Tuesday, March 31, 2009

Use of "the Internet" Does Not Satisfy the "Machine" Prong of In re Bilski's "Machine or Transformation" Test

The court rejected plaintiff's argument that utilizing the "the myriad 'general and special purpose computers, routers, hubs, switches and other specialized hardware' comprising the internet" satisfied the "machine" prong of the "machine or transformation" test required by In re Bilski, 545 F.3d 943 (Fed. Cir. Oct. 30, 2008) (en banc). "This court is now presented with the question of whether recitation of 'over the Internet' suffices to tie a process claim to a particular machine. There are at least three reasons why it does not. First, the test requires that a claimed process be tied to 'a particular machine' . . . [Second,] the internet is an abstraction. . . . One can touch a computer or a network cable, but one cannot touch 'the internet' . . . Finally, the use of the internet does not impose meaningful limits on the scope of the claims."

Cybersource Corp. v. Retail Decision, Inc., 3-04-cv-03268 (CAND March 27, 2009, Opinion)

Monday, March 30, 2009

Certain Post-Expiration Provisions of License Agreements Did Not Constitute Patent Misuse

Plaintiff's license agreements did not constitute patent misuse even though they contained provisions "(1) providing for a post-expiration marking requirement (i.e., requiring licensees to mark expired patent numbers on their products); (2) requiring post-expiration supply obligations (i.e., requiring the licensees to buy [plaintiff's] products after the patents-in-suit expired); (3) providing for an undiminishing royalty rate (i.e., not decreasing the royalty rate the licensee paid for licensing both patents in suit after [one of the patents expired]); and (4) including a potential retroactive royalty increase (i.e., the royalty rate paid by the licensee could increase from 3% to 5% after expiration of the patents, depending on what happened up to five years after the [last] patent expired . . . )." "Because [defendant] has not established that any of the complained-of limitations in [plaintiff's] licensing agreements constitute patent misuse, either per se or under a 'rule of reason' analysis, the court will deny [defendant's] claims."

Hearing Components, Inc. v. Shure, Inc., 9-07-cv-00104 (TXED March 26, 2009, Memorandum & Order)

Friday, March 27, 2009

Non-Practicing Plaintiff is Entitled to Damages for Post-Filing Willful Infringement Even Though it Failed to Seek a Preliminary Injunction

The rule that damages for post-filing willful infringement are unavailable if the plaintiff fails to move for a preliminary injunction, (see In re Seagate Tech., LLC, 497 F.3d 1360, 1374 (Fed. Cir. 2007)), "is neither an absolute nor a general rule applicable to all patent cases." The rule did not apply in this case because the plaintiff "[did] not practice the invention and [did] not compete with the infringer," and therefore plaintiff "reasonably and wisely" concluded that he would lose a motion for preliminary injunction for reasons "other than its lack of merit on the underlying claim."

Krippelz v. Ford Mtr. Co., 1-98-cv-02361 (ILND March 25, 2009, Minute Order)

Thursday, March 26, 2009

Application for Extension of Patent Term Warrants a Stay of Litigation

In a case of "first impression," the court granted defendant's motion to stay pending the PTO's review of a patent term extension application "pursuant to the Hatch-Waxman Act, as codified in 35 U.S.C § 156." "In both re-examination cases and in the current case there is a risk of inconsistent outcomes when there are two parallel proceedings looking at the same issue -- whether the [patent-in-suit] is eligible for extension. Staying the proceedings in this action will allow the administrative review process to run its course prior to conducting any parallel proceedings in this Court."

Abbott Laboratories v. Medtronic, Inc., 4-08-cv-04962 (CAND March 24, 2009, Order)

Wednesday, March 25, 2009

Selective Disclosure is "Strong Evidence of Intent to Mislead the Patent Office"

"[Plaintiff] and its counsel selected the one part of [a prior art brochure] to disclose what was consistent with how it had described [the product advertised in the brochure] to the PTO. Furnishing the entire brochure would have revealed the inconsistencies between [plaintiff's] description in the application and the truth about the [product advertised in the brochure]. Such selectivity is strong evidence of intent to mislead the patent office about the relevant prior art system as described by its competitor."

Golden Hour Data Systems, Inc. v. emsCharts, Inc., 2-06-cv-00381 (TXED March 23, 2009, Memorandum Opinion & Order)

Tuesday, March 24, 2009

"Only" Means "Only": Any Range of Equivalents Beyond "Only" Vitiates That Claim Element

Where the asserted patent claims were construed to require laser light of a frequency that is absorbed by water "only to a negligible degree," a laser light of a frequency that is absorbed "more than to a negligible degree" could not infringe under the doctrine of equivalents because such a finding would completely vitiate that claim element.

American Medical Systems, Inc. v. Biolitec, Inc., 3-07-cv-30109 (MAD March 20, 2009, Memorandum & Order)

Monday, March 23, 2009

Misrepresentation is Not Automatically Immaterial Where the PTO has Information to Determine Truthfulness of the Misrepresentation

Defendant's defense of inequitable conduct was not futile for failure to allege materiality simply because the PTO had information before it that could be used to determine the accuracy of the alleged misrepresentation. "It is clear that a misrepresentation that is contradictory to information that is not presented to the examiner is an intentional material misrepresentation. It is a much closer question when the patentee makes a statement contradictory to information that is actually before the PTO. Two Federal Circuit cases that have addressed this issue came to differing conclusions based on whether the PTO examiner actually looked at the information that was the subject of the inequitable conduct. . . . Based on these lines of cases, this Court cannot adopt or apply a bright-line rule that, if the PTO had the information to ascertain the veracity of the alleged misstatement, the misstatement is not material."

Synovis Life Technologies, Inc. v. W.L. Gore & Associates, Inc., 0-07-cv-01396 (MND March 19, 2009, Order)

Friday, March 20, 2009

Despite Split in Federal Circuit Authority, Existence of a "Substantial Question" Concerning Validity Precludes Preliminary Injunction

In determining a defendant's burden to establish invalidity at the preliminary injunction stage, the court was "constrained" to follow the standard set in Erico Int’l Corp. v. Vutec Corp., 516 F.3d 1350 (Fed. Cir. Feb. 19, 2008) and not Abbott Laboratories v. Sandoz, Inc., 544 F.3d 1341 (Fed. Cir. Oct. 21, 2008). "Respectfully, the Court continues to agree with Judge Newman on this issue and finds her opinion in Sandoz, Inc. particularly persuasive. . . . Nonetheless, the Court finds that it is constrained to apply the standard set forth in Erico and, accordingly, finds that [defendant's] burden is to show no more than the existence of a 'substantial question' regarding the validity of the [patents at issue]. If [defendant] succeeds in 'casting doubt' regarding the validity of the patents the Court must deny [plaintiff's] motion for preliminary injunction."

Avery Dennison Corp. v. Alien Technology Corp., 1-08-cv-00795 (OHND March 18, 2009, Memorandum & Order)

Thursday, March 19, 2009

Motion to Limit the Number of Claims Asserted Prior to the Close of Discovery and Claim Construction Denied as Premature

Defendant's motion to limit the number of asserted claims was denied as premature. "While it is undisputed that a district court has the authority to manage its docket . . . the Federal Circuit has not directly addressed the issues surrounding when and how a district court may limit the asserted claims in a patent case. . . . To arbitrarily limit the number of claims that Plaintiff may assert at this point -- long before discovery has closed -- will result in prejudice to Plaintiff. Further, such a limitation so close to the Markman hearing will not help the parties, nor the Court, prepare for the upcoming hearing. . . . Moving forward after the Markman hearing, the Court would prefer the parties to address the issue of limiting claims among themselves and come to an agreement regarding a manageable number of claims to move forward on after the close of discovery. Should the parties fail to agree, the Court will consider competing proposals."

Real Time Data, LLC v. Packeteer, Inc., 6-08-cv-00144 (EDTX March 16, 2009, Memorandum Opinion & Order).

Wednesday, March 18, 2009

Reliance on "25% Rule of Thumb" Did Not Warrant Exclusion of Damages Expert's Testimony

Defendant's motion to exclude plaintiff's damages expert was denied. "[Defendant] claims [the expert's] methodology for concocting the reasonable royalty [a 25% "rule of thumb"] is just not 'good science.' But this is like saying Alice did not serve Earl Gray at her tea party. Maybe so, but in this fictional world it is close enough because the starting premise . . . is at least arguably grounded in the evidence and the rule of thumb calculation and the Georgia-Pacific factors are so widely accepted."

Uniloc USA, Inc., v. Microsoft Corp., 1-03-cv-00440 (RID March 16, 2009, Order)

Tuesday, March 17, 2009

Award of Attorneys' Fees for Appeal of Exceptional Case Does Not Require "a Separate Showing that the Appeal Itself is Exceptional"

In granting defendant's motion for additional attorneys' fees for a second appeal, the court rejected plaintiff's argument that "[defendant] must make a separate showing that the appeal itself is exceptional [and] that attorney fees have to be separately justified for each phase of a case." "[T]his Court has already held twice [that] this is an exceptional case, there is clear and convincing evidence of inequitable conduct, and attorney fees are appropriate. It does not matter that [defendant] requests fees for time spent on appeal because an award under the Patent Act 'is not limited to fees paid for counsel’s work at trial.' "

Dippin' Dots Inc, v. Mosey, 3-96-cv-01959 (TXND March 13, 2009, Order)

Monday, March 16, 2009

Defendant's Late Disclosure of Third Party, and Lack of Ownership or Control of Third Party, Warrants an Extension of Discovery as to such Third Party

Plaintiff's motion to reopen discovery to allow the deposition of a third party was granted. Where defendant did not formally identify the third party until two weeks before the discovery cut-off, and waited until the last day of the discovery period "to assert that it did not own or control [the third party] and thus did not infringe," discovery was reopened so plaintiff could depose that third party.

Ronald A Katz Technology Licensing L P v. Citizens Financial Group Inc., 2-07-cv-04964 (CACD March 9, 2009, Minutes)

Friday, March 13, 2009

Invitation to Discuss Patent Does Not Create a Substantial Controversy Supporting Declaratory Relief Claim Even When Sent by a "Non-Competitor Patent"

The court granted defendant's motion to dismiss for lack of subject matter jurisdiction where the only communications between the parties were a letter from defendant inviting discussions concerning the patent-in-suit and follow-up letters addressing a possible standstill agreement that would be effective during such discussions. "The court appreciates that the receipt of such correspondence from a non-competitor patent holding company (or a patent troll) may invoke a different reaction than would a meet-and-discuss inquiry by a competitor, presumably with intellectual property of its own to place on the bargaining table. . . [However] in the case at bar, the plaintiff 'jumped the gun' under the circumstances as they existed prior to [the filing date]."

Hewlett-Packard Co. v. Acceleron LLC, 1-07-cv-00650 (DED March 11, 2009, Memorandum Opinion)

Thursday, March 12, 2009

30-Month Hatch-Waxman Stay Cannot be Prolonged Under FRCP 56(f) Where Noninfringement is Clear

Plaintiff's request to delay ruling on defendant's motion for summary judgment of noninfringement pending additional discovery under FRCP 56(f) was denied because (i) prior to filing of the lawsuit, "[defendant] offered to provide [plaintiff] with samples of Defendants' product for testing in an effort to stave off litigation; they also provided Plaintiff with so-called independent expert testing that confirmed noninfringement. . . .[but defendant] asserted that Plaintiff was more interested in suing and obtaining a 30-month injunction against FDA approval of [defendant's] product than in learning the truth," (ii) after testing defendant's product, plaintiff acknowledged that it did not infringe the patents-in-suit, but nevertheless "insisted that it need substantial additional discovery before it could decide whether to continue the lawsuit," and (iii) although plaintiff claimed defendant's 30(b)(6) witness was unprepared and could not answer questions about defendant's manufacturing process, plaintiff failed to move to compel additional testimony.

Astrazeneca AB v. Dr. Reddy's Laboratories, Ltd., 1-07-cv-06790 (NYSD March 10, 2009, Decision and Order)

Wednesday, March 11, 2009

Defendant's Failure to Prove Apportionment Between Infringing and Noninfringing Uses Bars Objection to Plaintiff's Damages Evidence Encompassing Both

The court denied defendant's motion to exclude testimony of plaintiff's damages expert as to royalty calculations that allegedly included all copies of the accused devices regardless of whether such devices practiced the patented method. "[W]here it is difficult to determine the precise apportionment between infringing and non-infringing uses, it is the infringer and not the patentee that bears the burden to produce data allowing for a proper apportionment. Because this burden was [defendant's], this Court will not penalize [plaintiff] or its damage expert when [defendant] did not produce such data in a timely manner and still contends that it need not have produced such data."

PalTalk Holdings, Inc. v. Microsoft Corp., 2-06-cv-00367 (TXED March 8, 2009, Order)

Tuesday, March 10, 2009

Mathematically Feasible Combinations of Prior Art Do Not Provide Clear & Convincing Evidence of Invalidity Unless Presented to the Jury as ...

Specific Combinations That Invalidate Specific Claims

"[T]he court informed [defendant] that, without limiting the combinations of allegedly invalidating references it could present, it would have to identify each specific combination of prior art items that it asserted made one or more of the asserted claims obvious. To permit a party to list . . . nine prior art references, and allow an expert to tell the jury that some combination of two or more of them is what makes a claim invalid is gamesmanship of the highest order. On appeal, after seeing what did not work well, the party would have, mathematically, some 502 potential combinations of two or more references from which to choose. Some of them may actually invalidate a claim, but is it clear and convincing evidence to the jury if that combination was not explained to them?"

Hearing Components, Inc. v. Shure, Inc., 9-07-cv-00104 (TXED March 6, 2009, Order)

Monday, March 9, 2009

Reexamination Certificate Provides Fresh Basis for Willfulness Claim

"[B]efore the Reexamination Certificate issued, allegations that Defendant’s actions were deliberate or reckless would not have provided sufficient factual or legal grounds because the validity of the [patent-in-suit] remained questionable. However, once the USPTO had made its final decision, Defendant’s continued use of the [patent-in-suit] could reasonably be considered 'objectively reckless.' "

Ultratech International Inc. v. Swimways Corp., 3-05-cv-00134 (FLMD March 3, 2009, Order).

Friday, March 6, 2009

Plaintiff Not Required to Limit the 253 Claims Asserted in the Case

Defendants' motion to limit the 253 claims asserted in the case was denied without prejudice. "Defendants do not explain what would happen to the unrepresentative claims, their position appears to be that Plaintiff would be estopped from litigating those claims due to their similarity to the representative claims. The similarity of the claims, however, raises doubts about the burdens that may be imposed. If the claims are similar enough to warrant collateral estoppel, then the burdens of litigating all of the claims may not be as great as Defendants suggest."

SPH America, LLC v. High Tech Computer Corp., 3-08-cv-02146 (CASD March 4, 2009, Order)

Thursday, March 5, 2009

Membership in Standards Setting Organization Did Not Restrict Pending or Future Patent Rights

Plaintiff's infringement claims were not barred by equitable estoppel, based on plaintiff's participation in industry standards setting organization. "Although [defendants] did offer some evidence supporting an obligation by JEDEC members to make disclosures concerning their patents relevant to any standard being considered, the evidence was not persuasive that there was any understanding among members that they had to disclose pending patent applications or the intent to file such applications. The jury specifically found that JEDEC members did not share a clearly defined expectation that such disclosures would be made."

Rambus Inc. v. Micron Technology Inc., 5-06-cv-00244 (CAND March 3, 2009, Findings of Fact & Conclusions of Law)

Wednesday, March 4, 2009

Invalidity Contentions Need Not Disclose a Claim of Invalidity That is Conditional on Opponent's Position

Plaintiff's motion to strike portions of a defense expert's report which included an opinion about a prior art reference that was not disclosed in defendant's invalidity contentions or interrogatory responses was denied. "[Defendant] is essentially reserving the right to advance a contention that is contingent upon the position taken by [plaintiff]. The issue here is whether Patent Local Rule 3-3 requires a party to assert a claim of invalidity which is only conditional and contingent on the opposing party’s position. Neither party has cited the Court to any authority directly on point. In the absence of such authority, the Court concludes that Rule 3-3 does not require such at least in this case where the contingency is allegedly not clearly anticipated by the Court’s claim construction."

Medtronic, Inc. v. AGA Medical Corp., 3-07-cv-00567 (CAND March 2, 2009, Order)

Tuesday, March 3, 2009

Litigation Misconduct Supports Award of Enhanced Damages and Attorneys' Fees

Plaintiff's motion for enhanced damages was granted. "This case has involved, in particular, the consistent and ongoing use of litigation tactics by [defendant] that appear to have been employed for the primary purpose of unnecessarily increasing the burden of this litigation on [plaintiff] -- e.g., filing motions of dubious merit; taking positions that caused [plaintiff] to expend resources and later withdrawing those positions. While perhaps in other situations courts have found that a few isolated incidents of questionable conduct may not warrant an enhancement of damages or may be excused as 'zealous advocacy, genuine debate, and honest disagreement,' the Court finds that Defendants’ conduct in this case dictates otherwise."

Joyal Products, Inc. v. Johnson Electric North America, Inc., 3-04-cv-05172 (NJD February 27, 2009, Opinion)

Monday, March 2, 2009

Pop Culture Double Play:

Guitar Hero Avoids Infringement Because It Fails to Create "Musical Sounds"
Although shaped like musical instruments, Guitar Hero video game controllers did not infringe patent claiming "musical instruments" which required the creation of "musical sounds." "[T]he Court concludes that musical sounds must have more articulable characteristics than a button’s clack or the thud produced from striking a table, piece of rubber, or piece of plastic."

YouTube Video Excluded From Evidence For Lack of Foundation (Among Other Things)
"YouTube video purporting to show that someone—perhaps the teenager the video appears to depict—hacked Guitar Hero to allow a configuration that could present a somewhat closer case on [infringement]" was excluded from evidence because (i) defendant failed to offer such evidence in its opposition to the summary judgment motion, (ii) the evidence lacked foundation, and (iii) the evidence was not relevant since there was no evidence that plaintiff "endorsed, encouraged, or knew about the system in the video."

Activision Publishing, Inc. v. Gibson Guitar Corp., 2-08-cv-01653 (CACD February 26, 2009, Order)