Friday, December 15, 2017

Inconsistent Positions on Patent Scope Risks Attorney Fees Award

The court ordered plaintiff and its counsel to show cause why it should not be responsible for defendants' attorney fees under 35 U.S.C. § 285 after granting summary judgment that defendants did not infringe plaintiff's patents due to statements made by plaintiff during its appeal of inter partes review proceedings. "⁠[Plaintiff] argued . . . the claimed invention does not require that the server determine the second process’s online or offline status solely by checking its database at the time of the first process’s query. But [plaintiff] has repeatedly told the Federal Circuit that its claimed invention requires precisely that. Indeed, the Federal Circuit . . . went to great pains during oral argument to pin down this exact point. Having won on invalidity based on those representations, [plaintiff] cannot now take a different position for purposes of proving infringement. . . . [Plaintiff] and its counsel . . . shall show cause in writing why they should not be held liable for defendants’ attorney’s fees by virtue of this being an 'exceptional' case within the meaning of [35 U.S.C. § 285]."

Straight Path IP Group, Inc. v. Cisco Systems, Inc., 3-16-cv-03463 (CAND December 13, 2017, Order) (Alsup, USDJ)

Thursday, December 14, 2017

Third Party Services and Pre-Filing Events Excluded From Scope of Venue Discovery

The court granted in part defendant's motion for a protective order to limit the topics of plaintiff's venue-related deposition. "Whether [defendant] has owned or leased a place of business in the district is relevant, but whether a third party that provides 'services' to [defendant] has a place in the district is not relevant. . . . [T]he time period is overly-broad. Venue is determined at the time the complaint is filed -- not as early as six years before the complaint was filed. . . . An employee who works from home within the district might be relevant to the inquiry. . . . The name and location of anyone that 'provides services' to the defendant, however, is too broad. . . . While [information about retailers in the district] may be relevant to jurisdiction, or even to infringement or damages, the location of a retail store that is not owned or leased by the defendant is irrelevant to the venue inquiry."

Better Mouse Company, LLC v. Razer USA Ltd. d/b/a Razer, Inc., 2-17-cv-00317 (TXED December 12, 2017, Order) (Payne, MJ)

Wednesday, December 13, 2017

Lack of Clear Distinction Between "Dual Hat" Expert’s Roles Requires Production of Information Considered in Consulting Role

The court granted defendant's motion to compel the production of documents reviewed by plaintiff's "dual hat" expert that plaintiff withheld as privileged because plaintiff failed to establish a clear distinction between the expert's duties as both a consulting and testifying expert. "Plaintiff [argues the expert's] consulting role . . . was a 'separate engagement' . . . that there is a clear distinction between [the expert's] consulting and testifying roles because the information he considered in his consulting capacity, which was broader in geographic scope and included information on additional products, extends beyond the information he considered in his testifying capacity. . . . Plaintiff's assertion that [its expert's] consulting and testifying roles are separate engagements is belied by the fact that Plaintiffs have presented only one engagement agreement for [the expert]. . . . That [he] considered information in his consulting role beyond that which he considered in his testifying role does not establish a clear distinction. Since the information considered by [the expert] for his consulting role included United States sales data and other information relevant to the current case, it is difficult, if not impossible, to believe that it did not inform the opinions in his testifying expert report concerning damages. Accordingly, Plaintiff must produce the documents it exchanged with [the expert] in his consulting role."

Ansell Healthcare Products LLC v. Reckitt Benckiser LLC, 1-15-cv-00915 (DED December 11, 2017, Order) (Andrews, USDJ)

Tuesday, December 12, 2017

Ongoing Royalty Applies Only to Accused Products Identified at Trial

Following a jury verdict of willful infringement, the court granted plaintiff's motion for an ongoing royalty, but only as to the accused products at trial. "⁠[Plaintiff] argues that it is 'entitled to an ongoing royalty for any [defendant] product that is not "colorably different" from the adjudicated infringing products.'. . . At this juncture, it would be inappropriate to expand the jury’s verdict to encompass not only products which were identified at trial but also products that were not previously accused of infringing or otherwise identified in this lawsuit. Such a result raises many concerns. If [plaintiff] believes that certain newly-released, unaccused products infringe its patents, it can seek appropriate relief as part of a new action."

Saint Lawrence Communications, LLC v. Motorola Mobility, LLC, 2-15-cv-00351 (TXED December 8, 2017, Order) (Gilstrap, USDJ)

Monday, December 11, 2017

Venue Statute Does Not Require Nexus Between Infringing Activity and Regular and Established Place of Business

The court denied defendant's motion to dismiss or transfer for improper venue and rejected defendant's argument that there must be a nexus between its action of infringement and its regular and established place of business in the district. "Defendant devotes much of its motion to the argument that 'the patent venue statute requires a connection between the alleged acts of infringement and the regular and established place of business.' It supports this argument by reading into the statute a level of ambiguity, invoking the 'policy underlying the patent venue statute,' and examining the provision’s legislative history. The Court need not consider these contentions, because it concludes that the plain language of the statute does not include a nexus requirement. Courts should 'ordinarily resist reading words or elements into a statute that do not appear on its face,' and this is one of the many cases where that is true."

Plexxikon Inc. v. Novartis Pharmaceuticals Corporation, 4-17-cv-04405 (CAND December 7, 2017, Order) (Gilliam, USDJ)

Damages Opinion Based on Composite Royalty Rate Excluded as Unreliable

The court granted in part defendants' motion to exclude the testimony of plaintiffs' damages expert because his royalty base was based on a composite rate. "Defendants explain that to reach his damages calculation, [the expert] applies a royalty base that includes units accused under any asserted patent to a royalty rate with contributions from every asserted patent. . . . I do not believe that use of a composite rate is consistent with Federal Circuit case law. . . . [The expert's] royalty rate assigns to each accused product the same per-unit royalty regardless of how many patents that product is accused of infringing. Thus, his analysis results in a damages calculation that overcompensates Plaintiffs and does not appropriately reflect the inventions' footprints in the marketplace."

MiiCs & Partners, America, Inc. et al v. Funai Electric Co., Ltd. et al, 1-14-cv-00804 (DED December 7, 2017, Order) (Andrews, USDJ)

Friday, December 8, 2017

Nineteen Work-at-Home Employees Does Not Establish Regular and Established Place of Business For Venue

The court granted defendant's motion to dismiss for improper venue because defendant did not have a regular and established place of business through its work-at-home employees who resided in the district. "Although [defendant] has nineteen employees who are permitted to work from their individual residences in the Eastern District of Texas, the Court finds that none of these residences are 'places of the defendant'. . . . [Defendant] does not lease, or own any portion of these employees’ homes in the Eastern District of Texas. [Defendant's] employees do not regularly maintain physical inventory in this District, are 'free to live where [they] cho[o]se as far as [the defendant] [is] concerned,' and do not receive reimbursements and support conditioned on their location within this District. . . . [Defendant] emphasizes that '⁠[t]he territory to which [its] sales teams are assigned often bears little relation to the team members' place of residence.'"

Uniloc USA, Inc. et al v. Nutanix, Inc., 2-17-cv-00174 (TXED December 6, 2017, Order) (Gilstrap, USDJ)