Netscape Communications Corp. v. Konrad
2002 WL 1461893, 295 F.3d 1315 (2002)
Premium Feature
Subscribe to Lexplug to listen to the Case Podcast.
Rule of Law:
An inventor’s patent is invalid under the public use and on-sale bars of 35 U.S.C. § 102(b) if, more than one year before the patent application's filing date, the invention was used by a member of the public without an obligation of confidentiality or was the subject of a commercial offer for sale.
Facts:
- Allan M. Konrad, a staff scientist at Lawrence Berkeley Laboratory (LBL), developed a system for a computer to access a remote database.
- On September 26, 1990, Konrad successfully tested a prototype of the system, which was configured to access LBL's STAFF database.
- In 1991, Konrad adapted the prototype for the high energy physics database at the Stanford Linear Accelerator Center (SLAC).
- Also in 1991, Konrad demonstrated the prototype to University of California computing personnel, Shuli Roth and Dick Peters, without imposing any obligation of confidentiality.
- Konrad demonstrated the high energy physics version at SLAC, and it was used by employees of the University Research Association Superconducting Super Collider Laboratory (SSC Lab) without confidentiality restrictions.
- In September 1991, Konrad, through LBL, offered to create the system for the SSC Lab in exchange for four months of full-time employment or a payment of no more than $48,000.
- Konrad filed his first patent application on January 8, 1993, making the critical date for the § 102(b) bars January 8, 1992.
Procedural Posture:
- Allan M. Konrad sued thirty-nine customers of Netscape for patent infringement in the U.S. District Court for the Eastern District of Texas.
- Netscape Communications Corp., Microsoft Corp., and America Online, Inc. then filed a declaratory judgment action against Konrad in the U.S. District Court for the Northern District of California, seeking a judgment that the patents were invalid.
- Netscape moved for partial summary judgment, arguing Konrad's patents were invalid under the public use and on-sale bars of 35 U.S.C. § 102(b).
- The district court granted Netscape's motion for summary judgment, concluding the patents were invalid.
- Based on Konrad's stipulation that this finding would invalidate all claims, the district court entered a final judgment of invalidity.
- Konrad, as appellant, appealed the district court's judgment to the United States Court of Appeals for the Federal Circuit, with Netscape as appellee.
Premium Content
Subscribe to Lexplug to view the complete brief
You're viewing a preview with Rule of Law, Facts, and Procedural Posture
Issue:
Do an inventor's pre-critical date demonstrations of an invention to third parties without confidentiality agreements and a commercial offer to create the invention for another entity constitute public use and an on-sale bar under 35 U.S.C. § 102(b), thereby invalidating the patents?
Opinions:
Majority - Mayer, Chief Judge.
Yes, the inventor's pre-critical date activities invalidate the patents under both the public use and on-sale bars. An inventor's demonstration of an invention to others who are under no obligation of secrecy constitutes a public use. Konrad demonstrated his invention to university personnel without imposing confidentiality; his claim of experimental use fails because the demonstrations were aimed at commercial promotion rather than technical refinement, and he presented no objective evidence of experimentation or maintained control over the invention's use. Similarly, demonstrations to and use by other laboratory employees without confidentiality agreements constituted public use, as the onus is on the inventor to secure secrecy, not a funding agency. The on-sale bar was triggered by Konrad's offer to provide a working prototype to a separate entity for $48,000, which constituted a commercial offer for sale. Because Konrad admitted the invention was reduced to practice before this offer, it was ready for patenting, satisfying both prongs of the on-sale bar test established in Pfaff v. Wells Electronics, Inc.
Analysis:
This case reinforces the strict nature of the statutory bars to patentability under 35 U.S.C. § 102(b). It clarifies that an inventor bears the affirmative burden of imposing confidentiality on anyone to whom an invention is disclosed pre-critical date to avoid a 'public use' finding. The decision also demonstrates that even transactions between government-funded research institutions can be deemed 'commercial offers for sale' if the entities are distinct and the inventor does not maintain control, highlighting the importance of substance over form in the on-sale bar analysis. The ruling serves as a stark warning to inventors to be diligent in protecting secrecy and prompt in filing patent applications after any promotional or commercial activity.
Unlock the full brief for Netscape Communications Corp. v. Konrad