Trends in Patenting Blockchain Technologies

With the recent rise in values of cybercurrencies such as bitcoin, and with increasing interest in initial currency offerings (ICOs), businesses around the world are rushing to build value with new blockchain technologies and applications.

This presents many opportunities to patent innovative blockchain and other distributed ledger technologies. This is a relatively recent trend. The first recorded appearance of the word “blockchain” in any U.S. patent or published patent application was in 2012, approximately three years after the launch of bitcoin.

As of January 2018, United States Patent and Trademark Office (USPTO) records revealed:

  • 25 granted patents with the term “blockchain” or “distributed ledger” in their title, abstract or claims; and
  • at least 275 published patent applications include one or both of those terms in the title, abstract or claims.

When the data set is expanded to patents and applications that include the word “blockchain” anywhere in the text, the list grows to 56 granted patents and over 500 published applications. These include:

Patent Number Title Grant Date Assignee
US9862222 Digitally encoded seal for document verification 2018-01-09 UIPCO LLC
US9853819 Blockchain-supported, node ID-augmented digital record signature method 2017-12-26 Guardtime IP Holdings LTD.
US9836908 System and method for securely receiving and counting votes in an election 2017-12-05 Blockchain Technologies Corporation
US9824031 Efficient clearinghouse transactions with trusted and un-trusted entities 2017-11-21 International Business Machines Corporation
US9807106 Mitigating blockchain attack 2017-10-31 British Telecommunications PLC
US9785369 Multiple-link blockchain 2017-10-10 Accenture Global Solutions Limited; GSC Secrypt LLC
US9794074 Systems and methods for storing and sharing transactional data using distributed computing systems 2017-10-17 Nasdaq Technology AB
US9747586 System and method for issuance of electronic currency substantiated by a reserve of assets 2017-08-29 CPN Gold B.V.
US9749140 Systems and methods for managing digital identities 2017-08-29 Cambridge Blockchain LLC
US9722790 Identity management service using a blockchain providing certifying transactions between devices 2017-08-01 Shocard, Inc.
US9641338 Method and apparatus for providing a universal deterministically reproducible cryptographic key-pair representation for all SKUs, shipping cartons, and items 2017-05-02 SkuChain, Inc.
US9338148 Secure distributed information and password management 2016-05-10 Verizon Patent and Licensing Inc.; Cellco Partnership

Most of the granted patents cover new or improved aspects of the blockchain itself. Only a small number of U.S. patents have issued to date for new applications of existing blockchain technologies. This is likely because many companies are merely using existing blockchain technologies to implement different types of transactions.

Over half of the granted patents were examined within the USPTO’s Technology Center 2400, which covers networking, multiplexing, cable and security technologies. TC 2400 includes over 200 examiners who focus on security technologies.

In each of the past three years USPTO Examiners from TC 2400 have participated in a Cybersecurity Partnership meeting, in which the USPTO has interacted with stakeholders in the cybersecurity and network security sector to share ideas, experiences, and insights. Information that the USPTO shared in these meetings includes:

  • The top 15 filers of patent applications for information security and cryptography technologies in each year during 2014-2016 included Amazon, Google, IBM, Intel, Microsoft, Qualcomm, Samsung, Symantec, and Tencent. Top filers in 2015 and 2016 also included Bank of America, Cisco, and EMC.
  • While the vast majority of U.S. patent applications for information security and cryptography technologies have been filed by U.S. companies, the USPTO has also received a significant number of filings from companies that are based in Japan, China, Korea, Germany, France and Israel, among other countries.
  • The average pendency (time between filing and either grant or abandonment) of patent applications for information security and cryptography technologies was approximately 27 months in 2016.

Globally, as of January 2018 World Intellectual Property Office (WIPO) records show 197 published Patent Cooperation (PCT) applications with the term “blockchain” or “distributed ledger” in their title, abstract or claims. However, relatively few of these PCT applications have reached the national stage. The European Patent Office database includes only 21 such patents and published applications. According to a recent report from Clarivate Analytics, in 2016 China experienced significant growth in new patent filings for blockchain technologies and is second only to the U.S. for new filings involving blockchain technologies.

This post is the second in a four-part series. For other posts in this series, see:
Intellectual Property Strategies For Next Generation Cybersecurity Technologies
Defensive Patent Strategies For Blockchain and Distributed Ledger Technologies
Cybersecurity Patent Strategies vs. the Growing Barriers to Software Patents 

Intellectual Property Strategies for Next Generation Cybersecurity Technologies

Cybersecurity technology has become one of the most important industries in the world today. With products that are critical to businesses in countless fields, including finance, healthcare, transportation, public utilities, manufacturing, defense and government, experts have predicted that the global market for cybersecurity technologies will grow by 10% per year through 2020.

Cybersecurity technologies are also one of the biggest drivers in corporate value today. 129-year-old Eastman Kodak Company recently saw the value of its stock jump by 200% after announcing a new service that will use blockchain technologies to help photographers get paid in a new cryptocurrency when others use their photos. A New York-based beverage distributor experienced a 289% share price increase after it simply renamed itself from “Long Island Iced Tea Company” to “Long Blockchain Corp.” and announced that it would start to offer blockchain technology solutions.

Next generation cybersecurity technologies include more than just blockchain-based payment systems. Distributed ledger technologies have applications in multiple fields, including document sharing, video and audio streaming, and biomedical applications. And although blockchain is all the rage at the moment, other cybersecurity technologies such as network attack simulations, network security awareness training through methods such as simulated phishing, and real-time analytics are equally important, if not more so.

With this background in mind, what intellectual property protection options are available for next generation cybersecurity technologies? Continue reading

Fox launches GDPR Check app

Fox Rothschild LLP has launched a new mobile app to help businesses catalog their data management practices and determine necessary steps to comply with the European Union’s General Data Protection Regulation (GDPR), which will take effect in May 2018.

GDPR Check maps an organization’s data management practices in 17 areas that are key to determining compliance, and it produces a report for each key area that a company can share with its attorneys and compliance team.

For more details on the GDPR Check app and a link to the free download in the Apple App and Google Play stores, vist the GDPR Check announcement on the Fox Rothschild website at this link.

How long does it take to get a patent or trademark registration? (2017 update)

At the end of each fiscal year, the USPTO releases a Performance and Accountability Report, with statistics about patent and trademark allowance rates, average pendency, and other details. The USPTO recently released its Performance and Accountability Report for Fiscal Year 2017. This means that it’s time for IP Spotlight’s annual review of the question:  “how long does it take to receive a patent or register a trademark?”

To answer that question, here are a few highlights from the USPTO’s FY 2017 report:

Patents:  The USPTO continued a six-year trend of reducing overall patent application pendency in FY 2017. The average time between filing and first office action was 16.3 months, which is about the same as last year. However, average total pendency decreased to 24.2 months (down from last year’s 24.2-month average pendency, and down from a high of 33.7 months in 2012).

The report did not discuss the effect of the USPTO’s “Track 1” expedited examination option on the overall timeline. Applicants who pay the additional fee for Track 1 processing typically receive a first action within 4-6 months of filing, and allowance or final action within 12 months of filing.

The wait times vary depending on the technology involved. Patent applications for computer architecture and mechanical engineering inventions generally experienced the longest waits, while applications in the biotech and organic chemistry fields moved relatively quickly. The breakdown by technology included: Continue reading

Why do patents often include method claims and apparatus claims?

When I send a draft patent application to an inventor who is new to the patent process, the inventor often asks why the claims seem to repeat themselves. A patent application often has one group of claims directed to a method, and another group directed to an apparatus or system. This can confuse new inventors because the two claim groups often appear to be very similar.

Why the duplication?  There are several reasons.

One reason is that method and apparatus claims can be directed to two separate groups of infringers. A patent gives its holder the exclusive right to make, use and sell the invention. Method and apparatus claims may each define the invention in a slightly different way. Some entities — such as a distributor or retailer — may sell an apparatus, but they will never practice a method of making or using the apparatus. Other entities (such as end users) may use the invention but not make or sell it. Depending on the situation, one set of the claims or the other could be more useful to assert against a particular infringer.

Another reason to include two groups of claims relates to the point in time at which damages start to accrue for infringing activity. Section 287 of the Patent Act limits recovery of damages for making/using/selling a patented article to the point in time where the infringer had actual notice of the patent, or constructive notice of the patent through marking. Because Section 287 refers to “articles” but not methods, courts have generally limited the notice requirement to apparatus claims, not system claims.

This interpretation by the courts dates back to at least 1936, when in Wine Railway Appliance Company v. Enterprise Railway Equipment Company, the Supreme Court said that Section 287 does not limit damages if the patent holder isn’t actually making articles to mark.

More recently, courts have clarified that if a patent is directed only to a method (i.e., there are no apparatus/article claims), Section 287 does not apply and notice is not required. (See Bandag, Inc. v. Gerrard Tire Co.) If a patent includes both apparatus and method claims, then Section 287 does not apply if only the method are asserted. (See, for example:  American Medical System Inc. v. Medical Engineering Corp., Crown Packaging Technology Inc. v. Rexam Beverage Can Co. and Hanson v. Alpine Valley Ski Area, Inc.) Whether or how Section 287 would apply if both types of claims are asserted has not yet been fully addressed by the Federal Circuit. (See Rembrandt Wirless Technologies, LP v. Samsung Electronics Co., Ltd.)

Because of this method/apparatus dichotomy, as well as the fact that Section 287’s notice requirement does not apply to an entity that holds — but does not practice – the patent, the notice requirement has been criticized as primarily benefitting non-practicing entities. However, so far Congress has not considered this issue to be worthy of an amendment to the Patent Act.

In addition, to avoid issues associated with the notice requirement some patent applicants may consider filing patent applications with only method claims or only apparatus claims. This may mean filing two applications on the same day, or filing a second application that claims priority to a first application. This adds to the expense, but it can help reduce the worry that insufficient marking will limit damages when asserting both method and apparatus claims.

Operate a website? Don’t miss the 12/31 deadline to update your DMCA notice

If you operate a website that accepts user-generated content, now is the time to contact the Copyright Office.

Many online service providers (OSPs) accept user-generated content. Examples include e-commerce websites that accept product reviews, news sites that publish user comments on posted articles, social media sites that permit users to share photos or videos, and even blogs who post comments from other users.

It can be very difficult for an OSP to determine whether user-generated content was created by the user who posted it, or whether the content infringes someone else’s copyright.

To protect OSPs from being liable for copyright infringement resulting from user-generated content, since 1988 the Digital Millennium Copyright Act (DMCA) has provided OSP’s a “safe harbor” from liability so long as OSPs follow certain procedures, including:

  • not actually knowing about the infringement;
  • not financially benefiting from the infringement;
  • when gaining knowledge of infringement, acting quickly to remove or disable access to the infringing material; and
  • designating an agent to receive notifications of claimed copyright infringement, and providing the agent’s contact information to the Copyright Office.

In December, 2016, the procedures for designating a DMCA agent have changed. Previously, DMCA agent designation was handled by completing a form and filing the form with the Copyright Office with a required filing fee. This has now changed.

Under the new DMCA agent designation procedure, all DMCA agent designations must be done online. Even OSPs who previously designated an agent must file an online designation to maintain their DMCA designations. Any OSP that previously designated an agent with the Office will have until December 31, 2017 to use the online system to update their agent designation. OSPs must create an account on the Copyright Office website and complete the agent designation form online.

The Copyright Office has published several video tutorials to help OSPs understand how to use the new online designation system. Those tutorials are available on the Copyright Office website.

[Image credit:  Pavel Ignatov]

New USPTO fee schedule increases fees for challenging granted patents, adds streamlined reexamination option

The USPTO recently published an adjusted fee schedule for certain patent fees. The new schedule significantly increases the fees for challenging the validity of a patent in inter partes review (IPR), post-grant review (PGR) and covered business method (CBM) proceedings. (A comparison of these three types of proceedings is available from the USPTO at this link.)

The new fees for an IPR proceeding (request fee + post-institution fee) total $30,500 — an increase of $7,500. Additional fees apply if the IPR proceeding involves more than 15 claims.

The new fees for a PGR or CBM proceeding (request fee + post-institution fee) total $38,000 — an increase of $8,000. Additional fees also apply if the PGR or CBM petition involves more than 15 claims.

The office also established a new “streamlined reexamination” option for ex parte reexamination requests that do not exceed 40 pages. Line spacing (double-spaced or 1-1/2 spaced), font size (12-pt non-script), and margin requirements apply. The fee for a streamlined reexamination is $6,000, compared to the standard $12,000 ex parte reexamination fee.

The fee hikes also include:

  • a $100 increase (to $1300) in the fee for filing a first request for continued examination (RCE);
  • a $200 increase (to $1900) in the fee for filing a 2nd or subsequent RCE;
  • a $180 increase (to $760) for the search and examination fees required for new design patent applications;
  • a $240 increase (to $2,240) in the cost of moving an appeal of a final rejection from the briefing stage to the Patent Trial and Appeals Board for review; and
  • other fee increases for various petitions, such as petitions to revive an abandoned patent application and petitions to accept a delayed maintenance fee payment.

The costs listed above are the standard fees. Small entities and micro-entities may qualify for 50% or 75% reductions of certain USPTO fees.

The new fee schedule will take effect on January 16, 2018.