actually alter his treatment decision
in the light of the test. In doing so, the court construed the claim’s lan-
guage, ”indicates a need to decrease” (or ”to increase”), as not limited
to instances in which the doctor actually decreases (or increases) the
dosage level where the test results suggest that such an adjustment is
Prometheus’ patents set forth laws of nature – namely, relationships
between concentrations of certain metabolites in the blood and the
likelihood that a dosage of a thiopurine drug will prove ineffective
or cause harm. Claim 1, for example, states that if the levels of 6-TG
in the blood (of a patient who has taken a dose of a thiopurine drug)
exceed about 400 pmol per 8 × 108 red blood cells, then the admin-
istered dose is likely to produce toxic side effects. While it takes a
human action (the administration of a thiopurine drug) to trigger a
manifestation of this relation in a particular person, the relation it-
self exists in principle apart from any human action. The relation is a
consequence of the ways in which thiopurine compounds are metab-
olized by the body – entirely natural processes. And so a patent that
simply describes that relation sets forth a natural law.
    The question before us is whether the claims do significantly more
than simply describe these natural relations. To put the ma er more
precisely, do the patent claims add enough to their statements of the
correlations to allow the processes they describe to qualify as patent-
eligible processes that apply natural laws? We believe that the answer
to this question is no.
If a law of nature is not patentable, then neither is a process reciting
a law of nature, unless that process has additional features that pro-
vide practical assurance that the process is more than a drafting effort
designed to monopolize the law of nature itself. A patent, for exam-
                                                                                            $)"15&3  1"5&/5

                                            ple, could not simply recite a law of nature and then add the instruc-
                                            tion ”apply the law.” Einstein, we assume, could not have patented
                                            his famous law by claiming a process consisting of simply telling lin-
                                            ear accelerator operators to refer to the law to determine how much
                                            energy an amount of mass has produced (or vice versa). Nor could
                                            Archimedes have secured a patent for his famous principle of flota-
                                            tion by claiming a process consisting of simply telling boat builders
                                            to refer to that principle in order to determine whether an object will
                                                 What else is there in the claims before us? The process that each
                                            claim recites tells doctors interested in the subject about the corre-
                                            lations that the researchers discovered. In doing so, it recites an ”ad-
                                            ministering” step, a ”determining” step, and a ”wherein” step. These
                                            additional steps are not themselves natural laws but neither are they
                                            sufficient to transform the nature of the claim.
                                                 First, the ”administering” step simply refers to the relevant audi-
                                            ence, namely doctors who treat patients with certain diseases with
                                            thiopurine drugs. That audience is a pre-existing audience; doctors
                                            used thiopurine drugs to treat patients suffering from autoimmune
                                            disorders long before anyone asserted these claims. In any event, the
                                            prohibition against patenting abstract ideas cannot be circumvented
                                            by a empting to limit the use of the formula to a particular techno-
                                            logical environment.
                                                 Second, the ”wherein” clauses simply tell a doctor about the rel-
                                            evant natural laws, at most adding a suggestion that he should take
                                            those laws into account when treating his patient. That is to say, these
                                            clauses tell the relevant audience about the laws while trusting them
                                            to use those laws appropriately where they are relevant to their de-
                                            cisionmaking (rather like Einstein telling linear accelerator operators
                                            about his basic law and then trusting them to use it where relevant).
                                                 Third, the ”determining” step tells the doctor to determine the
                                            level of the relevant metabolites in the blood, through whatever pro-
                                            cess the doctor or the laboratory wishes to use. As the patents state,
                                            methods for determining metabolite levels were well known in the
                                            art. Indeed, scientists routinely measured metabolites as part of their
                                            investigations into the relationships between metabolite levels and
                                            efficacy and toxicity of thiopurine compounds. Thus, this step tells
                                            doctors to engage in well-understood, routine, conventional activity
TIPQ 5IF CBSCFS UBLFT B MPPL BU UIF        previously engaged in by scientists who work in the field. Purely con-
MBXZFS GPS B CJU BOE UIFO TBZT h0L          ventional or obvious pre-solution activity is normally not sufficient to
UIBUMM CF h 5IF MBXZFS SFTQPOET        transform an unpatentable law of nature into a patent-eligible appli-
                                            cation of such a law. The prohibition against patenting abstract ideas
TPMVUJPO BDUJWJUZh .JDIBFM 4 ,XVO "M   cannot be circumvented by adding insignificant post-solution activ-
JDF 5FMMT B +PLF  (SFFO #BH E         ity.
   6OGBJS                                   Fourth, to consider the three steps as an ordered combination
# 130$&%63&4                                                         

adds nothing to the laws of nature that is not already present when
the steps are considered separately. Anyone who wants to make use
of these laws must first administer a thiopurine drug and measure the
resulting metabolite concentrations, and so the combination amounts
to nothing significantly more than an instruction to doctors to apply
the applicable laws when treating their patients.
    The upshot is that the three steps simply tell doctors to gather          *T UIFSF BOZUIJOH IFSF UIBU UIF JOWFO
data from which they may draw an inference in light of the correla-           UPST DPVME IBWF QBUFOUFE XJUI CFUUFS
                                                                              ESBGUJOH PS XFSF UIFJS DMBJNT VOTBM
tions. To put the ma er more succinctly, the claims inform a relevant
audience about certain laws of nature; any additional steps consist
of well-understood, routine, conventional activity already engaged
in by the scientific community; and those steps, when viewed as a
whole, add nothing significant beyond the sum of their parts taken
separately. For these reasons we believe that the steps are not suffi-
cient to transform unpatentable natural correlations into patentable
applications of those regularities.

                     5BY 1MBOOJOH 1BUFOU 1SPCMFN
You are staff counsel to Representative Helvering (R-IA), who has
read a number of newspaper articles on the growing phenomenon
of “tax planning patents.” These patents describe transactions de-
signed to help a company reduce the taxes it owes. For example, one
such patent describes dividing a real estate portfolio into a number
of shares held as tenancies in common subject to a master lease, in
which each holder receives guaranteed annual income and is subject
to repurchase at fair market value at a specified date, such that the
investments qualify for tax-deferred treatment under … you get the
    The Representative has asked you to help her think through                'PS QVSQPTFT PG FWBMVBUJOH BO JOWFO
the policy and legal issues these patents raise. She wants to know            UJPO VOEFS TFDUJPO  <OPWFMUZ> PS 
whether they are valid under current law and whether they’re con-             <OPOPCWJPVTOFTT> BOZ TUSBUFHZ GPS SF
                                                                              EVDJOH BWPJEJOH PS EFGFSSJOH UBY MJB
tributing to tax evasion. If they’re problematic, she would like your         CJMJUZ XIFUIFS LOPXO PS VOLOPXO BU
suggestions on possible legislative fixes (either to the Patent Act or to      UIF UJNF PG UIF JOWFOUJPO PS BQQMJDB
the Internal Revenue Code).                                                   UJPO GPS QBUFOU TIBMM CF EFFNFE JOTVG
                                                                              öDJFOU UP EJòFSFOUJBUF B DMBJNFE JOWFO

#    1SPDFEVSFT                                                               UJPO GSPN UIF QSJPS BSU "NFSJDB *OWFOUT
                                                                              "DU f  B  8IBU EP ZPV UIJOL PG UIJT
A patent (an example follows) has two jobs. It must describe the
scope of the owner’s rights in the invention. This is the job of the
claims. It must also disclose the invention in enough detail that others
could (if not for the patent) make use of it. This is the job of the speci-
fication. The process of patent prosecution is designed not just to check
that the invention is substantively eligible to be patented (discussed
in the next section), but also to ensure that the claims and specifica-
tion adequately carry out their jobs.
# 130$&%63&4                                                     


                              1BUFOU "DU

(b)  Conclusion. – The specification shall conclude with one or more        64$ f 
     claims particularly pointing out and distinctly claiming the sub-    4QFDJöDBUJPO
     ject ma er which the inventor or a joint inventor regards as the     5IF OBNF PG UIF HBNF JT UIF DMBJN
     invention.                                                           ‰(JMFT 4 3JDI
 (c) Form. – A claim may be wri en in independent or, if the nature
     of the case admits, in dependent or multiple dependent form.
(d) Reference in Dependent Forms. – A claim in dependent form shall
     contain a reference to a claim previously set forth and then spec-
     ify a further limitation of the subject ma er claimed. A claim in
     dependent form shall be construed to incorporate by reference
     all the limitations of the claim to which it refers.

                       /8 6- 3FW  
The specification and the claims do not describe the same thing in
different ways. Rather, they describe entirely different concepts. The
specification describes a single embodiment (or a very limited num-
ber of embodiments). The claim describes an idea. To be sure,
the specification embodiment embodies the claimed idea, but the
claimed idea may be reflected in countless other embodiments; con-
versely, the specification embodiment also embodies countless other
ideas in addition to what is claimed.
    The two differing concepts of “invention” create a problem for
defining patent scope. For any specification embodiment, an infinite
array of ideas are equally apt for a claim. Consider the invention of a
radiation machine that cures AIDS. The invention can be claimed as
any of the following:
   1. “A cure for AIDS,” covering all cures that might ever be devised.
   2. “A cure for AIDS using radiation,” covering all cures using any
      type of radiation but not other methods.
   3. “A cure for AIDS using X-radiation,” thereby excluding meth-
      ods using other types of radiation.
   4. “A cure for AIDS using X-radiation specifically by using the ex-
      act make and model of the radiation machine in the specifica-
Every level of abstraction describes something that is new, useful,
and non- obvious. Thus, the standard criteria of patentability pro-
vide no guidance regarding which level of abstraction is proper for
                                                   $)"15&3  1"5&/5

patent protection. But a patent covering all cures for AIDS is obvi-
ously different from a patent covering only one particular radiation

                     .BSL " -FNMFZ 1PJOU PG /PWFMUZ
                        /X 6- 3FW  
The fundamental requirement for obtaining a patent is that the appli-
cant must have invented something new.
    It is curious, then, that patent law itself purports to pay no a en-
tion to which aspects of a patentee’s invention are in fact new. A
patented invention is legally defined by its claims – wri en defini-
tions of the invention. And those wri en definitions virtually never
call out what it is that is new about the patentee’s invention. For
example, suppose that makers of widgets have long used a three-
step process to manufacture the widget. The inventor of a four-step
process that results in higher-quality widgets will not claim to own
merely the fourth step she has discovered. Rather, she is much more
likely to define her invention as including all four steps. Our hypo-
thetical patentee did not invent the first three steps: all three have
been known in the art for decades. But you wouldn’t know that fact
from reading the patent claims.
    Even if the parties do identify the novel element of an invention,
the law purports not to care. Longstanding patent law doctrine has
decried any focus on the ”point of novelty” of an invention. The
United States Court of Appeals for the Federal Circuit, which handles
patent appeals, evaluates the claim as a whole, not just the piece of
the claim that the patentee actually added to the storehouse of knowl-
edge. As that court has put it, ”there is no legally recognizable .. ’gist,’
or ’heart’ of the invention.”

                           4 $U  
The Patent Act requires that a patent specification ”conclude with one
or more claims particularly pointing out and distinctly claiming the sub-
ject ma er which the applicant regards as [the] invention.” According
to the Federal Circuit, a patent claim passes the threshold so long as
the claim is ”amenable to construction,” and the claim, as construed,
is not ”insolubly ambiguous.” We conclude that the Federal Circuit’s
formulation, which tolerates some ambiguous claims but not others,
does not satisfy the statute’s definiteness requirement. In place of
the ”insolubly ambiguous” standard, we hold that a patent is invalid
for indefiniteness if its claims, read in light of the specification delin-
eating the patent, and the prosecution history, fail to inform, with
# 130$&%63&4                                                     

reasonable certainty, those skilled in the art about the scope of the

                           'SFFOZ W "QQMF *OD
   /Po$7oo8$#  8-  &% 5FY "VH  
[Patent No.    (“the ’744 patent”), described a single device
that can communicate wirelessly with a variety of providers, such as
hotel systems, vehicle parking systems, and toll systems, using mul-
tiple frequencies. It claimed:
     A communication unit connected to a public communi-
     cation system, the communication unit capable of detect-            'PS QVCMJD DPNNVOJDBUJPO TZTUFN 
     ing a plurality of wireless devices and servicing each of           UIJOL *OUFSOFU
     the plurality of wireless devices by providing access to
     the public communication system when the wireless de-
     vices are within a predetermined proximity distance from
     the communication unit, the communication unit com-
     prising [various elements, including a] transceiver simul-
     taneously communicating with at least two wireless de-
     vices with different types of low power communication
The final term in dispute for purposes of claim construction is the
term “low power communication signals.” The plaintiffs argue that
the term “low power communication signals” should be construed to
mean “signals having a power for transmission up to a maximum of
several hundred feet.” The defendant argues that the term is indefi-
nite because the words “low power” are wholly lacking in specificity.
    While it is true that the patent does not define the term “low
power” with precision, precision is not required as long as the claim
language is as specific as is reasonably possible under the circum-
stances, and as long as a person of skill in the art would understand
the scope of the claims with reasonable certainty. The Federal Circuit
has frequently addressed claim language that was imprecise and has
frequently upheld claims containing similar language, based on the
commonsense observation that sometimes precision is impossible to
achieve, consistent with an accurate description of the full scope of
the invention. As the court has explained: “Definiteness problems
often arise when words of degree are used in a claim. That some
claim language may not be precise, however, does not automatically
render a claim invalid.” Sea le Box Co. v. Indus. Crating & Packing,     4FBUUMF #PY  'E  'FE   $JS
Inc. (upholding claim using term “substantially equal to”). When a       
word of degree is used, “the district court must determine whether
the patent’s specification provides some standard for measuring that
degree. The trial court must decide, that is, whether one of ordinary
skill in the art would understand what is claimed when the claim is
                                                                              $)"15&3  1"5&/5

                          read in light of the specification.”
                              Indefiniteness is a legal determination; if the court concludes that
                          a person of ordinary skill in the art, with the aid of the specification,
                          would understand what is claimed, the claim is not indefinite. For
                          example, the term “substantially” has frequently been held not in-
                          definite if a person of ordinary skill can discern from the claims and
                          specification what the bounds of the claim are with reasonable cer-
                          tainty. [Cases cited found the terms ”about 0.06,” ”substantially pla-
                          nar,” ”to increase substantially,” ”not interfering substantially,” ”rel-
                          atively small,” ”substantially equal to,” ”closely approximate,” and
                          ”about 5:1 to about 7:1” not indefinite.] On numerous occasions, dis-
                          trict courts, including this court, have held similarly imprecise claim
                          language not indefinite. [Cases cited found the phrases “substan-
                          tially collimated,” ”roughly the same,” ”low frequency forces,” ”low
                          hydroxyl ion content,” and ”low DC electrical voltage” not indefi-
                              In pressing its indefiniteness argument, the defendant relies heav-
                          ily on the Supreme Court’s recent decision in Nautilus, which ad-
                          dressed the issue of indefiniteness and modified the test applied in
                          some prior Federal Circuit cases. The Nautilus Court held “a patent’s
                          claims, viewed in light of the specification and prosecution history,
                          [must] inform those skilled in the art about the scope of the inven-
                          tion with reasonable certainty.” Contrary to the defendant’s sugges-
                          tion, that standard does not render all of the prior Federal Circuit and
                          district court cases inapplicable, nor does it require that the claim lan-
                          guage in this case be held indefinite. The Supreme Court recognized
                          that “some modicum of uncertainty” is “the price of ensuring the ap-
                          propriate incentives for innovation,” and that because patents are di-
                          rected to persons of skill in the art, all that is required is that the patent
                          apprise such persons of the scope of the invention. Indeed, the Court
&JCFM  64     cited with approval Eibel Process Co. v. Minn. & Ontario Paper Co.,
                          where the Court upheld claim language requiring a wire to be placed
                          at a “high” or “substantial” elevation. That language, the Eibel Court
                          held, would be sufficiently clear in context for persons of skill in the
                          art to understand and therefore was not invalid for indefiniteness.
                              In light of the applicable caselaw, including the Nautilus case, the
                          Court concludes that the term “low power communication signals”
                          is not indefinite. The specification on several occasions refers to low
                          power signals as those that do not communicate farther than a few
                          hundred feet. See, e.g., ’744 patent, col. 32, ll. 29–31 (“low power
                          wireless link ... does not typically communicate farther than about
                          300 feet”); col. 35, ll. 50–51 (detection range of “say several hundred
                          feet”); col. 36, ll. 31–38 (wireless connection ranges “will vary from
                          several hundred feet to only several feet”); col. 39, ll. 13–15 (trans-
                          missions possible “within several hundred feet” of a communication
# 130$&%63&4                                                        

unit); col. 7, ll. 4–8 (transceiver capable of communicating “up to at
least a predetermined proximity distance such as a hundred feet”);
col. 13, ll. 49–52 (different signal strengths designed for detection at
500 feet and 20 feet); col. 16, ll. 49–51 (authorization distance set at
500 feet and 20 feet). Moreover, the plaintiffs’ expert filed a declara-
tion pointing to the references in the patent to infrared signals, 900
MHz signals, 1.8 GHz signals, and 2.4 GHz signals as examples of
different types of low power communication signals. He explained
that a common characteristic of such signals is the limited distance
over which they can be transmi ed, as discussed in the specification.
One of ordinary skill in the art, he explained, would understand from
reading the ’744 specification that the claim term “different types of
low power communication signals” means “different types of com-
munication signals having a power for transmission up to a maxi-
mum of several hundred feet.” The defendant has not submi ed a
contrary expert declaration on the issue of indefiniteness.
    Accordingly, the Court concludes that the term “low power com-
munication signals,” viewed in light of the specification, would be un-
derstood by persons of skill in the art with reasonable certainty. The
asserted claims in the ’744 patent are therefore not indefinite. Further-
more, in light of the discussion of low power communications in the
specification, the Court agrees with the plaintiffs that the term should
be interpreted to mean “communication signals having a power for
transmission of up to a maximum of several hundred feet.”

                %BUBNJ[F --$ W 1MVNUSFF 4PGUXBSF *OD
                       'E  'FE $JS 
[U.S. Patent No.   ], entitled “Electronic Kiosk Authoring Sys-
tem,” discloses a software program that allows a person to author
user interfaces for electronic kiosks. “The authoring system enables
the user interface for each individual kiosk to be customized quickly
and easily within wide limits of variation, yet subject to constraints
adhering the resulting interface to good standards of aesthetics and
user friendliness.” ‘137 patent, Abstract. [It claimed, in relevant part
(emphasis added):
     In an electronic kiosk system ... a method for defining
     custom interface screens ... said method comprising the
     steps of: ... providing a plurality of pre-defined interface
     screen element types, each element type defining a form
     of element available for presentation on said custom inter-
     face screens, wherein each said element type permits lim-
     ited variation in its on-screen characteristics in conformity
     with a desired uniform and aesthetically pleasing look and
     feel for said interface screens on all kiosks of said kiosk
                                                                                            $)"15&3  1"5&/5

                                                  system ... .
                                            Datamize, the patentee, argued that the term “aesthetically pleasing”
                                            should be contrued to refer to the intent of a person practicing the
                                            invention. That person must intend to create an aesthetically pleasing
                                            interface screen; whether she succeeds is irrelevant.]
                                                Datamize’s proposed construction of “aesthetically pleasing” in
                                            the context of claim 1 is not reasonable for several reasons. First and
                                            foremost, the plain meaning of the claim language requires that the
                                            look and feel of interface screens actually be “aesthetically pleasing.”
                                            That the uniform and “aesthetically pleasing” look and feel must also
                                            be “desired” does not alter that fact.
                                                Here Datamize has offered no objective definition identifying a
                                            standard for determining when an interface screen is “aesthetically
                                            pleasing.” In the absence of a workable objective standard, “aes-
                                            thetically pleasing” does not just include a subjective element, it is
                                            completely dependent on a person’s subjective opinion. To the ex-
                                            tent Datamize argues that such a construction of “aesthetically pleas-
                                            ing” does not render the phrase indefinite, we disagree. The scope of
                                            claim language cannot depend solely on the unrestrained, subjective
                                            opinion of a particular individual purportedly practicing the inven-
5IF DMBJNT EFTDSJCF UIF TUFQ PG FYUSBDU   tion. Some objective standard must be provided in order to allow
JOH NBDIJOF DPEF JOTUSVDUJPOT GSPN          the public to determine the scope of the claimed invention. Even if
                                            the relevant perspective is that of the system creator, the identity of
TFOTJDBM JO UIF XBZ B DMBJN UP FYUSBDU     who makes aesthetic choices fails to provide any direction regarding
JOH PSBOHF KVJDF GSPN BQQMFT XPVME          the relevant question of how to determine whether that person suc-
CF BOE BSF UIVT JOEFöOJUF 5SVTUFFT PG     ceeded in creating an “aesthetically pleasing” look and feel for inter-
$PMVNCJB 6OJW W 4ZNBOUFD $PSQ         face screens. A purely subjective construction of “aesthetically pleas-
'E  'FE $JS 
                                            ing” would not notify the public of the patentee’s right to exclude
                                            since the meaning of the claim language would depend on the un-
                                            predictable vagaries of any one person’s opinion of the aesthetics of
                                            interface screens. While beauty is in the eye of the beholder, a claim
                                            term, to be definite, requires an objective anchor. Thus, even if we
                                            adopted a completely subjective construction of “aesthetically pleas-
                                            ing,” this would still render the ‘137 patent invalid.
                                                And while the description of an embodiment provides examples
                                            of aesthetic features of screen displays that can be controlled by the
                                            authoring system, it does not explain what selection of these features
                                            would be “aesthetically pleasing.” Major aesthetic choices appar-
                                            ently may include some aspect of bu on styles and sizes, window
                                            borders, color combinations, and type fonts. The wri en descrip-
                                            tion, however, provides no guidance to a person making aesthetic
                                            choices such that their choices will result in an “aesthetically pleas-
                                            ing” look and feel of an interface screen. For example, the specifica-
                                            tion does not explain what factors a person should consider when se-
# 130$&%63&4                                                         

 lecting a feature to include in the authoring system. Left unanswered
 are questions like: which color combinations would be “aesthetically
 pleasing” and which would not? And more generally, how does one
determine whether a color combination is “aesthetically pleasing”?
Again, one skilled in the art reading the specification is left with the
 unhelpful direction to consult the subjective opinions of aesthetic de-
 sign specialists, database specialists, and academic studies.
     Simply put, the definition of “aesthetically pleasing” cannot de-
 pend on an undefined standard. We therefore affirm the district
 court’s grant of summary judgment of invalidity of all claims of the
‘137 patent.

                          'E  'FE $JS 
In general, a preamble limits the invention if it recites essential struc-
ture or steps, or if it is necessary to give life, meaning, and vitality to
the claim. Conversely, a preamble is not limiting where a patentee de-
fines a structurally complete invention in the claim body and uses the
preamble only to state a purpose or intended use for the invention.
    Perhaps a hypothetical best illustrates these principles: Inventor
A invents a shoe polish for shining shoes (which, for the sake of exam-
ple, is novel, useful, and nonobvious). Inventor A receives a patent
having composition claims for shoe polish. Indeed, the preamble of
these hypothetical claims recites ”a composition for polishing shoes.”
Clearly, Inventor B could not later secure a patent with composition
claims on the same composition because it would not be novel. Upon
discovering, however, that the polish composition grows hair when
rubbed on bare human skin, Inventor B can likely obtain method
claims directed to the new use of the composition to grow hair.


The transitional phrases “comprising”, “consisting essentially of”            .1&1 f 
and “consisting of” define the scope of a claim with respect to what           5SBOTJUJPOBM 1ISBTFT
unrecited additional components or steps, if any, are excluded from
the scope of the claim. The determination of what is or is not excluded
by a transitional phrase must be made on a case-by-case basis in light
of the facts of each case.
    The transitional term “comprising”, which is synonymous with
“including,” “containing,” or “characterized by,” is inclusive or
open-ended and does not exclude additional, unrecited elements or
method steps. In Gille e Co. v. Energizer Holdings Inc., the court held       (JMMFUUF  'E  'FE $JS 
                                                                                             $)"15&3  1"5&/5

                                           that a claim to “a safety razor blade unit comprising a guard, a cap,
                                           and a group of first, second, and third blades” encompasses razors
                                           with more than three blades because the transitional phrase “compris-
                                           ing” in the preamble and the phrase “group of” are presumptively
                                           open-ended. The transitional phrase “consisting of” excludes any el-
                                           ement, step, or ingredient not specified in the claim. The transitional
                                           phrase “consisting essentially of” limits the scope of a claim to the
                                           specified materials or steps and those that do not materially affect
                                           the basic and novel characteristic(s) of the claimed invention.

f  F
                                           A claim is indefinite when it contains words or phrases whose mean-
-BDL PG "OUFDFEFOU #BTJT                   ing is unclear. The lack of clarity could arise where a claim refers to
                                           “said lever” or “the lever,” where the claim contains no earlier recita-
                                           tion or limitation of a lever and where it would be unclear as to what
                                           element the limitation was making reference. Similarly, if two differ-
                                           ent levers are recited earlier in the claim, the recitation of “said lever”
                                           in the same or subsequent claim would be unclear where it is uncer-
                                           tain which of the two levers was intended.

f  I
                                           Alternative expressions are permi ed if they present no uncertainty
"MUFSOBUJWF -JNJUBUJPOT                    or ambiguity with respect to the question of scope or clarity of the
                                           claims. A “Markush” claim recites a list of alternatively useable
                                           species. A Markush claim is commonly forma ed as: “selected from
                                           the group consisting of A, B, and C;” however, the phrase “Markush
                                           claim” means any claim that recites a list of alternatively useable
                                           species regardless of format. Inventions in metallurgy, refractories,
                                           ceramics, pharmacy, pharmacology and biology are most frequently
                                           claimed under the Markush formula but purely mechanical features
                                           or process steps may also be claimed by using the Markush style of
                                           claiming. It is improper to use the term “comprising” instead of “con-
                                           sisting of.”


                                                                          1BUFOU "DU

 64$ f  B
                                           The specification shall contain a wri en description of the invention,
4QFDJöDBUJPO                               and of the manner and process of making and using it, in such full,
                                           clear, concise, and exact terms as to enable any person skilled in the
                                           art to which it pertains, or with which it is most nearly connected,
JOH PSEJOBSZ TLJMM JO UIF BSU GSPN 4FD   to make and use the same, and shall set forth the best mode contem-
UJPO  BSF GSFRVFOUMZ BCCSFWJBUFE UP     plated by the inventor or joint inventor of carrying out the invention.
1)04*5" 5IF 1)04*5" JT UIF IZQP
# 130$&%63&4                                                       

This language has been interpreted by the courts to create three dis-
tinct disclosure requirements: enablement, wri en description, and best
mode. Of the three, enablement is the most practically significant.

                          0h3FJMMZ W .PSTF
[Morse sued O’Reilly for infringing his patent on the telegraph. The
Supreme Court found that Morse was the inventor of the technology
and found that O’Reilly’s ”Columbian Telegraph” infringed. But it
narrowed Morse’s patent by striking its now-famous eighth claim:]
     Eighth. I do not propose to limit myself to the specific ma-
     chinery or parts of machinery described in the foregoing
     specification and claims; the essence of my invention be-
     ing the use of the motive power of the electric or galvanic
     current, which I call electro-magnetism, however devel-
     oped for marking or printing intelligible characters, signs,
     or le ers, at any distances, being a new application of that
     power of which I claim to be the first inventor or discov-
It is impossible to misunderstand the extent of this claim. He claims
the exclusive right to every improvement where the motive power
is the electric or galvanic current, and the result is the marking or
printing intelligible characters, signs, or le ers at a distance.
     If this claim can be maintained, it ma ers not by what process or
machinery the result is accomplished. For aught that we now know
some future inventor, in the onward march of science, may discover
a mode of writing or printing at a distance by means of the electric
or galvanic current, without using any part of the process or combi-
nation set forth in the plaintiff’s specification. His invention may be
less complicated –less liable to get out of orderl– ess expensive in con-
struction, and in its operation. But yet if it is covered by this patent
the inventor could not use it, nor the public have the benefit of it with-
out the permission of this patentee.
     Nor is this all, while he shuts the door against inventions of other
persons, the patentee would be able to avail himself of new discov-
eries in the properties and powers of electro-magnetism which scien-
tific men might bring to light. For he says he does not confine his
claim to the machinery or parts of machinery, which he specifies; but
claims for himself a monopoly in its use, however developed, for the
purpose of printing at a distance. New discoveries in physical sci-
ence may enable him to combine it with new agents and new ele-
ments, and by that means a ain the object in a manner superior to
                                                  $)"15&3  1"5&/5

the present process and altogether different from it. And if he can
secure the exclusive use by his present patent he may vary it with ev-
ery new discovery and development of the science, and need place
no description of the new manner, process, or machinery, upon the
records of the patent office. And when his patent expires, the public
must apply to him to learn what it is. In fine he claims an exclusive
right to use a manner and process which he has not described and
indeed had not invented, and therefore could not describe when he
obtained his patent. The court is of opinion that the claim is too broad,
and not warranted by law.

                 8ZFUI  $PSEJT $PSQ W "CCPUU -BCT
                       'E  'FE $JS 
Wyeth and Cordis Corporation (Wyeth) appeal from the U.S. District
Court for the District of New Jersey’s grant of summary judgment
that claims 1 and 2 of U.S. Patent No.    (’781 patent) and claim
1 of U.S. Patent No.    (’146 patent) are invalid for nonenable-
ment. Because we hold that there is no genuine issue of material fact
that the specification does not enable one of ordinary skill to practice
the asserted claims without undue experimentation, we affirm.
The patents-in-suit relate to the use of rapamycin for the treatment
and prevention of restenosis, which is the renarrowing of an artery.
To open a blocked artery, a physician guides a balloon catheter to the
site of accumulated plaque, and then inflates the balloon to crush the
plaque. As the balloon inflates, however, it may cause injury to the
arterial wall. That vascular injury causes smooth muscle cells to pro-
liferate, which thickens the arterial wall, and, in turn, leads to resteno-
     The claims recite a method of treating or preventing “restenosis in
a mammal ... which comprises administering an antirestenosis effec-
tive amount of rapamycin to said mammal.” In general, “rapamycin”
may refer to a class of compounds. While the patents-in-suit use
the term “rapamycin,” the parties agree that the shared specification
discloses only one rapamycin species called sirolimus. Sirolimus is
naturally produced by a bacterium called Streptomyces hygroscopicus.
[Sirolimus’s chemical structure has two relevant features: a “macro-
cyclic triene ring” and a specific “substituent group.”]
     The parties do not dispute that the effective filing date of both
patents is January 9, 1992. At that time, it was known that sirolimus
acts in part by binding two proteins at sites within the macrocyclic
ring. It was also known that there were four additional compounds
with the same macrocyclic ring as sirolimus, but different substituent
# 130$&%63&4                                                      

    The parties also do not dispute that the specification discloses the
immunosuppressive and antirestenotic properties of sirolimus. The
specification discloses in vitro test data indicating that sirolimus in-
hibits rat smooth muscle cell proliferation. It also discloses in vivo
test data indicating that intraperitoneal injection of sirolimus in rats
reduced the thickening of the arterial wall following vascular injury.
    In two separate actions, Wyeth sued the defendants for infringe-
ment of the patents-in-suit. The defendants market stent products
that elute everolimus and zotarolimus, two drugs that have the same
macrocyclic ring as sirolimus but different [substituent groups]. Af-
ter briefing and a hearing, the district court adopted Wyeth’s pro-
posed construction of “rapamycin” as “a compound containing a
macrocyclic triene ring structure produced by Streptomyces hygroscop-
icus, having immuno-suppressive and anti-restenotic effects.” Based
in part on that construction, the court granted defendants’ joint mo-
tions for summary judgment of invalidity for nonenablement and
lack of wri en description.
A patent’s specification must describe the invention and “the man-
ner and process of making and using it, in such full, clear, concise,
and exact terms as to enable any person skilled in the art to which it
pertains ... to make and use the same.” 35 U.S.C. § 112(a). Claims
are not enabled when, at the effective filing date of the patent, one
of ordinary skill in the art could not practice their full scope without
undue experimentation.
The central issue on appeal is whether practicing the full scope of
the claims requires excessive – and thus undue – experimentation.
The district court held that it does. It found that the claims cover
any structural analog of sirolimus that exhibits immunosuppressive
and antirestenotic effects. The court also found that, while the speci-
fication describes assays to ascertain whether a potential rapamycin
compound exhibits the recited functional effects, the only species dis-
closed is sirolimus. In further support of its holding of nonenable-
ment, the court relied on the unpredictability of the chemical arts, the
complexity of the invention, and the limited knowledge of treatment
of restenosis using sirolimus at the time of the invention.
    Wyeth argues that the district court ignored evidence that prac-
ticing the full scope of the claims would have required only rou-
tine experimentation. First, a skilled artisan could ascertain whether
a candidate rapamycin compound has the same macrocyclic ring
as sirolimus. Second, a skilled artisan could routinely determine
                                                 $)"15&3  1"5&/5

whether a candidate has immunosuppressive and antirestenotic ef-
fects using the assays disclosed in the specification.
    Regarding the amount of experimentation, Wyeth acknowledges
that one of its experts testified that there could be millions of
compounds made by varying the substituent groups outside of
sirolimus’s macrocyclic ring. Wyeth counters that the same expert
testified that the number of compounds that would exhibit the recited
functional effects would be significantly smaller. [Wyeth’s expert ar-
gued that a PHOSITA would have known that only compounds per-
meable across cell membranes, typically having molecular weights
below 1,200 Daltons would need to be considered. For purposes of
summary judgment, the court accepted this claim as true, and also the
claim that the assays would effectively confirm whether a candidate
compound had the desired immunosuppressive and antirestinotic ef-
    We agree with Appellees and the district court that there is no gen-
uine dispute that practicing the full scope of the claims, measured
at the time of filing, would require excessive experimentation. The
scope of the claims at issue is broad. Under the district court’s unchal-
lenged construction of “rapamycin,” the invention is a new method
of use of a known compound (sirolimus) and any other compounds
that meet the construction’s structural and functional requirements.
We also agree that there is no genuine dispute that the specification’s
guidance is limited to disclosures of the immunosuppressive and
antirestenotic properties of sirolimus and assays to screen for those
    Yet, even accepting Wyeth’s assertions, we find no genuine dis-
pute that practicing the full scope of the claims would require more
than routine experimentation for two reasons.
    First, there is no dispute that, even if potential rapamycin com-
pounds must have a molecular weight below 1,200 Daltons, there
are still at least tens of thousands of candidates. The specification
is silent about how to structurally modify sirolimus, let alone in a
way that would preserve the recited utility. Second, there is no gen-
uine dispute that it would be necessary to first synthesize and then
screen each candidate compound using the assays disclosed in the
specification to determine whether it has immunosuppressive and
antirestenotic effects. There is no evidence in the record that any par-
ticular substitutions outside of the macrocyclic ring are preferable. In-
deed, a Wyeth scientist confirmed the unpredictability of the art and
the ensuing need to assay each candidate by testifying that, “until
you test [compounds], you really can’t tell whether they work or not
[i.e., have antirestenotic effects].” In sum, there is no genuine dispute
that practicing the full scope of the claims would require synthesizing
and screening each of at least tens of thousands of compounds.
# 130$&%63&4                                                        

    The remaining question is whether having to synthesize and
screen each of at least tens of thousands of candidate compounds
constitutes undue experimentation. We hold that it does. Undue
experimentation is a ma er of degree. Even a considerable amount
of experimentation is permissible, as long as it is merely routine or
the specification provides a reasonable amount of guidance regard-
ing the direction of experimentation. Yet, routine experimentation is
not without bounds.
    Our cases have described limits on permissible experimentation
in the context of enablement. For example, in ALZA Corp. v. An-              "-;"  'E  'FE $JS 
drx Pharmaceuticals, LLC, we affirmed a judgment of nonenablement
where the specification provided “only a starting point, a direction
for further research.” We concluded that one of ordinary skill “would
have been required to engage in an iterative, trial-and-error process
to practice the claimed invention even with the help of the specifica-
tion.” Finally, in In re Vaeck, we affirmed the PTO’s nonenablement            7BFDL  'E  'FE $JS 
rejection of claims reciting heterologous gene expression in as many
as 150 genera of cyanobacteria. The specification disclosed only nine
genera, despite cyanobacteria being a “diverse and relatively poorly
understood group of microorganisms,” with unpredictable heterol-
ogous gene expression. Here, the specification similarly discloses
only a starting point for further iterative research in an unpredictable
and poorly understood field. Synthesizing candidate compounds de-
rived from sirolimus could, itself, require a complicated and lengthy
series of experiments in synthetic organic chemistry. Even pu ing
the challenges of synthesis aside, one of ordinary skill would need
to assay each of at least tens of thousands of candidates. Wyeth’s ex-
pert conceded that it would take technicians weeks to complete each
of these assays. The specification offers no guidance or predictions
about particular substitutions that might preserve the immunosup-
pressive and antirestenotic effects observed in sirolimus. The result-
ing need to engage in a systematic screening process for each of the
many rapamycin candidate compounds is excessive experimentation.
We thus hold that there is no genuine dispute that practicing the full
scope of the claims, measured at the filing date, required undue ex-

                          1MBTUJD %ZF 1SPCMFN
You are drafting claims for a patent application for an industrial dye
that turns certain plastics an a ractive shade of blue. Your client has
tested it, with success, on PETE, HDPE, PEEK, and PVDC (all semi-
crystalline plastics). You could draft a broad claim that refers to “plas-
tic” or you could draft a narrow claim that refers to “a plastic selected
from the group of PETE, HDPE, PEEK, and PVDC.” What are the ad-
vantages and disadvantages of each approach?
                                                                            $)"15&3  1"5&/5

                            C     8SJUUFO %FTDSJQUJPO

                                          "SJBE 1IBSNBDFVUJDBMT *OD W &MJ -JMMZ BOE $P
                                               'E  'FE $JS  FO CBOD
                            Since its inception, this court has consistently held that § 112, first
                            paragraph, contains a wri en description requirement separate from
                            enablement, and we have articulated a fairly uniform standard,
                            which we now affirm. Specifically, the description must clearly al-
                            low persons of ordinary skill in the art to recognize that the inventor
                            invented what is claimed. In other words, the test for sufficiency is
                            whether the disclosure of the application relied upon reasonably con-
                            veys to those skilled in the art that the inventor had possession of the
                            claimed subject ma er as of the filing date.
                                The term “possession,” however, has never been very enlighten-
                            ing. It implies that as long as one can produce records documenting a
                            wri en description of a claimed invention, one can show possession.
                            But the hallmark of wri en description is disclosure. Thus, “posses-
                            sion as shown in the disclosure” is a more complete formulation. Yet
                            whatever the specific articulation, the test requires an objective in-
                            quiry into the four corners of the specification from the perspective of
                            a person of ordinary skill in the art. Based on that inquiry, the spec-
                            ification must describe an invention understandable to that skilled
                            artisan and show that the inventor actually invented the invention
                                We have made clear that the wri en description requirement does
                            not demand either examples or an actual reduction to practice; a con-
                            structive reduction to practice that in a definite way identifies the
                            claimed invention can satisfy the wri en description requirement.
                            Conversely, we have repeatedly stated that actual “possession” or re-
                            duction to practice outside of the specification is not enough. Rather,
                            as stated above, it is the specification itself that must demonstrate
                            possession. And while the description requirement does not demand
                            any particular form of disclosure, or that the specification recite the
                            claimed invention in haec verba, a description that merely renders the
                            invention obvious does not satisfy the requirement.
                            D #FTU .PEF

                                    .BOVBM PG 1BUFOU &YBNJOBUJPO 1SPDFEVSF 3FW /PW 

                            The best mode requirement is a safeguard against the desire on the
5IF #FTU .PEF 3FRVJSFNFOU   part of some people to obtain patent protection without making a
                            full disclosure as required by the statute. The requirement does not
# 130$&%63&4                                                        

permit inventors to disclose only what they know to be their second-
best embodiment, while retaining the best for themselves.
    Determining compliance with the best mode requirement re-
quires a two-prong inquiry. First, it must be determined whether,
at the time the application was filed, the inventor possessed a best
mode for practicing the invention. This is a subjective inquiry which
focuses on the inventor’s state of mind at the time of filing. Second, if
the inventor did possess a best mode, it must be determined whether
the wri en description disclosed the best mode such that a person
skilled in the art could practice it. This is an objective inquiry, focus-
ing on the scope of the claimed invention and the level of skill in the
art. All applicants are required to disclose for the claimed subject mat-
ter the best mode contemplated by the inventor even if the inventor
was not the discoverer of that mode.
    Failure to disclose the best mode need not rise to the level of ac-
tive concealment or inequitable conduct in order to support a rejec-
tion. Where an inventor knows of a specific material or method that
will make possible the successful reproduction of the claimed inven-
tion, but does not disclose it, the best mode requirement has not been
    Section 15 of the Leahy-Smith America Invents Act (AIA) did not
eliminate the requirement for a disclosure of the best mode, but ef-
fective September 16, 2011, it amended 35 U.S.C. 282 (the provision
that sets forth defenses in a patent validity or infringement proceed-
ing) to provide that the failure to disclose the best mode shall not be
a basis on which any claim of a patent may be canceled or held in-
valid or otherwise unenforceable. As this change is applicable only
in patent validity or infringement proceedings, it does not alter cur-
rent patent examining practices as set forth above for evaluation of
an application for compliance with the best mode requirement of 35
U.S.C. 112.

                         4BMU 4IBLFS 1SPCMFN
Assume that you represent the inventor of the first screw-top salt
shaker. (In this alternate universe, prior art salt shakers were filled
through a hole in the bo om.) Draft a claim for this new invention.
   • What are the constituent parts of the screw-top shaker? Your
     claim will need to describe them and explain how they are re-
   • Which features of the screw-top shaker are essential to its use?
     Which can safely be omi ed?
                                                                                     $)"15&3  1"5&/5

                                          • Once the new screw-top shaker is publicly available, competing
                                            shaker-makers will try to invent around the patent. How can
                                            you make their job harder?
                                          • Inventors in other industries may be inspired by the screw-top
                                            design. Can you make sure that your claim is not restricted to
                                            the one use your client has in mind?

                                           1BUFOU 1SPTFDVUJPO

                                                      $VP[[P 4QFFE 5FDIOPMPHJFT --$ W -FF
                                                                4 $U  
                                      An inventor obtains a patent by applying to the Patent Office. A
                                      patent examiner with expertise in the relevant field reviews an appli-
                                      cant’s patent claims, considers the prior art, and determines whether
                                      each claim meets the applicable patent law requirements.
                                          If the examiner rejects a claim, the applicant can resubmit a nar-
                                      rowed (or otherwise modified) claim, which the examiner will con-
                                      sider anew, measuring the new claim against the same patent law
                                      requirements. If the examiner rejects the new claim, the inventor typ-
                                      ically has yet another chance to respond with yet another amended
                                      claim. Ultimately, the Patent Office makes a final decision allowing
                                      or rejecting the application. The applicant may seek judicial review
                                      of any final rejection.

                                                                   1BUFOU "DU

 64$ f 
                                      (a) Confidentiality. – Except as provided in subsection (b), applica-
$POöEFOUJBM TUBUVT PG BQQMJDBUJPOT       tions for patents shall be kept in confidence by the Patent and
                                      (b) Publication. –
# 130$&%63&4                                                      

  (1)(A) Subject to paragraph (2), each application for a patent shall
          be published, in accordance with procedures determined
          by the Director, promptly after the expiration of a period of
          18 months from the earliest filing date for which a benefit is
          sought under this title. At the request of the applicant, an
          application may be published earlier than the end of such
          18-month period.
(2)(B)(i) If an applicant makes a request upon filing, certifying that
          the invention disclosed in the application has not and will
          not be the subject of an application filed in another coun-
          try, or under a multilateral international agreement, that
          requires publication of applications 18 months after filing,
          the application shall not be published as provided in para-
          graph (1)

                     $PEF PG 'FEFSBM 3FHVMBUJPOT

A patent by its very nature is affected with a public interest. The pub-     $'3 f  B 
lic interest is best served, and the most effective patent examination      %VUZ UP EJTDMPTF JOGPSNBUJPO NBUFSJBM
occurs when, at the time an application is being examined, the Office        UP QBUFOUBCJMJUZ
is aware of and evaluates the teachings of all information material to
patentability. Each individual associated with the filing and prose-
cution of a patent application has a duty of candor and good faith in
dealing with the Office, which includes a duty to disclose to the Office
all information known to that individual to be material to patentabil-
ity as defined in this section. The duty to disclose information exists
with respect to each pending claim until the claim is cancelled or with-
drawn from consideration, or the application becomes abandoned.

                  'E  'FE $JS  FO CBOD
Inequitable conduct is an equitable defense to patent infringement
that, if proved, bars enforcement of a patent. This judge-made doc-
trine evolved from a trio of Supreme Court cases that applied the doc-
trine of unclean hands to dismiss patent cases involving egregious
misconduct before the PTO.
    As the inequitable conduct doctrine evolved from these unclean
hands cases, it came to embrace a broader scope of misconduct, in-
cluding not only egregious affirmative acts of misconduct intended to
deceive both the PTO and the courts but also the mere nondisclosure
of information to the PTO. Inequitable conduct also diverged from
the doctrine of unclean hands by adopting a different and more po-
tent remedy – unenforceability of the entire patent rather than mere
                                                                                      $)"15&3  1"5&/5

                                     dismissal of the instant suit.
                                         To prevail on a claim of inequitable conduct, the accused infringer
                                     must prove that the patentee acted with the specific intent to deceive
                                     the PTO. A finding that the misrepresentation or omission amounts
                                     to gross negligence or negligence under a “should have known” stan-
                                     dard does not satisfy this intent requirement. In a case involving
                                     nondisclosure of information, clear and convincing evidence must
                                     show that the applicant made a deliberate decision to withhold a
                                     known material reference. In other words, the accused infringer must
                                     prove by clear and convincing evidence that the applicant knew of the
                                     reference, knew that it was material, and made a deliberate decision
                                     to withhold it.
                                         Because direct evidence of deceptive intent is rare, a district court
                                     may infer intent from indirect and circumstantial evidence. However,
                                     to meet the clear and convincing evidence standard, the specific in-
                                     tent to deceive must be the single most reasonable inference able to
                                     be drawn from the evidence. Indeed, the evidence must be sufficient
                                     to require a finding of deceitful intent in the light of all the circum-
                                         This court holds that, as a general ma er, the materiality required
                                     to establish inequitable conduct is but-for materiality. When an ap-
                                     plicant fails to disclose prior art to the PTO, that prior art is but-for
                                     material if the PTO would not have allowed a claim had it been aware
                                     of the undisclosed prior art.
                                     B 1SJPSJUZ %BUFT

                                                64150 (FOFSBM *OGPSNBUJPO $PODFSOJOH 1BUFOUT

                                     A provisional application for patent (provisional application) is a U.S.
1SPWJTJPOBM "QQMJDBUJPO GPS 1BUFOU   national application filed in the USPTO under 35 U.S.C. § 111(b). A
                                     provisional application is not required to have a formal patent claim
                                     or an oath or declaration. Provisional applications also should not
                                     include any information disclosure (prior art) statement since provi-
                                     sional applications are not examined. A provisional application pro-
                                     vides the means to establish an early effective filing date in a later
                                     filed nonprovisional patent application filed under 35 U.S.C. § 111(a).
                                     It also allows the term ”Patent Pending” to be applied in connection
                                     with the description of the invention.
                                         A provisional application for patent has a pendency lasting 12
                                     months from the date the provisional application is filed. The 12-
                                     month pendency period cannot be extended. Therefore, an appli-
                                     cant who files a provisional application must file a corresponding
                                     nonprovisional application for patent (nonprovisional application)
                                     during the 12-month pendency period of the provisional application
# 130$&%63&4                                                        

in order to benefit from the earlier filing of the provisional applica-

                               1BUFOU "DU

If two or more independent and distinct inventions are claimed in one         64$ f 
application, the Director may require the application to be restricted       %JWJTJPOBM "QQMJDBUJPOT
to one of the inventions. If the other invention is made the subject of
a divisional application it shall be entitled to the benefit of the filing
date of the original application. The validity of a patent shall not be
questioned for failure of the Director to require the application to be
restricted to one invention.


A continuation application is an application for the invention(s) dis-
                                                                             .1&1 f 
closed in a prior-filed copending nonprovisional application. The dis-        $POUJOVBUJPO "QQMJDBUJPO
closure presented in the continuation must not include any subject
ma er which would constitute new ma er if submi ed as an amend-
ment to the parent application. The inventorship in the continuation
application must include at least one inventor named in the prior-
filed application. At any time before the patenting, abandonment,
or termination of proceedings on an earlier application, an applicant
may have recourse to filing a continuation application in order to in-
troduce into the application a new set of claims and to establish a
right to further examination by the Office.

A continuation-in-part is an application filed during the lifetime of an
                                                                             .1&1 f 
earlier nonprovisional application, repeating some substantial por-          $POUJOVBUJPOJO1BSU "QQMJDBUJPO
tion or all of the earlier nonprovisional application and adding ma er
not disclosed in the said earlier nonprovisional application.

What’s the difference? Divisionals and continuations repeat the spec-
ification of their parent applications; they are entitled to share its pri-
ority date. Divisionals are required when the examiner concludes
that an inventor is trying to claim two distinct inventions in the same
patent; they split the claims across two distinct applications. Contin-
uations allow an applicant to appeal the rejection of claims, or to add
new claims, without holding up the examination and issuance of the
claims the examiner allows. A continuation-in-part (CIP) adds new
subject ma er to the specification, so it is not automatically entitled
                                                                                $)"15&3  1"5&/5

                               to the same priority date. Instead, priority dates are assessed on a
                               claim-by-claim basis.
                               D +VEJDJBM 3FWJFX
                               Applicants can appeal rejections to the Patent Trial and Appeal Board
                               (PTAB). 35 U.S.C. § 134(a). If the PTAB also rejects the application, the
                               applicant can seek judicial review either before the Federal Circuit, id.
                               § 141, or the Eastern District of Virginia, id. § 145.
                               E 1PTU(SBOU 1SPDFFEJOHT

                                                              1BUFOU "DU

 64$ f̓
                                (a)In general. – Whenever any patent is, through error, deemed
3FJTTVF PG EFGFDUJWF QBUFOUT       wholly or partly inoperative or invalid, by reason of a defective
                                   specification or drawing, or by reason of the patentee claiming
                                   more or less than he had a right to claim in the patent, the Di-
                                   rector shall, on the surrender of such patent and the payment
                                   of the fee required by law, reissue the patent for the invention
                                   disclosed in the original patent, and in accordance with a new
                                   and amended application, for the unexpired part of the term of
                                   the original patent. No new ma er shall be introduced into the
                                   application for reissue.
                               (d) Reissue patent enlarging scope of claims. – No reissued patent
                                   shall be granted enlarging the scope of the claims of the orig-
                                   inal patent unless applied for within two years from the grant
                                   of the original patent.

                                                $VP[[P 4QFFE 5FDIOPMPHJFT --$ W -FF
                                                          4 $U  
                               For several decades, the Patent Office has also possessed the author-
                               ity to reexamine – and perhaps cancel – a patent claim that it had
                               previously allowed. In 1980, for example, Congress enacted a statute
4FF  64$ 4  FU TFR    providing for ”ex parte reexamination.”. That statute (which remains
                               in effect) gives ”any person at any time” the right to ”file a request
                               for reexamination” on the basis of certain prior art ”bearing on the
                               patentability” of an already-issued patent. If the Patent Office con-
                               cludes that the cited prior art raises ”a substantial new question of
                               patentability,” the agency can reexamine the patent. And that reex-
                               amination can lead the Patent Office to cancel the patent (or some of
                               its claims). Alternatively, the Director of the Patent Office can, on her
                               ”own initiative,” trigger such a proceeding. And, as with examina-
                               tion, the patent holder can seek judicial review of an adverse final
# 130$&%63&4                                                      

    In 1999 and 2002, Congress enacted statutes that established
another, similar procedure, known as ”inter partes reexamination.”
Those statutes granted third parties greater opportunities to partic-
ipate in the Patent Office’s reexamination proceedings as well as in
any appeal of a Patent Office decision.
    In 2011, Congress enacted the statute before us. That statute mod-
ifies ”inter partes reexamination,” which it now calls ”inter partes re-
view” (IPR). Like inter partes reexamination, any third party can ask      4FF  64$ f  FU TFR
the agency to initiate inter partes review of a patent claim. But the
new statute has changed the standard that governs the Patent Office’s
institution of the agency’s process. Instead of requiring that a request
for reexamination raise a ”substantial new question of patentability,”
it now requires that a petition show ”a reasonable likelihood that” the
challenger ”would prevail.”
    The new statute provides a challenger with broader participation
rights. It creates within the Patent Office a Patent Trial and Appeal
Board (Board) composed of administrative patent judges, who are
patent lawyers and former patent examiners, among others. That
Board conducts the proceedings, reaches a conclusion, and sets forth
its reasons.
    The statute sets forth time limits for completing this review. It
grants the Patent Office the authority to issue rules. Like its predeces-
sors, the statute authorizes judicial review of a ”final wri en decision”
canceling a patent claim. And, the statute says that the agency’s ini-
tial decision ”whether to institute an inter partes review” is ”final and
nonappealable.” Like the Court of Appeals, we believe that Cuozzo’s
contention that the Patent Office unlawfully initiated its agency re-
view is not appealable.
    Cuozzo further argues that the Patent Office lacked the legal au-
thority to issue its regulation requiring the agency, when conducting
an inter partes review, to give a patent claim ”its broadest reasonable
construction in light of the specification of the patent in which it ap-
pears.” Instead, Cuozzo contends that the Patent Office should, like          $'3 4  C  8IZ XPVME UIF 150
the courts, give claims their ordinary meaning as understood by a          VTF B EJòFSFOU TUBOEBSE PG DPOTUSVDUJPO
                                                                           UIBO UIF DPVSUT 8IZ XPVME JU NBUUFS
person of skill in the art.
    The statute, however, contains a provision that grants the Patent
Office authority to issue ”regulations ... establishing and governing
inter partes review under this chapter.” The Court of Appeals held
that this statute gives the Patent Office the legal authority to issue its
broadest reasonable construction regulation. We agree.

Even more confusingly, the AIA also introduced ”post-grant review”
(PGR). PGR is only available within nine months after a patent issues      1(3 4FF  64$ f  FU TFR
                                                                                            $)"15&3  1"5&/5

                                          – except for a ”transitional” program that allows for PGR of any ”cov-
$#. 4FF "*" f  'PS HVJEBODF PO        ered business method patent” at any time, but sunsets in 2020. IPR be-
XIBU JT BOE JT OPU B DPWFSFE CVTJ       comes available after the nine-month PGR window closes. The major
                                          differences are that IPR only allows for challenges under § 102 (nov-
                                     elty) and § 103 (nonobviousness) and that the threshold for the PTO
                                          to hear an IPR is higher. Paradoxically, because of the wider range
                                          of challenges available in PGR, the potential estoppel against parties
                                          who bring one is much broader.


                                                                         1BUFOU "DU

                                          Subject to the payment of fees under this title, such grant shall be for a
$POUFOUT BOE UFSN PG QBUFOU               term beginning on the date on which the patent issues and ending 20
1SJPS UP +VOF   QBUFOU UFSNT XFSF    years from the date on which the application for the patent was filed
TFU BU  ZFBST GSPN UIF EBUF PG UIF      in the United States or, if the application contains a specific reference
QBUFOU HSBOU (JWFO UIBU BQQMJDBOUT DBO   to an earlier filed application or applications under section 120, 121,
QBSUJBMMZ DPOUSPM UIF QBDF BU XIJDI BQ   365(c), or 386(c), from the date on which the earliest such application
                                          was filed.

                                          Section 135 also contains an extensive and intricate set of provisions
                                          for adjusting the patent term ”if the issue of an original patent is de-
                                          layed due to the failure of the Patent and Trademark Office” to act
                                          expeditiously, as specified by the statute, in its examination of the

                                          $ 0XOFSTIJQ

                                                 .BOVBM PG 1BUFOU &YBNJOBUJPO 1SPDFEVSF 3FW /PW 

                                          The inventor, or each individual who is a joint inventor of a claimed
*OWFOUPSTIJQ                              invention, in an application for patent (other than a provisional ap-
                                          plication) must execute an oath or declaration directed to the appli-
                                          cation, except as provided for in 37 CFR 1.64.
                                              The definition for inventorship can be simply stated: The thresh-
                                          old question in determining inventorship is who conceived the inven-
                                          tion. Unless a person contributes to the conception of the invention,
                                          he is not an inventor. Insofar as defining an inventor is concerned,
                                          reduction to practice, per se, is irrelevant. One must contribute to
$ 08/&34)*1                                                       

the conception to be an inventor. With regard to the inventorship of
chemical compounds, an inventor must have a conception of the spe-
cific compounds being claimed. General knowledge regarding the
anticipated biological properties of groups of complex chemical com-
pounds is insufficient to confer inventorship status with respect to
specifically claimed compounds. One who suggests an idea of a re-
sult to be accomplished, rather than the means of accomplishing it,
is not an coinventor. See MPEP § 2138.04 - § 2138.05 for a discussion
of what evidence is required to establish conception or reduction to
     In arriving at conception the inventor may consider and adopt
ideas and materials derived from many sources such as a suggestion
from an employee, or hired consultant so long as he maintains in-
tellectual domination of the work of making the invention down to
the successful testing, selecting or rejecting as he goes even if such
suggestion or material proves to be the key that unlocks his prob-
lem. (Adoption of the ideas and materials from another can become
a derivation.)
     Difficulties arise in separating members of a team effort, where
each member of the team has contributed something, into those mem-
bers that actually contributed to the conception of the invention, such
as the physical structure or operative steps, from those members that
merely acted under the direction and supervision of the conceivers.
It is not essential for the inventor to be personally involved in carry-
ing out process steps where implementation of those steps does not
require the exercise of inventive skill. There is no requirement that
the inventor be the one to reduce the invention to practice so long as
the reduction to practice was done on his behalf. See also Ma or v.        .BUUPS  'E  $$1" 
Coolegem (one following oral instructions is viewed as merely a tech-
nician); Tucker v. Naito 188 USPQ 260 (Bd. Pat. Inter. 1975) (inven-       5VDLFS
tors need not “personally construct and test their invention”); Davis      $BSSJFS  'E  $$1" 
v. Carrier (noninventor’s work was merely that of a skilled mechanic
carrying out the details of a plan devised by another).
     The inventive entity for a particular application is based on some
contribution to at least one of the claims made by each of the named
inventors. “Inventors may apply for a patent jointly even though (1)
they did not physically work together or at the same time, (2) each
did not make the same type or amount of contribution, or (3) each
did not make a contribution to the subject ma er of every claim of
the patent.” The statute neither states nor implies that two inventors      64$ 
can be ”joint inventors” if they have had no contact whatsoever and
are completely unaware of each other’s work. What is required is
some quantum of collaboration or connection. In other words, for
persons to be joint inventors, there must be some element of joint be-
havior, such as collaboration or working under common direction,
                                                                                        $)"15&3  1"5&/5

                                        one inventor seeing a relevant report and building upon it or hearing
                                        another’s suggestion at a meeting. It is not necessary that the inven-
                                        tive concept come to both joint inventors at the same time.
                                            Each joint inventor must generally contribute to the conception
                                        of the invention. A coinventor need not make a contribution to ev-
                                        ery claim of a patent. A contribution to one claim is enough. “The
                                        contributor of any disclosed means of a means-plus-function claim
                                        element is a joint inventor as to that claim, unless one asserting sole
                                        inventorship can show that the contribution of that means was sim-
                                        ply a reduction to practice of the sole inventor’s broader concept.”
&UIJDPO  'E  'FE $JS    Ethicon Inc. v. United States Surgical Corp. (The electronics technician
                                        who contributed to one of the two alternative structures in the speci-
                                        fication to define “the means for detaining” in a claim limitation was
                                        held to be a joint inventor.).

                                                                      1BUFOU "DU

 64$ f 
                                        (a) Institution of Proceeding. –
%FSJWBUJPO QSPDFFEJOHT                      (1) In general. – An applicant for patent may file a petition
                                                  with respect to an invention to institute a derivation pro-
                                                  ceeding in the Office. The petition shall set forth with par-
                                                  ticularity the basis for finding that an individual named
                                                  in an earlier application as the inventor or a joint inventor
                                                  derived such invention from an individual named in the
                                                  petitioner’s application as the inventor or a joint inventor
                                                  and, without authorization, the earlier application claim-
                                                  ing such invention was filed.
                                        (b) Determination by Patent Trial and Appeal Board. – In a derivation
                                            proceeding instituted under subsection (a), the Patent Trial and
                                            Appeal Board shall determine whether an inventor named in
                                            the earlier application derived the claimed invention from an
                                            inventor named in the petitioner’s application and, without au-
                                            thorization, the earlier application claiming such invention was
                                            filed. In appropriate circumstances, the Patent Trial and Appeal
                                            Board may correct the naming of the inventor in any application
                                            or patent at issue.

                                             1SJPSJUZ /PWFMUZ BOE 4UBUVUPSZ #BST
                                        Priority rules determine which of competing claimants is entitled to
                                        an IP right based on an earlier claim. It is rarely as simple as ”first
                                        in time” because what counts as ”first” could be assessed in different
                                        ways. Priority rules select one of these ways of determining who is
                                        ”first” and determine the consequences of this fact. As we shall see,
                                        U.S. patent law mostly creates priority by preventing all but one – or
$ 08/&34)*1                                                         

sometimes all – of the potential claimants from obtaining a patent. As
we shall also see, the AIA dramatically changed the priority rules of
U.S. patent law; this was the single biggest change made by the AIA.
    Under Section 102, an applicant “shall be entitled to a patent un-
less” someone somewhere has done something that makes the inven-
tion not patentable. That something is called a prior art reference and it
is said to anticipate the applicant’s invention. Conceptually, any such
rule raises three questions:
    • What makes a prior art reference sufficiently similar to the ap-
      plicant’s “claimed invention” to make it unpatentable? If Alfie
      applies to patent an oven, Beth’s previous work on metalwork-
      ing is irrelevant to the novelty of Alfie’s oven. Patent law has
      se led on a remarkably elegant test to capture this idea: the test
      for anticipation is simply the test for infringement plus the test
      for enablement. A claim is anticipated by an enabling prior art
      reference (and hence not novel) if that reference would infringe
      the claim. Peters v. Active Mfg. Co. “That which infringes, if         1FUFST  64   
      later, would anticipate, if earlier.”
    • Which kinds of activities count as prior art? The present sec-
      tion 102 uses the words “patented, described in a printed pub-
      lication, or in public use, on sale, or otherwise available to the
      public.” They are broad, but they do not exhaust the universe
      of human activity. If Alfie files for a patent on an oven of a
      type that Beth once built and then demolished without using or
      telling anyone else, Beth’s secret use does not quality as prior
      art and will not stand in the way of Alfie’s application. Exten-
      sive caselaw glosses the meanings of these phrases, which are
      far subtler than they may appear at first glance, and which have
      changed substantially over time.
    • When must an activity have taken place to qualify as prior art?
      The present section 102 uses the words “before the effective fil-
      ing date of the claimed invention,” so the patent applicant must       5IF FòFDUJWF öMJOH EBUF JT BMTP DBMMFE
      not only think of the invention and make it work but must also         UIF QSJPSJUZ EBUF 5IF XPSE FòFD
                                                                             UJWF TIPVME IBWF ZPV TVTQFDUJOH UIBU
      make it to the Patent Office before anyone else goes public with
                                                                             NBZCF UIF FòFDUJWF öMJOH EBUF JT OPU BM
      the same idea. If Alfie invents in January and files in March but        XBZT UIF BDUVBM öMJOH EBUF "OE JU JTOhU
      Beth publishes (or worse, files her own application) in Febru-          " BO BQQMJDBUJPO DBO SFMBUF CBDL UP UIF
      ary, Alfie is out of luck. This is one of the major changes in the      UIF FBSMJFS öMJOH EBUF PG B QSPWJTJPOBM
      America Invents Act: under pre-AIA law, Alfie’s March appli-            BQQMJDBUJPO PG B GPSFJHO BQQMJDBUJPO PS
                                                                             PG BO BQQMJDBUJPO PG XIJDI JU JT B DPO
      cation based off a January invention date would have been good
                                                                             UJOVBUJPO DPOUJOVBUJPOJOQBSU PS EJWJ
      enough. As we dig into the text of the AIA, we will see why it         TJPOBM *O FBDI DBTF UIFSF BSF BQQSPQSJ
      is said to create a rule of “first inventor to file.”                    BUF SFTUSJDUJPOT UP FOTVSF UIBU UIF BQQMJ
Not coincidentally, these are the same kinds of questions one must           DBUJPO JT NFBOJOHGVMMZ UIF TBNF BT UIF
                                                                             POF PO XIPTF öMJOH EBUF JU EFQFOET
also ask about infringement: what kinds of conduct are prohibited,
what makes a defendant’s use too similar, and when does it fall
                                                                                             $)"15&3  1"5&/5

                                           within the term of the plaintiff’s rights? This symmetry is baked into
                                           patent law, as it is to many other fields of intellectual property law.
                                           B "OUJDJQBUJPO

                                                          .BOVBM PG 1BUFOU &YBNJOBUJPO 1SPDFEVSF

                                           A claimed invention may be rejected under 35 U.S.C. 102 when the
"OUJDJQBUJPO  "QQMJDBUJPO PG  64$   invention is anticipated (or is “not novel”) over a disclosure that is
f                                       available as prior art. To anticipate a claim, the disclosure must teach
                                           every element of the claim.
                                               A claim is anticipated only if each and every element as set forth in
                                           the claim is found, either expressly or inherently described, in a single
                                           prior art reference. “When a claim covers several structures or com-
                                           positions, either generically or as alternatives, the claim is deemed
                                           anticipated if any of the structures or compositions within the scope
#SPXO W .  'E  'FE $JS       of the claim is known in the prior art.” Brown v. 3M (claim to a sys-
                                       tem for se ing a computer clock to an offset time to address the Year
                                           2000 (Y2K) problem, applicable to records with year date data in “at
                                           least one of two-digit, three-digit, or four-digit” representations, was
                                           held anticipated by a system that offsets year dates in only two-digit
                                           formats). The elements must be arranged as required by the claim,
                                           but this is not an ipsissimis verbis test, i.e., identity of terminology is
                                           not required.

                                           A generic claim cannot be allowed to an applicant if the prior art dis-
(FOVT4QFDJFT 4JUVBUJPOT                   closes a species falling within the claimed genus. The species in that
                                           case will anticipate the genus.
                                               A genus does not always anticipate a claim to a species within
                                           the genus. However, when the species is clearly named, the species
                                           claim is anticipated no ma er how many other species are addition-
                                           ally named. See Ex parte AEx parte Aexpartea17 USPQ 2d 1716 (BPAI
                                           1990) (”The tenth edition of the Merck Index lists ten thousand com-
                                           pounds. In our view, each and every one of those compounds is ‘de-
                                           scribed’ as that term is used in [pre-AIA] 35 U.S.C. § 102(a), in that
                                               Whether a generic disclosure necessarily anticipates everything
                                           within the genusdepends on the factual aspects of the specific disclo-
                                           sure and the particular products at issue. How one of ordinary skill
                                           in the art would understand the relative size of a genus or species in
                                           a particular technology is of critical importance.
1FUFSJOH  'E  $$1"                In In re Petering, the prior art disclosed a generic chemical for-
                                           mula “wherein X, Y, Z, P, and R’- represent either hydrogen or alkyl
                                           radicals, R a side chain containing an OH group.” The court held
$ 08/&34)*1                                                       

that this formula, without more, could not anticipate a claim to 7-
methyl-9-[d, l’-ribityl]-isoalloxazine because the generic formula en-
compassed a vast number and perhaps even an infinite number of
compounds. However, the reference also disclosed preferred sub-
stituents for X, Y, Z, P, R, and R. The court determined that this more
limited generic class consisted of about 20 compounds. The limited
number of compounds covered by the preferred formula in combi-
nation with the fact that the number of substituents was low at each
site, the ring positions were limited, and there was a large unchanging
structural nucleus, resulted in a finding that the reference sufficiently
described “each of the various permutations here involved as fully as
if he had drawn each structural formula or had wri en each name.”
The claimed compound was 1 of these 20 compounds. Therefore, the
reference “described” the claimed compound and the reference antic-
ipated the claims.

When the reference relied on expressly anticipates or makes obvious        f 
all of the elements of the claimed invention, the reference is presumed    1SJPS "SU (FOFSBM -FWFM PG 0QFSBCJMJUZ
to be operable. Once such a reference is found, the burden is on ap-       3FRVJSFE UP .BLF B 1SJNB 'BDJF $BTF
plicant to provide facts rebu ing the presumption of operability.
    A prior art reference provides an enabling disclosure and thus an-
ticipates a claimed invention if the reference describes the claimed in-
vention in sufficient detail to enable a person of ordinary skill in the
art to carry out the claimed invention; proof of efficacy is not required
for a prior art reference to be enabling for purposes of anticipation.

                       'E  'FE $JS 
This appeal is from an Order of the United States District Court for the
District of Columbia in a civil action brought pursuant to 35 U.S.C. §
145 against Donald W. Banner as Commissioner of Patents and Trade-
marks authorizing the Commissioner to issue to appellee a patent
containing claims 1, 2, and 3 of patent application serial No. 598,935
    The inventors, Loren C. Covington and Howard R. Palmer, em-
ployees of appellee to whom they have assigned their invention and
the application thereon, filed an application on March 29, 1974, se-
rial No. 455,964, to patent an alloy they developed. The application
involved in this appeal contains the three claims on appeal. The al-
loy is made primarily of titanium (Ti) and contains small amounts of
nickel (Ni) and molybdenum (Mo) as alloying ingredients to give the
alloy certain desirable properties, particularly corrosion resistance in
hot brine solutions, while retaining workability so that articles such
as tubing can be fabricated from it by rolling, welding and other tech-
                                                 $)"15&3  1"5&/5

niques. The inventors apparently also found that iron content should
be limited, iron being an undesired impurity rather than an alloying
ingredient. They determined the permissible ranges of the compo-
nents, above and below which the desired properties were not ob-
tained. A precise definition of the invention sought to be patented
is found in the claims, set forth below, claim 3 representing the pre-
ferred composition, it being understood, however, that no iron at all
would be even more preferred.
    1. A titanium base alloy consisting essentially by weight of about
       0.6% to 0.9% nickel, 0.2% to 0.4% molybdenum, up to 0.2% max-
       imum iron, balance titanium, said alloy being characterized by
       good corrosion resistance in hot brine environments.
    2. A titanium base alloy as set forth in Claim 1 having up to 0.1%
       iron, balance titanium.
    3. A titanium base alloy as set forth in Claim 1 having 0.8% nickel,
       0.3% molybdenum, up to 0.1% maximum iron, balance tita-
The examiner’s final rejection, repeated in his Answer on appeal to
the Patent and Trademark Office (PTO) Board of Appeals (board),
was on the grounds that claims 1 and 2 are anticipated (fully met)
by, and claim 3 would have been obvious from, an article by Kal-
abukhova and Mikheyew, Investigation of the Mechanical Properties of
Ti-Mo-Ni Alloys, R          M            ₍M        ₎ No. 3, pages 130-133
(1970) (in the court below and hereinafter called “the Russian article”)
under 35 U.S.C. §§ 102 and 103, respectively. The board affirmed the
examiner’s rejection.
     The Russian article is short (3 pages), highly technical, and con-
tains 10 graphs as part of the discussion. As its title indicates, it re-
lates to ternary Ti-Mo-Ni alloys, the subject of the application at bar.
The examiner and the board both found that it would disclose to one
skilled in the art an alloy on which at least claims 1 and 2 read, so that
those claims would not be allowable under the statute because of lack
of novelty of their subject ma er. Since the article does not specif-
ically disclose such an alloy in words, a li le thinking is required
about what it would disclose to one knowledgeable about Ti-Ni-Mo
alloys. The PTO did that thinking as follows:
      Figure 1c [a graph] shows data for the ternary titanium al-
      loy which contains Mo and Ni in the ratio of 1:3. Amongst
      the actual points on the graph is one at 1% Mo + Ni. At
      this point, the amounts of Mo and Ni would be 0.25% and
      0.75% respectively. A similar point appears on the graph
      shown in Figure 2 of the article.
          Appellants do not deny that the data points are dis-
$ 08/&34)*1                                                       

     closed in the reference. In fact, the Hall affidavit indi-
     cates at least two specific points (at 1% and 1.25% Mo +
     Ni) which would represent a description of alloys falling
     within the scope of the instant claims.
On that basis, the board found that the claimed alloys were not new,
because they were disclosed in the prior art. It having been argued
that the Russian article contains no disclosure of corrosion-resistant
properties of any of the alloys, the board held: “The fact that a par-
ticular property or the end use for this alloy as contemplated by ap-
pellants was not recognized in the article is of no consequence.” It
therefore held the Russian article to be an anticipation, noting that
although the article does not discuss corrosion resistance, it does dis-
close other properties such as strength and ductility. The PTO further
points out that the authors of the reference must have made the alloys
to obtain the data points.
    Being dissatisfied with the decision of the board, Titanium Metals
Corporation of America, as assignee of the Covington and Palmer ap-
plication, then brought an action in the District Court for the District
of Columbia against the Commissioner pursuant to 35 U.S.C. § 145.
    The case came on for trial on January 24, 1980, before the Honor-
able John G. Penn and was concluded in two and a half hours. The tes-
timony of one witness was heard by the court, Dr. James C. Williams,
professor at Carnegie-Mellon University in Pi sburgh and an expert
in titanium metallurgy.
    The court then concluded that claims 1-3 were not anticipated and
that claim 3 was wrongly rejected as directed to obvious subject mat-
ter. In the court’s view, Dr. Williams’ testimony tipped the scales in
favor of issuing a patent.
    We are left in no doubt that the court was impressed by the total-
ity of the evidence that the applicants for patent had discovered or in-
vented and disclosed knowledge which is not to be found in the refer-
ence, nor do we have any doubt about that ourselves. But those facts
are beside the point. The patent law imposes certain fundamental
conditions for patentability, paramount among them being the con-
dition that what is sought to be patented, as determined by the claims,
be new. The title of the application here involved is “Titanium Alloy,”
a composition of ma er. Surprisingly, in all of the evidence, nobody
discussed the key issue of whether the alloy was new, which is the
essence of the anticipation issue, including the expert Dr. Williams.
Plaintiff’s counsel, bringing Dr. Williams’ testimony to its climax, af-
ter he had explained the nature of the ingredients, the alloys made
therefrom, and their superior corrosion resistance in hot brine, etc.,
repetitively asked him such questions as “Does the [Russian] article
direct you as one skilled in the art to a titanium alloy having nickel
                                                 $)"15&3  1"5&/5

present in an amount between .6 and .9 percent molybdenum in an
amount between .2 and .4 percent?” (emphasis ours) followed by “Is
there anything mentioned in the article about corrosion resistance?”
Of course, the answers were emphatically negative. But this and like
testimony does not deal with the critical question: do claims 1 and
2, to which the questions obviously relate, read on or encompass an
alloy which was already known by reason of the disclosure of the
Russian article?
    Section 102, the usual basis for rejection for lack of novelty or an-
ticipation, lays down certain principles for determining the novelty
[of an invention], among which are the provisions in § 102(a) and (b)
that the claimed invention has not been “described in a printed publi-
cation in this or a foreign country,” either (a) before the invention by
the applicant or (b) more than one year before the application date to
which he is entitled (strictly a “loss of right” provision similar to nov-
elty). Either provision applies in this case, the Russian article having
a date some 5 years prior to the filing date and its status as “prior art”
not being questioned. The question, therefore, is whether claims 1
and 2 encompass and, if allowed, would enable plaintiff-appellee to
exclude others from making, using, or selling an alloy described in
the Russian article.
    To answer the question we need only turn to the affidavit of James
A. Hall, a metallurgist employed by appellee’s TIMET Division, who
undertook to analyze the Russian article disclosure by calculating the
ingredient percentages shown in the graph data points, which he pre-
sented in tabular form. There are 15 items in his table. The second
item shows a titanium base alloy containing 0.25% by weight Mo and
0.75% Ni and this is squarely within the ranges of 0.2-0.4% Mo and
0.6-0.9% Ni of claims 1 and 2. As to that disclosed alloy of the prior
art, there can be no question that claims 1 and 2 read on it and would
be infringed by anyone making, using, or selling it. Therefore, the
statute prohibits a patent containing them. This seems to be a case
either of not adequately considering the novelty requirement of the
statute, the true meaning of the correlative term “anticipation,” or the
meaning of the claims.
    By reason of the court’s quotations from cases holding that a ref-
erence is not an anticipation which does not enable one skilled in the
art to practice the claimed invention, it appears that the trial court
thought there was some deficiency in the Russian article on that score.
Enablement in this case involves only being able to make the alloy,
given the ingredients and their proportions without more. The evi-
dence here, however, clearly answers that question in two ways. Ap-
pellee’s own patent application does not undertake to tell anyone
how to make the alloy it describes and seeks to patent. It assumes
that those skilled in the art would know how. Secondly, appellee’s
$ 08/&34)*1                                                             

expert, Dr. Williams, testified on cross examination that given the
alloy information in the Russian article, he would know how to pre-
pare the alloys “by at least three techniques.” Enablement is not a
problem in this case.
    As we read the situation, the court was misled by the arguments
and evidence to the effect that the inventors here found out and dis-
closed in their application many things that one cannot learn from
reading the Russian article and that this was sufficient in law to justify
granting them a patent for their contributions—such things as what
good corrosion resistance the claimed alloys have against hot brine,
which possibly was not known, and the range limits of the Ni and Mo
content, outside of which that resistance diminishes, which are teach-
ings of very useful information. These things the applicants teach the
art and the Russian article does not. But throughout the trial counsel
never came to grips with the real issues: (1) what do the claims cover
and (2) is what they cover new? Under the laws Congress wrote, they
must be considered. Congress has not seen fit to permit the patenting
of an old alloy, known to others through a printed publication, by one
who has discovered its corrosion resistance or other useful properties,
or has found out to what extent one can modify the composition of
the alloy without losing such properties.
                                                                                 *O IJOETJHIU JT UIFSF B DMBJN UIBU UIF
    For all of the foregoing reasons, the court below commi ed clear
                                                                                 QBUFOUFFhT DPVOTFM DPVME IBWF ESBGUFE
error and legal error in authorizing the issuance of a patent on claims          UIBU XPVME IBWF DBQUVSFE UIF OFXMZ
1 and 2 since, properly construed, they are anticipated under § 102              EJTDPWFSFE QSPQFSUJFT PG UIF BMMPZ DPS
by the Russian article which admi edly discloses an alloy on which               SPTJPO SFTJTUBODF JO IPU CSJOF XJUIPVU
these claims read.                                                               CFJOH BOUJDJQBUFE CZ UIF 3VTTJBO BSUJ
Under the new § 102(a)(1), ”A person shall be entitled to a patent
unless the claimed invention was patented, described in a printed publi-
cation, or in public use, on sale, or otherwise available to the public before
the effective filing date of the claimed invention.” Most of the caselaw
bearing on these phrases was developed under the old § 102; signifi-
cant relevant differences will be noted.
U.S. patents pose few conceptual or practical difficulties; they are
prior art as of the day they issue. It is not always so easy to tell
whether a foreign right is a ”patent” within the meaning of § 102. In            $BSMTPO  'E  'FE $JS 
re Carlson held that a German Geschmacksmuster counted as a patent
for prior art purposes. A person may obtain one by ”depositing with
a local office an application with a drawing, photograph or sample
of the article.” That was enough, even though ”Geschmacksmuster
on display for public view in remote cities in a far-away land may
                                               $)"15&3  1"5&/5

create a burden of discovery for one without the time, desire, or re-
sources to journey there in person or by agent to observe that which
was registered and protected under German law.” Such is life.

                           *O SF ,MPQGFOTUFJO
                      'E  'FE $JS 
Carol Klopfenstein and John Brent appeal a decision from the Patent
and Trademark Office’s Board of Patent Appeals and Interferences
(“Board”) upholding the denial of their patent application. The Board
upheld the Patent and Trademark Office’s (“PTO’s”) initial denial of
their application on the ground that the invention described in the
patent application was not novel under 35 U.S.C. § 102(b) because it
had already been described in a printed publication more than one
year before the date of the patent application. We affirm.
The appellants applied for a patent on October 30, 2000. Their patent
application, Patent Application Serial No. 09/699,950 (“the ‘950 appli-
cation”), discloses methods of preparing foods comprising extruded
soy cotyledon fiber (“SCF”). The ‘950 application asserts that feeding
mammals foods containing extruded SCF may help lower their serum
cholesterol levels while raising HDL cholesterol levels. The fact that
extrusion reduces cholesterol levels was already known by those of
ordinary skill in the art that worked with SCF. What was not known
at the time was that double extrusion increases this effect and yielded
even stronger results.
    In October 1998, the appellants, along with colleague M. Liu, pre-
sented a printed slide presentation (“Liu” or “the Liu reference”)
entitled “Enhancement of Cholesterol-Lowering Activity of Dietary
Fibers By Extrusion Processing” at a meeting of the American Associ-
ation of Cereal Chemists (“AACC”). The fourteen-slide presentation
was printed and pasted onto poster boards. The printed slide pre-
sentation was displayed continuously for two and a half days at the
AACC meeting.
    In November of that same year, the same slide presentation was
put on display for less than a day at an Agriculture Experiment Sta-
tion (“AES”) at Kansas State University.
    Both parties agree that the Liu reference presented to the AACC
and at the AES in 1998 disclosed every limitation of the invention dis-
closed in the ‘950 patent application. Furthermore, at neither presen-
tation was there a disclaimer or notice to the intended audience pro-
hibiting note-taking or copying of the presentation. Finally, no copies
of the presentation were disseminated either at the AACC meeting or
$ 08/&34)*1                                                           

at the AES, and the presentation was never catalogued or indexed in
any library or database.
The appellants argue on appeal that the key to establishing whether
or not a reference constitutes a “printed publication” lies in determin-
ing whether or not it had been disseminated by the distribution of re-
productions or copies and/or indexed in a library or database. They
assert that because the Liu reference was not distributed and indexed,
it cannot count as a “printed publication” for the purposes of 35 U.S.C.
§ 102(b). To support their argument, they rely on several precedents
from this court and our predecessor court on “printed publications.”
They argue that In re Cronyn, In re Hall, Massachuse s Institute of Tech-      $SPOZO 'E  'FE $JS 
nology v. AB Fortia, and In re Wyer, among other cases, all support the        )BMM  'E  'FE $JS 
view that distribution and/or indexing is required for something to            .*5  'E  'FE $JS 
be considered a “printed publication.”                                         8ZFS  'E  $$1" 
    We find the appellants’ argument unconvincing and disagree
with their characterization of our controlling precedent. Even if the
cases cited by the appellants relied on inquiries into distribution and
indexing to reach their holdings, they do not limit this court to find-
ing something to be a “printed publication” only when there is distri-
bution and/or indexing. Indeed, the key inquiry is whether or not a
reference has been made “publicly accessible.”
    The statutory phrase “printed publication” has been interpreted
to mean that before the critical date the reference must have been
sufficiently accessible to the public interested in the art; dissemina-
tion and public accessibility are the keys to the legal determination
whether a prior art reference was “published.”
    For example, a public billboard targeted to those of ordinary skill
in the art that describes all of the limitations of an invention and that is
on display for the public for months may be neither “distributed” nor
“indexed” – but it most surely is “sufficiently accessible to the public
interested in the art” and therefore, under controlling precedent, a
“printed publication.”
    Furthermore, the cases that the appellants rely on can be clearly
distinguished from this case. Cronyn involved college students’ pre-
sentations of their undergraduate theses to a defense commi ee
made up of four faculty members. Their theses were later catalogued
in an index in the college’s main library. The index was made up of
thousands of individual cards that contained only a student’s name
and the title of his or her thesis. The index was searchable by stu-
dent name and the actual theses themselves were neither included
in the index nor made publicly accessible. We held that because the
                                                            $)"15&3  1"5&/5

theses were only presented to a handful of faculty members and had
not been catalogued or indexed in a meaningful way, they were not
sufficiently publicly accessible for the purposes of 35 U.S.C. § 102(b).
   In Hall, this court determined that a thesis filed and indexed in
a university library did count as a “printed publication.” The Hall
court arrived at its holding after taking into account that copies of the
indexed thesis itself were made freely available to the general public
by the university more than one year before the filing of the relevant
patent application in that case. But the court in Hall did not rest its
holding merely on the indexing of the thesis in question. Instead, it
used indexing as a factor in determining “public accessibility.” As
the court asserted:
       The “printed publication” bar is grounded on the princi-
       ple that once an invention is in the public domain, it is
       no longer patentable by anyone. Because there are many
       ways in which a reference may be disseminated to the
       interested public, “public accessibility” has been called
       the touchstone in determining whether a reference consti-
       tutes a “printed publication” bar under 35 U.S.C. § 102(b).
In MIT, a paper delivered orally to the First International Cell Cul-
ture Congress was considered a “printed publication.” In that case,
as many as 500 persons having ordinary skill in the art heard the pre-
sentation, and at least six copies of the paper were distributed. The
key to the court’s finding was that actual copies of the presentation
were distributed. The court did not consider the issue of indexing.
The MIT court determined the paper in question to be a “printed pub-
lication” but did not limit future determinations of the applicability
of the “printed publication” bar to instances in which copies of a ref-
erence were actually offered for distribution. 4
    Finally, the Wyer court determined that an Australian patent ap-
plication kept on microfilm at the Australian Patent Office was suf-
ficiently accessible to the public and to persons skilled in the perti-
nent art to qualify as a ”printed publication.” The court so found even
though it did not determine whether or not there was “actual view-
ing or dissemination” of the patent application. Id. It was sufficient
for the court’s purposes that the records of the application were kept
     With regard to scientific presentations, it is important to note than an entirely
oral presentation at a scientific conference that includes neither slides nor copies of
the presentation is without question not a “printed publication” for the purposes
of 35 U.S.C. § 102(b). Furthermore, a presentation that includes a transient display
of slides is likewise not necessarily a “printed publication.” See, e.g., Regents of the
Univ. of Cal. v. Howmedica, Inc., 530 F.Supp. 846 (D.N.J. 1981) (holding that “the
projection of slides at the lecture that was limited in duration and could not disclose
the invention to the extent necessary to enable a person of ordinary skill in the art
to make or use the invention” was not a “printed publication”).
$ 08/&34)*1                                                                 

so that they could be accessible to the public. Id.5 According to the
Wyer court, the entire purpose of the “printed publication” bar was
to “prevent withdrawal” of disclosures already in the possession of
the public by the issuance of a patent.
    Thus, throughout our case law, public accessibility has been the
criterion by which a prior art reference will be judged for the pur-
poses of § 102(b). Oftentimes courts have found it helpful to rely
on distribution and indexing as proxies for public accessibility. But
when they have done so, it has not been to the exclusion of all other
measures of public accessibility. In other words, distribution and in-
dexing are not the only factors to be considered in a § 102(b) “printed
publication” inquiry.
In this case, the Liu reference was displayed to the public approxi-
mately two years before the ‘950 application filing date. The reference
was shown to a wide variety of viewers, a large subsection of whom
possessed ordinary skill in the art of cereal chemistry and agriculture.
Furthermore, the reference was prominently displayed for approxi-
mately three cumulative days at AACC and the AES at Kansas State
University. The reference was shown with no stated expectation that
the information would not be copied or reproduced by those viewing
it. Finally, no copies of the Liu display were distributed to the pub-
lic and the display was not later indexed in any database, catalog or
     The duration of the display is important in determining the oppor-
tunity of the public in capturing, processing and retaining the infor-
mation conveyed by the reference. The more transient the display,
the less likely it is to be considered a “printed publication.” Con-
versely, the longer a reference is displayed, the more likely it is to
be considered a “printed publication.” In this case, the Liu reference
was displayed for a total of approximately three days. It was shown
at the AACC meeting for approximately two and a half days and at
the AES at Kansas State University for less than one day.
     The expertise of the intended audience can help determine how
easily those who viewed it could retain the displayed material. As
Judge Learned Hand explained in Jockmus v. Leviton, a reference,                     +PDLNVT  'E  E $JS 
“however ephemeral its existence,” may be a “printed publication”
if it “goes direct to those whose interests make them likely to observe
and remember whatever it may contain that is new and useful.” In
this case, the intended target audience at the AACC meeting was com-
prised of cereal chemists and others having ordinary skill in the art
    Unlike in Cronyn, it was the actual patent application — and not just an index
card searchable by author name only — that was made publicly accessible.
                                                                                           $)"15&3  1"5&/5

                                          of the ‘950 patent application. The intended viewers at the AES most
                                          likely also possessed ordinary skill in the art.
                                              Whether a party has a reasonable expectation that the information
                                          it displays to the public will not be copied aids our § 102(b) inquiry.
                                          Where professional and behavioral norms entitle a party to a reason-
                                          able expectation that the information displayed will not be copied, we
                                          are more reluctant to find something a “printed publication.” This
                                          reluctance helps preserve the incentive for inventors to participate
                                          in academic presentations or discussions. Where parties have taken
                                          steps to prevent the public from copying temporarily posted infor-
                                          mation, the opportunity for others to appropriate that information
                                          and assure its widespread public accessibility is reduced. These pro-
                                          tective measures could include license agreements, non-disclosure
                                          agreements, anti-copying software or even a simple disclaimer in-
                                          forming members of the viewing public that no copying of the infor-
                                          mation will be allowed or countenanced. Protective measures are to
                                          be considered insofar as they create a reasonable expectation on the
                                          part of the inventor that the displayed information will not be copied.
                                          In this case, the appellants took no measures to protect the informa-
                                          tion they displayed — nor did the professional norms under which
                                          they were displaying their information entitle them to a reasonable
                                          expectation that their display would not be copied. There was no dis-
                                          claimer discouraging copying, and any viewer was free to take notes
                                          from the Liu reference or even to photograph it outright.
                                              Finally, the ease or simplicity with which a display could be
                                          copied gives further guidance to our § 102(b) inquiry. The more com-
                                          plex a display, the more difficult it will be for members of the public to
                                          effectively capture its information. The simpler a display is, the more
                                          likely members of the public could learn it by rote or take notes ade-
                                          quate enough for later reproduction. The Liu reference was made up
                                          of 14 separate slides. One slide was a title slide; one was an acknowl-
                                          edgement slide; and four others represented graphs and charts of ex-
                                          periment results. The other eight slides contained information pre-
                                          sented in bullet point format, with no more than three bullet points
                                          to a slide. Further, no bullet point was longer than two concise sen-
                                          tences. Finally, as noted earlier, the fact that extrusion lowers choles-
                                          terol levels was already known by those who worked with SCF. The
4VQQPTF UIBU UIF -JV QSFTFOUBUJPO IBE     discovery disclosed in the Liu reference was that double extrusion
OPU CFFO TIPXO BU UIF ""$$ NFFUJOH        increases this effect. As a result, most of the eight substantive slides
CVU JOTUFBE CFFO QPTUFE UP -JVhT QFS     only recited what had already been known in the field, and only a
TPOBM XFCQBHF 1SJOUFE QVCMJDBUJPO        few slides presented would have needed to have been copied by an
                                          observer to capture the novel information presented by the slides.
UIFS RVFTUJPOT ZPV XPVME XBOU UP BTL          Upon reviewing the above factors, it becomes clear that the Liu ref-
CFGPSF DPNNJUUJOH UP BO BOTXFS PO FJ     erence was sufficiently publicly accessible to count as a “printed pub-
UIFS PG UIFTF IZQPUIFUJDBMT               lication” for the purposes of 35 U.S.C. § 102(b). The reference itself
$ 08/&34)*1                                                         

was shown for an extended period of time to members of the public
having ordinary skill in the art of the invention behind the ‘950 patent
application. Those members of the public were not precluded from
taking notes or even photographs of the reference. And the reference
itself was presented in such a way that copying of the information it
contained would have been a relatively simple undertaking for those
to whom it was exposed — particularly given the amount of time they
had to copy the information and the lack of any restrictions on their
copying of the information. For these reasons, we conclude that the
Liu reference was made sufficiently publicly accessible to count as a
“printed publication” under § 102(b).
The old § 102 got at this concept in two different ways. It denied a
patent where the invention was ”known or used by others” before
the date of invention (a ”novelty” rule) or where it was ”in public use”
more than a year before the filing date (a ”statutory bar”). While the      *U BMTP VTFE UIF QISBTF JO UIJT DPVO
two provisions differed in their timing (more on this in the Priority       USZ  XIJDI UIF "*" ESPQT %POhU XPSSZ
                                                                           BCPVU UIF HFPHSBQIJD JTTVFT GPS OPX
section below), the most fundamental distinction was that ”known or
used by others” only applied to uses made by third parties, whereas
”in public use” also could be triggered by anyone, including the inven-

                        &HCFSU W -JQQNBOO
This suit was brought for an alleged infringement of the com-
plainant’s reissued le ers-patent, No. 5216, dated Jan. 7, 1873, for
an improvement in corset-springs.
   The original le ers bear date July 17, 1866, and were issued to
Samuel H. Barnes. The reissue was made to the complainant, under
her then name, Frances Lee Barnes, executrix of the original patentee.
   The specification for the reissue declares:
      This invention consists in forming the springs of corsets
      of two or more metallic plates, placed one upon another,
      and so connected as to prevent them from sliding off each
      other laterally or edgewise, and at the same time admit of
      their playing or sliding upon each other, in the direction
      of their length or longitudinally, whereby their flexibility
      and elasticity are greatly increased, while at the same time
      much strength is obtained.
The second claim is as follows:
      A pair of corset-springs, each member of the pair being
      composed of two or more metallic plates, placed one on
                                                $)"15&3  1"5&/5

      another, and fastened together at their centres, and so con-
      nected at or near each end that they can move or play on
      each other in the direction of their length.
[The patent statute in force at the time had a two-year statutory bar,
whose] effect is to render le ers-patent invalid if the invention which
they cover was in public use, with the consent and allowance of the
inventor, for more than two years prior to his application.
    The evidence on which the defendants rely to establish a prior
public use of the invention consists mainly of the testimony of the
    She testifies that Barnes invented the improvement covered by
his patent between January and May, 1855; that between the dates
named the witness and her friend Miss Cugier were complaining of
the breaking of their corset-steels. Barnes, who was present, and was
an intimate friend of the witness, said he thought he could make her
a pair that would not break. At their next interview he presented her
with a pair of corset-steels which he himself had made. The witness
wore these steels a long time. In 1858 Barnes made and presented to
her another pair, which she also wore a long time. When the corsets
in which these steels were used wore out, the witness ripped them
open and took out the steels and put them in new corsets. This was
done several times.
    It is admi ed, and, in fact, is asserted, by complainant, that these
steels embodied the invention afterwards patented by Barnes and
covered by the reissued le ers-patent on which this suit is brought.
    Joseph H. Sturgis, another witness for complainant, testifies that
in 1863 Barnes spoke to him about two inventions made by himself,
one of which was a corset-steel, and that he went to the house of
Barnes to see them. Before this time, and after the transactions testi-
fied to by the complainant, Barnes and she had intermarried. Barnes
said his wife had a pair of steels made according to his invention in
the corsets which she was then wearing, and if she would take them
off he would show them to witness. Mrs. Barnes went out, and re-
turned with a pair of corsets and a pair of scissors, and ripped the
corsets open and took out the steels. Barnes then explained to wit-
ness how they were made and used.
    The question for our decision is, whether this testimony shows a
public use within the meaning of the statute.
    We observe, in the first place, that to constitute the public use of
an invention it is not necessary that more than one of the patented
articles should be publicly used. The use of a great number may tend
to strengthen the proof, but one well-defined case of such use is just
as effectual to annul the patent as many. For instance, if the inventor
of a mower, a printingpress, or a railway-car makes and sells only one
$ 08/&34)*1                                                        

of the articles invented by him, and allows the vendee to use it for two
years, without restriction or limitation, the use is just as public as if
he had sold and allowed the use of a great number.
    We remark, secondly, that, whether the use of an invention is pub-
lic or private does not necessarily depend upon the number of per-
sons to whom its use is known. If an inventor, having made his de-
vice, gives or sells it to another, to be used by the donee or vendee,
without limitation or restriction, or injunction of secrecy, and it is so
used, such use is public, even though the use and knowledge of the
use may be confined to one person.
    We say, thirdly, that some inventions are by their very character
only capable of being used where they cannot be seen or observed by
the public eye. An invention may consist of a lever or spring, hidden
in the running gear of a watch, or of a rachet, shaft, or cog-wheel cov-
ered from view in the recesses of a machine for spinning or weaving.
Nevertheless, if its inventor sells a machine of which his invention
forms a part, and allows it to be used without restriction of any kind,
the use is a public one. So, on the other hand, a use necessarily open
to public view, if made in good faith solely to test the qualities of
the invention, and for the purpose of experiment, is not a public use
within the meaning of the statute. City of Elizabeth v. American Nichol-    $JUZ PG &MJ[BCFUI  64  
son Pavement Co..
    Tested by these principles, we think the evidence of the com-
plainant herself shows that for more than two years before the appli-
cation for the original le ers there was, by the consent and allowance
of Barnes, a public use of the invention, covered by them. He made
and gave to her two pairs of corset-steels, constructed according to
his device, one in 1855 and one in 1858. They were presented to her
for use. He imposed no obligation of secrecy, nor any condition or
restriction whatever. They were not presented for the purpose of ex-
periment, nor to test their qualities. No such claim is set up in her
testimony. The invention was at the time complete, and there is no
evidence that it was afterwards changed or improved. The donee of
the steels used them for years for the purpose and in the manner de-
signed by the inventor. They were not capable of any other use. She
might have exhibited them to any person, or made other steels of the
same kind, and used or sold them without violating any condition or
restriction imposed on her by the inventor.
    According to the testimony of the complainant, the invention was
completed and put to use in 1855. The inventor slept on his rights
for eleven years. Le ers-patent were not applied for till March, 1866.
In the mean time, the invention had found its way into general, and
almost universal, use. A great part of the record is taken up with the
testimony of the manufacturers and venders of corset-steels, show-
ing that before he applied for le ers the principle of his device was
                                                 $)"15&3  1"5&/5

almost universally used in the manufacture of corset-steels. It is fair
to presume that having learned from this general use that there was
some value in his invention, he a empted to resume, by his applica-
tion, what by his acts he had clearly dedicated to the public.
      An abandonment of an invention to the public may be
      evinced by the conduct of the inventor at any time, even
      within the two years named in the law. The effect of the
      law is that no such consequence will necessarily follow
      from the invention being in public use or on sale, with the
      inventor’s consent and allowance, at any time within two
      years before his application; but that, if the invention is
      in public use or on sale prior to that time, it will be con-
      clusive evidence of abandonment, and the patent will be
City of Elizabeth We are of opinion that the defence of two years’ pub-
lic use, by the consent and allowance of the inventor, before he made
application for le ers-patent, is satisfactorily established by the evi-

                        5FY - 3FW  
An inventor can obtain a patent only if the invention is “novel” – that
is, that no one has done the same thing before. Rather than adopting
an absolute novelty rule, however, patent law has traditionally re-
quired that most categories of prior art be “accessible to the public.”
Thus, while [old] 35 U.S.C. § 102(a) bars a patent if the invention was
“known or used by others” before the applicant invented it, courts
have interpreted that term to mean “publicly known or used.” At
the same time, the public accessibility requirement does not require
that the public have a realistic chance of accessing the information;
“public” seems to mean merely “not secret.” An invention performed
underground on private property in a rural area, an invention found
only inside the walls of a safe, and a single copy of a graduate thesis in
the basement of a library in Germany have all been held sufficiently
“public” to constitute prior art.
     In addition to novelty, the Patent Act of 1952, like its predeces-
sors, created a series of “statutory bars” designed to prevent inven-
tors from making commercial use of their invention while keeping it
secret. [Old] section 102(b) provides that even a true first inventor
is not entitled to a patent if the invention has been “on sale” or “in
public use” more than a year before the inventor files her patent ap-
plication. As with [old] section 102(a), the courts have interpreted the
word “public” quite loosely, so that even uses that are extremely un-
likely to be viewed by the public are nonetheless classed as “public
$ 08/&34)*1                                                          

uses” so long as they are not affirmatively secret. In the most extreme
example, the Supreme Court held that a woman engaged in a public
use of a corset invented by her fiancé when she wore it under her
    But even a very broad definition of “public” left a significant loop-
hole – an inventor could avoid the one-year statutory bar by commer-
cializing his invention but treating it as a trade secret. Because a secret
use is by definition not a public use, a company could make commer-
cial use of an invention indefinitely without triggering the one-year
period for filing. To solve this problem, courts for more than sev-
enty years have created a special rule for secret commercial uses: a
secret commercial use is not prior art that bars a third party from
later obtaining a patent, but it does start the one-year clock running
for the user. This rule originated in a 1940 opinion by Judge Learned
Hand in Metallizing Engineering v. Kenyon Bearing & Auto Parts. The           .FUBMMJ[JOH  'E  E $JS 
court acknowledged that interpreting the same term (“public use”) to
have different meanings was hard to reconcile with the statute. But
Judge Hand reasoned that it was not the intent of the statute to en-          *U JT B DPOEJUJPO VQPO BO JOWFOUPShT
courage secrecy, but instead to encourage disclosure. Metallizing’s           SJHIU UP B QBUFOU UIBU IF TIBMM OPU FY
                                                                              QMPJU IJT EJTDPWFSZ DPNQFUJUJWFMZ BGUFS JU
split interpretation of public use served that goal in two ways. First,
                                                                              JT SFBEZ GPS QBUFOUJOH <*G IF EPFT > IF
it encouraged inventors to file a patent quickly rather than relying           GPSGFJUT IJT SJHIU SFHBSEMFTT PG IPX MJUUMF
in trade secrecy, because they would lose the right to patent if they         UIF QVCMJD NBZ IBWF MFBSOFE BCPVU UIF
waited longer than a year. Second, the fact that a secret commercial          JOWFOUJPO .FUBMMJ[JOH
use wouldn’t prevent a later patent from issuing to a third party adds
to the disclosure incentive, because an inventor who opts for trade se-
crecy may find that a later inventor has patented their own idea and
there is nothing they can do to stop it.

                        -PVHI W #SVOTXJDL $PSQ
                        'E  'FE $JS 
[Lough designed an improved seal for outboard motors.] After some
trial and error with his grand-father’s metal lathe, he made six usable
prototypes in the spring of 1986. He installed one prototype in his
own boat at home. Three months later, he gave a second prototype
to a friend who installed it in his boat. He also installed prototypes in
the boat of the owner of the marina where he worked and in the boat
of a marina customer. He gave the remaining prototypes to longtime
friends who were employees at another marina in Sarasota. Lough
did not charge anyone for the prototypes. For over a year following
the installation of these prototypes, Lough neither asked for nor re-
ceived any comments about the operability of the prototypes. During
this time, Lough did not a empt to sell any seal assemblies.
    On June 6, 1988, Lough filed a patent application entitled ”Liquid
Seal for Marine Stern Drive Gear Shift Shafts,” which issued as [U.S.
Patent No.   "] on July 18, 1989.
                                                                           $)"15&3  1"5&/5

                             One is entitled to a patent unless, inter alia, ”the invention was ...
                         in public use ... in this country, more than one year prior to the date
 64$ f  C    of the application for patent in the United States.” We have defined
                         ”public use” as including any use of the claimed invention by a per-
                         son other than the inventor who is under no limitation, restriction or
                         obligation of secrecy to the inventor. An evaluation of a question of
                         public use depends on how the totality of the circumstances of the
                         case comports with the policies underlying the public use bar. These
                         policies include: (1) discouraging the removal, from the public do-
                         main, of inventions that the public reasonably has come to believe are
                         freely available; (2) favoring the prompt and widespread disclosure
                         of inventions; (3) allowing the inventor a reasonable amount of time
                         following sales activity to determine the potential economic value of
                         a patent; and (4) prohibiting the inventor from commercially exploit-
                         ing the invention for a period greater than the statutorily prescribed
                             Neither party disputes that Lough’s prototypes were in use before
                         the critical date. Thus, both parties agree that the issue presented on
                         appeal is whether the jury properly decided that the use of Lough’s
                         six prototypes in 1986, prior to the critical date, constituted experi-
                         mental use so as to negate the conclusion of public use.
                             ”The use of an invention by the inventor himself, or of any other
                         person under his direction, by way of experiment, and in order to
                         bring the invention to perfection, has never been regarded as [a pub-
                         lic] use.” City of Elizabeth. This doctrine is based on the underlying
                         policy of providing an inventor time to determine if the invention is
                         suitable for its intended purpose, in effect, to reduce the invention
                         to practice. See id. (”It is sometimes said that an inventor acquires
                         an undue advantage over the public by delaying to take out a patent,
                         but this cannot be said with justice when the delay is occasioned by
                         a bona fide effort to bring his invention to perfection, or to ascertain
                         whether it will answer the purpose intended.”). If a use is experi-
                         mental, it is not, as a ma er of law, a public use within the meaning
                         of section 102.
                             To determine whether a use is ”experimental,” a question of law,
                         the totality of the circumstances must be considered, including vari-
                         ous objective indicia of experimentation surrounding the use, such as
                         the number of prototypes and duration of testing, whether records or
                         progress reports were made concerning the testing, the existence of
                         a secrecy agreement between the patentee and the party performing
                         the testing, whether the patentee received compensation for the use
                         of the invention, and the extent of control the inventor maintained
                         over the testing.
                             In order to justify a determination that legally sufficient experi-
                         mentation has occurred, there must be present certain minimal indi-
$ 08/&34)*1                                                          

cia. The framework might be quite formal, as may be expected when
large corporations conduct experiments, governed by contracts and
explicit wri en obligations. When individual inventors or small busi-
ness units are involved, however, less formal and seemingly casual
experiments can be expected. Such less formal experiments may be
deemed legally sufficient to avoid the public use bar, but only if they
demonstrate the presence of the same basic elements that are required
to validate any experimental program.
     It cannot be reasonably disputed that Lough’s use of the invention
was not ”experimental” so as to negate a conclusion of public use. It
is true that Lough did not receive any compensation for the use of the
prototypes. He did not place the seal assembly on sale before apply-
ing for a patent. Lough’s lack of commercialization, however, is not
dispositive of the public use question in view of his failure to present
objective evidence of experimentation. Lough kept no records of the
alleged testing. Nor did he inspect the seal assemblies after they had
been installed by other mechanics. He provided the seal assemblies
to friends and acquaintances, but without any provision for follow-
up involvement by him in assessment of the events occurring during
the alleged experiments, and at least one seal was installed in a boat
that was later sold to strangers. Thus, Lough did not maintain any
supervision and control over the seals during the alleged testing.
     Lough argues that other evidence supports a finding that his uses
were experimental, including his own testimony that the prototypes
were installed for experimental purposes and the fact that the proto-
types were used in such a manner that they were unlikely to be seen
by the public. However, the expression by an inventor of his subjec-
tive intent to experiment, particularly after institution of litigation, is
generally of minimal value. n addition, the fact that the prototypes
were unlikely to be seen by the public does not support Lough’s po-
sition. As the Supreme Court stated in Egbert:
      Some inventions are by their very character only capable
      of being used where they cannot be seen or observed by
      the public eye. An invention may consist of a lever or
      spring, hidden in the running gear of a watch, or of a ra-
      chet, shaft, or cogwheel covered from view in the recesses
      of a machine for spinning or weaving. Nevertheless, if its
      inventor sells a machine of which his invention forms a
      part, and allows it to be used without restriction of any
      kind, the use is a public one.
Moreover, those to whom he gave the prototypes constituted ”the
public,” in the absence of meaningful evidence of experimentation.
   We therefore hold that the jury had no legal basis to conclude that
the uses of Lough’s prototypes were experimental and that the pro-
                                                                                         $)"15&3  1"5&/5

                                       totypes were not in public use prior to the critical date. Our holding
                                       is consistent with the policy underlying the experimental use nega-
                                       tion, that of providing an inventor time to determine if the invention
                                       is suitable for its intended purpose, i.e., to reduce the invention to
                                       practice. Lough’s activities clearly were not consistent with that pol-
                                       icy. We do not dispute that it may have been desirable in this case
                                       for Lough to have had his prototypes installed by mechanics of vari-
                                       ous levels of skill in boats that were exposed to different conditions.
                                       Moreover, Lough was free to test his invention in boats of friends
                                       and acquaintances to further verify that his invention worked for its
                                       intended purpose; however, Lough was required to maintain some
                                       degree of control and feedback over those uses of the prototypes if
                                       those tests were to negate public use.
                                        PO TBMF

                                             .BOVBM PG 1BUFOU &YBNJOBUJPO 1SPDFEVSF 3FW /PW 

f  E
                                       The pre-AIA case law indicates that on sale activity will bar
0O 4BMF                                patentability if the claimed invention was: (1) the subject of a com-
                                       mercial sale or offer for sale, not primarily for experimental purposes;
1GBò   64                  and (2) ready for patenting. See Pfaff v. Wells Elecs., Inc. Contract law
                                       principles apply in order to determine whether a commercial sale or
                                       offer for sale occurred.

f  C
                                       A sale is a contract between parties wherein the seller agrees to give
0O 4BMF EFTDSJCJOH QSF"*" MBX       and to pass rights of property in return for the buyer’s payment or
                                       promise “to pay the seller for the things bought or sold.. A contract
                                       for the sale of goods requires a concrete offer and acceptance of that
-JOFBS 5FDI  'E  'FE $JS   offer. See, e.g., Linear Tech. Corp. v. Micrel, Inc. (Court held there was
                                   no sale where prospective purchaser submi ed an order for goods at
                                       issue, but received an order acknowledgement reading “will advise-
                                       not booked.” Prospective purchaser would understand that order
                                       was not accepted.).
                                           An assignment or sale of the rights in the invention and potential
,PMMBS  'E  'FE $JS    patent rights is not a sale of ”the invention.” In re Kollar, distinguishes
                                       licenses which trigger the on-sale bar (e.g., a standard computer soft-
                                       ware license wherein the product is just as immediately transferred to
                                       the licensee as if it were sold), from licenses that merely grant rights
                                       to an invention which do not per se trigger the on-sale bar (e.g., ex-
                                       clusive rights to market the invention or potential patent rights).

 D                              The Supreme Court’s “ready for patenting” prong applies in the con-
5IF i*OWFOUJPOw EFTDSJCJOH QSF"*"     text of both the on sale and public use bars. “Ready for patenting,”
$ 08/&34)*1                                                        

the second prong of the Pfaff test, may be satisfied in at least two ways:
by proof of reduction to practice before the critical date; or by proof
that prior to the critical date the inventor had prepared drawings or
other descriptions of the invention that were sufficiently specific to
enable a person skilled in the art to practice the invention. In Invit-     *OWJUSPHFO  'E  'FE   $JS
rogen Corp. v. Biocrest Manufacturing L.P., The patent was held in-         
valid because the invention for a computer chip socket was “ready
for patenting” when it was offered for sale more than one year prior
to the application filing date. Even though the invention had not yet
been reduced to practice, the manufacturer was able to produce the
claimed computer chip sockets using the inventor’s detailed draw-
ings and specifications, and those sockets contained all elements of
invention claimed in the patent.

                       'E  'FE $JS 
Helsinn, the government, and other amici argue that the AIA
changed the law by adding the ”otherwise available to the public”
phrase. They argue that the on-sale bar now does not encompass se-
cret sales and requires that a sale make the invention available to the
public in order to trigger application of the on-sale bar. Apart from
the additional statutory language, this argument primarily relies on
floor statements made by individual members of Congress.
   We decline the invitation by the parties to decide this case more
broadly than necessary. At most the floor statements show an in-
tent ”to do away with precedent under current law.” (remarks of Sen.
Leahy). Such precedent had held certain secret uses to be invalidat-
ing under the ”public use” prong of § 102(b). Each of those cases
involved a public use where the invention was not, as a result of the
use, disclosed to the public. This public use issue is not before us, and
we decline to address it.
   The floor statements do not identify any sale cases that would be
overturned by the amendments. Even if the floor statements were in-
tended to overrule those secret or confidential sale cases, that would
have no effect here since those cases were concerned entirely with
whether the existence of a sale or offer was public. Here, the exis-
tence of the sale– i.e., the Supply and Purchase Agreement between
Helsinn and MGI – was publicly announced in MGI’s 8-K filing with
the SEC.
   Our prior cases have applied the on-sale bar even when there is
no delivery, when delivery is set after the critical date, or, even when,
upon delivery, members of the public could not ascertain the claimed
invention. There is no indication in the floor statements that these
members intended to overrule these cases.
                                                                                          $)"15&3  1"5&/5

                                           PUIFSXJTF BWBJMBCMF UP UIF QVCMJD
                                          The old § 102 had a closed list of prior art categories. The open-ended
                                          language ”otherwise available to the public” is new with the AIA. In
.1&1 f  F                          the PTO’s view, ”This ’catch-all’ provision permits decision makers
                                          to focus on whether the disclosure was ’available to the public,’ rather
                                          than on the means by which the claimed invention became available
                                          to the public or whether a disclosure constitutes a ’printed publica-
                                          tion’ or falls within another category of prior art.”
                                          D 1SJPSJUZ
                                          The AIA’s novelty provisions took effect on March 16, 2013. They
                                          apply to any applications filed on or after that date. Applications
                                          filed before that date are examined under the old pre-AIA rules.
                                           0ME f 

                                                                    1BUFOU "DU QSF"*"

 64$ f 
                                                A person shall be entitled to a patent unless –
$POEJUJPOT GPS QBUFOUBCJMJUZ OPWFMUZ           (a) the invention was [prior art by someone else] before the
 CFGPSF .BSDI                                 invention thereof by the applicant for patent, or
                                                (b) the invention was [prior art by anyone] more than one year
JDBOUMZ GSPN TVCTFDUJPO UP TVCTFDUJPO              prior to the date of the application for patent, or
*UhT OPU OFDFTTBSZ UP HFU JOUP UIF EF          (g) before such person’s invention thereof, the invention was
UBJMT UP VOEFSTUBOE UIF NPEFSO QSJPS               made by another inventor who had not abandoned, sup-
                                                    pressed, or concealed it. In determining priority of inven-
TVSEMZ JOUSJDBUF                                   tion under this subsection, there shall be considered not
                                                    only the respective dates of conception and reduction to
                                                    practice of the invention, but also the reasonable diligence
                                                    of one who was first to conceive and last to reduce to prac-
                                                    tice, from a time prior to conception by the other.

                                          Pay a ention to the structural differences between old subsections
                                          (a), (b), and (g). Old § 102(a) was a novelty provision: it denied a
                                          patent where someone else engaged in activity showing that the ap-
                                          plicant’s invention was not novel when it was supposedly ”invented.”
                                          Old § 102(b) was a statutory bar: it denied a patent to an applicant
                                          who waited too long to apply. And old § 102(g) was a true priority
                                          provision that dealt with the non-uncommon situation in which two
                                          parties independently came up with the same invention and neither
                                          of them generated prior art that would block the other’s application.
$ 08/&34)*1                                                        

    To apply old § 102(a), it was necessary to break down the inven-
tive process. The basic concepts were ”invention” (i.e. ”conception”),
”reduction to practice,” and ”reasonable diligence.”


Pre-AIA 35 U.S.C. 102(g) issues such as conception, reduction to prac-      f 
tice and diligence, while more commonly applied to interference mat-        1SF"*"  64$  H
ters, also arise in other contexts.
    Subsection (g) of pre-AIA 35 U.S.C. 1§ 02 is the basis of interfer-
ence practice for determining priority of invention between two par-
ties. An interference is an inter partes proceeding directed at deter-
mining the first to invent as among the parties to the proceeding, in-
volving two or more pending applications naming different inven-
tors or one or more pending applications and one or more unexpired
patents naming different inventors. The United States [was] unusual
in having a first to invent rather than a first to file system. Upon con-
clusion of an interference, subject ma er claimed by the losing party
that was the basis of the interference is rejected under pre-AIA 35
U.S.C. 102(g).
    Conception has been defined as “the complete performance of the
mental part of the inventive act” and it is “the formation in the mind
of the inventor of a definite and permanent idea of the complete and
operative invention as it is thereafter to be applied in practice.” Con-
ception is established when the invention is made sufficiently clear
to enable one skilled in the art to reduce it to practice without the ex-
ercise of extensive experimentation or the exercise of inventive skill.
Conception has also been defined as a disclosure of an invention
which enables one skilled in the art to reduce the invention to a prac-
tical form without “exercise of the inventive faculty.” It is se led that
in establishing conception a party must show possession of every fea-
ture recited in the count, and that every limitation of the count must
have been known to the inventor at the time of the alleged conception.
Conception must be proved by corroborating evidence. In Hi eman             )JU[FNBO  'E  'FE   $JS
v. Ru er, the inventor’s “hope” that a genetically altered yeast would      
produce antigen particles having the particle size and sedimentation
rates recited in the claims did not establish conception, since the in-
ventor did not show that he had a “definite and permanent under-
standing” as to whether or how, or a reasonable expectation that, the
yeast would produce the recited antigen particles. There must be a
contemporaneous recognition and appreciation of the invention for
there to be conception. On rare occasions conception and reduction
to practice occur simultaneously.
    Reduction to practice may be an actual reduction or a constructive
reduction to practice which occurs when a patent application on the
                                                 $)"15&3  1"5&/5

claimed invention is filed. The filing of a patent application serves as
conception and constructive reduction to practice of the subject mat-
ter described in the application. Thus the inventor need not provide
evidence of either conception or actual reduction to practice when
relying on the content of the patent application.
    In an interference proceeding, a party seeking to establish an ac-
tual reduction to practice must satisfy a two-prong test: (1) the party
constructed an embodiment or performed a process that met every
element of the interference count, and (2) the embodiment or process
operated for its intended purpose. Actual reduction to practice re-
quires a showing of the invention in a physical or tangible form that
shows every element of the count. For an actual reduction to practice,
the invention must have been sufficiently tested to demonstrate that
it will work for its intended purpose, but it need not be in a commer-
cially satisfactory stage of development. If a device is so simple, and
its purpose and efficacy so obvious, construction alone is sufficient
to demonstrate workability. The invention must be recognized and
appreciated for a reduction to practice to occur. An inventor need not
understand precisely why his invention works in order to achieve an
actual reduction to practice.

                             .PSXBZ W #POEJ
                           'E  $$1" 
[Morway (appellants) conceived on or before April 12, 1945 and filed
on December 27, 1946. Bondi (appellees) conceived on June 14, 1945
and filed on October 31, 1945. Both parties were entitled to construc-
tive reduction to practice as of their filing dates.]
    Appellants contend that there was a reduction to practice between
January 31, 1945 and March 13, 1945. It is claimed that on January 30,
1945 Beerbower, one of the joint appellants herein, compounded a
grease containing Carbowax 1500, which grease is said to meet the is-
sue counts. That grease was subjected to a standard Norma-Hoffman
oxidation test. It is claimed that the results of this test were good, and
counsel for Morway et al. contends that there was an actual reduction
to practice when this grease was successfully tested.
    Mr. Alan Beerbower, one of the appellants herein, testified on
cross-examination that the Norma-Hoffman bomb test merely mea-
sures resistance of the grease to oxidation under static or storage con-
ditions, but not under service conditions; and that he would not be
able to predict service life from Norma-Hoffman bomb results. In
view of the foregoing testimony by appellants’ expert witnesses, we
think it clear that a successful Norma-Hoffman laboratory test falls
far short of simulating actual service tests with sufficient closeness to
constitute a reduction to practice.
    Thus, appellants, although first to conceive, were last to reduce
$ 08/&34)*1                                                        

to practice. If they are to prevail, they must affirmatively establish
continuing and reasonable diligence in reducing to practice or rea-
sonable excuse for failure to act. Such diligence must be shown from
a date immediately prior to the time that Bondi conceived, on June
14, 1945, until reduction to practice by themselves as first conceivers.
    The record shows the following activities by appellants:
    • On June 7, August 1, August 15, and September 28, 1945, greases
       meeting the counts were prepared, and laboratory tests, such as
       the A.S.T.M. penetration test, were conducted on them.
    • On October 2, 1945, Miss O’Halloran conducted a Ford Wheel
       Bearing Test on the grease prepared September 28.
    • On December 26, 1945, a grease meeting the counts was pre-
       pared, and laboratory tests conducted on it.
    • The record then shows further activities (mainly aimed at possi-
       ble commercial exploitation of the grease in issue) in February,
       May, August, and November of 1946.
There was no activity at all between June 7 and August 1, 1945,
thereby creating a hiatus of one and one-half months right at the out-
set of the critical period when Bondi entered the field. There is a fur-
ther hiatus of one and one-half months, during the early part of the
critical period, from August 15 to September 28, 1945, when there was
no activity at all by Morway et al. It seems manifest from the above
chronology that the activities by Morway et al. from early June 1945
to December 1946 were quite sporadic throughout that period.
    In our opinion, the foregoing activities by appellants do not consti-
tute reasonable diligence in reducing the invention to practice during
the critical period.
    Appellants have introduced testimony to the effect that the joint
inventors herein and other assisting members of the research team
which developed the grease of the issue counts had many other
projects and duties. For example, there is testimony indicating that
Mr. Morway’s primary assignment at the time in question was the
development of a carbon black lubricant; and that Mr. Beerbower’s
primary assignment was the development of a continuous process for
manufacturing greases. When the party first to conceive voluntarily
lays aside his inventive concept because he is engrossed in pursuit
of other projects, this is generally not an acceptable excuse for fail-
ure to act diligently in reducing to practice. Clearly there may be
circumstances creating exceptions to this rule, but we find no such
circumstances in this record.
    Morway et al. also seek to explain their lack of diligence by refer-
ence to wartime assignments which allegedly took first call on their
time. In proper cases, war activities may reasonably excuse the first
                                                                                         $)"15&3  1"5&/5

                                        conceiver’s failure to act diligently, but lack of diligence is not ex-
                                        cused by a mere assertion that the applicant was engaged in war work.
                                        We fail to find in the record before us adequate evidence of such war
                                        activities as would excuse appellants’ lack of reasonable diligence.
                                         /FX f 

                                                                      1BUFOU "DU

                                        (a) A person shall be entitled to a patent unless—
 64$ f 
$POEJUJPOT GPS QBUFOUBCJMJUZ OPWFMUZ       (1) the claimed invention was [prior art] before the effective
                                                 filing date of the claimed invention; or
                                            (2) the claimed invention was described in a [published patent
                                                 or application that] names another inventor and was effec-
                                                 tively filed before the effective filing date of the claimed
                                        (b) Exceptions. –
                                            (1) A disclosure made 1 year or less before the effective filing
                                                 date of a claimed invention shall not be prior art to the
                                                 claimed invention under subsection (a)(1) if—
                                               (A) the disclosure was made by the inventor or joint inven-
                                                      tor or by another who obtained the subject ma er dis-
                                                      closed directly or indirectly from the inventor or a joint
                                                      inventor; or
                                                (B) the subject ma er disclosed had, before such disclo-
                                                      sure, been publicly disclosed by the inventor or a joint
                                                      inventor or another who obtained the subject ma er
                                                      disclosed directly or indirectly from the inventor or a
                                                      joint inventor.

                                        Do you see why the passage of the AIA is described as taking the
                                        United States from a ”first to invent” system to a ”first inventor to
                                        file” system? And also, in view of Morway, why the AIA’s propo-
                                        nents described it as simplifying interference practice and giving in-
                                        ventors greater certainty about their rights? (Who would have won
                                        in Morway under the AIA?)
                                           The AIA’s proponents also described it as harmonizing the United
                                        States with the rest of the world, where priority is assessed strictly on
                                        a first-to-file basis. The one-year grace period of new § 102(b)(1)(B),
                                        however, is not typical of true first-to-file systems.

$ 08/&34)*1                                                      

  1. Suppose that from 1960 to 1972, the Acme Corporation sold
     the Bait-o-Matic, a grey egg-shaped plastic container contain-
     ing sharp-grained sand with a grain size of 1/25 of an inch de-
     signed to be used to immobilize earthworms. Which claims, if
     any, of the Lukehart worm-immobilizing patent are invalid be-
     cause they were anticipated by the Bait-o-Matic?
  2. Ivan Inventor is working on a new ba ery design. Ivan has iden-
     tified promising materials, but has not yet found a way to com-
     bine them safely in a sealed container. Ivan is afraid that others
     are working on a similar invention. What factors do Ivan and
     his patent a orney need to consider in deciding when to file?

                        1MFJTUPDFOF 1BSL 1SPCMFN
Two biotechnology firms, Crichton Industries and Spielberg Genetics,
have been a empting to clone a wooly mammoth (an elephant-like
mammal that became extinct about 3,500 years ago) from sca ered
preserved DNA fragments. The teams made only slow progress at
first; the available mammoth DNA fragments were too short and too
numerous to combine into a complete DNA sequence using standard
laboratory techniques.
    Then, on January 1, 2004, mathematician Rube Goldblum pub-
lished an academic paper describing efficient ways to arrange books
in libraries. Crichton’s lead researcher read the paper on February 2,
2005 and realized that the method Goldblum was describing could
be used to arrange DNA fragments and compile complete DNA se-
    Goldblum published (on March 3, 2006), a follow-up academic pa-
per explaining how to apply his book-sorting method to the problem
of DNA compilation. An executive at Spielberg read the paper on
April 4, 2007, and decided to try the technique on the wooly mam-
moth problem.
    On May 5, 2013, in a Crichton laboratory, a modern elephant im-
planted with a wooly mammoth embryo using standard artificial in-
semination techniques gave birth to a live wooly mammoth. On June
6, 2013, a Spielberg elephant successfully gave birth to a wooly mam-
moth. Because both teams started from the same, publicly available
sets of wooly mammoth DNA fragments, their DNA sequences were
identical. The next day, June 7, 2013, Spielberg held a press confer-
ence to announce the birth; it showed video of the baby mammoth
and its scientists passed out CDs with the DNA sequence.
    On July 12, 2013, Spielberg filed a patent application claiming “a
wooly mammoth, having the DNA sequence …” Crichton filed its
own patent application on August 20, 2013 with an identical claim.
    Which application, if either, should the PTO allow, and why?
                                                                                        $)"15&3  1"5&/5

                                       Would the answer be different under the old § 102?


                                                                     1BUFOU "DU

                                       A patent for a claimed invention may not be obtained, notwithstand-
 64$ f 
                                       ing that the claimed invention is not identically disclosed as set forth
PCWJPVT TVCKFDU NBUUFS                 in section 102, if the differences between the claimed invention and
                                       the prior art are such that the claimed invention as a whole would
                                       have been obvious before the effective filing date of the claimed inven-
                                       tion to a person having ordinary skill in the art to which the claimed
                                       invention pertains. Patentability shall not be negated by the manner
                                       in which the invention was made.

                                                            ,43 *OUFSO $P W 5FMFøFY *OD
                                       The patent at issue, United States Patent No.    #, is enti-
                                       tled “Adjustable Pedal Assembly With Electronic Thro le Control.”
                                       Supplemental App. 1. The patentee is Steven J. Engelgau, and the
                                       patent is referred to as “the Engelgau patent.” Claim 4 of the Engel-
                                       gau patent describes a mechanism for combining an electronic sensor
                                       with an adjustable automobile pedal so the pedal’s position can be
                                       transmi ed to a computer that controls the thro le in the vehicle’s
(SBIBN  64  
                                           In Graham v. John Deere Co., the Court set out a framework for
                                       applying the statutory language of § 103:
                                             Under § 103, the scope and content of the prior art are to
                                             be determined; differences between the prior art and the
                                             claims at issue are to be ascertained; and the level of ordi-
                                             nary skill in the pertinent art resolved. Against this back-
                                             ground the obviousness or nonobviousness of the subject
                                             ma er is determined. Such secondary considerations as
                                             commercial success, long felt but unsolved needs, failure
                                             of others, etc., might be utilized to give light to the cir-
                                             cumstances surrounding the origin of the subject ma er
                                             sought to be patented.
                                       If a court, or patent examiner, conducts this analysis and concludes
                                       the claimed subject ma er was obvious, the claim is invalid under §
                                           Seeking to resolve the question of obviousness with more unifor-
                                       mity and consistency, the Court of Appeals for the Federal Circuit
                                       has employed an approach referred to by the parties as the “teach-
                                       ing, suggestion, or motivation” test (TSM test), under which a patent
$ 08/&34)*1                                                         

claim is only proved obvious if “some motivation or suggestion to
combine the prior art teachings” can be found in the prior art, the na-
ture of the problem, or the knowledge of a person having ordinary
skill in the art. KSR challenges that test, or at least its application in
this case.
In car engines without computer-controlled thro les, the accelerator
pedal interacts with the thro le via cable or other mechanical link.
The pedal arm acts as a lever rotating around a pivot point. In a cable-
actuated thro le control the rotation caused by pushing down the
pedal pulls a cable, which in turn pulls open valves in the carburetor
or fuel injection unit. The wider the valves open, the more fuel and air
are released, causing combustion to increase and the car to accelerate.
When the driver takes his foot off the pedal, the opposite occurs as the
cable is released and the valves slide closed.
    In the 1990’s it became more common to install computers in cars
to control engine operation. Computer-controlled thro les open and
close valves in response to electronic signals, not through force trans-
ferred from the pedal by a mechanical link. Constant, delicate ad-
justments of air and fuel mixture are possible. The computer’s rapid
processing of factors beyond the pedal’s position improves fuel effi-
ciency and engine performance.
    For a computer-controlled thro le to respond to a driver’s oper-
ation of the car, the computer must know what is happening with
the pedal. A cable or mechanical link does not suffice for this pur-
pose; at some point, an electronic sensor is necessary to translate the
mechanical operation into digital data the computer can understand.
    Before discussing sensors further we turn to the mechanical de-
sign of the pedal itself. In the traditional design a pedal can be pushed
down or released but cannot have its position in the footwell adjusted
by sliding the pedal forward or back. As a result, a driver who wishes
to be closer or farther from the pedal must either reposition himself
in the driver’s seat or move the seat in some way. In cars with deep
footwells these are imperfect solutions for drivers of smaller stature.
To solve the problem, inventors, beginning in the 1970’s, designed
pedals that could be adjusted to change their location in the footwell.
Important for this case are two adjustable pedals disclosed in U.S.
Patent Nos.    (filed July 28, 1989) (Asano) and    (filed
Sept. 17, 1993) (Redding). The Asano patent reveals a support struc-
ture that houses the pedal so that even when the pedal location is ad-
justed relative to the driver, one of the pedal’s pivot points stays fixed.
The pedal is also designed so that the force necessary to push the
                                                 $)"15&3  1"5&/5

pedal down is the same regardless of adjustments to its location. The
Redding patent reveals a different, sliding mechanism where both
the pedal and the pivot point are adjusted.
    We return to sensors. Well before Engelgau applied for his chal-
lenged patent, some inventors had obtained patents involving elec-
tronic pedal sensors for computer-controlled thro les. These inven-
tions, such as the device disclosed in U.S. Patent No.    (filed
Sept. 9, 1991) (‘936), taught that it was preferable to detect the pedal’s
position in the pedal assembly, not in the engine. The ‘936 patent dis-
closed a pedal with an electronic sensor on a pivot point in the pedal
assembly. U.S. Patent No.    (filed July 9, 1990) (Smith) taught
that to prevent the wires connecting the sensor to the computer from
chafing and wearing out, and to avoid grime and damage from the
driver’s foot, the sensor should be put on a fixed part of the pedal
assembly rather than in or on the pedal’s footpad.
    In addition to patents for pedals with integrated sensors inventors
obtained patents for self-contained modular sensors. A modular sen-
sor is designed independently of a given pedal so that it can be taken
off the shelf and a ached to mechanical pedals of various sorts, en-
abling the pedals to be used in automobiles with computer-controlled
thro les. One such sensor was disclosed in U.S. Patent No. filed Dec.
18, 1992) (‘068). In 1994, Chevrolet manufactured a line of trucks us-
ing modular sensors a ached to the pedal support bracket, adjacent
to the pedal and engaged with the pivot shaft about which the pedal
rotates in operation.
    The prior art contained patents involving the placement of sensors
on adjustable pedals as well. For example, U.S. Patent No.   
(filed Aug. 17, 1995) (Rixon) discloses an adjustable pedal assembly
with an electronic sensor for detecting the pedal’s position. In the
Rixon pedal the sensor is located in the pedal footpad. The Rixon
pedal was known to suffer from wire chafing when the pedal was
depressed and released.
    This short account of pedal and sensor technology leads to the
instant case.
Engelgau filed the patent application on August 22, 2000 as a con-
tinuation of a previous application for U.S. Patent No.   ,
which was filed on January 26, 1999. He has sworn he invented the
patent’s subject ma er on February 14, 1998. The Engelgau patent
discloses an adjustable electronic pedal described in the specification
as a “simplified vehicle control pedal assembly that is less expensive,
and which uses fewer parts and is easier to package within the vehi-
cle.” Claim 4 of the patent, at issue here, describes:
$ 08/&34)*1                                                       

      A vehicle control pedal apparatus comprising:
           a support adapted to be mounted to a vehicle structure;
           an adjustable pedal assembly having a pedal arm move-
           able in for[e] and aft directions with respect to said sup-
           a pivot for pivotally supporting said adjustable pedal as-
           sembly with respect to said support and defining a pivot
           axis; and
           an electronic control a ached to said support for control-
           ling a vehicle system;
           said apparatus characterized by said electronic control be-
           ing responsive to said pivot for providing a signal that cor-
           responds to pedal arm position as said pedal arm pivots
           about said pivot axis between rest and applied positions
           wherein the position of said pivot remains constant while
           said pedal arm moves in fore and aft directions with re-
           spect to said pivot.
We agree with the District Court that the claim discloses “a position-
adjustable pedal assembly with an electronic pedal position sensor
a ached to the support member of the pedal assembly. A aching
the sensor to the support member allows the sensor to remain in a
fixed position while the driver adjusts the pedal.”
   Before issuing the Engelgau patent the U.S. Patent and Trademark
Office (PTO) rejected one of the patent claims that was similar to, but
broader than, the present claim 4. The claim did not include the re-
quirement that the sensor be placed on a fixed pivot point. The PTO
concluded the claim was an obvious combination of the prior art dis-
closed in Redding and Smith, explaining:
     Since the prior art references are from the field of en-
     deavor, the purpose disclosed would have been recog-
     nized in the pertinent art of Redding. Therefore it would
     have been obvious to provide the device of Redding with
     the means a ached to a support member as taught by
In other words Redding provided an example of an adjustable pedal
and Smith explained how to mount a sensor on a pedal’s support
structure, and the rejected patent claim merely put these two teach-
ings together.
    Although the broader claim was rejected, claim 4 was later al-
lowed because it included the limitation of a fixed pivot point, which
distinguished the design from Redding’s. Engelgau had not included
Asano among the prior art references, and Asano was not mentioned
                                                $)"15&3  1"5&/5

in the patent’s prosecution. Thus, the PTO did not have before it an
adjustable pedal with a fixed pivot point. The patent issued on May
29, 2001 and was assigned to Teleflex.
The District Court determined, in light of the expert testimony and
the parties’ stipulations, that the level of ordinary skill in pedal de-
sign was “an undergraduate degree in mechanical engineering (or an
equivalent amount of industry experience) and familiarity with pedal
control systems for vehicles.” Following Graham’s direction, the court
compared the teachings of the prior art to the claims of Engelgau. It
found “li le difference.” Asano taught everything contained in claim
4 except the use of a sensor to detect the pedal’s position and transmit
it to the computer controlling the thro le. That additional aspect was
revealed in sources such as the ‘068 patent and the sensors used by
     Under the controlling cases from the Court of Appeals for the Fed-
eral Circuit, however, the District Court was not permi ed to stop
there. The court was required also to apply the TSM test. The Dis-
trict Court held KSR had satisfied the test. It reasoned (1) the state
of the industry would lead inevitably to combinations of electronic
sensors and adjustable pedals, (2) Rixon provided the basis for these
developments, and (3) Smith taught a solution to the wire chafing
problems in Rixon, namely locating the sensor on the fixed structure
of the pedal. This could lead to the combination of Asano, or a pedal
like it, with a pedal position sensor.
     The conclusion that the Engelgau design was obvious was sup-
ported, in the District Court’s view, by the PTO’s rejection of the
broader version of claim 4. Had Engelgau included Asano in his
patent application, it reasoned, the PTO would have found claim 4
to be an obvious combination of Asano and Smith, as it had found
the broader version an obvious combination of Redding and Smith.
As a final ma er, the District Court held that the secondary factor
of Teleflex’s commercial success with pedals based on Engelgau’s de-
sign did not alter its conclusion.
     With principal reliance on the TSM test, the Court of Appeals re-
versed. It ruled the District Court had not been strict enough in apply-
ing the test, having failed to make “findings as to the specific under-
standing or principle within the knowledge of a skilled artisan that
would have motivated one with no knowledge of the invention to at-
tach an electronic control to the support bracket of the Asano assem-
bly.” The Court of Appeals held that the District Court was incorrect
that the nature of the problem to be solved satisfied this requirement
because unless the “prior art references address[ed] the precise prob-
lem that the patentee was trying to solve,” the problem would not
$ 08/&34)*1                                                        

motivate an inventor to look at those references.
    Here, the Court of Appeals found, the Asano pedal was designed
to solve the “constant ratio problem” – that is, to ensure that the
force required to depress the pedal is the same no ma er how the
pedal is adjusted—whereas Engelgau sought to provide a simpler,
smaller, cheaper adjustable electronic pedal. As for Rixon, the court
explained, that pedal suffered from the problem of wire chafing but
was not designed to solve it. In the court’s view Rixon did not teach
anything helpful to Engelgau’s purpose. Smith, in turn, did not relate
to adjustable pedals and did not “necessarily go to the issue of mo-
tivation to a ach the electronic control on the support bracket of the
pedal assembly.” When the patents were interpreted in this way, the
Court of Appeals held, they would not have led a person of ordinary
skill to put a sensor on the sort of pedal described in Asano.
    That it might have been obvious to try the combination of Asano
and a sensor was likewise irrelevant, in the court’s view, because ”’ob-
vious to try’ has long been held not to constitute obviousness.”
We begin by rejecting the rigid approach of the Court of Appeals.
Throughout this Court’s engagement with the question of obvious-
ness, our cases have set forth an expansive and flexible approach in-
consistent with the way the Court of Appeals applied its TSM test
here. To be sure, Graham recognized the need for “uniformity and
definiteness.” Yet the principles laid down in Graham reaffirmed the
“functional approach” of Hotchkiss v. Greenwood.                            )PUDILJTT  64  
    Neither the enactment of § 103 nor the analysis in Graham dis-
turbed this Court’s earlier instructions concerning the need for cau-
tion in granting a patent based on the combination of elements found
in the prior art. For over a half century, the Court has held that
a patent for a combination which only unites old elements with no
change in their respective functions obviously withdraws what is al-
ready known into the field of its monopoly and diminishes the re-
sources available to skillful men. This is a principal reason for declin-
ing to allow patents for what is obvious. The combination of familiar
elements according to known methods is likely to be obvious when
it does no more than yield predictable results. Three cases decided
after Graham illustrate the application of this doctrine.
    In United States v. Adams, a companion case to Graham, the Court        "EBNT  64  
considered the obviousness of a “wet ba ery” that varied from prior
designs in two ways: It contained water, rather than the acids con-
ventionally employed in storage ba eries; and its electrodes were
magnesium and cuprous chloride, rather than zinc and silver chlo-
                                                                                       $)"15&3  1"5&/5

                                        ride. The Court recognized that when a patent claims a structure al-
                                        ready known in the prior art that is altered by the mere substitution
                                        of one element for another known in the field, the combination must
                                        do more than yield a predictable result. It nevertheless rejected the
                                        Government’s claim that Adams’s ba ery was obvious. The Court re-
                                        lied upon the corollary principle that when the prior art teaches away
                                        from combining certain known elements, discovery of a successful
                                        means of combining them is more likely to be nonobvious. When
                                        Adams designed his ba ery, the prior art warned that risks were in-
                                        volved in using the types of electrodes he employed. The fact that the
                                        elements worked together in an unexpected and fruitful manner sup-
                                        ported the conclusion that Adams’s design was not obvious to those
                                        skilled in the art.
"OEFSTPOhT #MBDL3PDL    64         In Anderson’s-Black Rock, Inc. v. Pavement Salvage Co., the Court
                                    elaborated on this approach. The subject ma er of the patent be-
                                        fore the Court was a device combining two pre-existing elements: a
                                        radiant-heat burner and a paving machine. The device, the Court con-
                                        cluded, did not create some new synergy: The radiant-heat burner
                                        functioned just as a burner was expected to function; and the paving
                                        machine did the same. The two in combination did no more than
                                        they would in separate, sequential operation. In those circumstances,
                                        “while the combination of old elements performed a useful function,
                                        it added nothing to the nature and quality of the radiant-heat burner
$PNQBSF "EBNT BOE "OEFSTPOT #MBDL     already patented,” and the patent failed under § 103.
3PDL 8IBU NBLFT UIF UXP DBTFT EJTUJO       Finally, in Sakraida v. Ag Pro, Inc., the Court derived from the
                                        precedents the conclusion that when a patent “simply arranges old
4BLSBJEB  64  
                                        elements with each performing the same function it had been known
                                        to perform” and yields no more than one would expect from such an
                                        arrangement, the combination is obvious..
                                            The principles underlying these cases are instructive when the
                                        question is whether a patent claiming the combination of elements
                                        of prior art is obvious. When a work is available in one field of en-
                                        deavor, design incentives and other market forces can prompt vari-
                                        ations of it, either in the same field or a different one. If a person
                                        of ordinary skill can implement a predictable variation, § 103 likely
                                        bars its patentability. For the same reason, if a technique has been
                                        used to improve one device, and a person of ordinary skill in the art
                                        would recognize that it would improve similar devices in the same
                                        way, using the technique is obvious unless its actual application is
                                        beyond his or her skill. Sakraida and Anderson’s Black-Rock are illus-
                                        trative – a court must ask whether the improvement is more than the
                                        predictable use of prior art elements according to their established
                                            Following these principles may be more difficult in other cases
                                        than it is here because the claimed subject ma er may involve more
$ 08/&34)*1                                                       

than the simple substitution of one known element for another or the
mere application of a known technique to a piece of prior art ready
for the improvement. Often, it will be necessary for a court to look
to interrelated teachings of multiple patents; the effects of demands
known to the design community or present in the marketplace; and
the background knowledge possessed by a person having ordinary
skill in the art, all in order to determine whether there was an appar-
ent reason to combine the known elements in the fashion claimed by
the patent at issue. To facilitate review, this analysis should be made
explicit. As our precedents make clear, however, the analysis need
not seek out precise teachings directed to the specific subject ma er
of the challenged claim, for a court can take account of the inferences
and creative steps that a person of ordinary skill in the art would em-
When it first established the requirement of demonstrating a teach-
ing, suggestion, or motivation to combine known elements in order
to show that the combination is obvious, the Court of Customs and
Patent Appeals captured a helpful insight. As is clear from cases such
as Adams, a patent composed of several elements is not proved obvi-
ous merely by demonstrating that each of its elements was, indepen-
dently, known in the prior art. Although common sense directs one
to look with care at a patent application that claims as innovation
the combination of two known devices according to their established
functions, it can be important to identify a reason that would have
prompted a person of ordinary skill in the relevant field to combine
the elements in the way the claimed new invention does. This is so
because inventions in most, if not all, instances rely upon building
blocks long since uncovered, and claimed discoveries almost of neces-
sity will be combinations of what, in some sense, is already known.
    Helpful insights, however, need not become rigid and mandatory
formulas; and when it is so applied, the TSM test is incompatible with
our precedents. The obviousness analysis cannot be confined by a
formalistic conception of the words teaching, suggestion, and moti-
vation, or by overemphasis on the importance of published articles
and the explicit content of issued patents. The diversity of inventive
pursuits and of modern technology counsels against limiting the anal-
ysis in this way. In many fields it may be that there is li le discussion
of obvious techniques or combinations, and it often may be the case
that market demand, rather than scientific literature, will drive de-
sign trends. Granting patent protection to advances that would occur
in the ordinary course without real innovation retards progress and
may, in the case of patents combining previously known elements,
deprive prior inventions of their value or utility.
                                                                                             $)"15&3  1"5&/5

                                            One of the ways in which a patent’s subject ma er can be proved ob-
                                            vious is by noting that there existed at the time of invention a known
                                            problem for which there was an obvious solution encompassed by
                                            the patent’s claims.
                                                The first error of the Court of Appeals in this case was to foreclose
                                            this reasoning by holding that courts and patent examiners should
                                            look only to the problem the patentee was trying to solve. The Court
                                            of Appeals failed to recognize that the problem motivating the paten-
                                            tee may be only one of many addressed by the patent’s subject mat-
                                            ter. The question is not whether the combination was obvious to
                                            the patentee but whether the combination was obvious to a person
                                            with ordinary skill in the art. Under the correct analysis, any need
                                            or problem known in the field of endeavor at the time of invention
                                            and addressed by the patent can provide a reason for combining the
                                            elements in the manner claimed.
                                                The second error of the Court of Appeals lay in its assumption
                                            that a person of ordinary skill a empting to solve a problem will be
                                            led only to those elements of prior art designed to solve the same
                                            problem. The primary purpose of Asano was solving the constant
                                            ratio problem; so, the court concluded, an inventor considering how
                                            to put a sensor on an adjustable pedal would have no reason to con-
*O DBTFT JO XIJDI iDPNNPO TFOTFw JT VTFE    sider pu ing it on the Asano pedal. Common sense teaches, however,
UP TVQQMZ B NJTTJOH MJNJUBUJPO BT EJT      that familiar items may have obvious uses beyond their primary pur-
                                            poses, and in many cases a person of ordinary skill will be able to
DPNNPO TFOTF NVTU CF TFBSDIJOH "Q         fit the teachings of multiple patents together like pieces of a puzzle.
QFMMFFT IBWF GBJMFE UP TIPX XIZ JU XPVME    Regardless of Asano’s primary purpose, the design provided an obvi-
CF DPNNPO TFOTF GPS UIF i"EE UP BEESFTT     ous example of an adjustable pedal with a fixed pivot point; and the
CPPLw GVODUJPO UP PQFSBUF CZ öSTU TFBSDI   prior art was replete with patents indicating that a fixed pivot point
                                            was an ideal mount for a sensor. The idea that a designer hoping
"SFOEJ 4"3* W "QQMF *OD /P      to make an adjustable electronic pedal would ignore Asano because
  'E  'FE $JS "VH      Asano was designed to solve the constant ratio problem makes li le
434-:                                       sense. A person of ordinary skill is also a person of ordinary creativ-
                                            ity, not an automaton.
                                                The same constricted analysis led the Court of Appeals to con-
                                            clude, in error, that a patent claim cannot be proved obvious merely
                                            by showing that the combination of elements was obvious to try.
                                            When there is a design need or market pressure to solve a problem
                                            and there are a finite number of identified, predictable solutions, a
                                            person of ordinary skill has good reason to pursue the known op-
                                            tions within his or her technical grasp. If this leads to the anticipated
                                            success, it is likely the product not of innovation but of ordinary skill
                                            and common sense. In that instance the fact that a combination was
                                            obvious to try might show that it was obvious under § 103.
$ 08/&34)*1                                                       

When we apply the standards we have explained to the instant facts,
claim 4 must be found obvious.
The District Court was correct to conclude that, as of the time Engel-
gau designed the subject ma er in claim 4, it was obvious to a person
of ordinary skill to combine Asano with a pivot-mounted pedal po-
sition sensor. There then existed a marketplace that created a strong
incentive to convert mechanical pedals to electronic pedals, and the
prior art taught a number of methods for achieving this advance. The
Court of Appeals considered the issue too narrowly by, in effect, ask-
ing whether a pedal designer writing on a blank slate would have
chosen both Asano and a modular sensor similar to the ones used in
the Chevrolet truckline and disclosed in the ‘068 patent. The proper
question to have asked was whether a pedal designer of ordinary skill,
facing the wide range of needs created by developments in the field
of endeavor, would have seen a benefit to upgrading Asano with a
    In automotive design, as in many other fields, the interaction of
multiple components means that changing one component often re-
quires the others to be modified as well. Technological developments
made it clear that engines using computer-controlled thro les would
become standard. As a result, designers might have decided to de-
sign new pedals from scratch; but they also would have had reason
to make pre-existing pedals work with the new engines. Indeed, up-
grading its own pre-existing model led KSR to design the pedal now
accused of infringing the Engelgau patent.
    For a designer starting with Asano, the question was where to
a ach the sensor. The consequent legal question, then, is whether
a pedal designer of ordinary skill starting with Asano would have
found it obvious to put the sensor on a fixed pivot point. The prior art
discussed above leads us to the conclusion that a aching the sensor
where both KSR and Engelgau put it would have been obvious to a
person of ordinary skill.
    The ‘936 patent taught the utility of pu ing the sensor on the pedal
device, not in the engine. Smith, in turn, explained to put the sensor
not on the pedal’s footpad but instead on its support structure. And
from the known wire-chafing problems of Rixon, and Smith’s teach-
ing that “the pedal assemblies must not precipitate any motion in the
connecting wires,” the designer would know to place the sensor on
a nonmoving part of the pedal structure. The most obvious nonmov-
ing point on the structure from which a sensor can easily detect the
pedal’s position is a pivot point. The designer, accordingly, would
                                                                                           $)"15&3  1"5&/5

                                          follow Smith in mounting the sensor on a pivot, thereby designing
                                          an adjustable electronic pedal covered by claim 4.
                                              Just as it was possible to begin with the objective to upgrade
                                          Asano to work with a computer-controlled thro le, so too was it pos-
                                          sible to take an adjustable electronic pedal like Rixon and seek an
                                          improvement that would avoid the wire-chafing problem. Follow-
                                          ing similar steps to those just explained, a designer would learn from
                                          Smith to avoid sensor movement and would come, thereby, to Asano
                                          because Asano disclosed an adjustable pedal with a fixed pivot.
                                              Like the District Court, finally, we conclude Teleflex has shown no
                                          secondary factors to dislodge the determination that claim 4 is obvi-
BCPVU B 4BX[JF  B GPBN DBO IPMEFS BU   ous. Proper application of Graham and our other precedents to these
UBDIFE UP B SPUBSZ TBX                    facts therefore leads to the conclusion that claim 4 encompassed obvi-
                                          ous subject ma er. As a result, the claim fails to meet the requirement
                                          of § 103.
                                          We build and create by bringing to the tangible and palpable real-
                                          ity around us new works based on instinct, simple logic, ordinary
                                          inferences, extraordinary ideas, and sometimes even genius. These
                                          advances, once part of our shared knowledge, define a new thresh-
                                          old from which innovation starts once more. And as progress be-
                                          ginning from higher levels of achievement is expected in the normal
                                          course, the results of ordinary innovation are not the subject of exclu-
                                          sive rights under the patent laws. Were it otherwise patents might
                                          stifle, rather than promote, the progress of useful arts.

                                                        5JUBOJVN .FUBMT $PSQ PG "NFSJDB W #BOOFS
                                                                 'E  'FE $JS 
                                          Li le more need be said in support of the examiner’s rejection of claim
                                          3, affirmed by the board, on the ground that its more specific subject
                                          ma er would have been obvious at the time the invention was made
                                          from the knowledge disclosed in the reference.
                                              As admi ed by appellee’s affidavit evidence from James A. Hall,
                                          the Russian article discloses two alloys having compositions very
                                          close to that of claim 3, which is 0.3% Mo and 0.8% Ni, balance ti-
                                          tanium. The two alloys in the prior art have 0.25% Mo-0.75% Ni and
                                          0.31% Mo-0.94% Ni, respectively. The proportions are so close that
                                          prima facie one skilled in the art would have expected them to have
                                          the same properties. Appellee produced no evidence to rebut that
                                          prima facie case. The specific alloy of claim 3 must therefore be con-
                                          sidered to have been obvious from known alloys.

                                                                         *O SF $MBZ
                                                                 'E  'FE $JS 
$ 08/&34)*1                                                       

Clay’s invention, assigned to Marathon Oil Company, is a process
for storing refined liquid hydrocarbon product in a storage tank hav-
ing a dead volume between the tank bo om and its outlet port. The
process involves preparing a gelation solution which gels after it is
placed in the tank’s dead volume; the gel can easily be removed by
adding to the tank a gel-degrading agent such as hydrogen peroxide.
    Two prior art references were applied against the claims on ap-
peal. They were U.S. Patent    (Hetherington), which dis-
closes an apparatus for displacing dead space liquid using impervi-
ous bladders, or large bags, formed with flexible membranes; and
U.S. Patent    (Sydansk), also assigned to Clay’s assignee,
Marathon Oil Company, which discloses a process for reducing the
permeability of hydrocarbon-bearing formations and thus improving
oil production, using a gel similar to that in Clay’s invention.
    The Board agreed with the examiner that, although neither ref-
erence alone describes Clay’s invention, Hetherington and Sydansk
combined support a conclusion of obviousness. It held that one
skilled in the art would glean from Hetherington that Clay’s inven-
tion “was appreciated in the prior art and solutions to that problem
generally involved filling the dead space with something.”
    The Board also held that Sydansk would have provided one
skilled in the art with information that a gelation system would have
been impervious to hydrocarbons once the system gelled. The Board
combined the references, finding that the “cavities” filled by Sydansk
are sufficiently similar to the “volume or void space” being filled by
Hetherington for one of ordinary skill to have recognized the appli-
cability of the gel to Hetherington.
The issue presented in this appeal is whether the Board’s conclusion
was correct that Clay’s invention would have been obvious from the
combined teachings of Hetherington and Sydansk.
    A prerequisite to making this finding is determining what is
“prior art.” Although § 103 does not, by its terms, define the “art to
which [the] subject ma er [sought to be patented] pertains,” this de-
termination is frequently couched in terms of whether the art is anal-
ogous or not, i.e., whether the art is too remote to be treated as prior
art. Clay argues that the claims at issue were improperly rejected over
Hetherington and Sydansk, because Sydansk is nonanalogous art.
    Two criteria have evolved for determining whether prior art is
analogous: (1) whether the art is from the same field of endeavor,
regardless of the problem addressed, and (2) if the reference is not
within the field of the inventor’s endeavor, whether the reference still
is reasonably pertinent to the particular problem with which the in-
ventor is involved.
                                                          $)"15&3  1"5&/5

    The Board found Sydansk to be within the field of Clay’s en-
deavor because, as the Examiner stated, “one of ordinary skill in the
art would certainly glean from Sydansk that the rigid gel as taught
therein would have a number of applications within the manipula-
tion of the storage and processing of hydrocarbon liquids and that the
gel as taught in Sydansk would be expected to function in a similar
manner as the bladders in the Hetherington patent.” These findings
are clearly erroneous.
    The PTO argues that Sydansk and Clay’s inventions are part of
a common endeavor – “maximizing withdrawal of petroleum stored
in petroleum reservoirs.” However, Sydansk cannot be considered
to be within Clay’s field of endeavor merely because both relate to
the petroleum industry. Sydansk teaches the use of a gel in uncon-
fined and irregular volumes within generally underground natural
oil-bearing formations to channel flow in a desired direction; Clay
teaches the introduction of gel to the confined dead volume of a man-
made storage tank. The Sydansk process operates in extreme condi-
tions, with petroleum formation temperatures as high as 115°C and
at significant well bore pressures; Clay’s process apparently operates
at ambient temperature and atmospheric pressure. Clay’s field of en-
deavor is the storage of refined liquid hydrocarbons. The field of en-
deavor of Sydansk’s invention, on the other hand, is the extraction of
crude petroleum. The Board clearly erred in considering Sydansk to
be within the same field of endeavor as Clay’s.
    Even though the art disclosed in Sydansk is not within Clay’s field
of endeavor, the reference may still properly be combined with Het-
herington if it is reasonably pertinent to the problem Clay a empts to
solve. A reference is reasonably pertinent if, even though it may be in
a different field from that of the inventor’s endeavor, it is one which,
because of the ma er with which it deals, logically would have com-
mended itself to an inventor’s a ention in considering his problem.
Thus, the purposes of both the invention and the prior art are impor-
tant in determining whether the reference is reasonably pertinent to
the problem the invention a empts to solve. If a reference disclosure
has the same purpose as the claimed invention, the reference relates
to the same problem, and that fact supports use of that reference in
an obviousness rejection. An inventor may well have been motivated
to consider the reference when making his invention. If it is directed
to a different purpose, the inventor would accordingly have had less
motivation or occasion to consider it.
    Sydansk’s gel treatment of underground formations functions to
fill anomalies1 so as to improve flow profiles and sweep efficiencies
    Sydansk refers to an anomaly, one of two general region types in an oil-bearing
geological formation, as “a volume or void space [e.g., ‘streaks, fractures, fracture
$ 08/&34)*1                                                                   

of injection and production fluids through a formation, while Clay’s
gel functions to displace liquid product from the dead volume of a
storage tank. Sydansk is concerned with plugging formation anoma-
lies so that fluid is subsequently diverted by the gel into the formation
matrix, thereby forcing bypassed oil contained in the matrix toward a
production well. Sydansk is faced with the problem of recovering oil
from rock, i.e., from a matrix which is porous, permeable sedimentary
rock of a subterranean formation where water has channeled through
formation anomalies and bypassed oil present in the matrix. Such a
problem is not reasonably pertinent to the particular problem with
which Clay was involved – preventing loss of stored product to tank
dead volume while preventing contamination of such product.
    A person having ordinary skill in the art would not reasonably
have expected to solve the problem of dead volume in tanks for stor-
ing refined petroleum by considering a reference dealing with plug-
ging underground formation anomalies. The Board’s finding to the
contrary is clearly erroneous. Since Sydansk is non-analogous art, the
rejection over Hetherington in view of Sydansk cannot be sustained.

                              ,43 1SPCMFN
In relevant part, claim 4 of the patent in suit in KSR comprises:
   • A pedal
   • that is adjustable
   • and has a fixed pivot,
   • and a sensor
   • that is in the pedal
   • and is and mounted on a fixed position
    The Court had before it a number of pieces of prior art, and had
to decide whether claim 4 was obvious in light of them. Please look
closely at the Court’s descriptions of the following prior art:
   • Asano
   • Redding
   • ‘936
   • Smith
   • ‘068
   • Certain 1994 Chevrolet trucks
   • Rixon
    Which of the characteristics of claim 4, as listed above, do each of
networks, vugs, solution channels, caverns, washouts, cavities, etc.’] in the forma-
tion having very high permeability relative to the matrix [the other region type,
consisting of homogeneous porous rock].”
                                               $)"15&3  1"5&/5

these prior art references disclose? Make a chart. What improvements,
if any, does each prior art reference suggest to a person having ordi-
nary skill in the art. Using your chart as a guide, explain whether the
Supreme Court’s analysis is persuasive.


                         6 $IJ - 3FW  
To claim the set of things protected by an intellectual property right,
one might be required to delineate to the public the set’s bounds so
that a third party could determine whether any particular embodi-
ment is a set member thus protected by the right. This sort of claiming
is known as peripheral claiming.” Alternatively, one might publicly
describe only some members of the set, which are clearly protected
under the right, and use them to determine whether other items are
similar enough to the enumerated members to fall also within the
same right. This sort of claiming is known as central claiming, in that
the rightsholder describes the central, or prototypical, set members,
but the right tends to cover a broader, similar set of items.
    There is another important dimension on which claiming can
vary, which until now has not been readily appreciated. Either pe-
ripheral or central claiming can be done by exemplar or by charac-
teristic. Claiming by exemplar entails enumerating particular mem-
bers of the set of protected embodiments. In the case of peripheral
claiming by exemplar, one would enumerate each set member, while
for central claiming by exemplar, one would catalog only some set
members. Claiming by characteristic, on the other hand, requires a
description of the essential properties of the set’s members. For pe-
ripheral claiming by characteristic, one would describe the necessary
and sufficient features common to all members of the set of protected
embodiments. And for central claiming by characteristic, one would
express the features common to at least some central members of the
set of protected embodiments. Claiming by exemplar and by charac-
teristic can be seen as opposing points on a spectrum of how much
distillation of the actual works’ characteristics is necessary.
% */'3*/(&.&/5 4*.*-"3*5:                                         

    A statutory change in 1870 – requiring a patent applicant to ”par-
ticularly point out and distinctly claim the part, improvement, or
combination which he claims as his invention or discovery” – offi-
cially (though gradually) brought peripheral claiming, almost always
by characteristic, to American patent law. The Supreme Court held
that, pursuant to this statutory language, the articulated bounds of
the patent claim would govern the scope of the set of things pro-
tected by the patent right. Validity and infringement would thus be
measured by construing the claim’s bounds and then determining
whether particular embodiments fell within those bounds. Charac-
teristic peripheral claiming- – in contrast to central claiming (by char-
acteristic or exemplar) – thus did not require courts to decide which
of an invention’s properties were essential, as the patentee would de-
lineate these qualities in the patent claims.
    At least two vestiges of central claiming have remained in the
patent system, namely the doctrine of equivalents and means-plus-
function claims.

A patent’s claims define what is covered by the patent. A [product]
[method] directly infringes a patent if it is covered by at least one
claim of the patent.
                                                 $)"15&3  1"5&/5

    Deciding whether a claim has been directly infringed is a two-step
process. The first step is to decide the meaning of the patent claim.
I have already made this decision, [and I will instruct you later as
to the meaning of the asserted patent claims] [and I have already in-
structed you as to the meaning of the asserted patent claims]. The
second step is to decide whether [alleged direct infringer] has [made,]
[used,] [sold,] [offered for sale] or [imported] within the United States
a [product] [method] covered by a claim of the [ ] patent. If it has, it
infringes. You, the jury, make this decision.
    [With one exception,] you must consider each of the asserted
claims of the patent individually, and decide whether [alleged direct
infringer]’s [product] [method] infringes that claim. [The one excep-
tion to considering claims individually concerns dependent claims.
A dependent claim includes all of the requirements of a particular
independent claim, plus additional requirements of its own. As a re-
sult, if you find that an independent claim is not infringed, you must
also find that its dependent claims are not infringed. On the other
hand, if you find that an independent claim has been infringed, you
must still separately decide whether the additional requirements of
its dependent claims have also been infringed.]
    There are two ways in which a patent claim may be directly in-
fringed. A claim may be “literally” infringed, or it may be infringed
under the “doctrine of equivalents.”
    To decide whether [alleged infringer]’s [product] [method] liter-
ally infringes a claim of the [ ] patent, you must compare that [prod-
uct] [method] with the patent claim and determine whether every
requirement of the claim is included in that [product] [method]. If so,
[alleged infringer]’s [product] [method] literally infringes that claim.
If, however, [alleged infringer]’s [product] [method] does not have
every requirement in the patent claim, [alleged infringer]’s [product]
[method] does not literally infringe that claim. You must decide lit-
eral infringement for each asserted claim separately.


                           1IJMMJQT W "8) $PSQ
                       'E   FO CBOD
It is a ”bedrock principle” of patent law that the claims of a patent
define the invention to which the patentee is entitled the right to ex-
clude. We have frequently stated that the words of a claim are gen-
erally given their ordinary and customary meaning. We have made
clear, moreover, that the ordinary and customary meaning of a claim
term is the meaning that the term would have to a person of ordinary
skill in the art in question at the time of the invention, i.e., as of the
% */'3*/(&.&/5 4*.*-"3*5:                                         

effective filing date of the patent application.
   The inquiry into how a person of ordinary skill in the art under-
stands a claim term provides an objective baseline from which to
begin claim interpretation. That starting point is based on the well-
se led understanding that inventors are typically persons skilled in
the field of the invention and that patents are addressed to and in-
tended to be read by others of skill in the pertinent art. S
   Importantly, the person of ordinary skill in the art is deemed to
read the claim term not only in the context of the particular claim
in which the disputed term appears, but in the context of the entire
patent, including the specification. This court explained that point
well in Multiform Desiccants, Inc. v. Medzam, Ltd.:                        .VMUJGPSN  'E  'FE   $JS
     It is the person of ordinary skill in the field of the inven-
     tion through whose eyes the claims are construed. Such
     person is deemed to read the words used in the patent
     documents with an understanding of their meaning in the
     field, and to have knowledge of any special meaning and
     usage in the field. The inventor’s words that are used
     to describe the invention – the inventor’s lexicography –
     must be understood and interpreted by the court as they
     would be understood and interpreted by a person in that
     field of technology. Thus the court starts the decisionmak-
     ing process by reviewing the same resources as would that
     person, viz., the patent specification and the prosecution

In some cases, the ordinary meaning of claim language as understood
by a person of skill in the art may be readily apparent even to lay
judges, and claim construction in such cases involves li le more than
the application of the widely accepted meaning of commonly under-
stood words. In such circumstances, general purpose dictionaries
may be helpful. In many cases that give rise to litigation, however, de-
termining the ordinary and customary meaning of the claim requires
examination of terms that have a particular meaning in a field of art.
Because the meaning of a claim term as understood by persons of
skill in the art is often not immediately apparent, and because paten-
tees frequently use terms idiosyncratically, the court looks to those
sources available to the public that show what a person of skill in the
art would have understood disputed claim language to mean. Those
sources include the words of the claims themselves, the remainder of
the specification, the prosecution history, and extrinsic evidence con-
cerning relevant scientific principles, the meaning of technical terms,
and the state of the art.
                                                 $)"15&3  1"5&/5

Quite apart from the wri en description and the prosecution history,
the claims themselves provide substantial guidance as to the meaning
of particular claim terms.
    To begin with, the context in which a term is used in the asserted
claim can be highly instructive. To take a simple example, the claim
in this case refers to ”steel baffles,” which strongly implies that the
term ”baffles” does not inherently mean objects made of steel. This
court’s cases provide numerous similar examples in which the use
of a term within the claim provides a firm basis for construing the
term. [Cited cases construed the claim term ”ingredients” in light of
the use of the term ”mixture” in the same claim phrase and the claim
term ”discharge rate” in light of the use of the same term in another
limitation of the same claim.]
    Other claims of the patent in question, both asserted and
unasserted, can also be valuable sources of enlightenment as to the
meaning of a claim term. Because claim terms are normally used con-
sistently throughout the patent, the usage of a term in one claim can
often illuminate the meaning of the same term in other claims. Dif-
ferences among claims can also be a useful guide in understanding
the meaning of particular claim terms. For example, 1315*1315 the
presence of a dependent claim that adds a particular limitation gives
rise to a presumption that the limitation in question is not present in
the independent claim.
The claims, of course, do not stand alone. Rather, they are part of a
fully integrated wri en instrument, consisting principally of a speci-
fication that concludes with the claims. For that reason, claims must
be read in view of the specification, of which they are a part. The spec-
ification is always highly relevant to the claim construction analysis.
Usually, it is dispositive; it is the single best guide to the meaning of
a disputed term.
    The importance of the specification in claim construction derives
from its statutory role. The close kinship between the wri en descrip-
tion and the claims is enforced by the statutory requirement that the
specification describe the claimed invention in ”full, clear, concise,
and exact terms.” In light of the statutory directive that the inven-
tor provide a ”full” and ”exact” description of the claimed invention,
the specification necessarily informs the proper construction of the
    Consistent with that general principle, our cases recognize that
the specification may reveal a special definition given to a claim term
by the patentee that differs from the meaning it would otherwise pos-
% */'3*/(&.&/5 4*.*-"3*5:                                         

sess. In such cases, the inventor’s lexicography governs. In other
cases, the specification may reveal an intentional disclaimer, or dis-
avowal, of claim scope by the inventor. In that instance as well, the
inventor has dictated the correct claim scope, and the inventor’s in-
tention, as expressed in the specification, is regarded as dispositive.
In addition to consulting the specification, we have held that a court
should also consider the patent’s prosecution history, if it is in evi-
dence. The prosecution history, which we have designated as part of
the ”intrinsic evidence,” consists of the complete record of the pro-
ceedings before the PTO and includes the prior art cited during the
examination of the patent. Like the specification, the prosecution his-
tory provides evidence of how the PTO and the inventor understood
the patent. Furthermore, like the specification, the prosecution his-
tory was created by the patentee in a empting to explain and ob-
tain the patent. Yet because the prosecution history represents an
ongoing negotiation between the PTO and the applicant, rather than
the final product of that negotiation, it often lacks the clarity of the
specification and thus is less useful for claim construction purposes.
Nonetheless, the prosecution history can often inform the meaning
of the claim language by demonstrating how the inventor under-
stood the invention and whether the inventor limited the invention
in the course of prosecution, making the claim scope narrower than
it would otherwise be.
Although we have emphasized the importance of intrinsic evidence
in claim construction, we have also authorized district courts to rely
on extrinsic evidence, which consists of all evidence external to the
patent and prosecution history, including expert and inventor testi-
mony, dictionaries, and learned treatises. However, while extrinsic
evidence can shed useful light on the relevant art, it is less significant
than the intrinsic record in determining the legally operative meaning
of claim language.
    Within the class of extrinsic evidence, dictionaries and treatises
can be useful in claim construction. We have especially noted the
help that technical dictionaries may provide to a court to be er un-
derstand the underlying technology and the way in which one of skill
in the art might use the claim terms. Because dictionaries, and espe-
cially technical dictionaries, endeavor to collect the accepted mean-
ings of terms used in various fields of science and technology, those
resources have been properly recognized as among the many tools
that can assist the court in determining the meaning of particular ter-
minology to those of skill in the art of the invention. Such evidence,
                                                    $)"15&3  1"5&/5

may be considered if the court deems it helpful in determining the
true meaning of language used in the patent claims.
    Extrinsic evidence in the form of expert testimony can be useful to
a court for a variety of purposes, such as to provide background on
the technology at issue, to explain how an invention works, to ensure
that the court’s understanding of the technical aspects of the patent is
consistent with that of a person of skill in the art, or to establish that
a particular term in the patent or the prior art has a particular mean-
ing in the pertinent field. However, conclusory, unsupported asser-
tions by experts as to the definition of a claim term are not useful to a
court. Similarly, a court should discount any expert testimony that is
clearly at odds with the claim construction mandated by the claims
themselves, the wri en description, and the prosecution history, in
other words, with the wri en record of the patent.
    We have viewed extrinsic evidence in general as less reliable than
the patent and its prosecution history in determining how to read
claim terms, for several reasons. First, extrinsic evidence by defini-
tion is not part of the patent and does not have the specification’s
virtue of being created at the time of patent prosecution for the pur-
pose of explaining the patent’s scope and meaning. Second, while
claims are construed as they would be understood by a hypothetical
person of skill in the art, extrinsic publications may not be wri en by
or for skilled artisans and therefore may not reflect the understanding
of a skilled artisan in the field of the patent. Third, extrinsic evidence
consisting of expert reports and testimony is generated at the time of
and for the purpose of litigation and thus can suffer from bias that is
not present in intrinsic evidence. The effect of that bias can be exacer-
bated if the expert is not one of skill in the relevant art or if the expert’s
opinion is offered in a form that is not subject to cross-examination.
Fourth, there is a virtually unbounded universe of potential extrinsic
evidence of some marginal relevance that could be brought to bear on
any claim construction question. In the course of litigation, each party
will naturally choose the pieces of extrinsic evidence most favorable
to its cause, leaving the court with the considerable task of filtering
the useful extrinsic evidence from the fluff. Finally, undue reliance
on extrinsic evidence poses the risk that it will be used to change the
meaning of claims in derogation of the indisputable public records
consisting of the claims, the specification and the prosecution history,
thereby undermining the public notice function of patents.
    In sum, extrinsic evidence may be useful to the court, but it is
unlikely to result in a reliable interpretation of patent claim scope un-
less considered in the context of the intrinsic evidence. Nonetheless,
because extrinsic evidence can help educate the court regarding the
field of the invention and can help the court determine what a person
of ordinary skill in the art would understand claim terms to mean, it
% */'3*/(&.&/5 4*.*-"3*5:                                       

is permissible for the district court in its sound discretion to admit
and use such evidence. In exercising that discretion, and in weighing
all the evidence bearing on claim construction, the court should keep
in mind the flaws inherent in each type of evidence and assess that
evidence accordingly.

                      'E  'FE $JS 
Craig Thorner and Virtual Reality Feedback Corporation (Appellants,
collectively) accused Sony Computer Entertainment America LLC
and a number of other Sony entities (Sony, collectively) of infringing
claims of U.S. patent no.    (‘941 patent) relating to a tactile
feedback system for computer video games. The district court con-
strued disputed claim terms and the parties stipulated to a judgment
of noninfringement. Because the district court improperly limited the
term “a ached to said pad” to mean a achment only to an external
surface and erred in its construction of the term “flexible”, we vacate
and remand.
The ‘941 patent describes a tactile feedback system for use with video
games. Figure 2 shows the many different embodiments of the inven-
    Tactile feedback controller 110 is part of a larger gaming system
that operates one or more of the devices shown above. Each device
includes some type of actuator that provides tactile feedback to a user
in response to certain game activities. For instance, the actuators in
hand-held game controller 598 may vibrate during a crash in a car rac-
ing game. Independent claim 1 requires “a flexible pad,” “a plurality
of actuators a ached to said pad” and a control circuit that activates
the actuators in response to game activity. The accused products are
hand-held game controllers.
    Two claim limitations are relevant to this appeal, “flexible pad”
and “a ached to said pad.” The district court held that flexible does
not mean simply “capable of being flexed.” It reasoned that this def-
inition was inappropriate because “many objects that are capable of
being flexed are not flexible. A steel I-beam is capable of being flexed,
but no one would call it ‘flexible.’” The court thus construed the term
to mean “capable of being noticeably flexed with ease.”
    The district court then turned to the construction of “a ached to
said pad.” Appellants argued that a ached should be given its plain
and ordinary meaning and that an actuator can be a ached to the in-
side of an object. Sony argued that “a ached to said pad” should be
construed as affixed to the exterior surface of the pad and does not
include embedded within said pad. The court held that “the specifi-
                                                   $)"15&3  1"5&/5

       U.S. Patent    Jul. 23, 2002   Sheet 2 0f 37        US 6,422,941 B1

                                             F        LO

U.S. Patent No. 6,422,941, Universal tactile feedback system for com-
puter video games and simulations
% */'3*/(&.&/5 4*.*-"3*5:                                        

cation redefines ‘a ached’ by implication.” The court held that the
word a ached was limited to a ached to the outside of an object be-
cause the embodiments in the specification consistently use the term
“a ached” to indicate affixing an actuator to the outer surface of an
object and use the word “embedded” when referring to an actuator
inside an object. For additional support for the notion that a ached
and embedded have different meanings, the court pointed to claim 1
which uses the word “a ached” and dependent claim 10 which uses
the word “embedded.”
    Following claim construction, the parties stipulated to nonin-
fringement by the accused products. They stated that “under the
Court’s construction of the phrase ‘a ached to said pad,’ Defendants
have not infringed....” The stipulation further stated that the “parties
reserve their rights to challenge this or any other construction of the
disputed claim phrases of the ‘941 patent on appeal.”
The words of a claim are generally given their ordinary and custom-
ary meaning as understood by a person of ordinary skill in the art
when read in the context of the specification and prosecution history.
See AWH. There are only two exceptions to this general rule: 1) when
a patentee sets out a definition and acts as his own lexicographer, or
2) when the patentee disavows the full scope of a claim term either
in the specification or during prosecution. The use of the term “at-
tached” in this specification does not meet either of these exceptions.
    To act as its own lexicographer, a patentee must clearly set forth a
definition of the disputed claim term other than its plain and ordinary
meaning. . It is not enough for a patentee to simply disclose a single
embodiment or use a word in the same manner in all embodiments,
the patentee must clearly express an intent to redefine the term. For
example, in 3M Innovative Properties Co. v. Avery Dennison Corp., we       . *OOPWBUJWF 1SPQFSUJFT  'E 
held that the patentee acted as its own lexicographer when the speci-       'FE$JS 
fication stated: “‘Multiple embossed’ means two or more embossing
pa erns are superimposed on the web to create a complex pa ern of
differing depths of embossing.”). Similarly, we limited a patentee to
particular examples of solubilizers when it stated in the specification
that “[t]he solubilizers suitable according to the invention are defined
below.” Astrazeneca AB v. Mutual Pharm. Co..                               "TUSB[FOFDB  'E  'FE $JS
    The standard for disavowal of claim scope is similarly exacting.
Where the specification makes clear that the invention does not in-
clude a particular feature, that feature is deemed to be outside the
reach of the claims of the patent, even though the language of the
claims, read without reference to the specification, might be consid-
ered broad enough to encompass the feature in question. The paten-
tee may demonstrate intent to deviate from the ordinary and accus-
                                                                                           $)"15&3  1"5&/5

                                       tomed meaning of a claim term by including in the specification ex-
                                       pressions of manifest exclusion or restriction, representing a clear dis-
4DJ.FE  'E  'FE $JS    avowal of claim scope. For example, in SciMed Life Sys., Inc. v. Ad-
                                       vanced Cardiovascular Sys., Inc., the patentee described two different
                                       types of catheters in the prior art, those with dual lumens (side-by-
                                       side) and those with coaxial lumens. In discussing the prior art, the
                                       patentee disparaged the dual lumen configuration as larger than nec-
                                       essary and less pliable than the coaxial type. Further, the specification
                                       repeatedly described the “present invention” as a coaxial design. Fi-
                                       nally, the specification stated: “The intermediate sleeve structure de-
                                       fined above [coaxial design] is the basic sleeve structure for all embod-
                                       iments of the present invention contemplated and disclosed herein.”
                                       This court held that collectively this amounted to disavowal of the
                                       dual lumen design.
                                           Mere criticism of a particular embodiment encompassed in the
                                       plain meaning of a claim term is not sufficient to rise to the level of
                                       clear disavowal. Even where a particular structure makes it particu-
                                       larly difficult to obtain certain benefits of the claimed invention, this
                                       does not rise to the level of disavowal of the structure. It is likewise
                                       not enough that the only embodiments, or all of the embodiments,
                                       contain a particular limitation. We do not read limitations from the
                                       specification into claims; we do not redefine words. Only the paten-
                                       tee can do that. To constitute disclaimer, there must be a clear and
                                       unmistakable disclaimer.
                                           It is the claims that define the metes and bounds of the patentee’s
                                       invention. The patentee is free to choose a broad term and expect
                                       to obtain the full scope of its plain and ordinary meaning unless the
                                       patentee explicitly redefines the term or disavows its full scope.
                                           Claim 1 of the patent at issue includes the disputed claim terms:
                                              In a computer or video game system, apparatus for provid-
                                              ing, in response to signals generated by said computer or video
                                              game system, a tactile sensation to a user of said computer or
                                              video game system, said apparatus comprising:
                                                    a flexible pad;
                                                    a plurality of actuators, a ached to said pad, for selectively
                                                    generating tactile sensation; and a control circuit ... for gen-
                                                    erating a control signal to control activation of said plural-
                                                    ity of actuators....

                                                                 I. “a ached to said pad”
                                       Appellants argue that the district court erred by holding that the spec-
                                       ification implicitly defined “a ached” to mean “affixed to an exterior
                                       surface.” They argue that the term does not require any construction
                                       and that the plain and ordinary meaning includes affixing an item to
% */'3*/(&.&/5 4*.*-"3*5:                                         

either an exterior or an interior surface. They contend that the spec-
ification explicitly states whether an a achment is to an interior or
exterior surface: “a vibratory actuator can be a ached to [the] outer
side of the thro le handle.” They argue this shows that when the ap-
plicant wished to distinguish an internal from an external a achment,
he did so with deliberate, express language. Thus, appellants argue
that the specification contemplates “a ached” to have its plain and
ordinary meaning—a ached to either an interior or exterior surface.
Finally, appellants argue that the fact that claim 10 includes the word
“embedded” does not mean that “a ached” can only mean connected
to an exterior surface. Rather, appellants argue that “embedded” is
merely a narrower term that includes only a achment to an interior
    Sony responds that the patent clearly identified two different con-
nections, “a ached to” and “embedded within.” It argues that in ev-
ery instance where the specification uses the term “a ached,” it refers
to an a achment to an outer surface. Conversely, in every embodi-
ment where the actuator is placed inside a housing, the specification
uses the term “embedded.” See, e.g., ‘941 patent col.32 l.66 (“embed-
ded within or a ached to”).
    Our case law is clear, claim terms must be given their plain and
ordinary meaning to one of skill in the art. The plain meaning of
the term “a ached” encompasses either an external or internal a ach-
ment. We must decide whether the patentee has redefined this term
to mean only a achment to an external surface. As Sony argues, the
specification repeatedly uses the term “a ached” in reference to em-
bodiments where the actuators are “a ached to [an] outer side.” In
fact, the specification never uses the word “a ached” when referring
to an actuator located on the interior of a controller. We hold that this
does not rise to the level of either lexicography or disavowal. Both ex-
ceptions require a clear and explicit statement by the patentee. It is
not enough that the patentee used the term when referencing an at-
tachment to an outer surface in each embodiment. In fact, the specifi-
cation explains that an actuator was “a ached to [an] outer surface.”
If the applicant had redefined the term “a ached” to mean only “at-
tached to an outer surface,” then it would have been unnecessary to
specify that the a achment was “to [an] outer surface” in the specifi-
cation. We conclude that the term a ached should be given its plain
and ordinary meaning. The specification does not redefine a ached
nor is there any disavowal.
    The fact that the specification uses the two terms “a ached” and
“embedded” as alternatives does not require a different result. There
is nothing inconsistent about the applicant’s use of the narrower term,
“embedded,” to describe embodiments affixed to an internal surface.
The plain and ordinary meaning of embedded, “a ached within,” is
                                                 $)"15&3  1"5&/5

narrower than “a ached.” Hence it makes sense that the applicant
would want to use embedded when it meant to explicitly claim at-
tached to the inside only. That does not mean the word a ached au-
tomatically means a ached to the external surface, as opposed to the
broader plain meaning—a ached to either the interior or exterior.
    Other parts of the claim and specification also support this con-
struction. The claim at issue requires a “flexible pad.” The only em-
bodiment in the specification that includes flexible material is the seat
cushion 510 shown in Figure 2. The specification states that “the tac-
tile feedback seating unit 510 is a semi-rigid flexible foam structure
... with a plurality of actuators embedded within the foam structure.”
Thus, the only flexible embodiment in the specification has embed-
ded actuators. If we agreed with Sony that “a ached” must mean
a ached to an outer surface, then the claim would exclude the only
flexible embodiment disclosed in the specification. This is further ev-
idence that the term “a ached” should have its plain and ordinary
meaning which includes either internal or external a achments.
    We hold that the term “a ached to said pad” should be given its
plain and ordinary meaning which encompasses either internal or ex-
ternal a achment. Because the parties based the stipulation of nonin-
fringement on the district court’s erroneous construction of this claim
term, we vacate and remand.
                           II. “flexible pad” …
Appellants argue that the term “flexible” simply means “capable of
being flexed” and that the district court erred by requiring “capable of
being noticeably flexed with ease.” They note that the specification
only uses the term “flexible pad” when referring to a “semi-rigid”
structure and that a “semi-rigid” structure would certainly not be
“noticeably flexed with ease.”
    Sony responds that although the specification uses the term to re-
fer to a “semi-rigid” structure, that structure is made out of foam in
every embodiment. It argues that foam is capable of being noticeably
flexed with ease and thus a rigid, barely bendable material should not
be considered “flexible.” Sony also points to portions of the Mark-
man hearing where the district court judge inspected one of the ac-
cused hard plastic controllers. The judge noted that the controller
was rigid and “[i]f I try to flex this thing, I think that you’re going to
see it snap.”
    We agree with the appellants that the district court improperly
limited the term. Neither the claims nor the specification requires
the “flexible pad” to be noticeably flexed with ease. The specifica-
tion says only that the flexible pad must be a semi-rigid structure.
The task of determining the degree of flexibility, the degree of rigid-
ity that amounts to “semi-rigid,” is part of the infringement analysis,
% */'3*/(&.&/5 4*.*-"3*5:                                         

not part of the claim construction. The district court is of course free
on summary judgment to decide that there is no genuine issue of ma-
terial fact that the accused products in this case do not meet the plain
and ordinary meaning of the term “flexible.” We do not mean to sug-
gest that summary judgment is improper in this case, only that claim
construction is the wrong venue for this determination.


           "OHFMP .POHJFMMPT $IJMESFO --$ W 1J[[B )VU *OD
                     ' 4VQQ E  &%/: 
The complaint alleges that defendant’s method for making stuffed-
crust pizzas, in use between March of 1994 and at least July of 1996, in-
fringed plaintiff’s method for making pizza claimed in United States
Patent No.    dated April 28, 1987 (the ‘361 patent).
    In essence, plaintiff’s method is to create multiple, individually
sealed pockets made of dough that are filled with cheese (or other
ingredients) and enclosed within the outer rim of a pizza crust or
placed on a portion of the pizza crust. Tomato sauce and cheese cov-
ers the rest of the pie. The claims describe two basic methods: one
uses dough pulled over from the edge of the crust to cover the fill-
ings and form the pockets; the other places a separate piece of dough,
not from the edge, over the fillings to form a pocket.
    [Claim 1 reads] as follows:
  1. A method of making a pizza comprising the steps of:
                                                                            'JH  GSPN UIF h QBUFOU
      (a) forming a generally flat dough base;
      (b) placing a plurality of separated individual food portions
           on the dough base such that, when the dough base is cut
           into substantially equally sized portions, each individual
           food portion is located upon a portion of each pie;
       (c) covering each food portion with an unbaked dough section
           of sufficient dimensions to cover said food portion thereby
           forming a separate closed pocket about each food portion;
      (d) covering the portions of the dough base which are not cov-
           ered by said closed pockets with a layer of tomato sauce
           and cheese to form an unbaked pizza product; and
      (e) baking the unbaked product to obtain a pizza.
In early 1988 Anthony Mongiello sent defendant a copy of the ‘361
patent, offering a license under it. Defendant responded by le er
dated May 17, 1988 that it was “not a new concept for Pizza Hut”
and rejected the offer.
    In March of 1995 defendant launched a cheese “Stuffed Crust
Pizza.” The manager’s guide dated February 1995 describes defen-
                                                 $)"15&3  1"5&/5

dant’s method as follows:
    • Place thumbs on edge of dough.
    • Press dough ridge up the sides of pan.
          – Dough must extend just above rim of pan (¼”)
    • Evenly space five pieces of thawed mozzarella string cheese ap-
      proximately a thumb’s width apart along the outside edge of
      the dough
          – Place close to bo om of pan where edge meets.
    • Use thumb and index fingers to stretch and fold edge of the
      dough over string cheese and press firmly to seal.
          – Dough overlap should be visible on both sides of thumb.
          – Keep stuffed edge at score line etched in pan to keep dough
            in round shape.
    • Use thumbs to press and seal overlapped dough to bo om edge.
    • Use thumbs to push stuffed edge out to edge of pan....
    • All Stuffed Crust Pizzas are cut into 8 slices. If cheese is leaking
      through small hole in crust, begin cu ing pizza at that spot.
An objective of the method was to create “cheese pull,” which means
that the cheese within the crust joins together during baking so that
the consumer receives “cheese in every bite.”
    Defendant launched a pepperoni and cheese Stuffed Crust Pizza
in September of 1995, which contained a continuous layer of pepper-
oni slices beneath the five pieces of cheese within the outer edge of
the pizza. Plaintiff concedes that the pepperoni and cheese version
does not infringe the ‘361 patent.
    Shortly after learning of the 1995 launch of defendant’s Stuffed
Crust Pizza, Anthony Mongiello and his brother Lawrence cut open
Stuffed Crust Pizzas purchased from defendant’s restaurants. They
say that when they cut into the crusts, they observed “pockets” of
mozzarella cheese and spots where “a dough wall separated adjacent
mozzarella strings.”
    Based on their observations of randomly occurring dough walls
dividing cheese within the crust of defendant’s baked product, the
Mongiellos believed that the method defendant used to make Stuffed
Crust Pizzas infringed on their claimed method.
    Defendant argues that its method of making Stuffed Crust Pizza
does not infringe the ‘361 patent, either literally or through substan-
tial equivalence, because it does not perform what it says are three
required elements of the claimed method [including]:
 (1) The “cu ing step” of claim 1: “when the dough base is cut into
      substantially equally sized pieces, each individual food portion
      is located upon a portion of each piece.”
% */'3*/(&.&/5 4*.*-"3*5:                                         

 (2)  The “forming step” of claim 1: “forming a separate closed
      pocket about each food portion.”
Defendant says that the phrase “such that, when the dough base is cut
into substantially equally sized portions, each individual food por-
tion is located upon a portion of each piece” is an essential limitation
of the claim requiring that the pizza be cut in a specific manner. Plain-
tiff contends that the phrase should be construed as an optional step
that merely explains where the food portions should be placed, and
says that the phrase really means: “if the dough base were cut into
equal slices, a food portion would be on each slice.” Plaintiff argues
that cu ing the pizza such that there is an individual filled pocket on
each piece is not required, but that “it is enough that it is possible to
do so.”
    But the plain language of the claim says “when,” not “if.” If the
patent applicants had wanted the language to be hypothetical, they
would have drafted it in that manner.                                       5XP QBHFT PG GVSUIFS DMBJN DPOTUSVD
                                                                            UJPO EJTDVTTJPO PNJUUFE 'PDVT PO XIBU
    In order to find literal infringement, the defendant must practice
                                                                            UIF DPVSU EPFT PODF JU IBT DPOTUSVFE
each and every element of the claimed method. Defendant’s method,           UIF DMBJN MBOHVBHF
as described in the February 1995 manager’s guide and the affidavit
of Patricia Scheibmeir, a manager in defendant’s research and devel-
opment department, does not practice the “cu ing” limitation as con-
strued by the court. Although the Stuffed Crust Pizzas in question           5IJT JT UIF DPVSUT DPNQMFUF EJTDVTTJPO
used five separate pieces of cheese, separated by a thumb’s width,           PG MJUFSBM JOGSJOHFNFOU 5IJT JT OPU BUZQ
                                                                            JDBM 0ODF DMBJN DPOTUSVDUJPO JT DPN
the instructions direct that the pizza be cut into eight slices using a
                                                                            QMFUF BQQMZJOH UIF DMBJN MBOHVBHF JT
“rocker blade,” which cuts pizzas into an even number of slices. It         PGUFO UIPVHI OPU BMXBZT USJWJBM 8IZ
is thus impossible for individual portions of cheese to be located on       NJHIU UIBU CF
each portion of defendant’s pizza.
    Since defendant does not practice one of the essential limitations
of the ‘361 patent, the court need not consider the other limitations
before making a finding of no literal infringement.

                 "CCPUU -BCPSBUPSJFT W 4BOEP[ *OD
                     'E  'FE $JS 
[Abbo ’s patent No.   , as construed, claimed cefdinir anhy-
drate (or ”Crystal A”). Sandoz and Teva’s products contained pri-
marily cefdinir monohydrate (or ”Crystal B”). The District Court had
       The evidence does not convince us that there in fact are
       trace amounts of cefdinir anhydrate contained within the
       cefdinir monohydrate in defendants’ products. Moreover,
       there is no evidence that, even if there were traces, that
       those trace amounts could be a contributing factor in the
       efficacy of the defendants’ products. If there is a small
       amount of cefdinir anhydrate in defendants’ products, we
                                                $)"15&3  1"5&/5

       do not conclude that this could cause literal infringement
       of the ’507 patent.]
As to the alleged presence of small amounts of Crystal A in San-
doz and Teva’s products, Abbo ’s evidence did not persuade the
Northern District of Illinois. This court perceives that decision as
well within the trial court’s discretion. As additional support, the
Northern District observed that there was no evidence that any trace
amounts of cefdinir anhydrate, i.e. Crystal A, in Sandoz and Teva’s
products ”could be a contributing factor in the efficacy” and that even
”if there is a small amount of cefdinir anhydrate in defendants’ prod-
ucts, we do not conclude that this could cause literal infringement.”
While these may be misstatements of the law, because de minimis in-
fringement can still be infringement, this court need not reach that
issue in a preliminary injunction context which affords the trial court
broad leeway to discern a ”likelihood of success.” As noted, this court
sustains the trial court’s discretion based primarily on its administra-
tion of the proper claim construction and its finding that Abbo was
not likely to show Sandoz and Teva’s products contained any Crystal
A at all.


                       'E  'FE $JS 
Freedman Seating Company (“Freedman”) sued American Seating
Company and Hi-Tech Seating Products (doing business as Kustom
Fit) (collectively, “American Seating”) for infringement of U.S. Patent
No.    (issued Feb. 20, 1996) (“the ‘389 patent”). Because
we conclude that the judgment of infringement under the doctrine
of equivalents has the effect of vitiating a limitation of the claims of
the ‘389 patent, we reverse the judgment and remand the case to the
district court with instructions to enter judgment of non-infringement
in favor of American Seating.
Freedman manufactures seats used in public transportation vehicles.
Its product line includes stowable seats, which are seats that have
the ability to fold away in order to create more interior space in a
vehicle. They are particularly useful for accommodating passengers
with wheelchairs, but may be used whenever more interior space is
    Freedman also owns the ‘389 patent, titled “Stowable Seat.” The
figures shown below are representative of the stowable seat claimed
in the ‘389 patent.
% */'3*/(&.&/5 4*.*-"3*5:                                            

      US. Patent      Feb. 20, 1996   Sheet 1 0f 3         5,492,389

                                                 j“;wé ‘

             U.S. Patent No. 5,492,389, Stowable seat
                                                                   $)"15&3  1"5&/5

                      Figure 1 shows the stowable seat (10) in the horizontal (or de-
                 ployed) position, while figure 2 shows the stowable seat in the ver-
                 tical (or stowed) position. Moving the seat from its horizontal to ver-
                 tical position involves “folding the seatback (16) flat against the seat-
                 base (14), unlocking the seatbase from its horizontally deployed po-
                 sition and raising the seatbase to its vertically stowed position where
                 it is locked in place.”
                      As shown by figure 1, the invention of the ‘389 patent does not
                 use an aisle leg to support the seat when in the horizontal position.
                 Rather, the invention is based on a cantilever design, which uses a di-
                 agonal truss (18), also referred to as a support member, to support the
                 aisle-end of the seat when in the horizontal position. This design, ac-
                 cording to the ‘389 patent, avoids difficulties a endant with stowing
                 and deploying seats that have a separate aisle leg.
                      In addition to providing aisle support, the diagonal truss allows
                 for translational movement of the seatbase between the horizontal
                 and vertical positions. This is due to the truss having a fixed end that
                 is a ached to the seat’s frame (12) at a pivot point (54), and a mov-
                 able end (56) that is “slidably mounted” in a runner track (58). When
                 stowing the seat, the movable end of the diagonal truss slides on the
                 runner track toward the middle of the seatbase, while the fixed end of
                 the diagonal truss rotates upward until the seat is in the vertical posi-
                 tion. Similarly, when the seat is deployed again, the movable end of
                 the diagonal truss slides toward the aisle end of the seatbase, while
                 the fixed end rotates downward until the seat is in the horizontal posi-
                 tion. This folding mechanism created by the slidably mounted move-
                 able end is known in the field of mechanical engineering as a “slider
                 crank,” which is a particular type of “four bar mechanism.”
                      Claim 1 is representative of the claims asserted against American
                 Seating; it reads:
                         A stowable seat for mounting to support member of a vehicle
                         wherein a space may be selectively provided for positioning an
                         article adjacent to the stowable seat, when stowed the seat com-
                               a frame a ached to a support member;
                               a cantilevered seatbase having a free end, a pivotable end
                               including a pivot mounted thereto for rotatably associat-
                               ing said pivotable end with said frame and for providing
                               said seatbase with a range of motion extending from a
                               horizontally deployed position to a vertically stowed po-
                               sition, a support member for supporting said seatbase in
                               said deployed position including a moveable end slidably
FNQIBTJT BEEFE                 mounted to said seatbase and a fixed end journalled with
                               said frame, and a first lock near said free end for releasably
% */'3*/(&.&/5 4*.*-"3*5:                                         

            locking said movable end to maintain said seatbase in said
            deployed position; and
            a seatback having a pivot for rotatably associating said
            seatback with said seatbase and for providing said seat-
            back with a range of motion extending from an unfolded
            position to a folded position, said range of motion of
            said seatback being perpendicular to said range of motion
            of said seatbase, said seatback in said unfolded position
            adapted to be a predetermined angle with respect to said
            seatbase in said deployed position to provide seating and
            said seatback in said folded position adapted to be adja-
            cent said seatbase for stowing to provide the space for the
American Seating Company and Kustom Fit also manufacture and
market seating products for the transportation industry. One partic-
ular seat is the Horizon EZ Fold (“EZ Fold”), which is a stowable seat.
The EZ Fold is in many respects similar, if not identical, to the inven-
tion claimed in the ‘389 patent. Most notably, neither device has an
aisle leg. However, and important to this case, the two products use
different types of support structures in lieu of the aisle leg. The in-
vention claimed in the ‘389 patent, of course, uses the slider crank,
which is described in part by the “slidably mounted” limitation. The
EZ Fold, on the other hand, uses what is known as a “fourth link.”
    Like the slider crank, the fourth link is also a specific type of four
bar mechanism. However, the two mechanisms differ in that, where
the moveable end of the ‘389 patent’s support member is slidably
mounted to the seatbase, the moveable end of the EZ Fold’s support
member is rotatably mounted to the seatbase. Therefore, the move-
able end of the EZ Fold’s support member does not slide or otherwise
move along the seatbase. Rather, its only range of motion consists of
rotation throughout its revolute joints. That said, the EZ Fold’s fourth
link mechanism still provides the seatbase with fluid translational
motion, and thereby allows the seat to fold between the deployed
and stowed positions. It does this through an extra set of revolute
joints located in the midsection of its support member (“mid-joints”).
These mid-joints are shown below in two representative illustrations
of the EZ Fold product.
    The illustration on the left shows the seat in the fully deployed po-
sition, and the illustration on the right shows the device in transition
between the deployed and stowed positions.
                                                                                      $)"15&3  1"5&/5

                                          In due course, both parties filed motions for summary judgment
                                      on the issue of infringement. The parties generally agreed that the
                                      EZ Fold literally meets all of the limitations of claim 1 except for the
                                      limitation requiring that the movable end of the support member be
                                     “slidably mounted” to the seatbase. The accused product does not
                                      literally meet this limitation because the EZ Fold’s support member
                                      is rotatably mounted, not slidably mounted, to the seatbase.
                                          American Seating argued that its support member and moveable
                                      end were not equivalent to the corresponding structure claimed by
                                      the ‘389 patent because its system used a fourth link, which cre-
                                      ated a substantially different support structure than the slider crank
                                      of the ‘389 patent. In particular, American Seating argued that the
                                      support structures of the two devices created substantially different
                                     distribution forces. The district court disagreed. As an initial mat-
                                      ter, the court stated that force distributions were not claimed in the
                                     ‘389 patent and were therefore of minimal relevance. In addition,
                                      the court found that any difference in force distributions was insub-
                                      stantial, and that Freedman’s “slider-crank and [American Seating’s]
                                      fourth link perform substantially the same function in substantially
                                      the same manner to achieve substantially the same result.” The court
                                      therefore granted Freedman summary judgment of infringement by
                                     Patent infringement is a two step inquiry. First, the court must con-
                                     strue the asserted claim. Second, the court must determine whether
                                     the accused product or process contains each limitation of the prop-
                                     erly construed claims, either literally or by a substantial equivalent.
                                         Under the doctrine of equivalents, a product or process that does
                                     not literally infringe upon the express terms of a patent claim may
                                     nonetheless be found to infringe if there is ‘equivalence’ between the
                                     elements of the accused product or process and the claimed elements
8BSOFS+FOLJOTPO  64     of the patented invention.” Warner-Jenkinson Co. v. Hilton Davis Chem.
                                     Co.. The doctrine evolved in recognition of the fact that
                                           The language in the patent claims may not capture every
% */'3*/(&.&/5 4*.*-"3*5:                                         

     nuance of the invention or describe with complete preci-
     sion the range of its novelty. If patents were always inter-
     preted by their literal terms, their value would be greatly
     diminished. Unimportant and insubstantial substitutes
     for certain elements could defeat the patent, and its value
     to inventors could be destroyed by simple acts of copying.
Festo. At the same time, the doctrine of equivalents necessarily adds
uncertainty to the scope of patent claims, and thereby detracts from
the public-notice function of patent claims and risks deterring non-
infringing and potentially innovative endeavors. See Festo (“If the
range of equivalents is unclear, competitors may be unable to de-
termine what is a permi ed alternative to a patented invention and
what is an infringing equivalent.”); Warner-Jenkinson (“There can be
no denying that the doctrine of equivalents, when applied broadly,
conflicts with the definitional and public-notice functions of the statu-
tory claiming requirements.”). In recognition of this risk, and in an
effort to strike the proper balance between protecting patentees while
also providing sufficient notice to the public, various rules of law
have emerged to constrain when and how the doctrine of equivalents
is to be applied.
    Of relevance to this case is the “all limitations” rule. The rule
holds that an accused product or process is not infringing unless it
contains each limitation of the claim, either literally or by an equiva-
lent. This principle has two primary implications for the doctrine of
equivalents. First, the all limitations rule requires that equivalence
be assessed on a limitation-by-limitation basis, as opposed to from
the perspective of the invention as a whole. Second, an element of an
accused product or process is not, as a ma er of law, equivalent to
a limitation of the claimed invention if such a finding would entirely
vitiate the limitation.
    There is no set formula for determining whether a finding of
equivalence would vitiate a claim limitation, and thereby violate the
all limitations rule. Rather, courts must consider the totality of the
circumstances of each case and determine whether the alleged equiv-
alent can be fairly characterized as an insubstantial change from the
claimed subject ma er without rendering the pertinent limitation
    In Sage Products, Inc. v. Devon Industries, Inc. we affirmed the         4BHF 1SPEVDUT  'E  'FE $JS
district court’s grant of summary judgment of non-infringement un-         
der the doctrine of equivalents. One of the asserted patents de-
scribed a container for discarding syringes and other like materials
and claimed, among other things, “an elongated slot at the top of the
container body” and a barrier means comprised of “a first constric-
tion extending over said slot.” We agreed that the district court prop-
                                                                                        $)"15&3  1"5&/5

                                       erly interpreted “top of the container body” to mean “highest point,
                                       level, or part of.” The accused product differed from the claimed in-
                                       vention in that the slot was located in the interior of the container
                                       rather than at the top of the container.
                                           We concluded that finding infringement under these circum-
                                       stances would vitiate the “slot at the top of the container body” and
                                       “extending over said slot” limitations. We reached our conclusion
                                       based on several considerations, including the simplicity of the struc-
                                       ture, the specificity and narrowness of the claim, and the foreseeabil-
                                       ity of variations at the time of filing the claim with the PTO:
                                             The claim at issue defines a relatively simple structural
                                             device. A skilled patent drafter would foresee the limit-
                                             ing potential of the “over said slot” limitation. No sub-
                                             tlety of language or complexity of the technology, nor any
                                             subsequent change in the state of the art, such as later-
                                             developed technology, obfuscated the significance of this
                                             limitation at the time of its incorporation into the claim. If
                                             [the patentee] desired broad patent protection for any con-
                                             tainer that performed a function similar to its claimed con-
                                             tainer, it could have sought claims with fewer structural
                                             encumbrances. . . . Instead, [the patentee] left the PTO
                                             with manifestly limited claims that it now seeks to expand
                                             through the doctrine of 1361*1361 equivalents. However,
                                             as between the patentee who had a clear opportunity to
                                             negotiate broader claims but did not do so, and the pub-
                                             lic at large, it is the patentee who must bear the cost of its
                                             failure to seek protection for this foreseeable alteration of
                                             its claimed structure.
                                       Compare Hughes Aircraft Co. v. United States, 140 F.3d 1470, 1475
                                       (Fed. Cir. 1998) (“This is a case in which a ‘subsequent change in the
                                       state of the art, such as later-developed technology, obfuscated the
                                       significance of [the] limitation at the time of its incorporation into the
5SPO[P  'E  'FE $JS        In Tronzo v. Biomet, Inc., we similarly concluded that a finding of
                                       equivalence would vitiate the claimed limitation. The asserted claims
                                       related to an artificial hip socket and included a limitation requiring
                                       that the prosthesis’s body have “a generally conical outer surface.”
                                       In finding infringement, the jury concluded that the hemispherical
                                       shape of the accused product’s hemispherical cup was equivalent to
                                       the “generally conical outer surface” limitation. We reversed, find-
                                       ing no infringement as a ma er of law. We were particularly trou-
                                       bled by expert testimony submi ed by the plaintiff, Tronzo, stating
                                       that “when either a hemispherical cup or trapezoidal cup or any other
                                       shape cup is successfully implanted into the body, it functions almost
% */'3*/(&.&/5 4*.*-"3*5:                                           

 exactly the same way.” We stated that, according to this theory of
 infringement, “any shape would be equivalent to the conical limita-
 tion.” “Such a result,” we concluded, “is impermissible under the all-
 elements rule of Warner-Jenkinson because it would write the ‘gener-
 ally conical outer surface’ limitation out of the claims.” See also Asyst    "TZTU 5FDIT  'E  'FE $JS
Techs., Inc. v. Emtrak, Inc. (holding that, under the “specific exclu-         
 sion” principle, “the term ‘mounted’ can fairly be said to specifically
 exclude objects that are ‘unmounted’”); Moore U.S.A. v Standard Regis-       .PPSF  'E  'FE $JS 
 ter Co. (“[T]o allow what is undisputedly a minority (i.e., 47.8%) to be
 equivalent to a majority would vitiate the requirement that the ‘first
 and second longitudinal strips of adhesive … extend the majority of
 the lengths of said longitudinal marginal portions.’”).
     In the instant case, we think the district court’s finding of infringe-
 ment under the doctrine of equivalents had the effect of entirely vi-
 tiating the “slidably mounted” limitation. The parties agree that all
 of the claims require a support member having “a moveable end slid-
 ably mounted to” the seatbase. It is also not disputed that the move-
 able end of the EZ Fold’s support member is rotatably mounted, not
 slidably mounted, to the seatbase. Therefore, while the moveable end
 of the EZ Fold’s support member has the ability to rotate, it cannot
 slide or otherwise move along the seatbase. It is confined to a fixed
 location. We think that this structural difference in the mounting of
 the moveable end to the seatbase is not a subtle difference in degree,
 but rather, a clear, substantial difference or difference in kind.
     Freedman argues that the slider crank claimed in the ‘389 patent
 and the fourth link mechanism used in the EZ Fold function in the
 same way to produce identical results. Freedman asserts that this
 is because “both the infringing seat and the claimed structure of the
‘389 patent provide the moveable end of the support member with
 both translational and rotational motion relative to the seatbase.” The
 problem, however, is that taken to its logical conclusion, Freedman’s
 argument would mean that any support member capable of allowing
 translational and rotational motion would be equivalent to a support
 member “slidably mounted to said seatbase,” which reads “slidably
 mounted” completely out of the claims. This is the precise type of
 overextension of the doctrine of equivalents that the claim vitiation
doctrine is intended to prevent.

Petitioner Festo Corporation owns two patents [   (Stoll) and
   (Carroll)] for an improved magnetic rodless cylinder, a
piston-driven device that relies on magnets to move objects in a con-
veying system. The device has many industrial uses and has been em-
ployed in machinery as diverse as sewing equipment and the Thun-
                                                $)"15&3  1"5&/5

der Mountain ride at Disney World. Petitioner’s patent applications,
as often occurs, were amended during the prosecution proceedings.
Both amended patents added a new limitation—that the inventions
contain a pair of sealing rings, each having a lip on one side, which
would prevent impurities from ge ing on the piston assembly. The
amended Stoll Patent added the further limitation that the outer shell
of the device, the sleeve, be made of a magnetizable material.
    Prosecution history estoppel requires that the claims of a patent
be interpreted in light of the proceedings in the PTO during the ap-
plication process. Estoppel is a rule of patent construction that en-
sures that claims are interpreted by reference to those that have been
cancelled or rejected. The doctrine of equivalents allows the paten-
tee to claim those insubstantial alterations that were not captured in
drafting the original patent claim but which could be created through
trivial changes. When, however, the patentee originally claimed the
subject ma er alleged to infringe but then narrowed the claim in re-
sponse to a rejection, he may not argue that the surrendered territory
comprised unforeseen subject ma er that should be deemed equiva-
lent to the literal claims of the issued patent. On the contrary, by the
amendment the patentee recognized and emphasized the difference
between the two phrases and the difference which the patentee thus
disclaimed must be regarded as material.
    A rejection indicates that the patent examiner does not believe the
original claim could be patented. While the patentee has the right
to appeal, his decision to forgo an appeal and submit an amended
claim is taken as a concession that the invention as patented does
not reach as far as the original claim. Were it otherwise, the inventor
might avoid the PTO’s gatekeeping role and seek to recapture in an
infringement action the very subject ma er surrendered as a condi-
tion of receiving the patent.
    Prosecution history estoppel ensures that the doctrine of equiv-
alents remains tied to its underlying purpose. Where the original
application once embraced the purported equivalent but the paten-
tee narrowed his claims to obtain the patent or to protect its validity,
the patentee cannot assert that he lacked the words to describe the
subject ma er in question. The doctrine of equivalents is premised
on language’s inability to capture the essence of innovation, but a
prior application describing the precise element at issue undercuts
that premise. In that instance the prosecution history has established
that the inventor turned his a ention to the subject ma er in ques-
tion, knew the words for both the broader and narrower claim, and
affirmatively chose the la er.
    We agree with the Court of Appeals that a narrowing amendment
made to satisfy any requirement of the Patent Act may give rise to an
estoppel. Estoppel arises when an amendment is made to secure the
% */'3*/(&.&/5 4*.*-"3*5:                                          

patent and the amendment narrows the patent’s scope. A patentee
who narrows a claim as a condition for obtaining a patent disavows
his claim to the broader subject ma er, whether the amendment was
made to avoid the prior art or to comply with § 112. We must regard
the patentee as having conceded an inability to claim the broader sub-
ject ma er or at least as having abandoned his right to appeal a rejec-
tion. In either case estoppel may apply.
    On the record before us, we cannot say petitioner has rebu ed the
presumptions that estoppel applies and that the equivalents at issue
have been surrendered. Petitioner concedes that the limitations at is-
sue – the sealing rings and the composition of the sleeve – were made
in response to a rejection for reasons under § 112, if not also because of
the prior art references. As the amendments were made for a reason
relating to patentability, the question is not whether estoppel applies
but what territory the amendments surrendered.

                    'E  'FE $JS  FO CBOD
Johnson and Johnston Associates (Johnston) asserted United States
Patent No.    (the ’050 patent) against R.E. Service Co. and
Mark Frater (collectively RES). [The patent concerned a method for
making printed circuit boards by adhering them to a stiff substrate
sheet during processing.]
    When a patent drafter discloses but declines to claim subject mat-
ter, as in this case, this action dedicates that unclaimed subject ma er
to the public. Application of the doctrine of equivalents to recapture
subject ma er deliberately left unclaimed would conflict with the pri-
macy of the claims in defining the scope of the patentee’s exclusive
    Moreover, a patentee cannot narrowly claim an invention to avoid
prosecution scrutiny by the PTO, and then, after patent issuance, use
the doctrine of equivalents to establish infringement because the spec-
ification discloses equivalents. Such a result would merely encourage
a patent applicant to present a broad disclosure in the specification
of the application and file narrow claims, avoiding examination of
broader claims that the applicant could have filed consistent with the
specification. By enforcing this rule, the courts avoid the problem of
extending the coverage of an exclusive right to encompass more than
that properly examined by the PTO.
    In this case, Johnston’s ’050 patent specifically limited the claims
to ”a sheet of aluminum” and ”the aluminum sheet.” The specifica-
tion of the ’050 patent, however, reads: ”While aluminum is currently
the preferred material for the substrate, other metals, such as stainless
steel or nickel alloys may be used.” Having disclosed without claim-
ing the steel substrates, Johnston cannot now invoke the doctrine
                                                                                           $)"15&3  1"5&/5

                                          of equivalents to extend its aluminum limitation to encompass steel.
                                          Thus, Johnston cannot assert the doctrine of equivalents to cover the
                                          disclosed but unclaimed steel substrate.
                                              A patentee who inadvertently fails to claim disclosed subject mat-
                                          ter, however, is not left without remedy. Within two years from the
                                          grant of the original patent, a patentee may file a reissue application
                                          and a empt to enlarge the scope of the original claims to include the
3FJTTVF  64$ f               disclosed but previously unclaimed subject ma er.. In addition, a
                                          patentee can file a separate application claiming the disclosed subject
4FQBSBUF BQQMJDBUJPO  64$ f      ma er.. Notably, Johnston took advantage of the la er of the two op-
  BMMPXJOH öMJOH BT B DPOUJOVBUJPO    tions by filing two continuation applications that literally claim the
                                          relevant subject ma er

                                               " )ZCSJE .FBOT1MVT'VODUJPO $MBJNT

                                                         ,FNDP 4BMFT *OD W $POUSPM 1BQFST $P *OD
                                          In order for an accused structure to literally meet a section 112, para-
                                          graph 6 means-plus-function limitation, the accused structure must
                                          either be the same as the disclosed structure or be a section 112, para-
                                          graph 6 ”equivalent,” i.e., (1) perform the identical function and (2) be
                                          otherwise insubstantially different with respect to structure. Under a
                                          modified version of the function-way-result methodology, two struc-
                                          tures may be ”equivalent” for purposes of section 112, paragraph 6
                                          if they perform the identical function, in substantially the same way,
                                          with substantially the same result.
                                              If an accused structure is not a section 112, paragraph 6 equiva-
                                          lent of the disclosed structure because it does not perform the iden-
                                          tical function of that disclosed structure and hence does not literally
                                          infringe, it may nevertheless still be an ”equivalent” under the doc-
                                          trine of equivalents. Thus, if one applies the traditional function-
                                          way-result test, the accused structure must perform substantially the
                                          same function, in substantially the same way, to achieve substantially
                                          the same result, as the disclosed structure. A key feature that distin-
                                          guishes ”equivalents” under section 112, paragraph 6 and ”equiva-
                                          lents” under the doctrine of equivalents is that section 112, paragraph
                                          6 equivalents must perform the identical function of the disclosed
                                          structure, while equivalents under the doctrine of equivalents need
                                          only perform a substantially similar function.
                                              Because the ”way” and ”result” prongs are the same under both
                                          the section 112, paragraph 6 and doctrine of equivalents tests, a struc-
                                          ture failing the section 112, paragraph 6 test under either or both
                                          prongs must fail the doctrine of equivalents test for the same rea-
% */'3*/(&.&/5 4*.*-"3*5:                                         

    In the present case, we agree with the district court that no reason-
able jury could have found that the TripLok infringes, either literally
or under the doctrine of equivalents. Turning first to literal infringe-
ment, it is clear that the foldover flap structure disclosed in the ’197
patent specification is not identical to the dual-lip structure in the ac-
cused device, so we must then ask whether the dual-lip structure is
an ”equivalent” structure under section 112, paragraph 6. In deter-
mining this under a modified function-way-result test, we note that
both the accused and disclosed structures perform the identical func-
tion, which is to close the envelope. However, unlike the disclosed
flap, which closes by folding over the envelope, the dual-lip structure
closes the accused envelope in a different way by meeting together
and binding via the internal adhesive. The accused structure’s differ-
ent way of closing also yields a substantially different result. The first
and second sealing means in the disclosed structure are ultimately
a ached to the outside of the envelope. In contrast, the first sealing
means in the TripLok envelope is internally a ached to the two lips
of the dual-lip structure, thereby sealing the envelope.
    Based on this analysis, it is also clear that Control Papers does not
infringe under the doctrine of equivalents. When a court determines
                                                                                            $)"15&3  1"5&/5

                                           that the ”way” and/or ”result” is/are substantially different under a
                                           section 112, paragraph 6 equivalents analysis, a patentee cannot pre-
                                           vail under the doctrine of equivalents for the same reason(s). In this
                                           case, the dual-lip structure is not a section 112, paragraph 6 equiva-
                                           lent of a fold-over flap because the ”way” and ”result” are substan-
                                           tially different; accordingly, the dual-lip structure also cannot be an
                                           equivalent under the doctrine of equivalents.

                                                                   4VQFS 4PBLFS 1SPCMFN
                                           This is claim 1 from U.S. Patent No.   :
$*7 "   8-  &% 1B
.BS                                        A toy comprising an elongated housing [case] having a
                                                  chamber therein for a liquid [tank], a pump including a
                                                  piston having an exposed rod [piston rod] and extending
                                                  rearwardly of said toy facilitating manual operation for
                                                  building up an appreciable amount of pressure in said
                                                  chamber for ejecting a stream of liquid therefrom an ap-
                                                  preciable distance substantially forwardly of said toy, and
                                                  means for controlling the ejection.
                                           Does the Super Soaker 50 infringe this claim? Note that to use a Su-
                                           per Soaker, one fills it with water through the orange cap at the back
                                           top. Sliding the yellow handle back and forth along the white barrel
                                           pumps air into the green part, along with water. Pulling the trigger
                                           opens a valve that causes the air to press water forward, resulting in
                                           the Super Soaker’s famed superior soaking ability. (Conventional wa-
                                           ter pistols didn’t store up compressed air; they drove water out the
                                           barrel using the force of the trigger pull itself.)
           4VQFS 4PBLFS 

                                           & *OGSJOHFNFOU 1SPIJCJUFE $POEVDU

                                                             )FSNBO W :PVOHTUPXO $BS .GH $P
                                                                     '  UI $JS 
                                           A patent is not the grant of a right to make or use or sell. It does not,
                                           directly or indirectly, imply any such right. It grants only the right to
                                           exclude others. The supposition that a right to make is created by the
                                           patent grant is obviously inconsistent with the well-known fact that a
                                           very considerable portion of the patents granted are in a field covered
                                           by a former relatively generic or basic patent, are tributary to such
                                           earlier patent, and cannot be practiced unless by license thereunder.

                                                %JSFDU *OGSJOHFNFOU
                                           It is typically said that patent infringement is ”strict liability.” That
                                           is, ”It is, of course, elementary, that an infringement may be entirely
4VQQ  %%$ 
& */'3*/(&.&/5 130)*#*5&% $0/%6$5                                   

inadvertent and unintentional and without knowledge of the patent.”
Saurabh Vishnubhakat argues that this is misleading in at least one           "O *OUFOUJPOBM 5PSU 5IFPSZ PG 1BUFOUT 
respect; based on a reading of the (limited) case law, he claims that         'M - 3FW  
one who does not even intend to take the actions described by the
claims is not an infringer, just as someone who is blown into another
by a gust of wind does not commit the tort of ba ery.
    As a corollary, there is no requirement that the defendant copy
from the plaintiff, as there is in trade secret and copyright. ”Similarly,
evidence of copying is of no import on the question of whether the            %FQVZ 4QJOF *OD W .FEUSPOJD 4PGBNPS
claims of an issued patent are infringed, either literally or by equiva-      %BOFL *OD  'E  'FE $JS

                               1BUFOU "DU

(a)   Except as otherwise provided in this title, whoever without au-          64$ f 
      thority makes, uses, offers to sell, or sells any patented inven-        *OGSJOHFNFOU PG QBUFOU
      tion, within the United States or imports into the United States
      any patented invention during the term of the patent therefor,
      infringes the patent.

                             #MB[FS W F#BZ *OD
    /P $7,0#  8-  /% "MB .BS  
Carpenter Bee Solutions, of which Mr. Blazer is the sole proprietor,
is the owner of United States Patent No.    entitled “Carpen-
ter Bee Traps.” Mr. Blazer originally contacted eBay about products
listed on the site he believed infringed his patent.
    eBay is an online marketplace. On an average day, just south of
a billion items are listed for sale on the website. eBay does not take
physical possession of the items listed for sale; the third-party sellers
conduct sales and shipping the item to buyers. A seller listing an
item on eBay provides the item’s price and description. eBay does
not supply this information. When a user creates a listing on eBay’s
site, the listing identifies the user as the seller of the item. eBay buyers
commonly interact with sellers rather than eBay itself. eBay informs
users that other users, and not the company, are the seller of listed
items. eBay’s User Agreement emphasizes that when a sale occurs
via the site, “the actual contract for sale is directly between the seller
and buyer. eBay is not a traditional auctioneer.”                                            #FF USBQ
    For a “sale” within the meaning of § 271(a) to occur, a transfer
of property or title must occur. In his response, Mr. Blazer concedes
that eBay does not “sell” the allegedly infringing bee traps. Therefore,
eBay cannot be liable under § 271(a) for selling a patented invention.
    An “offer to sell” under § 271(a) is given the same meaning as in
contract law. An entity “offers to sell” a patented invention when it
                                                                                           $)"15&3  1"5&/5

                                          communicates a manifestation of willingness to enter into a bargain,
                                          so made as to justify another person in understanding that his assent
                                          to the bargain is invited and will conclude the transaction.
                                              Here, eBay’s website contained descriptions of the allegedly in-
                                          fringing products and a price at which the items could be obtained.
                                          As Mr. Blazer observes, eBay tells users that bidding on a product
                                          creates a contract that obligates the bidder to purchase the product.
                                          Undoubtedly, an offer existed. The question is who made the offer.
                                          eBay? The user who created the listing? Both? In this case, the con-
                                          text of an exchange on eBay demonstrates that no reasonable con-
                                          sumer could conclude that by bidding on an eBay listing, he was ac-
                                          cepting an offer from eBay itself.

                                                         5FMFDUSPOJDT 1BDJOH 4ZTUFNT W 7FOUSJUFY *OD
                                                                  'E  'FE $JS 
                                          The language of § 271(a) clearly specifies only the making, using or
                                          selling of a patented invention as infringing activities. All of the other
                                          Ventritex activities that Telectronics complains of – presenting clinical
                                          trial data at a cardiology conference, reporting clinical trial progress
                                          to investors, analysts and journalists, and describing clinical trial re-
                                          sults in a private fund-raising memorandum – fall under the category
4FDUJPO  F QSPWJEFT BO FYFNQUJPO       of dissemination of the data developed for FDA approval. This dis-
GSPN QBUFOU JOGSJOHFNFOU GPS DFSUBJO      closure of clinical trial data cannot, in and of itself, constitute an in-
                                          fringing activity.

                                                   "LBNBJ 5FDIOPMPHJFT *OD W -JNFMJHIU /FUXPSLT *OD
                                                            ' E  'FE $JS  FO CBOD
                                          In 2006, Akamai Technologies, Inc. (”Akamai”) filed a patent in-
                                          fringement action against Limelight alleging infringement of U.S.
                                          Patent No.    which claims methods for delivering content
                                          over the Internet. The case proceeded to trial, at which the parties
                                          agreed that Limelight’s customers – not Limelight – perform the ”tag-
                                          ging” and ”serving” steps in the claimed methods. For example, as
                                          for claim 34 of the ’703 patent, Limelight performs every step save
                                          the ”tagging” step, in which Limelight’s customers tag the content to
                                          be hosted and delivered by Limelight’s content delivery network.
                                              Direct infringement under § 271(a) occurs where all steps of a
                                          claimed method are performed by or a ributable to a single entity.
                                          Where more than one actor is involved in practicing the steps, a court
                                          must determine whether the acts of one are a ributable to the other
                                          such that a single entity is responsible for the infringement. We will
                                          hold an entity responsible for others’ performance of method steps
                                          in two sets of circumstances: (1) where that entity directs or controls
                                          others’ performance, and (2) where the actors form a joint enterprise.
                                              The jury heard substantial evidence from which it could find
& */'3*/(&.&/5 130)*#*5&% $0/%6$5                                 

that Limelight directs or controls its customers’ performance of each
remaining method step, such that all steps of the method are at-
tributable to Limelight. Specifically, Akamai presented substantial
evidence demonstrating that Limelight conditions its customers’ use
of its content delivery network upon its customers’ performance of
the tagging and serving steps, and that Limelight establishes the man-
ner or timing of its customers’ performance. Therefore, Limelight is
liable for direct infringement.


                              1BUFOU "DU

(b) Whoever actively induces infringement of a patent shall be li-           64$ f 
    able as an infringer.                                                   *OGSJOHFNFOU PG QBUFOU
(c) Whoever offers to sell or sells within the United States or im-
    ports into the United States a component of a patented machine,
    manufacture, combination or composition, or a material or ap-
    paratus for use in practicing a patented process, constituting a
    material part of the invention, knowing the same to be espe-
    cially made or especially adapted for use in an infringement of
    such patent, and not a staple article or commodity of commerce
    suitable for substantial noninfringing use, shall be liable as a
    contributory infringer.

                          4 $U  
Neither the Federal Circuit nor respondents dispute the proposition
that liability for inducement must be predicated on direct infringe-
ment. This is for good reason, as our case law leaves no doubt that
inducement liability may arise if, but only if, there is direct infringe-
ment.                                                                       8BUDI UIF EBUFT 5IJT JT GSPN BO FBSMJFS
                                                                            TUBHF PG UIF DBTF *O UIJT  PQJOJPO
    One might think that this simple truth is enough to dispose of
                                                                            UIF 4VQSFNF $PVSU SFWFSTFT B  'FE
this appeal. But the Federal Circuit reasoned that a defendant can          FSBM $JSDVJU PQJOJPO %PFT TFFJOH UIJT
be liable for inducing infringement under § 271(b) even if no one has       IJTUPSZ DIBOHF ZPVS WJFX PG UIF 'FEFSBM
commi ed direct infringement within the terms of § 271(a) (or any           $JSDVJUhT  PQJOJPO PO SFNBOE
other provision of the patent laws), because direct infringement can
exist independently of a violation of these statutory provisions.
    The Federal Circuit’s analysis fundamentally misunderstands
what it means to infringe a method patent. A method patent claims
a number of steps; under this Court’s case law, the patent is not in-
fringed unless all the steps are carried out. This principle follows
ineluctably from what a patent is: the conferral of rights in a particu-
lar claimed set of elements. Each element contained in a patent claim
                                                                              $)"15&3  1"5&/5

                               is deemed material to defining the scope of the patented invention,
                               and a patentee’s rights extend only to the claimed combination of el-
                               ements, and no further.
                                   The Federal Circuit seems to have adopted the view that Limelight
                               induced infringement on the theory that the steps that Limelight and
                               its customers perform would infringe the ‘703 patent if all the steps
                               were performed by the same person. But we have already rejected
                               the notion that conduct which would be infringing in altered circum-
                               stances can form the basis for contributory infringement, and we see
%FFQTPVUI  64     no reason to apply a different rule for inducement. In Deepsouth Pack-
                               ing Co. v. Laitram Corp., a manufacturer produced components of a
                               patented machine and then exported those components overseas to
                               be assembled by its foreign customers. (The assembly by the foreign
                               customers did not violate U.S. patent laws.) In both Deepsouth and
                               this case, the conduct that the defendant induced or contributed to
                               would have been infringing if commi ed in altered circumstances: in
                               Deepsouth if the machines had been assembled in the United States,
                               and in this case if performance of all of the claimed steps had been
                               a ributable to the same person. In Deepsouth, we rejected the pos-
                               sibility of contributory infringement because the machines had not
                               been assembled in the United States, and direct infringement had con-
                               sequently never occurred. Similarly, in this case, performance of all
                               the claimed steps cannot be a ributed to a single person, so direct
                               infringement never occurred. Limelight cannot be liable for inducing
                               infringement that never came to pass.

                                                (MPCBM5FDI "QQMJBODFT *OD W 4&# 4"
                                                          4 $U  
                               [SEB held a U.S. patent on a deep fryer whose exterior surface re-
                               mained cool to the touch. Pentalpha cloned an SEB fryer it purchased
                               in Hong Kong (which did not bear U.S. patent markings). It sold
                               infringing fryers to Sunbeam, Fingerhut, and Montgomery Ward,
                               which resold them in the United States. Pentalpha argued that it did
                               not “induce” these sales under § 271(b) because it did not know about
                               the patent.]
                                   [W]e now hold that induced infringement under § 271(b) requires
                               knowledge that the induced acts constitute patent infringement. We
                               nevertheless affirm the judgment of the Court of Appeals because the
                               evidence was plainly sufficient to support a finding of Pentalpha’s
                               knowledge under the doctrine of willful blindeness, [under which]
                               (1) the defendant must subjectively believe that there is a high prob-
                               ability that a fact exists and (2) the defendant must take deliberate
                               actions to avoid learning of that fact. Pentalpha’s belief that SEB’s
                               fryer embodied advanced technology that would be valuable in the
                               U.S. market is evidenced by its decision to copy all but the cosmetic
& */'3*/(&.&/5 130)*#*5&% $0/%6$5                                  

features of SEB’s fryer. Even more telling is [a Pentalpha executive’s]
decision not to inform the a orney from whom Pentalpha sought a
right-to-use opinion that the product to be evaluated was simply a
knock-off of SEB’s deep fryer.

                  $PNNJM 64" --$ W $JTDP 4ZTUFNT *OD
                            4 $U  
The question the Court confronts today concerns whether a defen-
dant’s belief regarding patent validity is a defense to a claim of in-
duced infringement. It is not.
    Invalidity is an affirmative defense that can preclude enforcement
of a patent against otherwise infringing conduct. An accused in-
fringer can, of course, a empt to prove that the patent in suit is in-
valid; if the patent is indeed invalid, and shown to be so under proper
procedures, there is no liability. That is because invalidity is not a de-
fense to infringement, it is a defense to liability. And because of that
fact, a belief as to invalidity cannot negate the scienter required for
induced infringement.

                       'E  'FE $JS 
In December 1986, three computer engineers at [Lucent’s predeces-
sor] AT&T filed a patent application, which eventually issued as the
Day patent. The patent is generally directed to a method of enter-
ing information into fields on a computer screen without using a key-
board. A user fills in the displayed fields by choosing concurrently
displayed, predefined tools adapted to facilitate the inpu ing of the
information in a particular field, wherein the predefined tools include
an on-screen graphical keyboard, a menu, and a calculator.
    Lucent asserts that certain features of Outlook, Money, and Win-
dows Mobile, when used, practice the methods of claims 19 and 21.
For instance, Outlook includes a calendar tool that allows the user
to enter dates in a form when preparing a record of an appointment.
The tool displays a monthly calendar as a grid of numbered dates,
along with graphical controls that allow the user to scroll to adja-
cent months or skip directly to a different month and year. Once the
user defines a date with the tool, the software enters the numerical
day, month, and year into the corresponding field in the appointment
form. Similar to the number pad tool illustrated in the Day patent,
Outlook’s calendar date-picker tool enables the user to select a series
of numbers, corresponding to the day, month, and year, using graph-
ical controls. This date-picker calendar tool is incorporated in a few
of Outlook’s features. Microsoft Money and Windows Mobile have
similar functionalities.
                                                                                        $)"15&3  1"5&/5

                                           According to Microsoft, Lucent did not prove contributory in-
                                       fringement [under § 271(c)] because the products have substantial
                                       noninfringing uses. Lucent counters that the date-picker tool does
                                       not have any noninfringing uses. Thus, as framed by the parties, the
                                       main issue reduces to whether the “material or apparatus” is the en-
                                       tire software package or just the particular tool (e.g., the calendar
                                       date-picker) that performs the claimed method. If the former, then
                                       Microsoft prevails because the entire software package has substan-
                                       tial noninfringing uses. If the material or apparatus is the specific
                                       date-picker tool, then Lucent wins because that tool was “especially
                                       made or especially adapted for” practicing the claimed method.
                                           One example illustrates the problem with Microsoft’s approach.
                                       Consider a software program comprising five – and only five – fea-
                                       tures. Each of the five features is separately and distinctly patented
                                       using a method claim. That is, the first feature infringes a method
                                       claim in a first patent, the second feature infringes a method claim
                                       in a second patent, and so forth. Assume also that the company sell-
                                       ing the software doesn’t provide specific instructions on how to use
                                       the five features, thus taking potential liability outside the realm of
                                       § 271(b). In this scenario, under Microsoft’s position, the software
                                       seller can never be liable for contributory infringement of any one of
                                       the method patents because the entire software program is capable of
                                       substantial noninfringing use. This seems both untenable as a prac-
                                       tical outcome and inconsistent with both the statute and governing
                                           Similarly, if, instead of selling Outlook with the date-picker, Mi-
                                       crosoft had offered the date-picker for sale as a separate download
                                       to be used with Outlook, there would be li le dispute that Microsoft
                                       was contributing to infringement of the Day patent.
)PEPTI  'E  'FE $JS        In Hodosh v. Block Drug Co., the patent at issue claimed “a method
                                       for desensitizing teeth with a composition containing an alkali metal
                                       nitrate.” The accused infringer sold toothpaste, e.g., “Sensodyne-F,”
                                       containing potassium nitrate, an alkali metal nitrate. The accused
                                       infringer argued that the sale of the toothpaste, which itself was not
                                       patented, could not constitute contributory infringement because the
                                       toothpaste contained a staple article, i.e., potassium nitrate. The court
                                       rejected this argument. While potassium nitrate, when sold in bulk
                                       form, was “a staple article or commodity of commerce suitable for
                                       substantial noninfringing use,” it was suitable only for the infringing
                                       use when sold as an ingredient in the toothpaste specially made to
                                       perform the patented method of desensitizing teeth.
                                           Here, the infringing feature for completing the forms, i.e., the
                                       date-picker tool, is suitable only for an infringing use. Inclusion of
                                       the date-picker feature within a larger program does not change the
                                       date-picker’s ability to infringe. Because Microsoft included the date-
' %&'&/4&4                                                            

picker tool in Outlook, the jury could reasonably conclude, based on
the evidence presented, that Microsoft intended computer users to
use the tool—perhaps not frequently—and the only intended use of
the tool infringed the Day patent.

    1. Suppose that the Plano Bait Shop is selling empty open-topped
       rectangular aluminum boxes, with a length slightly less than the
       width of a bait box, lips at each end that are the right shape to at-
       tach to the top edges of a bait box, and a detachable plastic cover.
       Some buyers take the boxes, fill them with sharp-grained sand,
       and use it to immobilize earthworms. Others take the boxes
       and fill them with fish hooks, washcloths, or other items. Who,
       if anyone, is infringing on the Lukehart patent? Does it ma er
       if Plano includes instructions with the boxes explaining how to
       fill them with sand to immobilize earthworms?


                          4 $U  
Under § 282 of the Patent Act of 1952, ”[a] patent shall be presumed
valid” and ”[t]he burden of establishing invalidity of a patent or any
claim thereof shall rest on the party asserting such invalidity.” We
consider whether § 282 requires an invalidity defense to be proved
by clear and convincing evidence. We hold that it does.


                            4 $U  
When a patentee sells one of its products, the patentee can no longer
control that item through the patent laws – its patent rights are said
to “exhaust.” The purchaser and all subsequent owners are free to
use or resell the product just like any other item of personal property,
without fear of an infringement lawsuit.
    We conclude that a patentee’s decision to sell a product exhausts
all of its patent rights in that item, regardless of any restrictions the
patentee purports to impose.
                                               $)"15&3  1"5&/5

The underlying dispute in this case is about laser printers – or,
more specifically, the cartridges that contain the powdery substance,
known as toner, that laser printers use to make an image appear on
paper. Respondent Lexmark designs, manufactures, and sells toner
cartridges to consumers in the United States and around the globe. It
owns a number of patents that cover components of those cartridges
and the manner in which they are used.
    When toner cartridges run out of toner they can be refilled and
used again. This creates an opportunity for other companies – known
as remanufacturers – to acquire empty Lexmark cartridges from pur-
chasers in the United States and abroad, refill them with toner, and
then resell them at a lower price than the new ones Lexmark puts on
the shelves.
    Not blind to this business problem, Lexmark structures its sales in
a way that encourages customers to return spent cartridges. It gives
purchasers two options: One is to buy a toner cartridge at full price,
with no strings a ached. The other is to buy a cartridge at roughly
20–percent off through Lexmark’s “Return Program.” A customer
who buys through the Return Program still owns the cartridge but,
in exchange for the lower price, signs a contract agreeing to use it
only once and to refrain from transferring the empty cartridge to
anyone but Lexmark. To enforce this single-use/no-resale restriction,
Lexmark installs a microchip on each Return Program cartridge that
prevents reuse once the toner in the cartridge runs out.
    Lexmark’s strategy just spurred remanufacturers to get more cre-
ative. Many kept acquiring empty Return Program cartridges and de-
veloped methods to counteract the effect of the microchips. With that
technological obstacle out of the way, there was li le to prevent the
remanufacturers from using the Return Program cartridges in their
resale business. After all, Lexmark’s contractual single-use/no-resale
agreements were with the initial customers, not with downstream
purchasers like the remanufacturers.
    Lexmark, however, was not so ready to concede that its plan had
been foiled. In 2010, it sued a number of remanufacturers, including
petitioner Impression for patent infringement with respect to Return
Program cartridges. Lexmark argued that, because it expressly pro-
hibited reuse and resale of these cartridges, the remanufacturers in-
fringed the Lexmark patents when they refurbished and resold them.
    Eventually, the lawsuit was whi led down to one defendant, Im-
pression Products, and one defense: that Lexmark’s sales exhausted
its patent rights in the cartridges, so Impression Products was free to
refurbish and resell them.
' %&'&/4&4                                                           

We conclude that Lexmark exhausted its patent rights in Return Pro-
gram cartridges the moment it sold them. The single-use/no-resale re-
strictions in Lexmark’s contracts with customers may have been clear
and enforceable under contract law, but they do not entitle Lexmark
to retain patent rights in an item that it has elected to sell.
    The Patent Act grants patentees the “right to exclude others from
making, using, offering for sale, or selling [their] invention[s].” 35
U.S.C. § 154(a). For over 160 years, the doctrine of patent exhaustion
has imposed a limit on that right to exclude. The limit functions au-
tomatically: When a patentee chooses to sell an item, that product
is no longer within the limits of the monopoly and instead becomes
the private, individual property of the purchaser, with the rights and
benefits that come along with ownership. A patentee is free to set the
price and negotiate contracts with purchasers, but may not, by virtue
of his patent, control the use or disposition”of the product after own-
ership passes to the purchaser.
    This well-established exhaustion rule marks the point where
patent rights yield to the common law principle against restraints on
alienation. The Patent Act promotes the progress of science and the
useful arts by granting to inventors a limited monopoly that allows
them to secure the financial rewards for their inventions. But once
a patentee sells an item, it has enjoyed all the rights secured by that
limited monopoly. Because the purpose of the patent law is fulfilled
when the patentee has received his reward for the use of his invention,
that law furnishes no basis for restraining the use and enjoyment of
the thing sold.
    We have explained in the context of copyright law that exhaustion
has “an impeccable historic pedigree,” tracing its lineage back to the
“common law’s refusal to permit restraints on the alienation of chat-
tels.” Kirtsaeng v. John Wiley & Sons, Inc.. As Lord Coke put it in the       ,JSUTBFOH *  64  
17th century, if an owner restricts the resale or use of an item after
selling it, that restriction “is voide, because ... it is against Trade and
Traffique, and bargaining and contracting betweene man and man.”
1 E. Coke, Institutes of the Laws of England (1628); see J. Gray, Re-         $PLF f  Q 
straints on the Alienation of Property (2d ed. 1895) (“A condition or         (SBZ f  Q 
conditional limitation on alienation a ached to a transfer of the en-
tire interest in personalty is as void as if a ached to a fee simple in
    This venerable principle is not, as the Federal Circuit dismissively
viewed it, merely “one common-law jurisdiction’s general judicial
policy at one time toward anti-alienation restrictions.” Congress en-
acted and has repeatedly revised the Patent Act against the backdrop
of the hostility toward restraints on alienation. That enmity is re-
flected in the exhaustion doctrine.
    An illustration never hurts. Take a shop that restores and sells
                                                                                  $)"15&3  1"5&/5

                                used cars. The business works because the shop can rest assured
                                that, so long as those bringing in the cars own them, the shop is free
                                to repair and resell those vehicles. That smooth flow of commerce
                                would spu er if companies that make the thousands of parts that go
                                into a vehicle could keep their patent rights after the first sale. Those
                                companies might, for instance, restrict resale rights and sue the shop
                                owner for patent infringement. And even if they refrained from im-
                                posing such restrictions, the very threat of patent liability would force
                                the shop to invest in efforts to protect itself from hidden lawsuits. Ei-
                                ther way, extending the patent rights beyond the first sale would clog
                                the channels of commerce, with li le benefit from the extra control
                                that the patentees retain. And advances in technology, along with
                                increasingly complex supply chains, magnify the problem. See Brief
                                for Intel Corp. et al. as Amici Curiae (“A generic smartphone assem-
                                bled from various high-tech components could practice an estimated
                                250,000 patents”).
                                    This Court accordingly has long held that, even when a patentee
                                sells an item under an express restriction, the patentee does not re-
#PTUPO 4UPSF  64     tain patent rights in that product. In Boston Store of Chicago v. Ameri-
                                can Graphophone Co., for example, a manufacturer sold graphophones
                                – one of the earliest devices for recording and reproducing sounds –
                                to retailers under contracts requiring those stores to resell at a spe-
                                cific price. When the manufacturer brought a patent infringement
                                suit against a retailer who sold for less, we concluded that there was
                                “no room for controversy” about the result: By selling the item, the
                                manufacturer placed it “beyond the confines of the patent law, and
                                could not, by qualifying restrictions as to use, keep it under the patent
6OJWJT  64         monopoly.” [Similarly in United States v. Univis Lens Co..]
                                    It is true that Boston Store and Univis involved resale price restric-
                                tions that, at the time of those decisions, violated the antitrust laws.
                                But in both cases it was the sale of the items, rather than the illegality
                                of the restrictions, that prevented the patentees from enforcing those
                                resale price agreements through patent infringement suits.
                                    Turning to the case at hand, we conclude that this well-se led line
                                of precedent allows for only one answer: Lexmark cannot bring a
                                patent infringement suit against Impression Products to enforce the
                                single-use/no-resale provision accompanying its Return Program car-
                                tridges. Once sold, the Return Program cartridges passed outside of
                                the patent monopoly, and whatever rights Lexmark retained are a
                                ma er of the contracts with its purchasers, not the patent law.
                                The Federal Circuit reached a different result largely because it got
                                off on the wrong foot. The “exhaustion doctrine,” the court believed,
                                “must be understood as an interpretation of” the infringement statute,
' %&'&/4&4                                                          

which prohibits anyone from using or selling a patented article “with-
out authority” from the patentee. Exhaustion reflects a default rule
that a patentee’s decision to sell an item “presumptively grants ‘au-
thority’ to the purchaser to use it and resell it.” But, the Federal Cir-
cuit explained, the patentee does not have to hand over the full “bun-
dle of rights” every time. If the patentee expressly withholds a stick
from the bundle – perhaps by restricting the purchaser’s resale rights
– the buyer never acquires that withheld authority, and the patentee
may continue to enforce its right to exclude that practice under the
patent laws.
    The misstep in this logic is that the exhaustion doctrine is not a
presumption about the authority that comes along with a sale; it is
instead a limit on the scope of the patentee’s rights. The right to use,
sell, or import an item exists independently of the Patent Act. What
a patent adds – and grants exclusively to the patentee – is a limited
right to prevent others from engaging in those practices. As a result,
the sale transfers the right to use, sell, or import because those are the
rights that come along with ownership, and the buyer is free and clear
of an infringement lawsuit because there is no exclusionary right left
to enforce.
    The Federal Circuit also expressed concern that preventing paten-
tees from reserving patent rights when they sell goods would cre-
ate an artificial distinction between such sales and sales by licensees.
Patentees, the court explained, often license others to make and sell
their products, and may place restrictions on those licenses. A com-
puter developer could, for instance, license a manufacturer to make
its patented devices and sell them only for non-commercial use by in-
dividuals. If a licensee breaches the license by selling a computer for
commercial use, the patentee can sue the licensee for infringement.
If patentees can employ licenses to impose post-sale restrictions on
purchasers that are enforceable through infringement suits, the court
concluded, it would make li le sense to prevent patentees from doing
so when they sell directly to consumers.
    The Federal Circuit’s concern is misplaced. A patentee can im-
pose restrictions on licensees because a license does not implicate the
same concerns about restraints on alienation as a sale. Patent exhaus-
tion reflects the principle that, when an item passes into commerce,
it should not be shaded by a legal cloud on title as it moves through
the marketplace. But a license is not about passing title to a product,
it is about changing the contours of the patentee’s monopoly: The
patentee agrees not to exclude a licensee from making or selling the
patented invention, expanding the club of authorized producers and
sellers. Because the patentee is exchanging rights, not goods, it is free
to relinquish only a portion of its bundle of patent protections.
    A patentee’s authority to limit licensees does not, as the Federal
                                                 $)"15&3  1"5&/5

Circuit thought, mean that patentees can use licenses to impose post-
sale restrictions on purchasers that are enforceable through the patent
laws. So long as a licensee complies with the license when selling an
item, the patentee has, in effect, authorized the sale. That licensee’s
sale is treated, for purposes of patent exhaustion, as if the patentee
made the sale itself. The result: The sale exhausts the patentee’s
rights in that item. A license may require the licensee to impose a
restriction on purchasers, like the license limiting the computer man-
ufacturer to selling for non-commercial use by individuals. But if the
licensee does so – by, perhaps, having each customer sign a contract
promising not to use the computers in business – the sale nonetheless
exhausts all patent rights in the item sold. The purchasers might not
comply with the restriction, but the only recourse for the licensee is
through contract law, just as if the patentee itself sold the item with
a restriction.
    In sum, patent exhaustion is uniform and automatic. Once a
patentee decides to sell – whether on its own or through a licensee
– that sale exhausts its patent rights, regardless of any post-sale re-
strictions the patentee purports to impose, either directly or through
a license.

Respondent LG Electronics, Inc. (LGE), purchased a portfolio of com-
puter technology patents in 1999 [relating to the storage of data in
computer memory.]
    LGE licensed a patent portfolio, including the LGE Patents, to
Intel Corporation (Intel). The cross-licensing agreement (License
Agreement) permits Intel to manufacture and sell microprocessors
and chipsets that use the LGE Patents (the Intel Products). The Li-
cense Agreement authorizes Intel to ”‘make, use, sell (directly or indi-
rectly), offer to sell, import or otherwise dispose of’” its own products
practicing the LGE Patents. Notwithstanding this broad language,
the License Agreement contains some limitations. Relevant here, it
stipulates that no license
      is granted by either party hereto . . . to any third party for
      the combination by a third party of Licensed Products of
      either party with items, components, or the like acquired
      . . . from sources other than a party hereto, or for the use,
      import, offer for sale or sale of such combination.
The License Agreement purports not to alter the usual rules of patent
exhaustion, however, providing that, ”[n]otwithstanding anything to
' %&'&/4&4                                                       

the contrary contained in this Agreement, the parties agree that noth-
ing herein shall in any way limit or alter the effect of patent exhaus-
tion that would otherwise apply when a party hereto sells any of its
Licensed Products.”
    In a separate agreement (Master Agreement), Intel agreed to give
wri en notice to its own customers informing them that, while it had
obtained a broad license ”ensuring that any Intel product that you
purchase is licensed by LGE and thus does not infringe any patent
held by LGE,” the license ”does not extend, expressly or by implica-
tion, to any product that you make by combining an Intel product
with any non-Intel product.” The Master Agreement also provides
that ”a breach of this Agreement shall have no effect on and shall not
be grounds for termination of the Patent License.”
    Petitioners, including Quanta Computer (collectively Quanta),
are a group of computer manufacturers. Quanta purchased micro-
processors and chipsets from Intel and received the notice required
by the Master Agreement. Nonetheless, Quanta manufactured com-
puters using Intel parts in combination with non-Intel memory and
buses in ways that practice the LGE Patents. Quanta does not modify
the Intel components and follows Intel’s specifications to incorporate
the parts into its own systems.
LGE argues that the exhaustion doctrine is inapplicable here because
it does not apply to method claims, which are contained in each of the
LGE Patents. LGE reasons that, because method patents are linked
not to a tangible article but to a process, they can never be exhausted
through a sale. Rather, practicing the patent – which occurs upon
each use of an article embodying a method patent – is permissible
only to the extent rights are transferred in an assignment contract.
Quanta, in turn, argues that there is no reason to preclude exhaustion
of method claims, and points out that both this Court and the Federal
Circuit have applied exhaustion to method claims. It argues that any
other rule would allow patent holders to avoid exhaustion entirely
by inserting method claims in their patent specifications.
    Quanta has the be er of this argument. Nothing in this Court’s ap-
proach to patent exhaustion supports LGE’s argument that method
patents cannot be exhausted. It is true that a patented method may
not be sold in the same way as an article or device, but methods
nonetheless may be ”embodied” in a product, the sale of which ex-
hausts patent rights. Our precedents do not differentiate transac-
tions involving embodiments of patented methods or processes from
those involving patented apparatuses or materials. To the contrary,
                                                                                             $)"15&3  1"5&/5

                                    this Court has repeatedly held that method patents were exhausted
&UIZM (BTPMJOF  64     by the sale of an item that embodied the method. In Ethyl Gasoline
                                    Corp. v. United States, for example, the Court held that the sale of
                                    a motor fuel produced under one patent also exhausted the patent
                                    for a method of using the fuel in combustion motors.4 Similarly, Uni-
                                    vis held that the sale of optical lens blanks that partially practiced a
                                    patent exhausted the method patents that were not completely prac-
                                    ticed until the blanks were ground into lenses.
                                        These cases rest on solid footing. Eliminating exhaustion for
                                    method patents would seriously undermine the exhaustion doctrine.
                                    Patentees seeking to avoid patent exhaustion could simply draft their
                                    patent claims to describe a method rather than an apparatus. Appa-
                                    ratus and method claims may approach each other so nearly that it
                                    will be difficult to distinguish the process from the function of the
                                    apparatus. By characterizing their claims as method instead of appa-
                                    ratus claims, or including a method claim for the machine’s patented
                                    method of performing its task, a patent drafter could shield practi-
                                    cally any patented item from exhaustion.
                                        This case illustrates the danger of allowing such an end-run
                                    around exhaustion. On LGE’s theory, although Intel is authorized
                                    to sell a completed computer system that practices the LGE Patents,
                                    any downstream purchasers of the system could nonetheless be liable
                                    for patent infringement. Such a result would violate the longstand-
                                    ing principle that, when a patented item is once lawfully made and
                                    sold, there is no restriction on its use to be implied for the benefit of
                                    the patentee.
                                    We next consider the extent to which a product must embody a patent
                                    in order to trigger exhaustion. Quanta argues that, although sales of
                                    an incomplete article do not necessarily exhaust the patent in that ar-
                                    ticle, the sale of the microprocessors and chipsets exhausted LGE’s
                                    patents in the same way the sale of the lens blanks exhausted the
                                    patents in Univis. Just as the lens blanks in Univis did not fully prac-
                                    tice the patents at issue because they had not been ground into fin-
                                    ished lenses, Quanta observes, the Intel Products cannot practice the
                                    LGE Patents – or indeed, function at all – until they are combined
                                    with memory and buses in a computer system. If, as in Univis, patent
                                    rights are exhausted by the sale of the incomplete item, then LGE has
                                        The patentee held patents for (1) a fluid additive increasing gasoline efficiency,
                                    (2) motor fuel produced by mixing gasoline with the patented fluid, and (3) a
                                    method of using fuel containing the patented fluid in combustion motors. The
                                    patentee sold only the fluid, but a empted to control sales of the treated fuel. The
                                    Court held that the sale of the fluid to refiners relinquished the patentee’s exclusive
                                    rights to sell the treated fuel.
' %&'&/4&4                                                         

no postsale right to require that the patents be practiced using only In-
tel parts. Quanta also argues that exhaustion doctrine will be a dead
le er unless it is triggered by the sale of components that essentially,
even if not completely, embody an invention. Otherwise, patent hold-
ers could authorize the sale of computers that are complete with the
exception of one minor step – say, inserting the microprocessor into a
socket – and extend their rights through each downstream purchaser
all the way to the end user.
    We agree with Quanta that Univis governs this case. As the Court
there explained, exhaustion was triggered by the sale of the lens
blanks because their only reasonable and intended use was to prac-
tice the patent and because they ”embodie[d] essential features of
[the] patented invention.” Each of those a ributes is shared by the
microprocessors and chipsets Intel sold to Quanta under the License
Having concluded that the Intel Products embodied the patents, we
next consider whether their sale to Quanta exhausted LGE’s patent
rights. Exhaustion is triggered only by a sale authorized by the patent
    LGE argues that there was no authorized sale here because the
License Agreement does not permit Intel to sell its products for use
in combination with non-Intel products to practice the LGE Patents.
LGE overlooks important aspects of the structure of the Intel-LGE
transaction. Nothing in the License Agreement restricts Intel’s right
to sell its microprocessors and chipsets to purchasers who intend to
combine them with non-Intel parts. It broadly permits Intel to ”make,
use, [or] sell” products free of LGE’s patent claims. To be sure, LGE
did require Intel to give notice to its customers, including Quanta,
that LGE had not licensed those customers to practice its patents.
But neither party contends that Intel breached the agreement in that
respect. In any event, the provision requiring notice to Quanta ap-
peared only in the Master Agreement, and LGE does not suggest that
a breach of that agreement would constitute a breach of the License
Agreement. Hence, Intel’s authority to sell its products embodying
the LGE Patents was not conditioned on the notice or on Quanta’s
decision to abide by LGE’s directions in that notice.

                           "LUJFCPMBH W &+ $P
                        'E  'FE $JS 
The facts in this case are not in dispute. The patents in suit [  
and   ] are directed to a drill with a shank portion and a
unique carbide tip geometry that has specially configured cu ing
edges resulting in a drill suitable for high-feed machining with im-
                                                 $)"15&3  1"5&/5

proved cu ing ability especially at its center portion. The drill tip is
not separately patented.

    As illustrated in the above drawings from the ’690 patent, the drill
has a tip (1), shank portion (2), twisted grooves (3), projections (4)
(these projections bend and break the chips to render them smoothly
removable) and a conical end having a center point (11) at the apex of
the cone and a pair of cu ing edges (10). The drill shank (2) is made
of medium carbon steel. The drill tip (1) is made of a more durable
carbide and is brazed to the steel shank (2). Brazing is like soldering
but with a much higher melting point. It requires a temperature of
1300 degrees Fahrenheit to join the carbide tip to the steel shank.
    Sandvik manufactures a commercial embodiment of the patented
drill. Although made of durable carbide, over time and use, the drill
tip dulls and may require resharpening. Resharpening, also known
as regrinding, involves pu ing a new edge on the drill tip. Normally,
the drill can cut through about one thousand inches of material before
needing resharpening, depending, of course, upon the hardness of
the material being cut. Sandvik expects the drill tip to be resharpened
and, in fact, issues guidelines explaining how to resharpen the tip so
as to maintain the specially configured cu ing edges. Sandvik does
not contend that resharpening constitutes infringement.
    E.J. offers a drill repair service which includes resharpening and
retipping Sandvik drills. E.J. retips, at the request of its customers,
when the tip cannot be sharpened because it chips, cracks or simply
wears down after being resharpened several times. According to E.J’s
vice-president, Mr. Robert Hayes, some of E.J.’s customers elect not
to have the drill retipped when it cannot be resharpened any longer.
E.J. returns the drill to the customer or disposes of it at the customer’s
request. The parties agree that when the tip is damaged (i.e. chipped,
cracked or sufficiently worn down so that it cannot be resharpened),
' %&'&/4&4                                                           

the drill has reached the end of its useful life unless it is retipped.
    E.J.’s retipping process includes removing the worn or damaged
tip by heating the tip to 1300 degrees Fahrenheit using an acetylene
torch. E.J. then brazes in a rectangular piece of new carbide onto
the drill shank. After the piece of carbide has cooled, E.J. recreates
the patented geometry of the cu ing edges by machining the carbide.
This process includes: (1) grinding the carbide to the proper outside
diameter; (2) grinding the carbide to a point; (3) grinding the rake
surfaces of the new point; (4) grinding the center of the new point;
and (5) honing the edges. In the final steps of the machining process,
E.J. creates the cu ing edges by following Sandvik’s instructions for
tip resharpening.
    Sandvik claims that E.J.’s retipping service constitutes an infring-
ing reconstruction of its patented drills. Sandvik does not manufac-
ture or sell replacement drill tips. It contends that it never intended
for the drills to be retipped. E.J. contends that its retipping service is
a lawful repair of the patented drills.
    Direct infringement includes the making of a patented article
without authority. 35 U.S.C. § 271(a) (1994). Sandvik contends that
E.J. is reconstructing its patented drill and therefore infringing its ’690
and ’162 patents under § 271(a). However, when Sandvik sold its
patented drills to its customers, it granted them an implied license
to use the drill for its useful life, see Aro Mfg. Co. v. Convertible Top     "SP **  64  
Replacement Co. (”Aro II”), and the implied license to use includes the
right to repair the patented drill.
    The Supreme Court has taken an expansive view of what consti-
tutes a permissible repair. In Aro Mfg. Co. v. Convertible Top Re-            "SP *  64  
placement Co. (”Aro I”), the Court held that the replacement of the
fabric portion of a convertible car top was a permissible repair, not
an infringing reconstruction. The Court held: ”No element, not itself
separately patented, that constitutes one of the elements of a combina-
tion patent is entitled to patent monopoly, however essential it may
be to the patented combination and no ma er how costly or difficult
replacement may be.” Therefore, even if E.J.’s retipping service cost
almost as much as the drill or if the replacement of the tip is difficult
and time consuming, as in this case, these factors are not dispositive
of reconstruction.
    The Court also rejected the ”heart of the invention test.” See id.
(holding that replacement of the distinguishing part of the patented
combination does not amount to a reconstruction because a patent
covers the totality of the elements in a combination). Therefore, the
fact that E.J. may be replacing the novel features of the ’690 patented
invention is also not dispositive of reconstruction.
    In Aro I, the Supreme Court further explained the test for what
constitutes a reconstruction: ”The decisions of this Court require the
                                                                            $)"15&3  1"5&/5

                           conclusion that reconstruction of a patented entity, comprised of un-
                           patented elements, is limited to such a true reconstruction of the en-
                           tity as to ‘in fact make a new article,’ after the entity, viewed as a
                           whole, has become spent.” Although we question the district court’s
                           finding that the tip is, in fact, a separate part of the device, we need
                           not reach this issue because the court nevertheless failed to analyze
                           whether the replacement of this ”part” constituted reconstruction
                           consistent with Aro I.
                               There are a number of factors to consider in determining whether
                           a defendant has made a new article, after the device has become spent,
                           including the nature of the actions by the defendant, the nature of the
                           device and how it is designed (namely, whether one of the compo-
                           nents of the patented combination has a shorter useful life than the
                           whole), whether a market has developed to manufacture or service
                           the part at issue and objective evidence of the intent of the patentee.
                           Under the totality of the circumstances, we hold in this case that E.J.’s
                           actions are a reconstruction.
                               By E.J.’s own admission, the drill is ”spent” when the tip can no
                           longer be resharpened unless it is retipped. In fact, the record reveals
                           that E.J.’s customers may elect not to retip and inform E.J. to discard
                           the drill instead.
                               Moreover, the nature of the work done by E.J. shows that retip-
                           ping is more like reconstruction than repair. E.J. does not just a ach
                           a new part for a worn part, but rather must go though several steps
                           to replace, configure and integrate the tip onto the shank. It has to
                           break the worn or damaged tip from the shank by heating it to 1300
                           degrees Fahrenheit. It brazes to the shank a new rectangular block of
                           carbide and grinds and machines it to the proper diameter and cre-
                           ates the point. Thereafter, the tip is honed and sharpened, grinding
                           the rake surfaces and the center of the point and honing the edges.
                           These actions are effectively a re-creation of the patented invention
                           after it is spent.
                               This is not a case where it is clear that the patented device has
                           a useful life much longer than that of certain parts which wear out
8JMTPO  64     quickly. For example, in Wilson v. Simpson, in determining that a re-
                           pair had occurred, the Supreme Court focused specifically on the fact
                           that the machine was designed so that the knives had to be replaced
                           long before the other components:
                                 The proof in the case, is, that one of [the patentee’s] ma-
                                 chines, properly made, will last in use for several years,
                                 but that its cu ing-knives will wear out and must be re-
                                 placed at least every sixty or ninety days. [If such a] part
                                 of the combination is meant to be only temporary in the
                                 use of the whole, and to be frequently replaced, because it
' %&'&/4&4                                                           

      will not last as long as the other parts of the combination,
      its inventor cannot complain.
See also Aro I (noting that the fabric had a much shorter expected life
(about three years) than the convertible car top); Porter v. Farmer Sup-      1PSUFS  'E  'FE $JS 
ply Serv., Inc. (”The useful life of a disk is measured in weeks, that of a
harvester is five or six years. The district court found, and it is undis-
puted, that a purchaser can expect to wear out many disks during the
useful life of the header.”).
    The drill tip in this case is not a part like the detachable knives in
the Wilson that have to be replaced periodically over the useful life
of the planing machine. The drill tip was not manufactured to be a
replaceable part, although it could be resharpened a number of times
to extend its life. It was not intended or expected to have a life of
temporary duration in comparison to the drill shank. And finally, the
tip was not a ached to the shank in a manner to be easily detachable.
    In Aro I, the Supreme Court also noted that ”the consequent de-
mand for replacement fabrics has given rise to a substantial indus-
try.” Evidence of development in the industry could also be a factor
tending to prove that there is a reasonable expectation that the part
of the patented combination wears out quickly and requires frequent
replacement. In this case, there is no evidence of a substantial mar-
ket for drill retipping of the sort required for the Sandvik drill. There
is no evidence of large numbers of customers retipping these drills
or of companies (other than E.J.) offering to retip these drills. No
one manufactures replacement tips for Sandvik’s drill and although
some customers opt to retip the drill only a small percentage of all
drills manufactured are retipped.
    Finally, there was no intent evidenced by the patentee that would
support E.J.’s argument that replacement of the tips is a repair. See
Sage Products (evidence that patentee intended the inner containers
to be replaced, that it manufactures replacement parts and instructs
customers to replace supports holding such replacement a permis-
sible repair); Porter (considering that the patentee sold replacement
cu ing disks for its tomato harvester). The evidence shows that Sand-
vik never intended for its drills to be retipped. It did not manufacture
or sell replacement drill tips. It did not publish instructions on how
to retip its patented drills or suggest that the drills could or should be
retipped. Sandvik was aware that the drill tip would need occasional
resharpening and instructed its customer on how to resharpen the
tip. There is, therefore, no objective evidence that Sandvik’s drill tip
was intended to be a replaceable part. Although the repair or recon-
struction issue does not turn on the intention of the patentee alone,
the fact that no replacement drill tips have ever been made or sold by
the patentee is consistent with the conclusion that replacement of the
                                                                                           $)"15&3  1"5&/5

                                           carbide tip is not a permissible repair.
                                               Although there is no bright-line test for determining whether re-
                                           construction or repair has occurred, we conclude based on all of the
                                           facts in this case that E.J. is reconstructing an otherwise spent device
                                           when it retips Sandvik’s drills. Accordingly, we hold that E.J.’s drill
                                           tip replacements infringe the ’690 and ’162 patents.


                                                                         1BUFOU "DU

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                                           A person shall be entitled to a defense under section 282(b) with
%FGFOTF UP JOGSJOHFNFOU CBTFE PO QSJPS     respect to subject ma er consisting of a process, or consisting of a
DPNNFSDJBM VTF                             machine, manufacture, or composition of ma er used in a manufac-
                                           turing or other commercial process, that would otherwise infringe a
                                           claimed invention being asserted against the person if –
&WFO UIPVHI UIPVTBOET PG QBUFOU DBTFT       (1) such person, acting in good faith, commercially used the sub-
BSF öMFE FWFSZ ZFBS UIF QSJPS VTF EF            ject ma er in the United States, either in connection with an
                                                 internal commercial use or an actual arm’s length sale or other
                                                 arm’s length commercial transfer of a useful end result of such
                                                 commercial use; and
                                            (2) such commercial use occurred at least 1 year before the earlier
                                                 of either—
                                                (A) the effective filing date of the claimed invention; or
                                                (B) the date on which the claimed invention was disclosed to
                                                       the public in a manner that qualified for the exception from
                                                       prior art under section 102(b).

                                                                  .BEFZ W %VLF 6OJWFSTJUZ
                                                                  'E  'FE $JS 
                                           [Madey owned a patent on certain laser technology. Duke practiced
                                           the patent as part of a research project under a federally funded
                                               Madey argues, and we agree, that the district court had an overly
                                           broad conception of the very narrow and strictly limited experimen-
                                           tal use defense. The district court stated that the experimental use
                                           defense inoculated uses that ”were solely for research, academic, or
                                           experimental purposes,” and that the defense covered use that ”is
                                           made for experimental, non-profit purposes only.” Both formulations
                                           are too broad and stand in sharp contrast to our admonitions in Em-
                                           brex and Roche that the experimental use defense is very narrow and
&NCSFY  ' E                      strictly limited. In Embrex, Inc. v. Service Engineering Corp, we held
                                           that the defense was very narrow and limited to actions performed
' %&'&/4&4                                                         

”for amusement, to satisfy idle curiosity, or for strictly philosophical
inquiry.” Further, use does not qualify for the experimental use de-
fense when it is undertaken in the ”guise of scientific inquiry” but has
”definite, cognizable, and not insubstantial commercial purposes.”
    Our precedent clearly does not immunize use that is in any way
commercial in nature. Similarly, our precedent does not immunize
any conduct that is in keeping with the alleged infringer’s legitimate
business, regardless of commercial implications. For example, major
research universities, such as Duke, often sanction and fund research
projects with arguably no commercial application whatsoever. How-
ever, these projects unmistakably further the institution’s legitimate
business objectives, including educating and enlightening students
and faculty participating in these projects. These projects also serve,
for example, to increase the status of the institution and lure lucrative
research grants, students and faculty.
    In the present case, the district court a ached too great a weight to
the nonprofit, educational status of Duke, effectively suppressing the
fact that Duke’s acts appear to be in accordance with any reasonable
interpretation of Duke’s legitimate business objectives. The correct
focus should not be on the non-profit status of Duke but on the legit-
imate business Duke is involved in and whether or not the use was
solely for amusement, to satisfy idle curiosity, or for strictly philo-
sophical inquiry.
   $)"15&3  1"5&/5


Copyright protects creative expression. In some respects it is struc-     5IF TUBOEBSE DPQZSJHIU USFBUJTFT BSF
turally analogous to patent law: both reward someone who creates          .FMWJMMF # /JNNFS  %BWJE /JNNFS
                                                                          /JNNFS PO $PQZSJHIU .BUUIFX #FO
valuable information with exclusive rights over it. But in many other
                                                                          EFS PO -FYJT  8JMMJBN ' 1BUSZ 1B
respects – including subject ma er, novelty, registration, term, and      USZ PO $PQZSJHIU 5IPNTPO 3FVUFST PO
similarity – copyright is almost completely the opposite of patent.       8FTUMBX  1BVM (PMETUFJO (PMETUFJO PO
    The standard justification for copyright law is a familiar and util-   $PQZSJHIU 8PMUFST ,MVXFS  )PXBSE #
itarian: to maximize public access to the fruits of human creativity.     "CSBNT 5IF -BX PG $PQZSJHIU 5IPN
                                                                          TPO 3FVUFST PO 8FTUMBX  BOE #SVDF
Thus, copyright law provides an economic incentive to create new
                                                                          1 ,FMMFS  +FòSFZ 1 $VOBSE $PQZSJHIU
expressive works, and provides protections to encourage the distri-       -BX " 1SBDUJUJPOFShT (VJEF 1-* 
bution of those works. Another rationale, with more of a natural-law
flavor, is to protect authors’ non-economic rights by giving them cre-
ative control. One sometimes also sees arguments that link copyright
and freedom of speech in a shared goal of creating a diverse society
with a healthy culture and healthy democracy.


                            $PQZSJHIU "DU

Copyright protection subsists, in accordance with this title, in origi-    64$ f  B
nal works of authorship fixed in any tangible medium of expression,        4VCKFDU NBUUFS PG DPQZSJHIU *O HFOFSBM
now known or later developed, from which they can be perceived,
reproduced, or otherwise communicated, either directly or with the
aid of a machine or device. Works of authorship include the follow-
ing categories:
 (1) literary works;
 (2) musical works, including any accompanying words;
 (3) dramatic works, including any accompanying music;
 (4) pantomimes and choreographic works;
 (5) pictorial, graphic, and sculptural works;
                                                                                         $)"15&3  $01:3*()5

                                            (6)    motion pictures and other audiovisual works;
                                            (7)    sound recordings; and
                                            (8)    architectural works.

                                                      'FJTU 1VCMJDBUJPOT *OD W 3VSBM 5FMFQIPOF 4FSWJDF $P
                                            The sine qua non of copyright is originality. To qualify for copyright
                                            protection, a work must be original to the author. Original, as the
                                            term is used in copyright, means only that the work was indepen-
                                            dently created by the author (as opposed to copied from other works),
                                            and that it possesses at least some minimal degree of creativity. To
                                            be sure, the requisite level of creativity is extremely low; even a slight
                                            amount will suffice. The vast majority of works make the grade quite
                                            easily, as they possess some creative spark, no ma er how crude,
                                            humble or obvious it might be. Originality does not signify novelty;
                                            a work may be original even though it closely resembles other works
                                            so long as the similarity is fortuitous, not the result of copying. To il-
                                            lustrate, assume that two poets, each ignorant of the other, compose
                                            identical poems. Neither work is novel, yet both are original and,
                                            hence, copyrightable.

                                            Elsewhere, Feist helpfully expresses the elements of originality as ”in-
                                            dependent creation plus a modicum of creativity.” The second prong
8F XJMM SFUVSO UP JOEFQFOEFOU DSFBUJPO      is the subject (pun intended) of this section. First, we look at it as
JO UIF 0XOFSTIJQ TFDUJPO                   a threshold test: when are works uncopyrightable because they are
                                            uncreative? Then, we ask whether it expresses any exclusions from
                                            copyrightability. In one sense, no: courts are not to inquire into a
                                            work’s quality or morality. In another sense, yes: ”ideas” are re-
                                            garded as uncopyrightable, even if they are original.

                                                 $SFBUJWJUZ )PX .VDI *T B .PEJDVN

                                                                  $PEF PG 'FEFSBM 3FHVMBUJPOT

 $'3 f                            The following are examples of works not subject to copyright and
.BUFSJBM OPU TVCKFDU UP DPQZSJHIU           applications for registration of such works cannot be entertained:
5IF DIJFG TJNJMBSJUZ CFUXFFO UIF UXP        (a) Words and short phrases such as names, titles, and slogans; fa-
                                                 miliar symbols or designs; mere variations of typographic orna-
DPQZSJHIU PG B CPPL PS QMBZ EPFT OPU             mentation, le ering or coloring; mere listing of ingredients or
-PFXhT *OD  'E  UI $JS 
" 46#+&$5 ."55&3                                                    

(d) Works consisting entirely of information that is common prop-
    erty containing no original authorship, such as, for example:
    Standard calendars, height and weight charts, tape measures
    and rulers, schedules of sporting events, and lists or tables taken
    from public documents or other common sources.

This case requires us to clarify the extent of copyright protection avail-
able to telephone directory white pages.
Rural Telephone Service Company, Inc., is a certified public utility
that provides telephone service to several communities in northwest
Kansas. It is subject to a state regulation that requires all telephone
companies operating in Kansas to issue annually an updated tele-
phone directory. Accordingly, as a condition of its monopoly fran-
chise, Rural publishes a typical telephone directory, consisting of
white pages and yellow pages. The white pages list in alphabeti-
cal order the names of Rural’s subscribers, together with their towns
and telephone numbers. The yellow pages list Rural’s business sub-
scribers alphabetically by category and feature classified advertise-
ments of various sizes. Rural distributes its directory free of charge
to its subscribers, but earns revenue by selling yellow pages adver-
    [Feist published a telephone directory, containing both white and
yellow pages, covering a much larger geographic area. It contained
46,878 white-pages listings. Feist requested a license to Rural’s list-
ings; Rural refused.]
    Unable to license Rural’s white pages listings, Feist used them
without Rural’s consent. Feist began by removing several thousand
listings that fell outside the geographic range of its area-wide di-
rectory, then hired personnel to investigate the 4,935 that remained.
These employees verified the data reported by Rural and sought to
obtain additional information. As a result, a typical Feist listing in-
cludes the individual’s street address; most of Rural’s listings do not.
Notwithstanding these additions, however, 1,309 of the 46,878 list-
ings in Feist’s 1983 directory were identical to listings in Rural’s 1982-
1983 white pages. Four of these were fictitious listings that Rural had
inserted into its directory to detect copying.
    Rural sued for copyright infringement in the District Court for the
District of Kansas taking the position that Feist, in compiling its own
directory, could not use the information contained in Rural’s white
pages. Rural asserted that Feist’s employees were obliged to travel
                                                                                     $)"15&3  $01:3*()5

                                        door-to-door or conduct a telephone survey to discover the same in-
                                        formation for themselves. Feist responded that such efforts were eco-
                                        nomically impractical and, in any event, unnecessary because the in-
                                        formation copied was beyond the scope of copyright protection. The
                                        District Court granted summary judgment to Rural.
                                        This case concerns the interaction of two well-established proposi-
                                        tions. The first is that facts are not copyrightable; the other, that com-
                                        pilations of facts generally are. Each of these propositions possesses
                                        an impeccable pedigree.
                                            The key to resolving the tension lies in understanding why facts
                                        are not copyrightable. No one may claim originality as to facts. This
                                        is because facts do not owe their origin to an act of authorship. The
                                        distinction is one between creation and discovery: The first person to
                                        find and report a particular fact has not created the fact; he or she has
                                        merely discovered its existence.
                                            Factual compilations, on the other hand, may possess the requi-
                                        site originality. The compilation author typically chooses which facts
                                        to include, in what order to place them, and how to arrange the col-
                                        lected data so that they may be used effectively by readers. These
                                        choices as to selection and arrangement, so long as they are made
                                        independently by the compiler and entail a minimal degree of cre-
                                        ativity, are sufficiently original that Congress may protect such com-
                                        pilations through the copyright laws.
                                            This inevitably means that the copyright in a factual compilation
                                        is thin. Notwithstanding a valid copyright, a subsequent compiler
                                        remains free to use the facts contained in another’s publication to aid
                                        in preparing a competing work, so long as the competing work does
                                        not feature the same selection and arrangement.
                                        As we have explained, originality is a constitutionally mandated pre-
                                        requisite for copyright protection. The Court’s decisions announcing
                                        this rule predate the Copyright Act of 1909, but ambiguous language
                                        in the 1909 Act caused some lower courts temporarily to lose sight of
                                        this requirement.
                                            Making ma ers worse, these courts developed a new theory to
                                        justify the protection of factual compilations. Known alternatively
                                        as “sweat of the brow” or “industrious collection,” the underlying
                                        notion was that copyright was a reward for the hard work that went
+FXFMFShT $JSDVMBS  '  E $JS   into compiling facts. The classic formulation of the doctrine appeared
                                    in Jeweler’s Circular Publishing Co.:
" 46#+&$5 ."55&3                                                    

     The right to copyright a book upon which one has ex-
     pended labor in its preparation does not depend upon
     whether the materials which he has collected consist or
     not of ma ers which are publici juris, or whether such ma-
     terials show literary skill or originality, either in thought
     or in language, or anything more than industrious collec-
     tion. The man who goes through the streets of a town and
     puts down the names of each of the inhabitants, with their
     occupations and their street number, acquires material of
     which he is the author.
Without a doubt, the “sweat of the brow” doctrine flouted basic copy-
right principles. Throughout history, copyright law has recognized
a greater need to disseminate factual works than works of fiction or
fantasy. But “sweat of the brow” courts took a contrary view; they
handed out proprietary interests in facts and declared that authors
are absolutely precluded from saving time and effort by relying upon
the facts contained in prior works.
The definition of “compilation” is found in § 101 of the 1976 Act. It
defines a “compilation” in the copyright sense as “a work formed by
the collection and assembling of preexisting materials or of data that
are selected, coordinated, or arranged in such a way that the resulting
work as a whole constitutes an original work of authorship.”
    As discussed earlier, however, the originality requirement is not
particularly stringent. A compiler may se le upon a selection or ar-
rangement that others have used; novelty is not required. Originality
requires only that the author make the selection or arrangement inde-
pendently (i. e., without copying that selection or arrangement from
another work), and that it display some minimal level of creativity.
Presumably, the vast majority of compilations will pass this test, but
not all will. There remains a narrow category of works in which the
creative spark is u erly lacking or so trivial as to be virtually nonex-
istent. Such works are incapable of sustaining a valid copyright.
    In summary, the 1976 revisions to the Copyright Act leave no
doubt that originality, not “sweat of the brow,” is the touchstone of
copyright protection in directories and other fact-based works. Nor is
there any doubt that the same was true under the 1909 Act. The 1976
revisions were a direct response to the Copyright Office’s concern
that many lower courts had misconstrued this basic principle, and
Congress emphasized repeatedly that the purpose of the revisions
was to clarify, not change, existing law. The revisions explain with
painstaking clarity that copyright requires originality, § 102(a); that
facts are never original, § 102(b); that the copyright in a compilation
                                            $)"15&3  $01:3*()5

does not extend to the facts it contains, § 103(b); and that a compi-
lation is copyrightable only to the extent that it features an original
selection, coordination, or arrangement, § 101.
The selection, coordination, and arrangement of Rural’s white pages
do not satisfy the minimum constitutional standards for copyright
protection. As mentioned at the outset, Rural’s white pages are en-
tirely typical. Persons desiring telephone service in Rural’s service
area fill out an application and Rural issues them a telephone num-
ber. In preparing its white pages, Rural simply takes the data pro-
vided by its subscribers and lists it alphabetically by surname. The
end product is a garden-variety white pages directory, devoid of even
the slightest trace of creativity.
    Rural’s selection of listings could not be more obvious: It pub-
lishes the most basic information – name, town, and telephone num-
ber – about each person who applies to it for telephone service. This
is “selection” of a sort, but it lacks the modicum of creativity neces-
sary to transform mere selection into copyrightable expression. Rural
expended sufficient effort to make the white pages directory useful,
but insufficient creativity to make it original.
    We note in passing that the selection featured in Rural’s white
pages may also fail the originality requirement for another reason.
Feist points out that Rural did not truly “select” to publish the names
and telephone numbers of its subscribers; rather, it was required to
do so by the Kansas Corporation Commission as part of its monopoly
franchise. Accordingly, one could plausibly conclude that this selec-
tion was dictated by state law, not by Rural.
    Nor can Rural claim originality in its coordination and arrange-
ment of facts. The white pages do nothing more than list Rural’s
subscribers in alphabetical order. This arrangement may, technically
speaking, owe its origin to Rural; no one disputes that Rural under-
took the task of alphabetizing the names itself. But there is nothing
remotely creative about arranging names alphabetically in a white
pages directory. It is an age-old practice, firmly rooted in tradition
and so commonplace that it has come to be expected as a ma er
of course. It is not only unoriginal, it is practically inevitable. This
time-honored tradition does not possess the minimal creative spark
required by the Copyright Act and the Constitution.
    Because Rural’s white pages lack the requisite originality, Feist’s
use of the listings cannot constitute infringement. This decision
should not be construed as demeaning Rural’s efforts in compiling
its directory, but rather as making clear that copyright rewards origi-
nality, not effort. As this Court noted more than a century ago, “great
praise may be due to the plaintiffs for their industry and enterprise
" 46#+&$5 ."55&3                                                    

in publishing this paper, yet the law does not contemplate their being
rewarded in this way.” Baker

                             "SSPXT 1SPCMFN
                                                                             #BTFE PO +PIO .VMMFS  $P W /FX :PSL
Is this logo (for a professional sports team) sufficiently creative to be      "SSPXT 4PDDFS 5FBN  'E  UI
copyrightable?                                                               $JS

                   #BTFCBMM $BSE 1SJDF 3FQPSU 1SPCMFN
The Baseball Card Price Report is a comprehensive printed list of col-
lectible baseball cards sold between 1909 and 2011. It lists 32,000 base-
ball cards and a market price for each of them. The market price is
determined by obtaining transaction lists from several dozen large
dealers and averaging the sales prices for the card over the past year.
    The Report is organized by year: it has a section for 1909, a section                 "SSPXT MPHP
for 1910, and so on. Each section is subdivided into a list of manufac-      #BTFE PO &DLFT W $BSE 1SJDFT 6QEBUF
turers (Topps, Upper Deck, and so on). Each manufacturer’s list is            'E  E $JS  BOE TJNJMBS
then divided by teams, and players are listed alphabetically by last
name within a team section. For each card, the Report gives prices
for mint, excellent, very good, good, and fair condition cards. In addi-
tion, about 9,000 of the cards are noted with a star to indicate that they
are “premium” cards. These cards are considered especially valuable
beacuse the player is in the Hall of Fame, played for a famous team, or
some other reason that makes the card especially scarce or especially
prized by collectors.
    An entrepreneur calling himself Tyrone Tyrannosaurus has
started a website called the “Collector’s Cheat Sheet.” The front of
the site consists of three drop-down menus: year, team, and player
name. Once a user selects all three, he is taken to a page that lists all
of the companies that made cards of that player in that year. If a card
is considered “premium” by the Report, the Cheat Sheet lists the card
in bold.
    You represent Mr. Tyrannosaurus, who has received a cease-and-
desist le er from the publisher of the Report claiming that the Cheat
Sheet is infringing on a copyright in the Report. What is your advice
to your client?


[The plaintiffs produced three large color posters (”chro-
molithographs”) to be used as advertisements for Wallace’s
circus. Later, the defendant reproduced the posters in smaller
black-and-white versions, as advertisements for the same circus.
                                                                                     8BMMBDF DJSDVT QPTUFS
                                                          $)"15&3  $01:3*()5

            When sued, the defendants argued that the chromolithographs were
            not copyrightable.]
)PMNFT +       We shall do no more than mention the suggestion that painting
            and engraving unless for a mechanical end are not among the use-
            ful arts, the progress of which Congress is empowered by the Con-
            stitution to promote. The Constitution does not limit the useful to
            that which satisfies immediate bodily needs. It is obvious also that
            the plaintiffs’ case is not affected by the fact, if it be one, that the
            pictures represent actual groups – visible things. They seem from
            the testimony to have been composed from hints or description, not
            from sight of a performance. But even if they had been drawn from
            the life, that fact would not deprive them of protection. The opposite
            proposition would mean that a portrait by Velasquez or Whistler was
            common property because others might try their hand on the same
            face. Others are free to copy the original. They are not free to copy
            the copy. The copy is the personal reaction of an individual upon
            nature. Personality always contains something unique. It expresses
            its singularity even in handwriting, and a very modest grade of art
            has in it something irreducible, which is one man’s alone. That some-
            thing he may copyright unless there is a restriction in the words of
            the act.
                If there is a restriction it is not to be found in the limited preten-
            sions of these particular works. The least pretentious picture has
            more originality in it than directories and the like, which may be copy-
                [The copyright act in force at the time protected only defined cat-
            egories of works, one of which was ”pictorial illustrations or works
            connected with the fine arts.”] These chromolithographs are ”picto-
            rial illustrations.” The word ”illustrations” does not mean that they
            must illustrate the text of a book, and that the etchings of Rembrandt
            or Steinla’s engraving of the Madonna di San Sisto could not be pro-
            tected to-day if any man were able to produce them. Again, the act
            however construed, does not mean that ordinary posters are not good
            enough to be considered within its scope. The antithesis to ”illustra-
            tions or works connected with the fine arts” is not works of ti le merit
            or of humble degree, or illustrations addressed to the less educated
            classes; it is ”prints or labels designed to be used for any other articles
            of manufacture.” Certainly works are not the less connected with the
            fine arts because their pictorial quality a racts the crowd and there-
            fore gives them a real use – if use means to increase trade and to help
            to make money. A picture is none the less a picture and none the
            less a subject of copyright that it is used for an advertisement. And
            if pictures may be used to advertise soap, or the theatre, or monthly
            magazines, as they are, they may be used to advertise a circus. Of
            course, the ballet is as legitimate a subject for illustration as any other.
" 46#+&$5 ."55&3                                                  

A rule cannot be laid down that would excommunicate the paintings
of Degas.
    It would be a dangerous undertaking for persons trained only to
the law to constitute themselves final judges of the worth of pictorial
illustrations, outside of the narrowest and most obvious limits. At the
one extreme some works of genius would be sure to miss apprecia-
tion. Their very novelty would make them repulsive until the public
had learned the new language in which their author spoke. It may be
more than doubted, for instance, whether the etchings of Goya or the
paintings of Manet would have been sure of protection when seen
for the first time. At the other end, copyright would be denied to pic-
tures which appealed to a public less educated than the judge. Yet
if they command the interest of any public, they have a commercial
value – it would be bold to say that they have not an aesthetic and
educational value – and the taste of any public is not to be treated
with contempt. It is an ultimate fact for the moment, whatever may
be our hopes for a change. That these pictures had their worth and        $PNQBSF 5IF VMUJNBUF HPPE EFTJSFE
their success is sufficiently shown by the desire to reproduce them         JT CFUUFS SFBDIFE CZ GSFF USBEF JO JEFBT
                                                                          5IF CFTU UFTU PG USVUI JT UIF QPXFS PG
without regard to the plaintiffs’ rights. We are of opinion that there
                                                                          UIF UIPVHIU UP HFU JUTFMG BDDFQUFE JO
was evidence that the plaintiffs have rights entitled to the protection    UIF DPNQFUJUJPO PG UIF NBSLFU "CSBNT
of the law.                                                               W 6OJUFE 4UBUFT  64  
                                                                           )PMNFT + EJTTFOUJOH 

As a general rule, the Copyright Office will not consider factors that
have no bearing on whether the originality requirement has been met.
                                                                          'BDUPST 5IBU 8JMM /PU #F $POTJEFSFE JO
The fact that a work may be novel, distinctive, innovative, or even       UIF &YBNJOBUJPO PG 0SJHJOBMJUZ
unique is irrelevant to this analysis. The Copyright Office does not
consider the aesthetic value, artistic merit, or intrinsic quality of a
work. For example, the Office will not look for any particular style of
creative expression. Likewise, the Office will not consider whether a
work is visually appealling or wri en in elegant prose. For the same
reasons, the Office will not consider the truth or falsity of the facts
set forth in a work of authorship. Nor will the Office consider the
soundness of the views expressed in the work.
    The Office will focus only on the actual appearance or sound of
the work that has been submi ed for registration, but will not con-
sider any meaning or significance that the work may evoke. The Of-
fice will not consider the author’s inspiration for the work, creative
intent, or intended meaning. The U.S. Copyright Office will not con-
sider the author’s creative skill and experience, because the author’s
personal or professional history is irrelevant to the determination of
    The Office will not consider the amount of time, effort, or expense
required to create the work. As a general rule, the Office will not con-
                                                                                       $)"15&3  $01:3*()5

                                          sider possible design alternatives that the author may have consid-
                                          ered when he or she created the work. Likewise, the Office will not
                                          consider potential variations in the use of the work, such as the fact
                                          that the work could be presented in a different color, in a different
                                          size, or with a different orientation. As a general rule, the materials
                                          used to create a work have no bearing on the originality analysis. For
                                          example, the U.S. Copyright Office will not consider the fact that a
                                          jewelry design was constructed with precious metals or gemstones,
                                          or the fact that a silk screen was printed on a particular paper stock.
                                          The U.S. Copyright Office will not consider the marketability or com-
                                          mercial success of the work, because these issues are irrelevant to the
                                          originality analysis.

                                                     .JUDIFMM #SPT 'JMN (SPVQ W $JOFNB "EVMU 5IFBUFS
                                                                    'E  UI $JS 
                                          Plaintiffs-appellants owned a properly registered copyright on a mo-
                                          tion picture titled ”Behind the Green Door.” Two groups of defen-
                                          dants, each group consisting of a theater and several individuals,
                                          obtained copies of the movie without plaintiffs’ permission and in-
                                          fringed the copyright by exhibiting the film at the theaters. We hold
                                          that the district court erred in permi ing the assertion of obscenity as
                                          an affirmative defense to the claim of infringement, and, accordingly,
                                          reverse without reaching the question whether the film is obscene.
QPSOPHSBQIZGSJFOEMZ UIBO UIF 'JSTU           The district court did not base its decision on standards found
"NFOENFOU 5IF 'JSTU "NFOENFOU            within the [1909 Copyright] Act, which it described as ”silent as to
XJMM POMZ QSPUFDU QPSOPHSBQIZ JG JU       works which are subject to registration and copyright.” The Act is
JT OPU PCTDFOF PS JMMFHBM GPS PUIFS       not ”silent.” Rather, the statutory language ”all the writings of an au-
                                          thor” is facially all-inclusive, within itself admi ing of no exceptions.
PòFST QSPUFDUJPOT UP QPSOPHSBQIZ OP       There is not even a hint in the language of § 4 that the obscene nature
NBUUFS XIBU NBUFSJBM JU DPOUBJOT 5IF     of a work renders it any less a copyrightable ”writing.”
'JSTU "NFOENFOU NFSFMZ QSFWFOUT UIF           Society’s view of what is moral and immoral continually changes.
HPWFSONFOU GSPN JOUFSGFSJOH JO UIF DSF   To give one example, in Martine i v. Maguire, the play ”The Black
                                          Crook,” because it featured women clad in flesh-colored tights, was
PS PUIFSXJTF JMMFHBM 8JUI UIF DVSSFOU    held to be ”grossly indecent, and calculated to corrupt the morals
QSBDUJDF PG JOEJTDSJNJOBUFMZ BDDPSEJOH    of the people” and hence uncopyrightable. By the early part of this
QPSOPHSBQIJD XPSLT DPQZSJHIU QSP         century, it had become clear that this judgment reflected the moral
                                          standards of a bygone era.
                                              Denying copyright protection to works adjudged obscene by the
BOE OPOVTFGVM BOE UIFSFGPSF CFZPOE       standards of one era would frequently result in lack of copyright pro-
UIF TDPQF PG UIF *OUFMMFDUVBM 1SPQFSUZ    tection (and thus lack of financial incentive to create) for works that
$MBVTF PG UIF 64 $POTUJUVUJPO 5IJT     later generations might consider to be not only non-obscene but even
                                          of great literary merit. Many works that are today held in high re-
                                     gard have been adjudged obscene in previous eras. English courts of
.BSUJOFUUJ  'FE $BT  $$ $BM    the nineteenth century found the works of Byron, Southey and Shel-
                                      ley to be immoral. American courts have found these books, among
" 46#+&$5 ."55&3                                                    

others, obscene: Edmund Wilson, M              H        C       ;
Henry Miller, T      C        and T          C         ; Erskine
Caldwell, G ’ L      A    ; Lillian Smith, S        F    ; D. H.
Lawrence, L     C       ’ L       ; Theodore Dreiser, A A       -
    T       .

                            #FMDIFS W 5BSCPY
                       'E  UI $JS 
Defendant’s primary contention is that the works were not entitled
to copyright protection since they, and the advertising material asso-
ciated with them, fraudulently represented to the public that users of
the system described could beat the horses.
    There is nothing in the Copyright Act to suggest that the courts are
to pass upon the truth or falsity, the soundness or unsoundness, of the
views embodied in a copyrighted work. The gravity and immensity
of the problems, theological, philosophical, economic and scientific,
that would confront a court if this view were adopted are staggering
to contemplate. It is surely not a task lightly to be assumed, and we
decline the invitation to assume it.


                             $PQZSJHIU "DU

In no case does copyright protection for an original work of author-          64$ f 
ship extend to any idea, procedure, process, system, method of opera-        4VCKFDU NBUUFS PG DPQZSJHIU *O HFOFSBM
tion, concept, principle, or discovery, regardless of the form in which
it is described, explained, illustrated, or embodied in such work.

It is hornbook law that ideas are not copyrightable, only an author’s
individual expression of those ideas. But what qualifies as an ”idea”
can only be learned by seeing what courts treat as one. Sometimes
”idea” refers to the general creative concept for a work, as distinguished
from its more specific details. Sometimes ”idea” is used as a synec-
doche for other § 102(b) exclusions – ”procedure, process, system,
method of operation” – that describe functional ma er in a work. In
addition, two closely related doctrines – merger and scènes à faire –
help implement these exclusions.

                            #MFIN W +BDPCT
                      ' E  UI $JS 
                                            $)"15&3  $01:3*()5

Appellant Gary Blehm brought this copyright infringement action
against brothers Albert and John Jacobs and the Life is Good Com-
pany (collectively ”Life is Good”). Mr. Blehm is the creator of copy-
righted posters featuring cartoon characters called ”Penmen.” He
contends that numerous Life is Good depictions of a cartoon char-
acter called ”Jake” infringe on his copyrighted works. The district
court granted Life is Good’s motion for summary judgment, holding
that no infringement occurred because the copyrighted and accused
works are not substantially similar.
                             I. B
Mr. Blehm is a commercial artist who lives in Colorado Springs, Col-
orado. In the late 1980s, he developed characters called ”Penmen.”
According to Mr. Blehm, each Penman is ”a deceptively-simple look-
ing figure” that ”engages in a variety of activities pulled directly from
his colorful life experiences.” The Penmen have ”round heads, dispro-
portionately large half-moon smiles, four fingers, large feet, dispro-
portionately long legs, and a message of unbridled optimism.”
     The Penmen are a product of Mr. Blehm’s commercial art training.
Through his training, Mr. Blehm learned how to ”add a slight bend
to a figure’s limb to show weight bearing into it” and how, as he puts
it, to apply negative space. Eventually, Mr. Blehm developed rules
and guidelines for drawing each Penman. These rules and guidelines
include a specific shape for each Penman’s head, specific length and
height requirements for each character, rules on fluidity and perspec-
tive, and the ”Penmen parallel curve,” which Mr. Blehm employs to
”create eye-pleasing shapes within the negative space.”
     In 1990, Mr. Blehm began selling his posters to distributors. From
1990 to 2004, Prints Plus sold his posters nationally.
     Starting in 1989, the Jacobs brothers designed and sold t-shirts
”infused with a positive undertone as a reflection of their beliefs.”
The brothers sold t-shirts in areas around Boston, including Harvard
Square, not far from the Harvard Coop. During the 1993 holiday sea-
son, the Jacobses sold t-shirts from carts in the Cambridgeside Galle-
ria and the Emerald Square Mall, both of which had Prints Plus stores
that sold Mr. Blehm’s posters.
     According to the Jacobses, around April 1994 John Jacobs drew a
sketch of a figure with a red face, wide smile, sunglasses, and a beret.
The figure was enclosed in two circles. John hung the sketch on the
wall of the brothers’ apartment.
     The Jacobses recall hosting a party in August 1994 at their apart-
ment and soliciting feedback on the sketch from their friends. After a
friend stated that the figure in the sketch ”really has life figured out,”
John Jacobs wrote ”Life is good” under the image. They named the
image ”Jake,” a spinoff of their last name.
" 46#+&$5 ."55&3                                                     

    The Jacobses soon made and sold t-shirts featuring Jake at street
fairs and to retailers. As demand for the shirts increased, John Jacobs
added a torso, arms, and feet to the Jake head. Jake was portrayed en-
gaging in simple activities, such as biking, hiking, golfing, and play-
ing soccer.
    The Jacobses incorporated Life is Good in 1997 with the ”overar-
ching themes of optimism, simplicity, humor, and humility.”
                             II. D
                        A. Substantial Similarity

1. Legal Framework
In order to prove copying of legally protectable material, a plain-
tiff must typically show substantial similarity between legally [pro-
tectable] elements of the original work and the allegedly infringing
work. This commonly stated rule raises two questions: First, what
elements of a copyrighted work are legally protectable? Second,
how do courts determine whether a copyrighted work’s legally pro-
tectable elements are ”substantially similar” to an accused work?
     Section 102(a) of the Copyright Act states that a copyright protects
the ”original works of authorship fixed in any tangible medium of ex-
pression,” including pictorial and graphic works. 17 U.S.C. S 102(a).
To gain protection, the work must demonstrate at least some minimal
degree of creativity, but even a slight amount will suffice. The vast
majority of works make the grade quite easily, as they possess some
creative spark, no ma er how crude, humble or obvious it might be.
     But legal protection does not extend to all aspects of a copyrighted
work. Section 102(b) provides, ”In no case does copyright protection
... extend to any idea ... [or] concept ... regardless of the form in which
it is described, explained, illustrated, or embodied in such work.” 17
U.S.C. S 102(b). This provision enshrines the fundamental tenet that
copyright protection extends only to the author’s original expression
and not to the ideas embodied in that expression.
     Thus, courts comparing works must first distill the protectable el-
ements of the copyrighted work – i.e., determine what aspects consti-
tute protectable expression. But this process, although sound in the-
ory, is difficult to apply in practice. More than 50 years ago, Judge
Learned Hand recognized that ”[t]he test for infringement of a copy-
right is of necessity vague.” Peter Pan Fabrics, Inc. v. Martin Weiner        1FUFS 1BO 'BCSJDT  'E  OE $JS
Corp.. Because ”no principle can be stated as to when an imitator has         
gone beyond copying the ’idea,’ and has borrowed its ’expression[,]’
[d]ecisions must therefore inevitably be ad hoc.” Id.We follow this
case-by-case approach, and are mindful that copyright law seeks to
achieve a proper balance between competition based on public ideas
                                                                                    $)"15&3  $01:3*()5

                                        and incentive to produce original work.
                                             Because the idea/expression distinction is the most complex part
                                        of the substantial similarity inquiry, we discuss a few examples
$PVOUSZ ,JET  'E  UI $JS    where courts have separated the two. In Country Kids ’N City Slicks,
                                    Inc. v. Sheen, this court held that copyright protection did not ”ex-
                                        tend to the size, shape and medium” of wooden dolls. We explained
                                        that the Copyright Act is concerned with artistic innovation and ex-
                                        cludes protection for a work’s ”utilitarian qualities.” The idea of a
                                        wooden doll is not copyrightable, nor are ”any basic and utilitarian
                                        aspects of the dolls, such as the shape of a human body and standard
                                        doll poses which are both friendly and inviting and also utilitarian in
                                        their ease of manufacture and adaptability to the a achment of vari-
                                        ous wardrobes.”
                                             Similarly, a copyright owner has no monopoly over the idea of
                                        fashion dolls with a bra y look or a itude, or dolls sporting trendy
                                        clothing. Nor does copyright protection extend to the idea of creating
                                        a doll with an upturned nose, bow lips, and widely spaced eyes, even
                                        if the allegedly infringing work has explicitly taken this idea from the
                                        copyrighted work.
                                             Copyright instead protects the particularized expression of the
                                        idea of a doll with such features. For example, although a copyright
                                        owner has no monopoly over the idea of a muscular doll in a stan-
                                        dard pose, the owner may have a valid infringement claim for copy-
                                        ing of the particularized expression of that idea, such as the decision
                                        to accentuate certain muscle groups relative to others. A copyright
                                        owner’s original stylistic choices qualify as protectable expression if
"MJPUUJ  'E  UI $JS      the choices are not dictated by the underlying idea. See Alio i v. R.
                                        Dakin & Co. (stuffed dinosaur toys cannot be substantially similar be-
                                        cause of shared physiognomy, but a distinctive ”eye style and stitch-
                                        ing” could qualify as protectable expression if they are ”not dictated
                                        by the idea of stuffed dinosaur dolls”).
                                             In architecture, there is no copyright protection for the idea of
4UVSE[B  'E  %$ $JS    using domes, wind-towers, parapets and arches.” Sturdza v. United
                                        Arab Emirates. ”To hold otherwise would render basic architectural
                                        elements unavailable to architects generally, thus running afoul of
                                        the very purpose of the idea/expression distinction: promoting incen-
                                        tives for authors to produce original work while protecting society’s
                                        interest in the free flow of ideas.” On the other hand, the combina-
                                        tion of common architectural elements and use of specific designs
                                        may constitute original expression that is protected. An architectural
                                        design may infringe if its use of public-domain elements gives off
                                        a similar unique effect in decoration and design as the copyrighted
                                             Thus, a sweater designer can have copyright protection over an
                                        original way of using squirrels as a design element in conjunction
" 46#+&$5 ."55&3                                                   

with fall colors, stripes, and panels, even though those elements indi-
vidually constitute ideas in the public domain. See Knitwaves, Inc. v.      -PMMZUPHT    'E        E
Lollytogs Ltd.. A plaintiff’s ”selective and particularized” alterations     $JS
of a public-domain carpet pa ern also can constitute protectable ex-
pression. Tufenkian Imp./Exp. Ventures, Inc. v. Einstein Moomjy, Inc..      5VGFOLJBO  'E  OE $JS 

2. Comparing the Penmen and Jake Images
The district court was correct that Mr. Blehm has no copyright over
the idea of a cartoon figure holding a birthday cake, catching a Fris-
bee, skateboarding, or engaging in various other everyday activities.
Nor can the Jake images infringe on the Penmen because the figures
share the idea of using common anatomical features such as arms,
legs, faces, and fingers, which are not protectable elements. See Baby       #BCZ #VEEJFT  'E  UI $JS
Buddies, Inc. v. Toys ”R” Us, Inc.. (no copyright protection over com-      
mon anatomical features of teddy bear). Mr. Blehm’s copyright also
does not protect Penmen poses that are a ributable to an associated
activity, such as reclining while taking a bath or lounging in an inner
tube. These everyday activities, common anatomical features, and
natural poses are ideas that belong to the public domain; Mr. Blehm
does not own these elements.
    Although we do not consider these unprotected elements in our
substantial similarity analysis, we acknowledge that Mr. Blehm’s
works do contain some protectable expression. The Penmen at first
glance might be considered simple stick figures, but they are more
nuanced than a child’s rudimentary doodling. For example, the pro-
totypical Penman has a rounded, half-moon smile that takes up a sub-
stantial portion of the face. Mr. Blehm has chosen to omit any other
facial features on the Penmen. Each figure is filled in black, except for
the white half-moon smile, and each Penman’s head is detached, hov-
ering above the body. Many of the Penmen stand facing the viewer,
flashing the half-moon smile.
    Mr. Blehm also drew the Penmen according to his own rules and
guidelines. The figure’s head might be perceived as slightly dispro-
portional to the body. Its arms and legs are thin, long, and dispropor-
tionate to the torso, which is relatively short. Mr. Blehm also chose to
give the Penmen four fingers – each about as thick as their arms and
legs – on each hand, as well as feet that are disproportionately long
and thick compared with the rest of the body.
    Having identified protectable expression in Mr. Blehm’s draw-
ings, we must determine whether that expression is substantially sim-
ilar to the allegedly infringing Life is Good images. Life is Good is not
entitled to summary judgment unless its Jake figures are so dissimilar
from the protectable elements of the Penmen that no reasonable jury
could find for Mr. Blehm on the question of substantial similarity.
    To show substantial similarity, Mr. Blehm provided the district
                                                               $)"15&3  $01:3*()5

                    court with an exhibit juxtaposing 67 individual Penmen with a corre-
                    sponding, allegedly infringing Jake image. We have reviewed these
                    images and agree with the district court’s grant of summary judg-
                    ment in favor of Life is Good. We now address two of Mr. Blehm’s
                    proposed comparisons, which he highlights in his appellate brief,
                    and explain why the Life is Good images are so dissimilar from the
                    protectable elements of Mr. Blehm’s images that no reasonable jury
                    could find in his favor.
                       a. The Peace Sign Images
                    The first example in Mr. Blehm’s exhibit juxtaposes a Penman and
                    Jake image standing and displaying the peace sign. Because we must
                    separate unprotected ideas from expression, our analysis does not
                    consider that both drawings share the idea of a cartoon figure making
                    a common hand gesture. But we do consider whether the Jake image
                    is substantially similar to Mr. Blehm’s expression of this idea.
                        Mr. Blehm urges us to find certain similarities between the im-
                    ages. He notes that both have round heads. But Mr. Blehm has no
                    copyright protection in general human features. Further, the figures’
                    heads are not similarly round. Jake’s head is more oval and some-
                    what misshapen, whereas the Penman’s head is circular and uniform.
                        Mr. Blehm suggests that the figures have similar proportions,
                    such as the size of the figures’ heads, arms, legs, and feet compared
                    with their bodies. A close review of the figures, however, yields the
                    opposite conclusion. Jake’s head is very large compared with the
                    body, while the Penman’s head is relatively proportional. The Pen-
                    man’s arms and legs are long and disproportionate to its truncated
                    torso. Jake, on the other hand, has more proportional limbs com-
                    pared with his torso. The figures’ feet are distinctly different: the
                    Penman’s are thick, long, and roll-shaped, but Jake’s are shorter and
                        Nevertheless, there are some similarities between the Penman and
                    Jake. Both have black-line bodies, four fingers, and large half-moon
                    smiles, and their feet are pointed outward. But even these similarities
                    have important differences, or are not protectable expression. For
                    example, Jake’s fingers appear stubbier. The choice to display the
                    figures’ feet outward also naturally flows from the common idea of
                    drawing a two-dimensional stick figure and is thus unprotected.
                        The figures’ smiles thus seem to be the crux of this litigation. The
                    Penman and Jake both face the viewer with disproportionately large
                    half-moon smiles. A smile can be drawn in various ways. Here, they
                    share a crescent shape, but the idea of a crescent-shaped smile is un-
                    protected. Rather, the expression of the smiles must be substantially
                    similar and important to the overall work.
                        The Penman’s smile is all white, as is Jake’s. The smiles on both
" 46#+&$5 ."55&3                                                   

figures take up a large portion of the head. But the Penman’s smile
is rounded on the tips, whereas the tips of Jake’s smile are sharper
angled. Jake’s smile, by virtue of the size of his head, is much larger
compared with his body than is the Penman’s. And although both
smiles are white, the Penman’s is set on an all-black head, making it
appear different from Jake’s, which is the outline of a smile on a white
head with black sunglasses.
    Indeed, Mr. Blehm’s decision to omit eyes and other facial fea-
tures on the Penman makes the figure susceptible to an interpretation
that the Penman is not smiling at all. One interpretation is that the
white space on the head is not a smile, but is the Penman’s face with
no features. The black above the half-moon shape can be perceived
as hair swooping down over the Penman’s forehead. Thus, the Pen-
man’s lack of facial features make it susceptible to different interpre-
tations. The Jake figure is not susceptible to similar confusion.
    Any similarity between smiles also is insubstantial in light of other
differences between the figures. Jake’s head is a ached to the body,
and his head is white and has black sunglasses. The Penman’s head is
detached and is black with no eyes. Jake sports a beret, and his whole
figure is displayed on a color background, whereas the Penman has
no headwear and is portrayed against a plain white background.
    The Jake image’s arms are positioned differently from the Pen-
man, with Jake’s left arm curved, rather than sharp and angular. Mr.
Blehm also chose a unique feature for the Penman’s peace-sign ex-
pression – white space in the figure’s hand – that the Jake image does
not share.
    We conclude that no reasonable juror could determine that the
Jake figure is substantially similar to the protected, expressive choices       'SJTCFF JNBHFT
Mr. Blehm used for the Penman figure.
   b. The Frisbee Images
In another example, a Penman and Jake a empt to catch Frisbees be-
tween their legs. The two figures’ poses are similar – suspended in
the air with legs outstretched and a hand descending to catch the disc
– but we do not consider the pose in our analysis. Such a pose is com-
mon to this activity and is not protected expression. Again, the fig-
ures have large, half-moon smiles. And unlike the ”peace sign” Jake,
this Jake image has legs that are disproportionate to a truncated torso.
The Penman’s legs also are long with respect to the torso, but not as
disproportionate as Jake’s.
    Jake’s legs are curved, but the Penman’s are straightened. The
Jake image’s head differs in the same important ways as in the ”peace
sign” images. Jake’s arms appear to extend from his head, but the
Penman’s arms a ach to the top of the torso. Jake’s torso is much
thinner (and disproportionately shorter) than the Penman’s; Jake has        4FMFDUFE PUIFS JNBHFT
                                              $)"15&3  $01:3*()5

three fingers on each hand (not four); and the Jake image, unlike the
Penman image, incorporates color on the canvas and disc. Jake’s feet
are defined – toes and arches are visible – but the Penman’s are not.
Although the images share a similar idea of catching a Frisbee be-
tween the legs, the protectable expression in the Penman is not sub-
stantially similar to the Jake image.
   c. Other Images
Mr. Blehm highlights 65 other Penmen as having been copied. At-
tached to this opinion is the ”Penmen-Jake Chart” Mr. Blehm submit-
ted to the district court in an effort to demonstrate substantial simi-
    We have reviewed these images, and an analysis similar to the
discussion above applies.
    Copying alone is not infringement. The infringement determina-
tion depends on what is copied. Assuming Life is Good copied Pen-
men images when it produced Jake images, our substantial similarity
analysis shows it copied ideas rather than expression, which would
make Life is Good a copier but not an infringer under copyright law.

                       8BMLFS W 5JNF -JGF 'JMNT *OD
                           'E  E $JS 
In the district court, appellant proffered lists of specific alleged simi-
larities in an a empt to prove fragmented literal similarity between
the book and the film. None of these claims alters our conclusion that
the district court properly held that as a ma er of law no substantial
similarity exists between the protectible elements of the works. For
example, appellant notes that both the book and the film depict cock-
fights, drunks, stripped cars, prostitutes and rats; both feature as cen-
tral characters third- or fourth-generation Irish policemen who live in
Queens and frequently drink; both show disgruntled, demoralized
police officers and unsuccessful foot chases of fleeing criminals.
    These similarities, however, relate to uncopyrightable material.
Elements such as drunks, prostitutes, vermin and derelict cars would
appear in any realistic work about the work of policemen in the South
Bronx. These similarities therefore are unprotectible as “scènes à
faire,” that is, scenes that necessarily result from the choice of a se ing
or situation. Neither does copyright protection extend to copyright or
“stock” themes commonly linked to a particular genre. Foot chases
and the morale problems of policemen, not to mention the familiar
figure of the Irish cop, are venerable and often-recurring themes of
police fiction. As such, they are not copyrightable except to the ex-
tent they are given unique – and therefore protectible – expression in
an original creation.
" 46#+&$5 ."55&3                                                     

                               )VMB 1SPCMFN
                                                                              #BTFE PO 3FFDF W *TMBOE 5SFBTVSFT "SU
Consider this photograph and stained glass image of hula dancers.             (BMMFSZ *OD  ' 4VQQ E  %
The dancers’ pose (kneeling, with right arm extended, etc.) is tradi-         )BX 
tional. So is their dress (including the lei, etc.). Does the stained glass
infringe on the photograph? Are there further facts it would be help-
ful to know?

                            #BLFS W 4FMEFO
Charles Selden, the testator of the complainant in this case, in the year
1859 took the requisite steps for obtaining the copyright of a book, en-
titled ”Selden’s Condensed Ledger, or Book-keeping Simplified,” the
object of which was to exhibit and explain a peculiar system of book-
keeping. In 1860 and 1861, he took the copyright of several other
books, containing additions to and improvements upon the said sys-
tem. The bill of complaint was filed against the defendant, Baker, for
an alleged infringement of these copyrights.
    The book or series of books of which the complainant claims the                ,JN 5BZMPS 3FFDF .BLBOBOJ
copyright consists of an introductory essay explaining the system
of book-keeping referred to, to which are annexed certain forms or
blanks, consisting of ruled lines, and headings, illustrating the sys-
tem and showing how it is to be used and carried out in practice.
This system effects the same results as book-keeping by double entry;
but, by a peculiar arrangement of columns and headings, presents
the entire operation, of a day, a week, or a month, on a single page,
or on two pages facing each other, in an account-book. The defen-
dant uses a similar plan so far as results are concerned; but makes
a different arrangement of the columns, and uses different headings.
If the complainant’s testator had the exclusive right to the use of the
system explained in his book, it would be difficult to contend that the
defendant does not infringe it, notwithstanding the difference in his
form of arrangement; but if it be assumed that the system is open to
                                                                                      .BSZMFF $PMVDDJ /PIF
public use, it seems to be equally difficult to contend that the books
made and sold by the defendant are a violation of the copyright of
the complainant’s book considered merely as a book explanatory of
the system. Where the truths of a science or the methods of an art are
the common property of the whole world, any author has the right
to express the one, or explain and use the other, in his own way. As
an author, Selden explained the system in a particular way. It may
be conceded that Baker makes and uses account-books arranged on
substantially the same system; but the proof fails to show that he has
violated the copyright of Selden’s book, regarding the la er merely
as an explanatory work; or that he has infringed Selden’s right in any
way, unless the la er became entitled to an exclusive right in the sys-
                                                                       $)"15&3  $01:3*()5

                                It is contended that he has secured such exclusive right, because
                            no one can use the system without using substantially the same ruled
                            lines and headings which he has appended to his books in illustration
                            of it. In other words, it is contended that the ruled lines and head-
                            ings, given to illustrate the system, are a part of the book, and, as
                            such, are secured by the copyright; and that no one can make or use
                            similar ruled lines and headings, or ruled lines and headings made
                            and arranged on substantially the same system, without violating the
                                There is no doubt that a work on the subject of book-keeping,
                            though only explanatory of well-known systems, may be the subject
                            of a copyright; but, then, it is claimed only as a book. Such a book
                            may be explanatory either of old systems, or of an entirely new sys-
                            tem; and, considered as a book, as the work of an author, conveying
                            information on the subject of book-keeping, and containing detailed
                            explanations of the art, it may be a very valuable acquisition to the
                            practical knowledge of the community. But there is a clear distinc-
                            tion between the book, as such, and the art which it is intended to
                            illustrate. The mere statement of the proposition is so evident, that
                            it requires hardly any argument to support it. The same distinction
                            may be predicated of every other art as well as that of book-keeping.
                            A treatise on the composition and use of medicines, be they old or
                            new; on the construction and use of ploughs, or watches, or churns;
                            or on the mixture and application of colors for painting or dyeing;
                            or on the mode of drawing lines to produce the effect of perspective,
                            – would be the subject of copyright; but no one would contend that
                            the copyright of the treatise would give the exclusive right to the art
                            or manufacture described therein. The copyright of the book, if not
                            pirated from other works, would be valid without regard to the nov-
                            elty, or want of novelty, of its subject-ma er. The novelty of the art
                            or thing described or explained has nothing to do with the validity of
                            the copyright. To give to the author of the book an exclusive property
                            in the art described therein, when no examination of its novelty has
                            ever been officially made, would be a surprise and a fraud upon the
                            public. That is the province of le ers-patent, not of copyright. The
                            claim to an invention or discovery of an art or manufacture must be
                            subjected to the examination of the Patent Office before an exclusive
                            right therein can be obtained; and it can only be secured by a patent
                            from the government.
                                The copyright of a work on mathematical science cannot give to
                            the author an exclusive right to the methods of operation which he
                            propounds, or to the diagrams which he employs to explain them,
                            so as to prevent an engineer from using them whenever occasion re-
                            quires. The very object of publishing a book on science or the useful
                            arts is to communicate to the world the useful knowledge which it
" 46#+&$5 ."55&3                                                   

contains. But this object would be frustrated if the knowledge could
not be used without incurring the guilt of piracy of the book. And
where the art it teaches cannot be used without employing the meth-
ods and diagrams used to illustrate the book, or such as are similar to
them, such methods and diagrams are to be considered as necessary
incidents to the art, and given therewith to the public; not given for
the purpose of publication in other works explanatory of the art, but
for the purpose of practical application.
    Of course, these observations are not intended to apply to orna-
mental designs, or pictorial illustrations addressed to the taste. Of
these it may be said, that their form is their essence, and their object,
the production of pleasure in their contemplation. This is their final
end. They are as much the product of genius and the result of com-
position, as are the lines of the poet or the historian’s periods. On
the other hand, the teachings of science and the rules and methods
of useful art have their final end in application and use; and this ap-
plication and use are what the public derive from the publication of
a book which teaches them. But as embodied and taught in a literary
composition or book, their essence consists only in their statement.
This alone is what is secured by the copyright. The use by another
of the same methods of statement, whether in words or illustrations,
in a book published for teaching the art, would undoubtedly be an
infringement of the copyright.
    Recurring to the case before us, we observe that Charles Selden,
by his books, explained and described a peculiar system of book-
keeping, and illustrated his method by means of ruled lines and blank
columns, with proper headings on a page, or on successive pages.
Now, whilst no one has a right to print or publish his book, or any
material part thereof, as a book intended to convey instruction in the
art, any person may practise and use the art itself which he has de-
scribed and illustrated therein. The use of the art is a totally different
thing from a publication of the book explaining it. The copyright of a
book on book-keeping cannot secure the exclusive right to make, sell,
and use account-books prepared upon the plan set forth in such book.
Whether the art might or might not have been patented, is a question
which is not before us. It was not patented, and is open and free to
the use of the public. And, of course, in using the art, the ruled lines
and headings of accounts must necessarily be used as incident to it.
    The conclusion to which we have come is, that blank account-
books are not the subject of copyright; and that the mere copyright
of Selden’s book did not confer upon him the exclusive right to make
and use account-books, ruled and arranged as designated by him and
described and illustrated in said book.

                                                                                    $)"15&3  $01:3*()5

                                                               'E  UI $JS 
                                       We must decide whether a sequence of twenty-six yoga poses and
                                       two breathing exercises developed by Bikram Choudhury and de-
                                       scribed in his 1979 book, B        ’ B           Y    C      , is entitled
                                       to copyright protection.
                                           In 1971, Bikram Choudhury, the self-proclaimed ”Yogi to the
                                       stars,” arrived in Beverly Hills, California. He soon became a central
                                       figure in the growing popularity of yoga in the United States. Choud-
                                       hury developed a sequence of twenty-six asanas and two breath-
                                       ing exercises, arranged in a particular order, which he calls the ”Se-
                                       quence.” Choudhury opened his own studio, where he began offer-
                                       ing ”Bikram Yoga” classes. In a Bikram Yoga class, the Sequence is
                                       practiced over the course of ninety minutes, to a series of instructions
                                       (the ”Dialogue”), in a room heated to 105 degrees Fahrenheit to sim-
                                       ulate Choudhury’s native Indian climate.
                                           Evolation Yoga offers several types and styles of yoga, includ-
                                       ing ”hot yoga,” which is similar to ”Bikram’s Basic Yoga System.”
                                       Evolation acknowledges that hot yoga ”includes 26 postures and two
                                       breathing exercises and is done for 90 minutes, accompanied by a se-
                                       ries of oral instructions, in a room heated to approximately 105 de-
                                       grees Fahrenheit.” [Choudhury sued.]
                                           Though Choudhury emphasizes the aesthetic a ributes of the Se-
                                       quence’s ”graceful flow,” at bo om, the Sequence is an idea, process,
                                       or system designed to improve health. Copyright protects only the
                                       expression of this idea – the words and pictures used to describe the
                                       Sequence – and not the idea of the Sequence itself.
                                                       A. The Sequence Is an Unprotectable Idea.
                                       Following Baker, and recognizing this vital distinction between ideas
                                       and expression, courts have routinely held that the copyright for a
                                       work describing how to perform a process does not extend to the pro-
1BMNFS  'E  UI $JS    cess itself. In Palmer v. Braun, for example, the Eleventh Circuit held
                                       that meditation exercises described in a copyrighted manual on ex-
                                       ploring the consciousness were ”a process” unentitled to copyright
                                       protection. The court explained that the ”exercises, while undoubt-
                                       edly the product of much time and effort, are, at bo om, simply a
                                       process for achieving increased consciousness. Such processes, even
                                       if original, cannot be protected by copyright.”
                                           As Choudhury describes it, the Sequence is a ”system” or a
                                       ”method” designed to ”systematically work every part of the body,
                                       to give all internal organs, all the veins, all the ligaments, and all the
                                       muscles everything they need to maintain optimum health and max-
                                       imum function. An essential element of this ”system” is the order in
                                       which the yoga poses and breathing exercises are arranged. B             ’
" 46#+&$5 ."55&3                                                   

B           Y      C      instructs readers, ”Do the poses in the strict
order given in this book. Nothing about Bikram’s Beginning Yoga
Class is haphazard. It is designed to scientifically warm and stretch
muscles, ligaments, and tendons in the order in which they should
be stretched.” For instance, Choudhury explains, ”Camel Pose (Us-
trasana) stretches the abdomen and compresses the spine; so for the
next posture, I chose the Rabbit Pose (Sasangasana), which does the
converse: stretches the back and compresses the abdomen.”
    Choudhury contends that the Sequence’s arrangement of pos-
tures is ”particularly beautiful and graceful.” But beauty is not a basis
for copyright protection. The performance of many ideas, systems,
or processes may be beautiful: a surgeon’s intricate movements, a
book-keeper’s careful notations, or a baker’s kneading might each
possess a certain grace for at least some viewers. Indeed, from Ver-
meer’s milkmaid to Lewis Hine’s power house mechanic, the individ-
ual engrossed in a process has long a racted artistic a ention. But
the beauty of the process does not permit one who describes it to
gain, through copyright, the monopolistic power to exclude all others
from practicing it. This is true even where, as here, the process was
conceived with at least some aesthetic considerations in mind. Just
as some steps in a recipe may reflect no more than the author’s belief
that a particular ingredient is beautiful or that a particular cooking
technique is impressive to watch and empowering to practice, some
elements in Choudhury’s Sequence may reflect his aesthetic prefer-
ences. Yet just like the recipe, the Sequence remains unprotectable as
a process the design of which primarily reflects function, not expres-
sion.                                                                         +PIBOOFT 7FSNFFS 5IF .JMLNBJE

          B. The Sequence Is Not a Copyrightable Compilation.
By claiming copyright protection for the Sequence as a compilation,
Choudhury misconstrues the scope of copyright protection for com-
pilations. As we have explained, the Sequence is an idea, process, or
system; therefore, it is not eligible for copyright protection. That the
Sequence may possess many constituent parts does not transform it
into a proper subject of copyright protection. Virtually any process
or system could be dissected in a similar fashion. Baker’s examples
of ”how-to” treatises are instructive: ”A treatise on the construction
and use of ploughs, or watches, or churns, or on the mode of drawing
lines to produce the effect of perspective” would likely list the steps
necessary to perform the process it describes. The watchmaking trea-
tise’s author could not claim a copyright in the process of making a
watch, however, by breaking down the process into multiple steps
and labeling it a ”compilation.” Likewise, Choudhury cannot obtain          -FXJT )JOF 1PXFS IPVTF NFDIBOJD
copyright protection for the Sequence as a compilation by separately        XPSLJOH PO TUFBN QVNQ
identifying the poses and breathing exercises it contains.
                                                                                     $)"15&3  $01:3*()5

                                             Moreover, according to Choudhury himself, the medical and func-
                                         tional considerations at the heart of the Sequence compel the very se-
                                         lection and arrangement of poses and breathing exercises for which
                                         he claims copyright protection. According to Bikram’s Beginning
                                         Yoga Class, the ”strict order” of the poses ”is designed to scientifi-
                                         cally warm and stretch muscles, ligaments, and tendons in the order
                                         in which they should be stretched.” Read in the light most favorable
                                         to Choudhury, the record demonstrates that the overarching reason
                                         for the organization of the poses and breathing exercises in the Se-
                                         quence is to further the basic goals of the method: to a ain ”[p]roper
                                         weight, muscle tone, glowing complexion, boundless energy, vibrant
                                         good health, and a sense of well-being.” The Sequence’s composition
                                         renders it more effective as a process or system, but not any more
                                         suitable for copyright protection as an original work of authorship.
                                             It makes no difference that similar results could be achieved
                                         through a different organization of yoga poses and breathing exer-
                                         cises. Choudhury argues that he could have chosen from ”hundreds
                                         of postures” and ”countless arrangements of these postures” in de-
                                         veloping the Sequence. But the possibility of a aining a particular
                                         end through multiple different methods does not render the uncopy-
8IBUFWFS *U 5BLFT  'E     rightable a proper subject of copyright. See ATC Distribution Group,
UI $JS                             Inc. v. Whatever It Takes Transmissions & Parts, Inc. (”To be sure, the
                                         publisher of a catalog describing a transmission parts numbering sys-
                                         tem could have arranged the parts information in other ways that
                                         were potentially less clear or useful, but this fact alone is insufficient
                                         to demonstrate the creativity necessary for copyright protection.”).
                                         Though it may be one of many possible yoga sequences capable of
                                         a aining similar results, the Sequence is nevertheless a process and
                                         is therefore ineligible for copyright protection.
                                               C. The Sequence Is Not a Copyrightable Choreographic Work.
                                         The Sequence is not copyrightable as a choreographic work for the
                                         same reason that it is not copyrightable as a compilation: it is an idea,
                                         process, or system to which copyright protection may ”in no case”
                                         extend. We recognize that the Sequence may involve ”static and ki-
                                         netic successions of bodily movement in certain rhythmic and spa-
$PNQFOEJVN ** 4                    tial relationships.”. So too would a method to churn bu er or drill
                                         for oil. That is no accident: ”successions of bodily movement” of-
                                         ten serve basic functional purposes. Such movements do not become
                                         copyrightable as ”choreographic works” when they are part and par-
                                         cel of a process. Even if the Sequence could fit within some colloquial
                                         definitions of dance or choreography, it remains a process ineligible
                                         for copyright protection.
                                             Our day-to-day lives consist of many routinized physical move-
                                         ments, from brushing one’s teeth to pushing a lawnmower to shaking
" 46#+&$5 ."55&3                                                                

a Polaroid picture, that could be (and, in two of the preceding exam-
ples, have been) characterized as forms of dance. Without a proper                       4IBLF JU TIBLF JU MJLF B 1PMBSPJE
understanding of the idea/expression dichotomy, one might obtain                         QJDUVSF
                                                                                         ‰0VU,BTU )FZ :B -B'BDF 3FDPSET
monopoly rights over these functional physical sequences by describ-
ing them in a tangible medium of expression and labeling them chore-
ographic works.
                          IV. C
Although there is no cause to dispute the many health, fitness, spir-
itual, and aesthetic benefits of yoga, and Bikram Yoga in particular,
they do not bring the Sequence into the realm of copyright protection.

                                                                                         )FSCFSU 3PTFOUIBM  'E  UI
           $PODSFUF .BDIJOFSZ $P W $MBTTJD -BXO 0SOBNFOUT                              $JS
                          'E  TU $JS                                       .PSSJTTFZ  'E  TU $JS 
Some ideas admit of only a limited number of expressions. When                           #BTFE PO -BQJOF W 4FJOGFME /P 
there is essentially only one way to express an idea, the idea and its                   DW  8-  4%/: 4FQU
expression are inseparable and copyright is no bar to copying that                        
expression. See, e.g., Herbert Rosenthal Jewelry Corp. v. Kalpakian
(idea and expression of copyrighted “jeweled bee pin” inseparable
and thus copying not prohibited); Morrissey v. Proctor & Gamble
Co. (since few ways to express rules for “sweepstakes,” no infringe-
ment although defendant’s rules only slightly different from plain-
tiff’s rules).7 When the idea and its expression are not completely
inseparable, there may still be only a limited number of ways of ex-
pressing the idea. In such a case, the burden of proof is heavy on the
plaintiff who may have to show “near identity” between the works
at issue. This showing is necessary because, as idea and expression
merge, fewer and fewer aspects of a work embody a unique and cre-
ative expression of the idea; a copyright holder must then prove sub-
stantial similarity to those few aspects of the work that are expression
not required by the idea. …                                                                         5IF 4OFBLZ $IFG

                       $PPLJOH GPS ,JET 1SPCMFN
Missy Lapine is the author of T        S       C : S          S      -
          H      H        F         K ’F          M       (published
2007), which “presents over 75 recipes that ingeniously disguise the
most important superfoods inside kids’ favorite meals.” Jessica Sein-
feld is the author of D            D         : S     S           G
Y      K    E      G     F     (published 2008), which “is filled with
    The rationale for this rule, as Judge Aldrich stated, is that “to permit copy-
righting [in that case] would mean that a party or parties, by copyrighting a mere
handful of forms [of expression], could exhaust all possibilities of future use of the
substance ... [and thus] the subject ma er would be appropriated by permi ing the
copyrighting of its expression. We cannot recognize copyright as a game of chess
in which the public can be checkmated.”                                                          %FDFQUJWFMZ %FMJDJPVT
                                                                                      $)"15&3  $01:3*()5

                                           traditional recipes that kids love, except they’re stealthily packed
                                           with veggies hidden in them so kids don’t even know!” Infringe-
                                           ment? Are there further facts it would be helpful to know?

                                           #     0XOFSTIJQ

                                                         4IFMEPO W .FUSP(PMEXZO 1JDUVSFT $PSQ
                                                                   'E  E $JS 
)BOE +                                    Borrowed the work must indeed not be, for a plagiarist is not himself
                                           pro tanto an “author”; but if by some magic a man who had never
                                           known it were to compose anew Keats’s Ode on a Grecian Urn, he
$PNQBSF 1JFSSF .FOBSE EJE OPU XBOU       would be an “author,” and, if he copyrighted it, others might not copy
                                           that poem, though they might of course copy Keats’s.
JOBM IF IBE OP JOUFOUJPO PG DPQZJOH JU   Because of this rule permi ing multiple independent creation, copy-
)JT BENJSBCMF BNCJUJPO XBT UP QSPEVDF      right (like trade secret) does not need complicated priority doctrines,
                                           as patent and trademark do. The price paid for simplicity here,
                                           though, is that copyright (like trade secret) must include proof of
-VJT #PSHFT 1JFSSF .FOBSE "VUIPS PG UIF    copying from the plaintiff as part of its infringement analysis.
2VJYPUF  "OESFX )VSMFZ USBOT             Two kinds of issues about initial copyright ownership do arise
                                           with some regularity. First, there is the problem of whether certain
                                           kinds of allegedly ”creative” processes should be regarded as result-
                                           ing in copyrightable authorship at all. Second, there is the prob-
                                           lem of dividing up ownership among multiple parties who do con-
                                           tribute authorship. Copyright slices this problem up along two di-
                                           mensions: contemporaneous collaborations are addressed as joint
                                           works or works made for hire, whereas sequential creation is ana-
                                           lyzed in terms of derivative works.


                                                          #VSSPX(JMFT -JUIPHSBQIJD $P W 4BSPOZ
                                           The suit was commenced by an action at law in which Sarony was
                                           plaintiff and the lithographic company was defendant, the plaintiff
                                           charging the defendant with violating his copyright in regard to a
                                           photograph, the title of which is “Oscar Wilde No. 18.” A jury being
          0TDBS 8JMEF /P                waived, the court made a finding of facts on which a judgment in
                                           favor of the plaintiff was rendered for the sum of $600 for the plates
DFMFCSJUZ QIPUPHSBQIFS JF CPUI B        and 85,000 copies sold and exposed to sale, and $10 for copies found
QIPUPHSBQIFS PG DFMFCSJUJFT BOE B          in his possession.
DFMFCSJUZ JO IJT PXO SJHIU                    The constitutional question is not free from difficulty.
# 08/&34)*1                                                          

   The eighth section of the first article of the Constitution is the great
repository of the powers of Congress, and by the eighth clause of that
section Congress is authorized:
      To promote the progress of science and useful arts, by se-
      curing, for limited times to authors and inventors, the ex-
      clusive right to their respective writings and discoveries.
It is insisted in argument, that a photograph being a reproduction on
paper of the exact features of some natural object or of some person,
is not a writing of which the producer is the author.
     [The Court reviewed early copyright statutes conferring copy-
right protection on maps, charts, designs, engravings, etchings, cuts,
and other prints.]
     These statutes certainly answer the objection that books only, or
writing in the limited sense of a book and its author, are within the
constitutional provision. Both these words are susceptible of a more
enlarged definition than this. An author in that sense is “he to whom
anything owes its origin; originator; maker; one who completes a
work of science or literature.” W              . So, also, no one would      +PTFQI &NFSTPO 8PSDFTUFS o
now claim that the word writing in this clause of the Constitution,           XBT UIF OVNCFSUXP MFYJ
                                                                             DPHSBQIFS PG IJT EBZ BGUFS /PBI
though the only word used as to subjects in regard to which authors          8FCTUFS
are to be secured, is limited to the actual script of the author, and ex-
cludes books and all other printed ma er. By writings in that clause
is meant the literary productions of those authors, and Congress very
properly has declared these to include all forms of writing, printing,
engraving, etching, &c., by which the ideas in the mind of the author
are given visible expression. The only reason why photographs were
not included in the extended list in the act of 1802 is probably that
they did not exist, as photography as an art was then unknown, and
the scientific principle on which it rests, and the chemicals and ma-
chinery by which it is operated, have all been discovered long since
that statute was enacted.
     But it is said that an engraving, a painting, a print, does embody
the intellectual conception of its author, in which there is novelty, in-
vention, originality, and therefore comes within the purpose of the
Constitution in securing its exclusive use or sale to its author, while
the photograph is the mere mechanical reproduction of the physical
features or outlines of some object animate or inanimate, and involves
no originality of thought or any novelty in the intellectual operation
connected with its visible reproduction in shape of a picture.
     The third finding of facts says, in regard to the photograph in          %PFT UIJT QBTTBHF BEFRVBUFMZ FYQMBJO
question, that it is a “useful, new, harmonious, characteristic, and         XIZ /BQPMFPO 4BSPOZ SBUIFS UIBO 0T
                                                                             DBS 8JMF PXOFE UIF DPQZSJHIU 8IBU
graceful picture, and that plaintiff made the same ... entirely from
                                                                             BCPVU 4BSPOZhT DBNFSB PQFSBUPS #FO
his own original mental conception, to which he gave visible form by         KBNJO 3JDIBSETPO
posing the said Oscar Wilde in front of the camera, selecting and ar-
                                                                                       $)"15&3  $01:3*()5

                                           ranging the costume, draperies, and other various accessories in said
                                           photograph, arranging the subject so as to present graceful outlines,
                                           arranging and disposing the light and shade, suggesting and evoking
                                           the desired expression, and from such disposition, arrangement, or
                                           representation, made entirely by plaintiff, he produced the picture in
                                               These findings, we think, show this photograph to be an original
                                           work of art, the product of plaintiff’s intellectual invention, of which
                                           plaintiff is the author, and of a class of inventions for which the Con-
                                           stitution intended that Congress should secure to him the exclusive
  8-  /% $BM +BO        right to use, publish and sell, as it has done by section 4952 of the
                                     Revised Statutes.

                                                                  .POLFZ 4FMöF 1SPCMFN
                                           Nature photographer David Slater was traveling in Indonesia when
                                           a monkey picked up his camera and pushed the shu er bu on, re-
                                           sulting in this photograph. Is it copyrightable? If so, who owns the
                                               Does it ma er whether Slater had chosen his camera’s se ings
                                           (e.g., shu er speed, aperture, autofocus) for taking close-up daytime
                                           outdoor wildlife photographs? If he was specifically trying to get
                                           monkeys to pick up the camera and take selfies? If he took the pho-
                                           tograph himself and then falsely passed it off as a monkey selfie?

                                                                        $PQZSJHIU "DU

            .POLFZ TFMöF                   Copyright protection under this title is not available for any work of
                                           the United States Government, but the United States Government is
                                           not precluded from receiving and holding copyrights transferred to
 64$ f                             it by assignment, bequest, or otherwise.
DPVME CF TFDVSFE JO UIF QSPEVDUT PG UIF                                 $PQZSJHIU "DU
XIPMF XPSL EPOF CZ UIF KVEHFT DPOTUJ      (a)    Initial Ownership. – Copyright in a work protected under this
UVUFT UIF BVUIFOUJD FYQPTJUJPO BOE JO            title vests initially in the author or authors of the work. The
UFSQSFUBUJPO PG UIF MBX XIJDI CJOEJOH             authors of a joint work are coowners of copyright in the work.
BMM #BOLT W .BODIFTUFS  64      (b)    Works made for hire. – In the case of a work made for hire, the
                                             employer or other person for whom the work was prepared is
                                                  considered the author for purposes of this title, and, unless the
                                                  parties have expressly agreed otherwise in a wri en instrument
 64$ f                                    signed by them, owns all of the rights comprised in the copy-
# 08/&34)*1                                                        


A “joint work” is a work prepared by two or more authors with the            64$ f 
intention that their contributions be merged into inseparable or inter-     %FöOJUJPOT
dependent parts of a unitary whole.
    A “work made for hire” is
 (1) a work prepared by an employee within the scope of his or her
      employment; or
 (2) a work specially ordered or commissioned for use as a contribu-
      tion to a collective work, as a part of a motion picture or other
      audiovisual work, as a translation, as a supplementary work,
      as a compilation, as an instructional text, as a test, as answer
      material for a test, or as an atlas, if the parties expressly agree
      in a wri en instrument signed by them that the work shall be
      considered a work made for hire.

Ownership of a copyright, or of any of the exclusive rights under a          64$ f 
copyright, is distinct from ownership of any material object in which       0XOFSTIJQ PG DPQZSJHIU BT EJTUJODU GSPN
the work is embodied. Transfer of ownership of any material object,         PXOFSTIJQ PG NBUFSJBM PCKFDU
including the copy or phonorecord in which the work is first fixed,
does not of itself convey any rights in the copyrighted work embod-
ied in the object; nor, in the absence of an agreement, does transfer of
ownership of a copyright or of any exclusive rights under a copyright
convey property rights in any material object.

                          5IPNTPO W -BSTPO
                        'E  E $JS 
Plaintiff-appellant Lynn Thomson claims that, along with principal
playwright Jonathan Larson, she co-authored a “new version” of the
critically acclaimed Broadway musical Rent.
Rent, the Puli er Prize and Tony Award-winning Broadway modern
musical based on Puccini’s opera La Bohème, began in 1989 as the joint
project of Billy Aronson and composer Jonathan Larson. Aronson
and Larson collaborated on the work until their amicable separation
in 1991. At that time, Larson obtained Aronson’s permission to de-
velop the play on his own.
    In the summer of 1992, Larson’s Rent script was favorably re-
ceived by James Nicola, Artistic Director of the New York Theatre
Workshop (“NYTW”), a non-profit theater company in the East Vil-
lage. Larson continued to develop and revise the “workshop version”
of his Rent script. In the spring of 1993, Nicola urged Larson to allow
the NYTW to hire a playwright or a bookwriter to help revamp the
                                                      $)"15&3  $01:3*()5

storyline and narrative structure of the play.
    In May 1995, in preparation for Rent’s off-Broadway opening
scheduled for early 1996, Larson agreed to the NYTW’s hiring of
Lynn Thomson, a professor of advanced playwrighting at New York
University, as a dramaturg5 to assist him in clarifying the storyline of
the musical. Thomson signed a contract with the NYTW, in which she
agreed to provide her services with the workshop production from
May 1, 1995, through the press opening, scheduled for early Febru-
ary of 1996. The agreement stated that Thomson’s “responsibilities
shall include, but not be limited to: Providing dramaturgical assis-
tance and research to the playwright and director.” In exchange, the
NYTW agreed to pay “a fee” of $2000, “[i]n full consideration of the
services to be rendered” and to provide for billing credit for Thom-
son as “Dramaturg.” The Thomson/NYTW agreement was silent as
to any copyright interests or any issue of ownership with respect to
the final work.
    In the summer and fall of 1995, Thomson and Larson worked ex-
tremely intensively together on the show. For the most part, the two
worked on the script alone in Larson’s apartment. Thomson testified
that revisions to the text of Rent didn’t begin until early August 1995.
Larson himself entered all changes directly onto his computer, where
he kept the script, and Thomson made no contemporaneous notes of
her specific contributions of language or other structural or thematic
suggestions. Thomson alludes to the “October Version” of Rent as
the culmination of her collaborative efforts with Larson. That new
version was characterized by experts as “a radical transformation of
the show.”
    A “sing-through” of the “October Version” of Rent took place in
early November 1995. And on November 3, 1995, Larson signed a
contract with the NYTW for ongoing revisions to Rent. This agree-
ment identified Larson as the “Author” of Rent and made no refer-
ence to Thomson. The contract incorporated by reference an earlier
draft author’s agreement that set forth the terms that would apply if
the NYTW opted to produce Rent. The earlier draft author’s agree-
ment gave Larson approval rights over all changes in text, provided
that any changes in text would become his property, and assured him
billing as “sole author.”
    The final dress rehearsal was held on January 24, 1996. Just hours
after it ended, Larson died suddenly of an aortic aneurysm. Over
the next few weeks, Nicola, Greif, Thomson, and musical director
    Dramaturgs provide a range of services to playwrights and directors in connec-
tion with the production and development of theater pieces. According to Thom-
son’s testimony, the role of the dramaturg “can include any number of the elements
that go into the crafting of a play,” such as “actual plot elements, dramatic structure,
character details, themes, and even specific language.”
# 08/&34)*1                                                                      

Tim Weil worked together to fine-tune the script. The play opened
off-Broadway on February 13, 1996, to rave reviews. On February
23, Rent’s move to Broadway was announced. Since its opening on
Broadway on April 29, 1996, the show has been “an astounding criti-
cal, artistic, and commercial success.”
    Before the Broadway opening, Thomson, in view of her contri-
butions to Rent, sought compensation and title page dramaturgical
credit from the Broadway producers. And on April 2, 1996, she
signed a contract in which the producers agreed to pay her $10,000
plus a nominal $50/ week for her dramaturgical services. Around
the same time, upon the producers’ advice, Thomson approached Al-
lan S. Larson, Nane e Larson, and Julie Larson McCollum (“Larson
Heirs”), the surviving members of Jonathan Larson’s family, to re-
quest a percentage of the royalties derived from the play. In a le er
to the Larson family, dated April 8, 1996, Thomson stated that she
believed Larson, had he lived, would have offered her a “small per-
centage of his royalties to acknowledge the contribution I made.” In
reply, the Larson Heirs offered Thomson a gift of 1% of the author’s
royalties. Negotiations between Thomson and the Larson Heirs, how-
ever, broke down.
    After the parties failed to reach a se lement, Thomson brought
suit against the Larson Heirs, claiming that she was a co-author of
Rent and that she had never assigned, licensed, or otherwise trans-
ferred her rights. Thomson sought declaratory relief and a retroac-
tive and on-going accounting under the Copyright Act. Specifically,
she asked that the court declare her a “co-author” of Rent and grant
her 16% of the author’s share of the royalties.11
                   T         ’ C -A             C
The Copyright Act defines a “joint work” as “a work prepared by
two or more authors with the intention that their contributions be
merged into inseparable or interdependent parts of a unitary whole.”
17 U.S.C. § 101 (1994). The touchstone of the statutory definition is the
intention at the time the writing is done that the parts be absorbed or
combined into an integrated unit.
    Joint authorship entitles the co-authors to equal undivided inter-
ests in the whole work – in other words, each joint author has the
     Thomson claims that she seeks 16% of the proceeds “because of her respect for
Larson’s role as the principal creator of the work.” Thomson derives the 16% figure
in the following way: she alleges that 48% of the Rent script is new in relation to the
1994 Workshop version (prior to her involvement); as co-author, she is, therefore,
entitled to 50% of this part (or 24% of the total revenues); but since there are three
components to Rent (book, lyrics, and music) and she did not contribute to one
(music), she is entitled to 2/3, or 16% of the total revenues. Thomson also sought
the right to quote freely from various versions of Rent in a book that she planned
to write.
                                                                            $)"15&3  $01:3*()5

                               right to use or to license the work as he or she wishes, subject only to
                               the obligation to account to the other joint owner for any profits that
                               are made.
$IJMESFTT  'E        In Childress v. Taylor, our court interpreted this section of the Act
                               and set forth “standards for determining when a contributor to a
                               copyrighted work is entitled to be regarded as a joint author” where
                               the parties have failed to sign any wri en agreement dealing with
                               coauthorship. While the Copyright Act states only that co-authors
                               must intend that their contributions “be merged into ... a unitary
                               whole,” Judge Newman explained why a more stringent inquiry than
                               the statutory language would seem to suggest is required:
                                         An inquiry so limited would extend joint author status
                                     to many persons who are not likely to have been within
                                     the contemplation of Congress. For example, a writer fre-
                                     quently works with an editor who makes numerous use-
                                     ful revisions to the first draft, some of which will consist of
                                     additions of copyrightable expression. Both intend their
                                     contributions to be merged into inseparable parts of a uni-
                                     tary whole, yet very few editors and even fewer writers
                                     would expect the editor to be accorded the status of joint
                                     author, enjoying an undivided half interest in the copy-
                                     right in the published work.
                                   The potential danger of allowing anyone who makes even a min-
                               imal contribution to the writing of a work to be deemed a statutory
                               co-author – as long as the two parties intended the contributions to
                               merge — motivated the court to set forth a two-pronged test. A co-
                               authorship claimant bears the burden of establishing that each of the
                               putative co-authors (1) made independently copyrightable contribu-
                               tions to the work; and (2) fully intended to be co-authors.
                                             1. Independently Copyrightable Contributions
                               Childress held that collaboration alone is not sufficient to establish
                               joint authorship. Rather, the contribution of each joint author must
                               be independently copyrightable.
                                   Without making specific findings as to any of Thomson’s claims
                               regarding lyrics or other contributions, the district court concluded
                               that Thomson “made at least some non-de minimis copyrightable
                               contribution,” and that Thomson’s contributions to the Rent libre o
                               were “certainly not zero.” Once having said that, the court de-
                               cided the case on the second Childress prong – mutual intent of co-
                               authorship. It hence did not reach the issue of the individual copy-
                               rightability of Thomson’s varied alleged contributions (plot develop-
                               ments, thematic elements, character details, and structural compo-
# 08/&34)*1                                                           

                          2. Intent of the Parties
Childress mandates that the parties “entertain in their minds the con-
cept of joint authorship.” This requirement of mutual intent recog-
nizes that, since coauthors are afforded equal rights in the coauthored
work, the “equal sharing of rights should be reserved for relation-
ships in which all participants fully intend to be joint authors.”
    Childress and its progeny, however, do not explicitly define the
nature of the necessary intent to be co-authors. The court stated that
“[i]n many instances, a useful test will be whether, in the absence of
contractual arrangements concerning listed authorship, each partic-
ipant intended that all would be identified as co-authors.” But it is
also clear that the intention standard is not strictly subjective.
i. Decisionmaking Authority
An important indicator of authorship is a contributor’s decisionmak-
ing authority over what changes are made and what is included in a
work. See, e.g., Erickson v. Trinity Theatre, Inc. (an actor’s suggestion of   &SJDLTPO  'E  UI $JS 
text does not support a claim of co-authorship where the sole author
determined whether and where such contributions were included in
the work); Maruel v. Smith (claimant had a contractual right to control        .BVSFM  '  E $JS 
the contents of the opera).
    The district court determined that Larson “retained and intended
to retain at all times sole decision-making authority as to what went
into Rent.” In support of its conclusion, the court relied upon Thom-
son’s statement that she was “fla ered that [Larson] was asking [her]
to contribute actual language to the text” and found that this state-
ment demonstrated that even Thomson understood “that the ques-
tion whether any contribution she might make would go into the
script was within Mr. Larson’s sole and complete discretion.” More-
over, as the court recognized, the November agreement between Lar-
son and the NYTW expressly stated that Larson had final approval
over all changes to Rent and that all such changes would become Lar-
son’s property.
ii. Billing
In discerning how parties viewed themselves in relation to a work,
Childress also deemed the way in which the parties bill or credit them-
selves to be significant. As the district court noted, “billing or credit
is ... a window on the mind of the party who is responsible for
giving the billing or the credit.” And a writer’s a ribution of the
work to herself alone is “persuasive proof ... that she intended this
particular piece to represent her own individual authorship” and is
“prima facie proof that [the] work was not intended to be joint.” Weiss-       8FJTTNBOO     'E  E $JS
mann v. Freeman Thomson claims that Larson’s decision to credit her            
                                            $)"15&3  $01:3*()5

as “dramaturg” on the final page of Rent scripts reflected some co-
authorship intent. Thomson concedes that she never sought equal
billing with Larson, but argues that she did not need to do so in or-
der to be deemed a statutory co-author.
    The district court found, instead, that the billing was unequivocal:
Every script brought to [the court’s] a ention says “Rent, by Jonathan
Larson.” In addition, Larson “described himself in the biography he
submi ed for the playbill in January 1996, nine days before he died,
as the author/composer, and listed Ms. Thomson on the same doc-
ument as dramaturg.” And while, as Ms. Thomson argues, it may
indeed have been highly unusual for an author/composer to credit
his dramaturg with a byline, we fail to see how Larson’s decision to
style her as “dramaturg” on the final page in Rent scripts reflects a
co-authorship intent on the part of Larson. The district court prop-
erly concluded that “the manner in which [Larson] listed credits on
the scripts strongly supports the view that he regarded himself as the
sole author.”
iii. Wri en Agreements with Third Parties
Just as the parties’ wri en agreements with each other can consti-
tute evidence of whether the parties considered themselves to be co-
authors, so the parties’ agreements with outsiders also can provide
insight into co-authorship intent, albeit to a somewhat more a enu-
ated degree.
    The district court found that Larson “listed himself or treated him-
self as the author in the November 1995 revisions contract that he
entered into with the NYTW, which in turn incorporated the earlier
draft author’s agreement that had not been signed.” That agreement
identifies Larson as Rent’s “Author” and does not mention Thomson.
It also incorporates the terms of a September 1995 draft agreement
(termed “Author’s Agreement”) that states that Larson “shall receive
billing as sole author.” The district court commented, moreover, that
“[t]he fact that [Larson] felt free to enter into the November 1995 con-
tract on his own, without the consent of and without any reference to
Ms. Thomson quite apart from whatever the terms of the agreements
are, indicates that his intention was to be the sole author.”
Based on all of the evidence, the district court concluded that “Mr.
Larson never regarded himself as a joint author with Ms. Thomson.”
We believe that the district court correctly applied the Childress stan-
dards to the evidence before it and hold that its finding that Larson
never intended co-authorship was not clearly erroneous.

                           (SFFOF W "CMPO
# 08/&34)*1                                                           

                        'E  TU $JS 
Authors who create a joint work co-own the copyright in that work.
Joint authors share equal undivided interests in the whole work – in
other words, each joint author has the right to use or to license the
work as he or she wishes, subject only to the obligation to account to
the other joint author for any profits that are made. Even if it is clear
that one co-author has contributed more to the work than another
co-author, they are nevertheless equal owners of the copyright in the
absence of an agreement to the contrary.
    A co-owner must account to other co-owners for any profits he
earns from licensing or use of the copyright. The duty to account
comes from equitable doctrines relating to unjust enrichment and
general principles of law governing the rights of co-owners. We ac-
knowledge the theoretical appeal of the notion that if one owner per-
mits free use of the copyright, that owner incurs a debt to his co-
owner because the use, paid-for or not, partially depletes the value of
the copyright. However, the duty to account is for profits, not value.

In the fall of 1985, CCNV decided to participate in the annual Christ-
mastime Pageant of Peace in Washington, D. C., by sponsoring a dis-
play to dramatize the plight of the homeless. As the District Court
      ”Snyder and fellow CCNV members conceived the idea
      for the nature of the display: a sculpture of a modern Na-
      tivity scene in which, in lieu of the traditional Holy Family,
      the two adult figures and the infant would appear as con-
      temporary homeless people huddled on a streetside steam
      grate. The family was to be black (most of the homeless in
     Washington being black); the figures were to be life-sized,
      and the steam grate would be positioned atop a platform
     ‘pedestal,’ or base, within which special-effects equipment
     would be enclosed to emit simulated ‘steam’ through the
      grid to swirl about the figures. They also se led upon a
      title for the work – ‘Third World America’ – and a legend
      for the pedestal: ‘and still there is no room at the inn.’ “
Snyder made inquiries to locate an artist to produce the sculpture.
He was referred to respondent James Earl Reid, a Baltimore, Mary-
land, sculptor. In the course of two telephone calls, Reid agreed to
sculpt the three human figures. CCNV agreed to make the steam
                                                                             +BNFT &BSM 3FJE 5IJSE 8PSME "NFSJDB
grate and pedestal for the statue. Reid proposed that the work be
                                           $)"15&3  $01:3*()5

cast in bronze, at a total cost of approximately $100,000 and taking
six to eight months to complete. Snyder rejected that proposal be-
cause CCNV did not have sufficient funds, and because the statue
had to be completed by December 12 to be included in the pageant.
Reid then suggested, and Snyder agreed, that the sculpture would
be made of a material known as “Design Cast 62,” a synthetic sub-
stance that could meet CCNV’s monetary and time constraints, could
be tinted to resemble bronze, and could withstand the elements. The
parties agreed that the project would cost no more than $15,000, not
including Reid’s services, which he offered to donate. The parties did
not sign a wri en agreement. Neither party mentioned copyright.
    After Reid received an advance of $3,000, he made several
sketches of figures in various poses. At Snyder’s request, Reid sent
CCNV a sketch of a proposed sculpture showing the family in a
crechelike se ing: the mother seated, cradling a baby in her lap; the
father standing behind her, bending over her shoulder to touch the
baby’s foot. Reid testified that Snyder asked for the sketch to use
in raising funds for the sculpture. Snyder testified that it was also
for his approval. Reid sought a black family to serve as a model for
the sculpture. Upon Snyder’s suggestion, Reid visited a family liv-
ing at CCNV’s Washington shelter but decided that only their newly
born child was a suitable model. While Reid was in Washington, Sny-
der took him to see homeless people living on the streets. Snyder
pointed out that they tended to recline on steam grates, rather than
sit or stand, in order to warm their bodies. From that time on, Reid’s
sketches contained only reclining figures.
    Throughout November and the first two weeks of December 1985,
Reid worked exclusively on the statue, assisted at various times by a
dozen different people who were paid with funds provided in install-
ments by CCNV. On a number of occasions, CCNV members visited
Reid to check on his progress and to coordinate CCNV’s construc-
tion of the base. CCNV rejected Reid’s proposal to use suitcases or
shopping bags to hold the family’s personal belongings, insisting in-
stead on a shopping cart. Reid and CCNV members did not discuss
copyright ownership on any of these visits.
    On December 24, 1985, 12 days after the agreed-upon date, Reid
delivered the completed statue to Washington. There it was joined
to the steam grate and pedestal prepared by CCNV and placed on
display near the site of the pageant. Snyder paid Reid the final in-
stallment of the $15,000. The statue remained on display for a month.
In late January 1986, CCNV members returned it to Reid’s studio in
Baltimore for minor repairs. Several weeks later, Snyder began mak-
ing plans to take the statue on a tour of several cities to raise money
for the homeless. Reid objected, contending that the Design Cast 62
material was not strong enough to withstand the ambitious itinerary.
# 08/&34)*1                                                        

He urged CCNV to cast the statue in bronze at a cost of $35,000, or
to create a master mold at a cost of $5,000. Snyder declined to spend
more of CCNV’s money on the project.
    In March 1986, Snyder asked Reid to return the sculpture. Reid re-
fused. He then filed a certificate of copyright registration for “Third
World America” in his name and announced plans to take the sculp-
ture on a more modest tour than the one CCNV had proposed. Sny-
der, acting in his capacity as CCNV’s trustee, immediately filed a com-
peting certificate of copyright registration.
    Snyder and CCNV then commenced this action against Reid.
The Copyright Act of 1976 provides that copyright ownership “vests
initially in the author or authors of the work.” 17 U. S. C. § 201(a). As
a general rule, the author is the party who actually creates the work,
that is, the person who translates an idea into a fixed, tangible expres-
sion entitled to copyright protection. § 102. The Act carves out an im-
portant exception, however, for “works made for hire.” If the work
is for hire, “the employer or other person for whom the work was
prepared is considered the author” and owns the copyright, unless
there is a wri en agreement to the contrary. § 201(b). Classifying a
work as “made for hire” determines not only the initial ownership of
its copyright, but also the copyright’s duration, § 302(c), and the own-
ers’ renewal rights, § 304(a), termination rights, § 203(a), and right to
import certain goods bearing the copyright, § 601(b)(1). The contours
of the work for hire doctrine therefore carry profound significance for
freelance creators – including artists, writers, photographers, design-
ers, composers, and computer programmers – and for the publish-
ing, advertising, music, and other industries which commission their
     The dispositive inquiry in this case therefore is whether “Third
World America” is “a work prepared by an employee within the
scope of his or her employment” under § 101(1). The Act does not
define these terms. In the absence of such guidance, four interpre-
tations have emerged. The first holds that a work is prepared by
an employee whenever the hiring party retains the right to control
the product. A second, and closely related, view is that a work is
prepared by an employee under § 101(1) when the hiring party has
actually wielded control with respect to the creation of a particular
work. A third view is that the term “employee” within § 101(1) car-
ries its common-law agency law meaning. Finally, respondent and
numerous amici curiae contend that the term “employee” only refers
to “formal, salaried” employees.
                                                     $)"15&3  $01:3*()5

    Nothing in the text of the work for hire provisions indicates that
Congress used the words “employee” and “employment” to describe
anything other than the conventional relation of employer and em-
ploye. On the contrary, Congress’ intent to incorporate the agency
law definition is suggested by § 101(1)’s use of the term, “scope of
employment,” a widely used term of art in agency law.
    We therefore conclude that the language and structure of § 101
of the Act do not support either the right to control the product or
the actual control approaches.8 The structure of § 101 indicates that a
work for hire can arise through one of two mutually exclusive means,
one for employees and one for independent contractors, and ordinary
canons of statutory interpretation indicate that the classification of a
particular hired party should be made with reference to agency law.
    In sum, we must reject petitioners’ argument. Transforming a
commissioned work into a work by an employee on the basis of the
hiring party’s right to control, or actual control of, the work is in-
consistent with the language, structure, and legislative history of the
work for hire provisions. To determine whether a work is for hire
under the Act, a court first should ascertain, using principles of gen-
eral common law of agency, whether the work was prepared by an
employee or an independent contractor. After making this determi-
nation, the court can apply the appropriate subsection of § 101.
We turn, finally, to an application of § 101 to Reid’s production of
“Third World America.” In determining whether a hired party is an
employee under the general common law of agency, we consider the
hiring party’s right to control the manner and means by which the
product is accomplished. Among the other factors relevant to this
inquiry are the skill required; the source of the instrumentalities and
tools; the location of the work; the duration of the relationship be-
tween the parties; whether the hiring party has the right to assign
additional projects to the hired party; the extent of the hired party’s
discretion over when and how long to work; the method of payment;
the hired party’s role in hiring and paying assistants; whether the
work is part of the regular business of the hiring party; whether the
     We also reject the suggestion of respondent and amici that the term “em-
ployee” refers only to formal, salaried employees. The Act does not say “formal”
or “salaried” employee, but simply “employee.” Moreover, respondent and those
amici who endorse a formal, salaried employee test do not agree upon the content
of this test. Compare, e. g., Brief for Respondent 37 (hired party who is on payroll
is an employee) with Tr. of Oral Arg. 31 (hired party who receives a salary or com-
missions regularly is an employee); and Brief for Volunteer Lawyers for the Arts,
Inc., et al. as Amici Curiae 4 (hired party who receives a salary and is treated as an
employee for Social Security and tax purposes is an employee).
# 08/&34)*1                                                                     

hiring party is in business; the provision of employee benefits; and
the tax treatment of the hired party. No one of these factors is deter-
    Examining the circumstances of this case in light of these factors,
we agree with the Court of Appeals that Reid was not an employee
of CCNV but an independent contractor. True, CCNV members di-
rected enough of Reid’s work to ensure that he produced a sculp-
ture that met their specifications. But the extent of control the hiring
party exercises over the details of the product is not dispositive. In-
deed, all the other circumstances weigh heavily against finding an
employment relationship. Reid is a sculptor, a skilled occupation.
Reid supplied his own tools. He worked in his own studio in Bal-
timore, making daily supervision of his activities from Washington
practicably impossible. Reid was retained for less than two months,
a relatively short period of time. During and after this time, CCNV
had no right to assign additional projects to Reid. Apart from the
deadline for completing the sculpture, Reid had absolute freedom to
decide when and how long to work. CCNV paid Reid $15,000, a sum
dependent on completion of a specific job, a method by which inde-
pendent contractors are often compensated. Reid had total discretion
in hiring and paying assistants. Creating sculptures was hardly regu-
lar business for CCNV. Indeed, CCNV is not a business at all. Finally,
CCNV did not pay payroll or Social Security taxes, provide any em-
ployee benefits, or contribute to unemployment insurance or workers’
compensation funds.
    Because Reid was an independent contractor, whether “Third
World America” is a work for hire depends on whether it satisfies
the terms of § 101(2). This petitioners concede it cannot do. Thus,                      *T $$/7 B KPJOU BVUIPS
CCNV is not the author of “Third World America” by virtue of the
work for hire provisions of the Act.

                8BSSFO W 'PY 'BNJMZ 8PSMEXJEF *OD
                      'E  UI $JS 
Richard Warren claims that defendants infringed the copyrights in
musical compositions he created for use in the television series ”Rem-
ington Steele.”
   The parties agree that Warren was not an employee of MTM, but
MTM contends that the agreements signed by the parties illustrate
an express agreement that the works in question were specially com-
missioned as works for hire.4 We agree.
    Because the parties are not in an employer-employee relationship, the Copy-
right Act requires not only that the work be specially commissioned pursuant to
a wri en agreement, but that the work come within one of the enumerated cate-
gories listed in 17 U.S.C. § 101(2). There is no doubt that the works fall into one of
these categories because it is undisputed that they are part of an audiovisual work.
                                                              $)"15&3  $01:3*()5

 64$ f       The Act confers work-for-hire status on a work where ”the parties
                  expressly agree in a wri en instrument signed by them that the work
                  shall be considered a work made for hire.” The Music Employment
                  Agreement provided:
                        As [Warren’s] employer for hire, [MTM] shall own in per-
                        petuity, throughout the universe, solely and exclusively,
                        all rights of every kind and character, in the musical mate-
                        rial and all other results and proceeds of the services ren-
                        dered by [Warren] hereunder and [MTM] shall be deemed
                        the author thereof for all purposes.
                  The parties later executed contracts almost identical to these first
                  agreements in June 1984, July 1985, and November 1986. As the dis-
                  trict court noted, these subsequent contracts are even more explicit
                  in defining the compositions as ”works for hire.” Le ers that Warren
                  signed accompanying the later Music Employment Agreements pro-
                  vided: ”It is understood and agreed that you are supplying [your]
                  services to us as our employee for hire ... [and] [w]e shall own all
                  right, title and interest in and to [your] services and the results and
                  proceeds thereof, as works made for hire.”
                      That the agreements did not use the talismanic words ”specially
                  ordered or commissioned” ma ers not, for there is no requirement,
                  either in the Act or the caselaw, that work-for-hire contracts include
                  any specific wording.
                      That the works were created at the behest of MTM is conclusively
                  demonstrated by the plain language of the contracts. The contracts
                  specified that Warren was, among other things, to ”compose an orig-
                  inal musical score ... mak[ing] such revisions in the musical material
                  as [MTM] may require,” and clearly indicate that such composing
                  was to be done for the sole purpose of the ”Remington Steele” pro-
                      The agreements between Warren and MTM conclusively show
                  that the musical compositions created by Warren were created as
                  works for hire, and Warren is therefore not the legal owner of the
                  copyrights therein.

                                            (BSDJB W (PPHMF *OD
                                     ' E  UI $JS  FO CBOD
                  In July 2011, Cindy Lee Garcia responded to a casting call for a film
                  titled Desert Warrior, an action-adventure thriller set in ancient Ara-
                  bia. Garcia was cast in a cameo role, for which she earned $500. She
                  received and reviewed a few pages of script. Acting under a profes-
                  sional director hired to oversee production, Garcia spoke two sen-
                  tences: ”Is George crazy? Our daughter is but a child?” Her role was
                  to deliver those lines and to ”seem[] concerned.”
# 08/&34)*1                                                             

    Garcia later discovered that writer-director Mark Basseley
Youssef (a.k.a. Nakoula Basseley Nakoula or Sam Bacile) had a dif-
ferent film in mind: an anti-Islam polemic renamed Innocence of Mus-
lims. The film, featuring a crude production, depicts the Prophet Mo-
hammed as, among other things, a murderer, pedophile, and homo-
sexual. Film producers dubbed over Garcia’s lines and replaced them
with a voice asking, ”Is your Mohammed a child molester?” Garcia
appears on screen for only five seconds.
    Almost a year after the casting call, in June 2012, Youssef up-
loaded a 13-minute-and-51-second trailer of Innocence of Muslims
to YouTube, the video-sharing website owned by Google, Inc., which
boasts a global audience of more than one billion visitors per month.
After it was translated into Arabic, the film fomented outrage across
the Middle East, and media reports linked it to numerous violent
protests. An Egyptian cleric issued a fatwa against anyone associ-
ated with Innocence of Muslims, calling upon the ”Muslim Youth in
America[] and Europe” to ”kill the director, the producer[,] and the
actors and everyone who helped and promoted this film.” Garcia re-
ceived multiple death threats.
    Legal wrangling ensued. Garcia asked Google to remove the film,
asserting it was hate speech and violated her state law rights to pri-
vacy and to control her likeness. Garcia also sent Google five take-
down notices under the Digital Millenium Copyright Act, 17 U.S.C.
§ 512, claiming that YouTube’s broadcast of Innocence of Muslims
infringed her copyright in her ”audio-visual dramatic performance.”
Google declined to remove the film.
    [Garcia sued Google and Youssef for copyright infringement.]
    The central question is whether the law and facts clearly favor
Garcia’s claim to a copyright in her five-second acting performance as
it appears in Innocence of Muslims. The answer is no. This conclusion
does not mean that a plaintiff like Garcia is without options or that
she couldn’t have sought an injunction against different parties or on
other legal theories, like the right of publicity and defamation.5
    Innocence of Muslims is an audiovisual work that is categorized as
a motion picture and is derivative of the script. Garcia is the author of
none of this and makes no copyright claim to the film or to the script.
Instead, Garcia claims that her five-second performance itself merits
copyright protection.
    Garcia’s theory of copyright law would result a legal morass –
splintering a movie into many different ”works,” even in the ab-
sence of an independent fixation. Simply put, as Google claimed, it
     Down the road, Garcia also may have a contract claim. She recalls signing
some kind of document, though she cannot find a copy. We take no position on
this claim.
                                                                                 $)"15&3  $01:3*()5

                                      ”make[s] Swiss cheese of copyrights.”
                                          Take, for example, films with a large cast—the proverbial ”cast of
                                      thousands.” The silent epic Ben-Hur advertised a cast of 125,000 peo-
                                      ple. In the Lord of the Rings trilogy, 20,000 extras tramped around
                                      Middle-Earth alongside Frodo Baggins (played by Elijah Wood).
                                      Treating every acting performance as an independent work would
                                      not only be a logistical and financial nightmare, it would turn cast of
                                      thousands into a new mantra: copyright of thousands.
                                          The reality is that contracts and the work-made-for-hire doctrine
                                      govern much of the big-budget Hollywood performance and produc-
                                      tion world. Absent these formalities, courts have looked to implied
                                      licenses. Indeed, the district court found that Garcia granted Youssef
                                      just such an implied license to incorporate her performance into the
                                      film. But these legal niceties do not necessarily dictate whether some-
                                      thing is protected by copyright, and licensing has its limitations. As
                                      filmmakers warn, low-budget films rarely use licenses. Even if film-
                                      makers diligently obtain licenses for everyone on set, the contracts
                                      are not a panacea. Third-party content distributors, like YouTube
                                      and Netflix, won’t have easy access to the licenses; litigants may dis-
                                      pute their terms and scope; and actors and other content contributors
                                      can terminate licenses after thirty five years. Untangling the complex,
                                      difficult-to-access, and often phantom chain of title to tens, hundreds,
                                      or even thousands of standalone copyrights is a task that could tie the
                                      distribution chain in knots. And filming group scenes like a public
                                      parade, or the 1963 March on Washington, would pose a huge bur-
                                      den if each of the thousands of marchers could claim an independent

                                             #MJ[[BSE &OUFSUBJONFOU *OD W -JMJUI (BNFT 4IBOHIBJ $P
                                          /P DW$3#  8-  /% $BM .BZ  
"BMNVIBNNFE  'E  UI $JS   Consider a twist on Aalmuhammed v. Lee:

                                         Spike Lee assigns his copyright in Malcolm X to, let’s say, Warner
                                      Brothers. Disney comes along and makes a cartoon version of the
UIF öMN .BMDPMN 9                     movie called Malcolm ABC. Warner Brothers sues, claiming Malcolm
                                      ABC infringes its copyright in Malcolm X. Disney responds that Aal-
                                      muhammed, not Spike Lee, wrote the scene chronicling the protag-
                                      onist’s Hajj pilgrimage, which appears in both Malcolm X and Mal-
                                      colm ABC. Warner Brothers, the argument goes, does not own the Hajj
                                      scene, and so cannot recover for Disney’s copying of that piece of Mal-
                                      colm X (nor for its copying of any scene, character, or other cinematic
                                      element dreamed up by anyone not named Spike Lee).
                                         Winning argument?
                                         No, and it was a loser even before Garcia suggested that Aal-
                                      muhammed’s script of the Hajj scene was not independently copy-
                                      rightable after all. The whole point of Aalmuhammed’s contributions
# 08/&34)*1                                                      

was to integrate them into Malcolm X, and so they must be understood
as parts of the movie to protect copyright in the movie. Copyright
in movies, comic books, and video games would be worthless other-


                           $PQZSJHIU "DU

(a) The subject ma er of copyright as specified by section 102 in-         64$ f 
    cludes compilations and derivative works, but protection for a       4VCKFDU NBUUFS PG DPQZSJHIU $PNQJMB
    work employing preexisting material in which copyright sub-          UJPOT BOE EFSJWBUJWF XPSLT
    sists does not extend to any part of the work in which such ma-
    terial has been used unlawfully.
(b) The copyright in a compilation or derivative work extends only
    to the material contributed by the author of such work, as dis-
    tinguished from the preexisting material employed in the work,
    and does not imply any exclusive right in the preexisting mate-
    rial. The copyright in such work is independent of, and does not
    affect or enlarge the scope, duration, ownership, or subsistence
    of, any copyright protection in the preexisting material.

A “compilation” is a work formed by the collection and assembling         64$ f 
of preexisting materials or of data that are selected, coordinated, or   %FöOJUJPOT
arranged in such a way that the resulting work as a whole constitutes
an original work of authorship. The term “compilation” includes col-
lective works.
    A “collective work” is a work, such as a periodical issue, anthol-
ogy, or encyclopedia, in which a number of contributions, constitut-
ing separate and independent works in themselves, are assembled
into a collective whole.
    A “derivative work” is a work based upon one or more preex-
isting works, such as a translation, musical arrangement, dramati-
zation, fictionalization, motion picture version, sound recording, art
reproduction, abridgment, condensation, or any other form in which
a work may be recast, transformed, or adapted. A work consisting
of editorial revisions, annotations, elaborations, or other modifica-
tions, which, as a whole, represent an original work of authorship,
is a “derivative work”.                                                  5PXMF NBOVGBDUVSFE BOE TPME SFQMJDBT
                                                                         PG UIF #BUNPCJMFT VTFE JO UIF 
                        %$ $PNJDT W 5PXMF                               UFMFWJTJPO TFSJFT BOE UIF  5JN #VS
                         'E                                 UPO NPWJF #FDBVTF UIF TFSJFT BOE UIF
                                                                         NPWJF XFSF NBEF VOEFS MJDFOTJOH BS
When a copyright owner authorizes a third party to prepare a deriva-     SBOHFNFOUT UIF DPVSU EJTDVTTFE UIF
tive work, the owner of the underlying work retains a copyright in       TDPQF PG EFSJWBUJWFXPSL DPQZSJHIUT
                                                                                    $)"15&3  $01:3*()5

                                       that derivative work with respect to all of the elements that the deriva-
                                       tive creator drew from the underlying work and employed in the
                                       derivative work. By contrast, the creator of the derivative work has
                                       a copyright only as to those original aspects of the work that the
                                       derivative creator contributed, and only to the extent the derivative
                                       creator’s contributions are more than trivial. Logically, therefore, if
                                       [another] third party copies a derivative work without authorization,
                                       it infringes the original copyright owner’s copyright in the underly-
                                       ing work to the extent the unauthorized copy of the derivative work
                                       also copies the underlying work.

                                                                    1JDLFUU W 1SJODF
                                                               ' E  UI $JS 
                                       The defendant, identified only as ”Prince” in the caption of the vari-
                                       ous pleadings, is a well-known popular singer whose name at birth
                                       was Prince Rogers Nelson, but who for many years performed un-
                                       der the name Prince (which is what we’ll call him) and since 1992
                                       has referred to himself by an unpronounceable symbol. The sym-
                                       bol (which rather strikingly resembles the Egyptian hieroglyph ankh,
                                       but the parties make nothing of this, so neither shall we) is his trade-
                                       mark but it is also a copyrighted work of visual art that licensees of
                                       Prince have embodied in various forms, including jewelry, clothing,
                                       and musical instruments.
                                           In 1993 the plaintiff made a guitar in the shape of the Prince sym-
                                       bol; he concedes that it is a derivative work within the meaning of 17
                                       U.S.C. § 101. The plaintiff claims (truthfully, we assume for purposes
                                       of the appeal) to have shown the guitar to Prince. Shortly afterwards
                                       Prince appeared in public playing a guitar quite similar to the plain-
                                           The plaintiff brought this suit for copyright infringement in 1994,
                                       but it languished for years in the district court. In January 1997 Prince
                                       counterclaimed for infringement of the copyright on his symbol.
                                           Picke claims the right to copyright a work derivative from an-
                                       other person’s copyright without that person’s permission and then
                                       to sue that person for infringement by the person’s own derivative
                                       work. Picke ’s guitar was a derivative work of the copyrighted
                                       Prince symbol, and so was Prince’s guitar. Since Prince had (or so
                                       we must assume) access to Picke ’s guitar, and since the two gui-
                                       tars, being derivatives of the same underlying work, are, naturally,
                                       very similar in appearance, Picke has – if he is correct that one can
                                       copyright a derivative work when the original work is copyrighted
                                       by someone else who hasn’t authorized the maker of the derivative
                                       work to copyright it – a prima facie case of infringement. Picke must,
'FSEJOBOE 1JDLFUU 4ZNCPMTIBQFE HVJ   he concedes, show that his derivative work has enough originality to
UBS                                    entitle him to a copyright, and also that the copyright is limited to the
# 08/&34)*1                                                       

features that the derivative work adds to the original. But he insists
that with these limitations his copyright is valid.
    We need not pursue the issue of originality of derivative works.
The Copyright Act grants the owner of a copyright the exclusive right
to prepare derivative works based upon the copyrighted work. So
Picke could not make a derivative work based on the Prince symbol
without Prince’s authorization even if Picke ’s guitar had a smidgeon
of originality. This is a sensible result. A derivative work is, by def-
inition, bound to be very similar to the original. Concentrating the
right to make derivative works in the owner of the original work pre-
vents what might otherwise be an endless series of infringement suits
posing insoluble difficulties of proof. Consider two translations into
English of a book originally published in French. The two transla-
tions are bound to be very similar and it will be difficult to establish
whether they are very similar because one is a copy of the other or be-
cause both are copies of the same foreign-language original. Whether
Prince’s guitar is a copy of his copyrighted symbol or a copy of Pick-
e ’s guitar is likewise not a question that the methods of litigation
can readily answer with confidence. If anyone can make derivative
works based on the Prince symbol, we could have hundreds of Pick-
e s, each charging infringement by the others.
    Picke relies for his implausible theory primarily on section 103(a)
of the Copyright Act, which provides that while copyright can be ob-
tained in derivative works, ”protection for a work employing preex-
isting material in which copyright subsists does not extend to any
part of the work in which such material has been used unlawfully.”
Picke reads this as authorizing a person other than the owner of the
original work to make a derivative work, merely forbidding him to
infringe the original. It is very difficult to see how a derivative work
not made by the owner of the original work could fail to infringe it,
given the definition of derivative works.
    Picke relied in the district court on a dictum in Eden Toys, Inc.      &EFO 5PZT  'E  E $JS 
v. Florelee Undergarment Co., that a stranger can make a derivative
work without the permission of the owner of the copyright of the
original work if the original work does not ”pervade” the deriva-
tive work. The suggestion, if taken seriously (which it has not been),
would inject enormous uncertainty into the law of copyright and un-
dermine the exclusive right that section 106(2) gives the owner of
the copyright on the original work. It also rests on a confusion be-
tween the determination of whether a work is derivative and the de-
termination of who has the right to make the derivative work. De-
fined too broadly, ”derivative work” would confer enormous power
on the owners of copyrights on preexisting works. The Bernstein-
Sondheim musical West Side Story, for example, is based loosely on
Shakespeare’s Romeo and Juliet, which in turn is based loosely on
                                           $)"15&3  $01:3*()5

Ovid’s Pyramus and Thisbe, so that if ”derivative work” were de-
fined broadly enough (and copyright were perpetual) West Side Story
would infringe Pyramus and Thisbe unless authorized by Ovid’s
heirs. We can thus imagine the notion of pervasiveness being used
to distinguish a work fairly described as derivative from works only
loosely connected with some ancestral work claimed to be their orig-
inal. In that sense Prince’s symbol clearly ”pervades” both guitars. If
it did not, the guitars might not be derivative works, but they would
not be derivative works that anyone was free to make without obtain-
ing Prince’s permission.

                             ,FFMJOH W )BST
                         'E  E $JS 
Plaintiff–Appellee Jaime Keeling is the author of Point Break Live!
(“PBL”), a parody stage adaptation of the 1991 Hollywood action
movie Point Break, starring Keanu Reeves and Patrick Swayze. In
the film, Reeves plays a rookie FBI agent who goes undercover to
infiltrate a gang of bank-robbing surfers led by Swayze’s character.
The Keeling-authored PBL parody parallels the characters and plot
elements from Point Break and relies almost exclusively on selected
dialogue from the screenplay. To this raw material, Keeling added
jokes, props, exaggerated staging, and humorous theatrical devices
to transform the dramatic plot and dialogue of the film into an irrever-
ent, interactive theatrical experience. For example, in Keeling’s PBL
parody, Point Break ’s death-defying scene in which Reeves’s charac-
ter must pick up bricks, blindfolded, in a swimming pool takes place,
instead, in a kiddie pool. Massive waves in the film are replaced by
squirt guns in the PBL parody. A central conceit of the PBL parody is
that the Keanu Reeves character is selected at random from the audi-
ence and reads his lines from cue cards, thereby lampooning Reeves’s
reputedly stilted performance in the movie. Keeling added to the ef-
fect that the audience was watching the making of the film by creat-
ing a set of film-production characters in the PBL parody, including
a director, cinematographer, and production assistants. Keeling pos-
sesses no copyright or license with regard to the Point Break motion
    Defendant–Appellant Eve Hars owns production company New
Rock Theater Productions, LLC (“New Rock”). In 2007, Keeling ex-
ecuted a production agreement with Hars, pursuant to which New
Rock would stage a two-month production run of PBL from October
through December 2007. During that time period, Hars conferred
with an entertainment a orney and the holder of the copyright to the
Hollywood screenplay for Point Break, and eventually Hars came to
believe that Keeling did not lawfully own any rights to the PBL par-
ody play. Accordingly, after its initial two-month run, Hars sought
$ 130$&%63&4                                                                

to renegotiate the terms of the contract upon its expiration and, in
effect, continue to produce PBL without further payment to Keeling.
Keeling refused renegotiation, threatened suit, and registered a copy-
right in PBL, without first obtaining permission from the copyright
holders of the original Point Break. Keeling’s asserted copyright in
PBL became effective on January 4, 2008. Hars and New Rock contin-
ued to stage performances of PBL for four years thereafter without
payment to or authorization from Keeling.
    If a work employs preexisting copyrighted material lawfully – as
in the case of a ”fair use” – nothing in the statute prohibits the ex-
tension of the ”independent” copyright protection promised by Sec-
tion 103.7 A close reading of the statute therefore makes plain that an
unauthorized but lawful fair use employing preexisting copyrighted
material may itself merit copyright protection. It is not the invocation
of fair use that provides the work copyright protection, and perhaps
thinking so has created some confusion on the part of the defendant.
It is the originality of the derivative work that makes it protectable,
and fair use serves only to render lawful the derivative work, such
that it may acquire – as would other lawful derivative works – such

Copyright, the statute tells us, subsists as soon as a work is created.              "OZ XIP UBMLT BCPVU DPQZSJHIUJOH B
The author doesn’t need to do anything more to become a copyright                    XPSL JT DPOGVTFE "U CFTU UIFZ BSF
                                                                                     UIJOLJOH BCPVU SFHJTUFSJOH UIF XPSL
owner. But it was not always thus. And this is not to say that copy-
                                                                                     XIJDI EPFT IBWF TFWFSBM JNQPSUBOU BE
right has no procedural wrinkles – only that these procedures are not                WBOUBHFT "U XPSTU UIFZ UIJOL UIBU
preconditions on copyright protection.                                               VOSFHJTUFSFE XPSLT BSF OPU QSPUFDUFE
                                                                                     CZ DPQZSJHIU BOE NBZ GSFFMZ CF DPQJFE
       'PSNBMJUJFT 5IFO                                                             5IJT JT XSPOH XSPOH UPUBMMZ XSPOH $PS
                                                                                     SFDU UIFN

                           4UBO - 3FW 
For most of our history, U.S. copyright law has included a system
of procedural mechanisms, referred to collectively as “copyright for-
malities,” that helped to maintain copyright’s traditional balance be-
tween providing private incentives to authors and preserving a ro-
bust stock of public domain works from which future creators could
draw. From the first copyright statute in 1790, Congress required that
authors register their copyrights, give notice (by marking published
copies with an indication of copyright status such as the “©” sym-
bol, as well as other information about copyright ownership), and
    To be sure, the independent copyright protection in the new work is limited to
that work’s original content.
                                             $)"15&3  $01:3*()5

(perhaps most importantly) renew their rights after a relatively short
initial term by reregistering their copyright. Failure to comply with
these requirements either terminated the copyright (in the case of
nonrenewal) or prevented it from arising in the first place.

                &TUBUF PG .BSUJO -VUIFS ,JOH W $#4 *OD
                       'E  UI $JS 
The Estate of Martin Luther King, Jr., Inc. brought this copyright in-
fringement action against CBS, Inc. after CBS produced a video doc-
umentary that used, without authorization, portions of civil rights
leader Dr. Martin Luther King’s famous ”I Have a Dream” speech at
the March on Washington on August 28, 1963.
    On September 30, 1963, approximately one month after the deliv-
ery of the Speech, Dr. King took steps to secure federal copyright
protection for the Speech under the Copyright Act of 1909, and a
certificate of registration of his claim to copyright was issued by the
Copyright Office on October 2, 1963. Almost immediately thereafter,
Dr. King filed suit in the Southern District of New York to enjoin the
unauthorized sale of recordings of the Speech and won a preliminary
injunction on December 13, 1963.
    Because of the dates of the critical events, the determinative issues
in this case are properly analyzed under the Copyright Act of 1909
(”1909 Act”), rather than the Copyright Act of 1976 (”1976 Act”) that
is currently in effect. The question is whether Dr. King’s a empt
to obtain statutory copyright protection on September 30, 1963 was
effective, or whether it was a nullity because the Speech had already
been forfeited to the public domain via a general publication.
    Under the regime created by the 1909 Act, an author received
state common law protection automatically at the time of creation
of a work. This state common law protection persisted until the mo-
ment of a general publication. When a general publication occurred,
the author either forfeited his work to the public domain, or, if he had
therebefore complied with federal statutory requirements, converted
his common law copyright into a federal statutory copyright.
    In order to soften the hardship of the rule that publication de-
stroys common law rights, courts developed a distinction between
a ”general publication” and a ”limited publication.” Only a general
publication divested a common law copyright. A general publication
occurred when a work was made available to members of the public
at large without regard to their identity or what they intended to do
with the work. Conversely, a non-divesting limited publication was
one that communicated the contents of a work to a select group and
for a limited purpose, and without the right of diffusion, reproduc-
tion, distribution or sale. The issue before us is whether Dr. King’s
delivery of the Speech was a general publication.
$ 130$&%63&4                                                       

    It appears from the case law that a general publication occurs
only in two situations. First, a general publication occurs if tangi-
ble copies of the work are distributed to the general public in such
a manner as allows the public to exercise dominion and control over
the work. Second, a general publication may occur if the work is ex-
hibited or displayed in such a manner as to permit unrestricted copy-
ing by the general public. See Le er Edged in Black Press, Inc. v. Public   -FUUFS &EHFE JO #MBDL  ' 4VQQ 
Bldg. Comm’n of Chicago (invoking this exception where ”there were           /% *MM 
no restrictions on copying [of a publicly displayed sculpture] and no
guards preventing copying” and ”every citizen was free to copy the
maque e for his own pleasure and camera permits were available to
members of the public”). However, the case law indicates that re-
strictions on copying may be implied, and that express limitations
in that regard are deemed unnecessary. See American Tobacco Co. v.          "NFSJDBO 5PCBDDP  64  
Werckmeister (holding that there is no general publication where art-
work is exhibited and ”there are bylaws against copies, or where it
is tacitly understood that no copying shall take place, and the public
are admi ed . . . on the implied understanding that no improper
advantage will be taken of the privilege” (emphasis added)); Burke v.       #VSLF  'E  TU $JS 
National Broadcasting Co. (holding that releasing a film to a professor
and host of an educational television program, and authorizing him
to copy and broadcast same on public television was a limited pub-
lication because the grant of permission to use the film contained an
implied condition against distributing copies of the film to others or
using it for other purposes); Nu v. National Inst. Incorporated for the     /VUU  'E  E $JS 
Improvement of Memory (lectures were not generally published when
delivered because oral delivery is not publication, and ”[e]ven where
the hearers are allowed to make copies of what was said for their per-
sonal use, they cannot later publish for profit that which they had not
retained the right to sell”).
    The case law indicates that distribution to the news media, as op-
posed to the general public, for the purpose of enabling the reporting
of a contemporary newsworthy event, is only a limited publication.
This rule comports with common sense; it does not force an author
whose message happens to be newsworthy to choose between ob-
taining news coverage for his work and preserving his common-law
    With the above principles in mind, in the summary judgment pos-
ture of this case and on the current state of this record, we are unable
to conclude that CBS has demonstrated beyond any genuine issue of
material fact that Dr. King, simply through his oral delivery of the
Speech, engaged in a general publication making the Speech avail-
able to members of the public at large without regard to their iden-
tity or what they intended to do with the work. A performance, no
ma er how broad the audience, is not a publication; to hold other-
                                                                                      $)"15&3  $01:3*()5

                                          wise would be to upset a long line of precedent. This conclusion is
                                          not altered by the fact that the Speech was broadcast live to a broad
                                          radio and television audience and was the subject of extensive con-
                                          temporaneous news coverage. We follow the above cited case law
                                          indicating that release to the news media for contemporary coverage
                                          of a newsworthy event is only a limited publication.

                                                           &TUBUF PG .BSUJO -VUIFS ,JOH W $#4 *OD
                                                               ' 4VQQ E  /% (B 
5IJT JT GSPN UIF %JTUSJDU $PVSU PQJOJPO   An advance text of Dr. King’s speech was available in the press tent;
PO BQQFBM JO UIF $PVSU PG "QQFBMT PQJO   no copyright notice appeared on the text or was asserted concurrent
                                          with the giving of the speech. CBS contends that there were no re-
                                          strictions regarding entry into the press tent and that individuals out-
                                          side of the press entered the area and obtained copies of the day’s
                                          speeches. The Estate argues that Dr. King furnished this advance
                                          text for the sole purpose of assisting press coverage of the March and
                                          that he had been assured that it would be available only to the press.
                                              Following the March, the SCLC reprinted the speech in its entirety
                                          in its September 1963 newsle er with no copyright notice or other re-
                                          strictions. The newsle er bore Dr. King’s name and title as President
                                          at the top of its masthead. Generally, the SCLC news-le er had a
                                          large national circulation and was also sent to those who asked for
                                              However, material facts are in dispute as to whether the use of
                                          Dr. King’s speech in the newsle er was authorized and also as to the
                                          actual availability of the advance text. Accordingly, for the purposes
                                          of summary judgment, this court does not rest its holding upon the
                                          newsle er or the advance text but upon the context of Dr. King’s
                                          speech itself.

                                                               8JMENBO W /FX :PSL 5JNFT $P
                                                                 ' 4VQQ  4%/: 
                                          This suit arose by reason of a wri en request sent to defendant’s
                                          newspaper for the words of the verse ”Remember This” by F. Col-
                                          lis Wildman. Several Sundays later in its Queries and Answers page
                                          defendant printed the answer to the said request, giving the title, the
                                          name of the author and the full text of the verse; followed by ”This
                                          request was answered by a number of readers, some of whom sent
                                          the poem”.
                                              Plaintiff claims that this publication in the newspaper without his
                                          consent was in derogation of his rights in the copyrighted verse. He
                                          wrote it on or about October 4, 1911. Plaintiff applied for a copyright
                                          and received the certificate of registration on or about July 3, 1926.
                                          On June 23, 1926, he did cause his verse to be printed on a card by a
                                          printer in Philadelphia; 3,000 copies of it. At the end of the verse, at
$ 130$&%63&4                                                      

the right is the name ”F. Collis Wildman”. In the lower left corner of
card is printed the word ”Copyright”. Three thousand of these cards,
described as above, were sold to the public by the plaintiff.
     The law is well se led that the provisions of the statute as to no-
tice must be complied with and by selling a copyrighted article oth-
erwise there is deication to the public and the copyright protection is
lost. Publication with notice of copyright is the essence of compliance
with the statute, and publication without proper notice amounts to a
dedication to the public sufficient to defeat all subsequent efforts at
copyright protection.
     With the above principles in mind, I can only come to the con-
clusion that the plaintiff, when he had printed and sold the cards in
June, 1926, dedicated his verse to the public. I can only conclude that
there was no sufficient or legal copyright notice a ached. There was
no date a ached. There apparently was no claim of copyright on the
printed card by him personally, although this is somewhat question-
able in view of the fact that his own name was at the end of the verse.
However, he did not comply with the statute; and the alleged notice,
if it was intended as a notice of copyright, is insufficient to secure to
the plaintiff any right under the copyright registration.

Formalities are dramatically less important under contemporary
copyright law. The 1976 Copyright Act moderated their impact in
some significant ways, and in 1988, the United States joined the inter-
national Berne Convention for the Protection of Literary and Artis-
tic Works, which requires that copyright ”shall not be subject to any
formality.” Thus, formalities are important mostly for older works –
those published before March 1, 1989, when the Berne Convention
Implementation Act came into force.                                        #VU GPS UIPTF XPSLT BT UIF DBTFT BCPWF
    For modern works, the main ”formality” is fixation, which is such       TIPX UIF GPSNBMJUJFT DBO CF WJUBMMZ JN
                                                                           QPSUBOU $PQZSJHIU EVF EJMJHFODF GPS
a thin prerequisite that it is more like the minimal condition required
                                                                           PMEFS XPSLT SFRVJSFT B DBSFGVM JOWFTUJHB
for the legal system to be sure it knows what the copyrighted work         UJPO PG UIF GPSNBMJUJFT
even is. But traces of the other formalities remain, and competent
copyright practice requires complying with them.


A work of authorship may be deemed copyrightable, provided that            f 
it has been “fixed in any tangible medium of expression, now known          5IF 'JYBUJPO 3FRVJSFNFOU
or later developed, from which [it] can be perceived, reproduced, or
otherwise communicated, either directly or indirectly with the aid
                                                               $)"15&3  $01:3*()5

 64$ f  B   of a machine or device.” Specifically, the work must be fixed in a
                    copy or phonorecord “by or under the authority of the author” and
                    the work must be “sufficiently permanent or stable to permit it to be
                    perceived, reproduced, or otherwise communicated for a period of
 64$ f      more than transitory duration.”
                        The terms “copy” and “phonorecord” are very broad. They cover
                    all of the material objects in which copyrightable works are capable
                    of being fixed.
 64$ f          • Copies are “material objects, other than phonorecords, in which
                           a work is fixed by any method now known or later developed,
                           and from which the work can be perceived, reproduced, or oth-
                           erwise communicated, either directly or with the aid of a ma-
                           chine or device,” including the material object “in which the
                           work is first fixed.”
 64$ f          • Phonorecords are “material objects in which sounds, other than
                           those accompanying a motion picture or other audiovisual
                           work, are fixed by any method now known or later developed,
                           and from which the sounds can be perceived, reproduced, or
                           otherwise communicated, either directly or with the aid of a
                           machine or device,” including “the material object in which the
                           sounds are first fixed.”
                    There are countless ways that a work may be fixed in a copy or
                    phonorecord and it makes no difference what the form, manner, or
                    medium of fixation may be. For example, a work may be expressed in
                    words, numbers, notes, sounds, pictures, or any other graphic or sym-
                    bolic indicia and the author’s expression may be fixed in a physical
                    object in wri en, printed, photographic, sculptural, punched, mag-
                    netic, or any other stable form.
                        Most works are fixed by their very nature, such as an article
                    printed on paper, a song recorded in a digital audio file, a sculpture
                    rendered in bronze, a screenplay saved in a data file, or an audiovi-
                    sual work captured on film. Nevertheless, some works of authorship
                    may not satisfy the fixation requirement, such as an improvisational
                    speech, sketch, dance, or other performance that is not recorded in
                    a tangible medium of expression. Other works may be temporarily
                    embodied in a tangible form, but may not be sufficiently permanent
                    or stable to warrant copyright protection, such as purely evanescent
                    or transient reproductions such as those projected briefly on a screen,
                    shown electronically on a television, or captured momentarily in the
                    memory of a computer.
                        The Office rarely encounters works that do not satisfy the fixation
                    requirement because the Office requires applicants to submit copies
                    or phonorecords that contain a visually or aurally perceptible copy of
                    the work. However, the Office may communicate with the applicant
$ 130$&%63&4                                                     

or may refuse registration if the work or the medium of expression
only exists for a transitory period of time, if the work or the medium
is constantly changing, or if the medium does not allow the specific
elements of the work to be perceived, reproduced, or otherwise com-
municated in a consistent and uniform manner.

                   4UFSO &MFDUSPOJDT *OD W ,BVGNBO
                        'E  OE $JS 
Video games like “Scramble” can roughly be described as comput-
ers programmed to create on a television screen cartoons in which
some of the action is controlled by the player. In Stern’s “Scramble,”
for example, the video screen displays a spaceship moving horizon-
tally through six different scenes in which obstacles are encountered.
With each scene the player faces increasing difficulty in traversing the
course and scoring points. The first scene depicts mountainous ter-
rain, missile bases, and fuel depots. The player controls the altitude
and speed of the spaceship, decides when to release the ship’s sup-
ply of bombs, and fires lasers that can destroy a acking missiles and
aircraft. He a empts to bomb the missile bases (scoring points for
success), bomb the fuel depots (increasing his own diminishing fuel
supply with each hit), avoid the missiles being fired from the ground,
and avoid crashing his ship into the mountains. And that is only
scene one. In subsequent scenes the hazards include missile-firing
enemy aircraft and tunnel-like airspaces. The scenes are in color, and
the action is accompanied by ba lefield sounds.
    The game is built into a cabinet containing a cathode ray tube, a
number of electronic circuit boards, a loudspeaker, and hand controls
for the player. The electronic circuitry includes memory storage de-
vices called PROMs, an acronym for “programmable read only mem-
ory.” The PROM stores the instructions and data from a computer
program in such a way that when electric current passes through the
circuitry, the interaction of the program stored in the PROM with
the other components of the game produces the sights and sounds of
the audiovisual display that the player sees and hears. The memory
devices determine not only the appearance and movement of the im-
ages but also the variations in movement in response to the player’s
operation of the hand controls.
    Stern manufactures amusement equipment, including video
games, for distribution worldwide. Even in the fast-paced world
of video games, “Scramble” quickly became a big success. Approx-
imately 10,000 units were sold at about $2,000 each in the first two
months for an initial sales volume of about $20 million. …
    [Omni was enjoined from distributing its own “Scramble” arcade
games. One of its arguments was that Stern’s Scramble was not fixed.]
    Omni contends that Konami is not entitled to secure a copyright      4DSBNCMF
                                                                                         $)"15&3  $01:3*()5

                                           in the sights and sounds of its “Scramble” game because the audio-
                                           visual work is neither “fixed in any tangible medium of expression”
                                           nor “original” within the meaning of § 102(a). Both contentions arise
                                           from the fact that the sequence of some of the images appearing on
                                           the screen during each play of the game will vary depending upon
                                           the actions taken by the player. For example, if he fails to avoid en-
                                           emy fire, his spaceship will be destroyed; if he fails to destroy enough
                                           fuel depots, his own fuel supply will run out, and his spaceship will
                                           crash; if he succeeds in destroying missile sites and enemy planes,
                                           those images will disappear from the screen; and the precise course
                                           travelled by his spaceship will depend upon his adjustment of the
                                           craft’s altitude and velocity.
                                               If the content of the audiovisual display were not affected by the
                                           participation of the player, there would be no doubt that the display
                                           itself, and not merely the wri en computer program, would be eligi-
                                           ble for copyright. The display satisfies the statutory definition of an
"VEJPWJTVBM XPSLTh BSF XPSLT UIBU DPO    original “audiovisual work,” and the memory devices of the game
TJTU PG B TFSJFT PG SFMBUFE JNBHFT XIJDI   satisfy the statutory requirement of a “copy” in which the work is
                                           “fixed.” The audiovisual work is permanently embodied in a mate-
BT QSPKFDUPST WJFXFST PS FMFDUSPOJD        rial object, the memory devices, from which it can be perceived with
FRVJQNFOU UPHFUIFS XJUI BDDPNQBOZ         the aid of the other components of the game.
JOH TPVOET JG BOZ SFHBSEMFTT PG UIF OB        We agree with the District Court that the player’s participation
UVSF PG UIF NBUFSJBM PCKFDUT TVDI BT       does not withdraw the audiovisual work from copyright eligibility.
                                           No doubt the entire sequence of all the sights and sounds of the game
FNCPEJFE  64$ f 
                                           are different each time the game is played, depending upon the route
                                           and speed the player selects for his spaceship and the timing and ac-
                                           curacy of his release of his craft’s bombs and lasers. Nevertheless,
                                           many aspects of the sights and the sequence of their appearance re-
                                           main constant during each play of the game. These include the ap-
                                           pearance (shape, color, and size) of the player’s spaceship, the enemy
                                           craft, the ground missile bases and fuel depots, and the terrain over
                                           which (and beneath which) the player’s ship flies, as well as the se-
                                           quence in which the missile bases, fuel depots, and terrain appears.
                                           Also constant are the sounds heard whenever the player successfully
                                           destroys an enemy craft or installation or fails to avoid an enemy mis-
                                           sile or laser. It is true, as appellants contend, that some of these sights
                                           and sounds will not be seen and heard during each play of the game
                                           in the event that the player’s spaceship is destroyed before the entire
                                           course is traversed. But the images remain fixed, capable of being
                                           seen and heard each time a player succeeds in keeping his spaceship
                                           aloft long enough to permit the appearances of all the images and
                                           sounds of a complete play of the game. The repetitive sequence of a
                                           substantial portion of the sights and sounds of the game qualifies for
$ 130$&%63&4                                                      

copyright protection as an audiovisual work.

     Which of the following are sufficiently fixed to be copy-
     rightable? In each case where your answer is “yes,” identify
     the material object.
        • A song sung on the sidewalk?
        • A song wri en out as sheet music?
        • A song on a CD?
        • A diagram on a blackboard?
        • A PowerPoint slide?
        • A sonnet in your mind?
        • A photograph?
        • The Fast and the Furious: Tokyo Drift?
        • Our class on copyrightable subject ma er?
                                                                           -BUUF BSU 'JYFE
                          1IPUPTIPPU 1SPCMFN
You represent Shelbyville Stages, a concert promoter. You have
booked the eccentric pop musician Plastica for a twelve-city tour in
the Northeast. The marketing staff at Shelbyville have recently dis-
covered an image online that they think would be perfect for using
on the concert posters. It features Plastica stepping down the landing
ramp of a flying saucer, backlit, carrying a pair of cheerleader’s pom-
poms, with a guitar slung over her back, and wearing her trademark
disinterested scowl.
    A similar photograph was the cover of this month’s Them, a
celebrity fashion magazine. An unknown party or party unknown,
however, extensively Photoshopped it to make it look like a faded,
weather-beaten Old West “WANTED” poster. The marketing staff
tell you that this was a stroke of genius; the combination of the an-
tique look with the kitschy futuristic technology gives the whole
thing what they call a “neo-horsepunk flying-car feel” and the out-
law theme plays off Plastica’s expression. Their research has deter-
mined that the following people were in some way connected with
the image:
    • Plastica herself, who has spent years crafting her stage persona,
      which might be described as “heroin-ravaged all-American girl
      from outer space.”
    • Plastica’s hair-stylist, Alicia Abt, who produced the compli-
      cated multi-layer updo in which she appears in the photograph,
      with a single side ponytail and a Statute-of-Liberty-style ring of
                                                                                    $)"15&3  $01:3*()5

                                           • Plastica’s personal trainer, Ben Boardwell, who has spent years
                                             working with her to develop her musculature to combine
                                             strength with a suggestion of wasted potential.
                                           • A celebrity photographer, Charles Carmack, who decided on
                                             the flying-saucer theme, chose the placement of props, and in-
                                             structed Plastica on how to pose.
                                           • Carmack’s salaried assistant, Denyse Dozier, who operated the
                                             camera and pushed the bu on that took the photographs.
                                           • A Photoshop expert, Ernest Eames, who digitally smoothed out
                                             the wrinkles in Plastica’s face, extended her neck by two inches,
                                             and made a hundred other similar tweaks.
                                           • Them magazine, where the modified photograph ran.
                                           • Some unknown person with the username SeePeteyPhotoshop,
                                             who added the Old West theme and uploaded the modified
                                             photo to the photosharing site
                                       Based on these facts, advise Shelbyville Stages on whether it will be
                                       possible to obtain sufficient permissions to use the Old West version
                                       of the photo for the concert posters, and, if so how to go about it.
                                       C     3FHJTUSBUJPO

                                              $PNQFOEJVN PG 64 $PQZSJHIU 0óDF 1SBDUJDFT E FE 

                                       Under the current copyright law, a work of authorship is protected
1VSQPTFT BOE "EWBOUBHFT PG 3FHJTUSB   by copyright from the moment it is created, provided that the work
UJPO                                   is original and has been fixed in a tangible medium of expression.
                                       Although registration is not required for a work to be protected by
                                       copyright, it does provide several important benefits:
                                          • A registration creates a public record that includes key facts re-
                                             lating to the authorship and ownership of the claimed work, as
                                             well as information about the work, such as title, year of cre-
                                             ation, date of publication (if any), and the type of authorship
                                             that the work contains (e.g., photographs, text, sound record-
                                          • Registration (or a refusal to register) is a prerequisite to filing a
                                             lawsuit for copyright infringement involving a U.S. work. Al-
                                             though registration is permissive, both the certificate and the
                                             original work must be on file with the Copyright Office before
                                             a copyright owner can sue for infringement.
                                          • To claim statutory damages or a orney’s fees in a copyright
                                             infringement lawsuit, a work must be registered before the in-
                                             fringement began or within three months after the first publica-
                                             tion of the work.
$ 130$&%63&4                                                      

   • A registration constitutes prima facie evidence of the validity
     of the copyright and the facts stated in the certificate of regis-
     tration, but only if the work is registered before or within five
     years after the work is first published.
   • A registration provides information to prospective licensees,
     such as the name and address for obtaining permission to use
     the work.
   • A document that has been recorded with the U.S. Copyright Of-
     fice may provide constructive notice of the facts stated therein,
     but only if the document specifically identifies a work of author-
     ship and only if that work has been registered.
   • The deposit copy(ies) submi ed with an application for regis-
     tration of a published work may satisfy the mandatory deposit
     requirement, provided that the applicant submi ed the best edi-
     tion of the work.
   • A registration is necessary to secure the full benefits of a prereg-
     istration that has been issued by the U.S. Copyright Office.
   • The U.S. Customs and Border Protection Service may seize for-
     eign pirated copies of a copyright owner’s work, provided that
     the work has been registered with the U.S. Copyright Office and
     the certificate of registration has been recorded with the U.S.
     Customs and Border Protection Service.
   • A registration is required to claim royalties under the compul-
     sory license for making and distributing phonorecords.



The U.S. Copyright Act provides for two separate sets of deposit re-       f 
quirements: deposits submi ed in connection with registration ap-          %FQPTJU GPS 3FHJTUSBUJPO %JTUJOHVJTIFE
plications and those submi ed in accordance with the mandatory de-         GSPN .BOEBUPSZ %FQPTJU
posit provisions (or “legal deposit” provisions) of the law. The U.S.
Copyright Office administers both sets of provisions.
    The Register of Copyrights specifies by regulation the form of de-
posit that must accompany a copyright claim and registration appli-
cation. Said regulations reflect and inform the ability of the Office
to examine the work for copyrightable authorship, to verify the au-
thorship claimed in the application, and to verify the facts stated in
the application. Deposits may also be used for evidentiary purposes
in litigation involving a copyrighted work. Since registration is not
                                                                                  $)"15&3  $01:3*()5

                                      required as a condition for copyright protection, the Register has the
                                      authority to adjust or exempt the deposit requirements as appropri-
                                      ate for certain works or application procedures, weighing the needs
                                      or concerns of applicants and the public. Deposits may also be se-
                                      lected by the Library of Congress.
                                          Mandatory deposit is a statutory requirement for the benefit of
                                      the national collection of the Library of Congress. The owner of copy-
                                      right or the owner of the exclusive right of publication in a work pub-
                                      lished in the United States must deposit two copies or phonorecords
                                      of the work within three months after publication.
                                          In most cases, a deposit submi ed for registration may be used to
                                      satisfy the mandatory deposit requirement, provided that the appli-
                                      cant submits two complete copies or two complete phonorecords of
                                      the best edition of the work. In such cases, there is no need to sub-
                                      mit additional copies or phonorecords for the purpose of mandatory
                                          For some classes of works, the deposit requirements for registra-
                                      tion and mandatory deposit are not the same. In such cases, a sepa-
                                      rate submission of copies, phonorecords, or identifying material may
                                      be needed to register the work and to satisfy the mandatory deposit
                                      requirements. For example, mandatory deposit for a computer pro-
                                      gram requires two complete copies of the best edition, while regis-
                                      tration may be accomplished with identifying material containing a
                                      selection of the source code for that work. In the digital context, such
                                      nuance and distinction is even more important, and applicable regu-
                                      lations are therefore subject to change.

                                      Submi ing a published work for the use or disposition of the Li-
.BOEBUPSZ %FQPTJU                     brary is not a condition of copyright protection. However, if compli-
                                      ance with the mandatory deposit requirement is not accomplished
                                      within three months of publication, the Register of Copyrights may
                                      facilitate, demand, negotiate, or exempt the provision of copies or
                                      phonorecords for the Library of Congress at any time after a work
                                      has been published in the United States. If the Office issues a writ-
                                      ten demand and if required copies or phonorecords are not received
                                      within three months of receipt of the demand, the copyright owner
                                      or owner of the exclusive right of publication in that work may be
                                      subject to fines or other monetary liability.
                                      E /PUJDF

                                            $PNQFOEJVN PG 64 $PQZSJHIU 0óDF 1SBDUJDFT E FE 
f  "
"EWBOUBHFT UP 6TJOH /PUJDF PO 1PTU   Although notice is optional for unpublished works, foreign works, or
#FSOF 8PSLT                           works published on or after March 1, 1989, the U.S. Copyright Office
$ 130$&%63&4                                                      

strongly encourages copyright owners to use a notice for the follow-
ing reasons:
   • It puts potential users on notice that copyright is claimed in the
   • In the case of a published work, a notice may prevent a defen-
      dant in a copyright infringement action from a empting to limit
      his or her liability for damages or injunctive relief based on an
      innocent infringement defense.
   • It identifies the copyright owner at the time the work was first
      published for parties seeking permission to use the work.
   • It identifies the year of first publication, which may be used
      to determine the term of copyright protection in the case of an
      anonymous work, a pseudonymous work, or a work made for
   • It may prevent the work from becoming an orphan work by
      identifying the copyright owner and/or specifying the term of
      the copyright.

A notice for a work published before March 1, 1989 that has been          f 
fixed in copies should include the following elements:                     /PUJDF GPS 8PSLT 'JYFE JO $PQJFT
    • The symbol © or the word “Copyright” or the abbreviation
    • The year of first publication for the work; and
    • The name of the copyright owner, or an abbreviation by which
      the name can be recognized, or a generally known alternative
      designation of the owner.
The elements of the notice should appear as a single continuous state-
ment containing the copyright symbol or the word “Copyright” or
the abbreviation “Copr.,” followed by the year of first publication,
followed by the name of the copyright owner.
    • © 1978 John Doe
    • Copyright 1980 John Doe
    • Copr. 1982 John Doe

There is no way around it: copyright terms for older works are a mess
and require careful investigation. The details are beyond the scope
of this course, but you have been warned.
                                                                           64$ f 
                            $PQZSJHIU "DU                                 %VSBUJPO PG DPQZSJHIU 8PSLT DSFBUFE
                                                                          PO PS BGUFS +BOVBSZ  
                                                                                      $)"15&3  $01:3*()5

8IBU BCPVU XPSLT DSFBUFE CFGPSF UIFO       (a) In General.— Copyright in a work created on or after January 1,
*UhT DPNQMJDBUFE 1VCMJTIFE XPSLT BM          1978, subsists from its creation and, except as provided by the
                                               following subsections, endures for a term consisting of the life
BOE UFSNJOBUJPO SJHIUT UP CF EJTDVTTFE         of the author and 70 years after the author’s death.
JO B GVUVSF 5SBOTBDUJPOT DIBQUFS  4UBSU   (b) Joint Works.— In the case of a joint work prepared by two or
XJUI f  6OQVCMJTIFE XPSLT QSF             more authors who did not work for hire, the copyright endures
                                               for a term consisting of the life of the last surviving author and
FYDFQU UIBU JG UIFZ XFSF QVCMJTIFE PO PS       70 years after such last surviving author’s death.
CFGPSF %FDFNCFS   UIFJS UFSNT        (c) Anonymous Works, Pseudonymous Works, and Works Made
                                               for Hire.— In the case of an anonymous work, a pseudonymous
                                               work, or a work made for hire, the copyright endures for a term
                                               of 95 years from the year of its first publication, or a term of 120
                                               years from the year of its creation, whichever expires first. …

 64$ f 
                                           All terms of copyright provided by sections 302 through 304 run to
%VSBUJPO PG DPQZSJHIU 5FSNJOBM EBUF       the end of the calendar year in which they would otherwise expire.

                                                                     &MESFE W "TIDSPGU
                                           This case concerns the authority the Constitution assigns to Congress
                                           to prescribe the duration of copyrights. In 1998, in the measure here
                                           under inspection [the Sonny Bono Copyright Term Extension Act
                                           (CTEA)], Congress enlarged the duration of copyrights by 20 years.
                                           Petitioners are individuals and businesses whose products or services
                                           build on copyrighted works that have gone into the public domain.
                                           They seek a determination that the CTEA fails constitutional review
                                           under both the Copyright Clause’s ”limited Times” prescription and
                                           the First Amendment’s free speech guarantee.
                                               Petitioners do not challenge the ”life-plus-70-years” timespan it-
                                           self. ”Whether 50 years is enough, or 70 years too much,” they ac-
                                           knowledge, ”is not a judgment meet for this Court.” Congress went
                                           awry, petitioners maintain, not with respect to newly created works,
                                           but in enlarging the term for published works with existing copy-
                                           rights. The ”limited Tim[e]” in effect when a copyright is secured,
                                           petitioners urge, becomes the constitutional boundary, a clear line
                                           beyond the power of Congress to extend.
                                               The Nation’s first copyright statute, enacted in 1790, provided a
                                           federal copyright term of 14 years from the date of publication, renew-
                                           able for an additional 14 years if the author survived the first term.
                                           The 1790 Act’s renewable 14-year term applied to existing works (i.
                                           e., works already published and works created but not yet published)
                                           and future works alike. Congress expanded the federal copyright
$ 130$&%63&4                                                       

term to 42 years in 1831 (28 years from publication, renewable for
an additional 14 years), and to 56 years in 1909 (28 years from publi-
cation, renewable for an additional 28 years). Both times, Congress
applied the new copyright term to existing and future works; to qual-
ify for the 1831 extension, an existing work had to be in its initial
copyright term at the time the Act became effective.
    In 1976, Congress altered the method for computing federal copy-
right terms. For works created by identified natural persons, the 1976
Act provided that federal copyright protection would run from the
work’s creation, not – as in the 1790, 1831, and 1909 Acts – its publica-
tion; protection would last until 50 years after the author’s death. In
these respects, the 1976 Act aligned United States copyright terms
with the then-dominant international standard adopted under the
Berne Convention for the Protection of Literary and Artistic Works.
    These new copyright terms, the 1976 Act instructed, governed all
works not published by its effective date of January 1, 1978, regard-
less of when the works were created. For published works with exist-
ing copyrights as of that date, the 1976 Act granted a copyright term
of 75 years from the date of publication, a 19-year increase over the
56-year term applicable under the 1909 Act.
    The measure at issue here, the CTEA, installed the fourth major
duration extension of federal copyrights. Retaining the general struc-
ture of the 1976 Act, the CTEA enlarges the terms of all existing and
future copyrights by 20 years. For works created by identified natu-
ral persons, the term now lasts from creation until 70 years after the
author’s death. This standard harmonizes the baseline United States
copyright term with the term adopted by the European Union in 1993.
    We address first the determination of the courts below that
Congress has authority under the Copyright Clause to extend the
terms of existing copyrights. The CTEA’s baseline term of life plus 70
years, petitioners concede, qualifies as a ”limited Tim[e]” as applied
to future copyrights. Petitioners contend, however, that existing
copyrights extended to endure for that same term are not ”limited.”
Petitioners’ argument essentially reads into the text of the Copyright
Clause the command that a time prescription, once set, becomes for-
ever ”fixed” or ”inalterable.” The word ”limited,” however, does not
convey a meaning so constricted.
    Satisfied that the CTEA complies with the ”limited Times” pre-
scription, we turn now to whether it is a rational exercise of the leg-
islative authority conferred by the Copyright Clause. On that point,
we defer substantially to Congress. By extending the baseline United
States copyright term to life plus 70 years, Congress sought to ensure
that American authors would receive the same copyright protection
in Europe as their European counterparts. The CTEA may also pro-
vide greater incentive for American and other authors to create and
                                            $)"15&3  $01:3*()5

disseminate their work in the United States. In addition to interna-
tional concerns, Congress passed the CTEA in light of demographic,
economic, and technological changes and rationally credited projec-
tions that longer terms would encourage copyright holders to invest
in the restoration and public distribution of their works.
    Petitioners separately argue that the CTEA is a content-neutral
regulation of speech that fails heightened judicial review under the
First Amendment. We reject petitioners’ plea for imposition of un-
commonly strict scrutiny on a copyright scheme that incorporates
its own speech-protective purposes and safeguards. In addition to
spurring the creation and publication of new expression, copyright
law contains built-in First Amendment accommodations. First, it dis-
tinguishes between ideas and expression and makes only the la er el-
igible for copyright protection. Second, the ”fair use” defense allows
the public to use not only facts and ideas contained in a copyrighted
work, but also expression itself in certain circumstances. When, as in
this case, Congress has not altered the traditional contours of copy-
right protection, further First Amendment scrutiny is unnecessary.

                      ,MJOHFS W $POBO %PZMF &TUBUF
                         'E  UI $JS 
Arthur Conan Doyle published his first Sherlock Holmes story in
1887 and his last in 1927. There were 56 stories in all, plus 4 nov-
els. The final 10 stories were published between 1923 and 1927. As a
result of statutory extensions of copyright protection culminating in
the 1998 Copyright Term Extension Act, the American copyrights on
those final stories (copyrights owned by Doyle’s estate, the appellant)
will not expire until 95 years after the date of original publication –
between 2018 to 2022, depending on the original publication date of
each story. The copyrights on the other 46 stories and the 4 novels,
all being works published before 1923, have expired.
    Leslie Klinger, the appellee in this case, co-edited an anthol-
ogy called A S            S         : S        I               S
H        C        (2011). Klinger’s anthology consisted of stories writ-
ten by modern authors but inspired by, and in most instances depict-
ing, the genius detective Sherlock Holmes and his awed sidekick Dr.
Watson. Klinger didn’t think he needed a license from the Doyle es-
tate to publish these stories, since the copyrights on most of the works
in the ”canon” had expired. But the estate told Random House, which
had agreed to publish Klinger’s book, that it would have to pay the
estate $5000 for a copyright license. Random House bowed to the
demand, obtained the license, and published the book.
    [Klinger made arrangements to publish a sequel.] Instead of ob-
taining a license, Klinger sued the estate, seeking a declaratory judg-
$ 130$&%63&4                                                        

ment that he is free to use material in the 50 Sherlock Holmes stories
and novels that are no longer under copyright, though he may use
nothing in the 10 stories still under copyright that has sufficient orig-
inality to be copyrightable.
    The issue is whether copyright protection of a fictional character
can be extended beyond the expiration of the copyright on it because
the author altered the character in a subsequent work. In such a case,
the Doyle estate contends, the original character cannot lawfully be
copied without a license from the writer until the copyright on the
later work, in which that character appears in a different form, ex-
    We cannot find any basis in statute or case law for extending a
copyright beyond its expiration. When a story falls into the public do-
main, story elements – including characters covered by the expired
copyright – become fair game for follow-on authors, as held in Sil-          4JMWFSNBO  'E  E $JS
verman v. CBS Inc., a case much like this one. At issue was the right
to copy fictional characters (Amos and Andy) who had appeared in
copyrighted radio scripts. The copyrights covered the characters be-
cause they were original. As in this case the characters also appeared
in subsequent radio scripts that remained under copyright, though
the copyrights on the original scripts in which the characters had ap-
peared had expired. The court ruled that ”a copyright affords protec-
tion only for original works of authorship and, consequently, copy-
rights in derivative works secure protection only for the incremental
additions of originality contributed by the authors of the derivative
    And so it is in our case. The ten Holmes-Watson stories in which
copyright persists are derivative from the earlier stories, so only origi-
nal elements added in the later stories remain protected. The freedom
to make new works based on public domain materials ends where the
resulting derivative work comes into conflict with a valid copyright,
as Klinger acknowledges. But there is no such conflict in this case.
    Lacking any ground known to American law for asserting post-
expiration copyright protection of Holmes and Watson in pre-1923
stories and novels going back to 1887, the estate argues that creativ-
ity will be discouraged if we don’t allow such an extension. It may
take a long time for an author to perfect a character or other expres-
sive element that first appeared in his early work. If he loses copy-
right on the original character, his incentive to improve the character
in future work may be diminished because he’ll be competing with
copiers, such as the authors whom Klinger wishes to anthologize. Of
course this point has no application to the present case, Arthur Conan
Doyle having died 84 years ago. More important, extending copy-
right protection is a two-edged sword from the standpoint of induc-
ing creativity, as it would reduce the incentive of subsequent authors
                                                                              $)"15&3  $01:3*()5

                                 to create derivative works (such as new versions of popular fictional
                                 characters like Holmes and Watson) by shrinking the public domain.
                                 For the longer the copyright term is, the less public-domain material
                                 there will be and so the greater will be the cost of authorship, because
                                 authors will have to obtain licenses from copyright holders for more
                                 material – as illustrated by the estate’s demand in this case for a li-
-FBSOFE )BOE +                  cense fee from Pegasus.
                                     Most copyrighted works include some, and often a great deal
                                 of, public domain material – words, phrases, data, entire sentences,
                                 quoted material, and so forth. The smaller the public domain, the
                                 more work is involved in the creation of a new work. The defendant’s
                                 proposed rule would also encourage authors to continue to write sto-
                                 ries involving old characters in an effort to prolong copyright protec-
                                 tion, rather than encouraging them to create stories with entirely new
                                 characters. The effect would be to discourage creativity.

                                 %     *OGSJOHFNFOU 4JNJMBSJUZ
                                 This section starts with passages from three classic copyright cases
                                 that set out the essential issues in assessing similarity. They are fol-
                                 lowed by two more recent cases that work through the details in a
                                 more concrete se ing.

         "CJFhT *SJTI 3PTF                       4IFMEPO W .FUSP(PMEXZO 1JDUVSFT $PSQ
                                                          'E  OE $JS 
                                 The plaintiffs’ originality is necessarily limited to the variants they
                                 introduced. Nevertheless, it is still true that their whole contribution
                                 may not be protected; for the defendants were entitled to use, not only
                                 all that had gone before, but even the plaintiffs’ contribution itself, if
                                 they drew from it only the more general pa erns; that is, if they kept
                                 clear of its “expression.”
                                     True, much of the picture owes nothing to the play; some of it
                                 is plainly drawn from the novel; but that is entirely immaterial; it is
                                 enough that substantial parts were lifted; no plagiarist can excuse the
                                 wrong by showing how much of his work he did not pirate.

                                                /JDIPMT W 6OJWFSTBM 1JDUVSFT $PSQPSBUJPO
                                                 'E  E $JS  -FBSOFE )BOE +
                                 [The plaintiff’s play, Abie’s Irish Rose, and the defendant’s movie,
                                 The Cohens and the Kellys, both concerned the tension between an
                                 Irish family and a Jewish family when their children fall in love and
                                     It is of course essential to any protection of literary property,
                                 whether at common-law or under the statute, that the right cannot be
% */'3*/(&.&/5 4*.*-"3*5:                                              

limited literally to the text, else a plagiarist would escape by imma-
terial variations. That has never been the law, but, as soon as literal
appropriation ceases to be the test, the whole ma er is necessarily at
large, so that, as was recently well said by a distinguished judge, the
decisions cannot help much in a new case. When plays are concerned,
the plagiarist may excise a separate scene or he may appropriate part
of the dialogue. Then the question is whether the part so taken is
”substantial.” It is the same question as arises in the case of any other
copyrighted work. But when the plagiarist does not take out a block
in situ, but an abstract of the whole, decision is more troublesome.
Upon any work, and especially upon a play, a great number of pat-
terns of increasing generality will fit equally well, as more and more
of the incident is left out. The last may perhaps be no more than the
most general statement of what the play is about, and at times might
consist only of its title; but there is a point in this series of abstractions
where they are no longer protected, since otherwise the playwright
could prevent the use of his ”ideas,” to which, apart from their ex-
pression, his property is never extended. Nobody has ever been able
to fix that boundary, and nobody ever can. In some cases the question
has been treated as though it were analogous to lifting a portion out
of the copyrighted work, but the analogy is not a good one, because,
though the skeleton is a part of the body, it pervades and supports the
whole. In such cases we are rather concerned with the line between
expression and what is expressed. As respects plays, the controversy
chiefly centers upon the characters and sequence of incident, these
being the substance.
    But we do not doubt that two plays may correspond in plot closely
enough for infringement. How far that correspondence must go is
another ma er. Nor need we hold that the same may not be true as
to the characters, quite independently of the ”plot” proper, though,
as far as we know, such a case has never arisen. If Twelfth Night
were copyrighted, it is quite possible that a second comer might so
closely imitate Sir Toby Belch or Malvolio as to infringe, but it would
not be enough that for one of his characters he cast a riotous knight
who kept wassail to the discomfort of the household, or a vain and
foppish steward who became amorous of his mistress. These would
be no more than Shakespeare’s ”ideas” in the play, as li le capable of
monopoly as Einstein’s Doctrine of Relativity, or Darwin’s theory of
the Origin of Species. It follows that the less developed the characters,
the less they can be copyrighted; that is the penalty an author must
bear for marking them too indistinctly.
    In the two plays at bar we think both as to incident and character,
the defendant took no more – assuming that it took anything at all
– than the law allowed. The stories are quite different. One is of a
religious zealot who insists upon his child’s marrying no one outside
                                            $)"15&3  $01:3*()5

his faith; opposed by another who is in this respect just like him, and
is his foil. Their difference in race is merely an obbligato to the main
theme, religion. They sink their differences through grandparental
pride and affection. In the other, zealotry is wholly absent; religion
does not even appear. It is true that the parents are hostile to each
other in part because they differ in race; but the marriage of their
son to a Jew does not apparently offend the Irish family at all, and it
exacerbates the existing animosity of the Jew, principally because he
has become rich, when he learns it. They are reconciled through the
honesty of the Jew and the generosity of the Irishman; the grandchild
has nothing whatever to do with it. The only ma er common to the
two is a quarrel between a Jewish and an Irish father, the marriage of
their children, the birth of grandchildren and a reconciliation.
    If the defendant took so much from the plaintiff, it may well have
been because her amazing success seemed to prove that this was a
subject of enduring popularity. Even so, granting that the plaintiff’s
play was wholly original, and assuming that novelty is not essential
to a copyright, there is no monopoly in such a background. Though
the plaintiff discovered the vein, she could not keep it to herself; so
defined, the theme was too generalized an abstraction from what she
wrote. It was only a part of her ”ideas.”
    Nor does she fare be er as to her characters. It is indeed scarcely
credible that she should not have been aware of those stock figures,
the low comedy Jew and Irishman. The defendant has not taken from
her more than their prototypes have contained for many decades. If
so, obviously so to generalize her copyright, would allow her to cover
what was not original with her. But we need not hold this as ma er
of fact, much as we might be justified. Even though we take it that
she devised her figures out of her brain de novo, still the defendant
was within its rights.
    We assume that the plaintiff’s play is altogether original, even to
an extent that in fact it is hard to believe. We assume further that, so
far as it has been anticipated by earlier plays of which she knew noth-
ing, that fact is immaterial. Still, as we have already said, her copy-
right did not cover everything that might be drawn from her play;
its content went to some extent into the public domain. We have to
decide how much, and while we are as aware as any one that the line,
whereever it is drawn, will seem arbitrary, that is no excuse for not
drawing it; it is a question such as courts must answer in nearly all
cases. Whatever may be the difficulties a priori, we have no question
on which side of the line this case falls. A comedy based upon con-
flicts between Irish and Jews, into which the marriage of their chil-
dren enters, is no more susceptible of copyright than the outline of
Romeo and Juliet.
    The plaintiff has prepared an elaborate analysis of the two plays,
% */'3*/(&.&/5 4*.*-"3*5:                                                  

showing a ”quadrangle” of the common characters, in which each is
represented by the emotions which he discovers. She presents the
resulting parallelism as proof of infringement, but the adjectives em-
ployed are so general as to be quite useless. Take for example the
a ribute of ”love” ascribed to both Jews. The plaintiff has depicted
her father as deeply a ached to his son, who is his hope and joy; not
so, the defendant, whose father’s conduct is throughout not actuated
by any affection for his daughter, and who is merely once overcome
for the moment by her distress when he has violently dismissed her
lover. ”Anger” covers emotions aroused by quite different occasions
in each case; so do ”anxiety,” ”despondency” and ”disgust.” It is un-
necessary to go through the catalogue for emotions are too much col-
ored by their causes to be a test when used so broadly. This is not the
proper approach to a solution; it must be more ingenuous, more like
that of a spectator, who would rely upon the complex of his impres-
sions of each character.

                            "SOTUFJO W 1PSUFS
                         'E  E $JS 
[The plaintiff,