Tribal Sovereign Immunity Shields Indian Nation From Liability For Patent Infringement

Defendant's motion to dismiss for lack of subject matter jurisdiction was granted where defendant was a federally recognized Indian nation and immune from suit. "[Plaintiff] points to no authority that Congress has expressly abrogated tribal sovereign immunity with respect to the enforcement of patents. . . . Nowhere in the Gaming Compact [between defendant and the State of Oklahoma] does [defendant] indicate an intention to waive its immunity from suit with respect to torts generally, or for patent infringement particularly. . . . Because the Quapaw Tribe enjoys sovereign immunity from patent infringement suits and did not waive its immunity, its Motion to Dismiss is granted."

Specialty House of Creation, Incorporated v. Quapaw Tribe of Oklahoma, 4-10-cv-00371 (OKND January 27, 2011, Order) (Frizzell, J.)

Transfer of Operations to Parent Entity Without Corresponding Transfer of Patent Rights Precludes Lost Profits

Defendant's motion for summary judgment of no lost profit damages was granted in part. "After [plaintiff's parent's] acquisition of [plaintiff], [plaintiff] operations were transferred to [its parent]. [Plaintiff] is still in existence and has consolidated financial statements; however, the business expenses incurred to produce the [products and services at issue] are now incurred by [the parent]. . . . [Plaintiff] has not assigned the patent-in-suit to [its parent] nor granted a license to [its parent]. This evidence establishes that, since the stock acquisition and restructuring of operations, as a matter of law, these profits and losses are, in effect, the profits and losses of [the parent], a non-party. . . . [Plaintiff] cannot recover lost profits after the date [its] operations . . . ceased. The precise date when this occurred is a question of fact for the jury to decide."

Duhn Oil Tool Inc. v. Cooper Cameron Corporation, 1-05-cv-01411 (CAED January 24, 2011, Order) (Wanger, J.).

Infringement by Direct Competitor Warrants Permanent Injunction

Plaintiff's motion for a permanent injunction precluding infringement of its guitar tuning patent was granted. "In this case, [plaintiff] is irreparably injured by the continuing patent infringement by [defendant]. The infringement devalues the patent and gives an advantage to competitors in the industry . . . by piggybacking on [plaintiff's] patented technology. The infringement will continue without an injunction, so money damages are inadequate. The balance of hardships favors the injunction, because it is a greater hardship to [plaintiff] to have its valid patent infringed upon than to allow [defendant] to continue infringing.

Ernie Ball Inc. v. Earvana, 5-06-cv-00384 (CACD January 21, 2011, Order) (Nguyen, J.).

Permanent Injunction May Include "Safeguards To Prevent U.S. Importation Of End Products Containing The Accused Products"

The court granted in part plaintiff's request to include a provision in a permanent injunction that precluded defendants from selling their products outside the U.S. to customers without adequate safeguards to prevent U.S. importation of end products containing the accused products. "An injunction 'cannot impose unnecessary restraints on lawful activity.'. . . [Plaintiff] is, however, entitled to an injunction directed toward Defendants‘ activities which cause domestic infringement as well as the activities of those persons or companies acting in concert with Defendants. . . . Given the jury‘s finding of induced infringement, [plaintiff] is entitled to an injunction that requires Defendants to provide the following Notice and a copy of this Order included with any shipped [enjoined products] or with the bill of sale for [enjoined products]. . . ."

SynQor, Inc. v. Artesyn Technologies, Inc., et. al., 2-07-cv-00497 (TXED January 24, 2011, Order) (Ward, J.).

Continued Marking After Service of False Marking Complaint Creates "Rebuttable Presumption of Intent to Deceive"

The court vacated its earlier dismissal of plaintiff's qui tam false marking claim because plaintiff's proposed amended complaint alleged "that [defendant] continued to mark the [accused] product insert with the [patent-in-suit] after being served with the first amended complaint. This allegation, when taken as true, establishes that [defendant] knew the [patent] was expired when it marked the product insert. A false statement, combined with knowledge that the statement is false, 'creates a rebuttable presumption of intent to deceive the public . . . .' The Court finds that Plaintiff has now adequately pleaded intent to deceive."

Baker v. Bausch & Lomb, Inc., 2-10-cv-02273 (TNWD January 20, 2011, Order) (McCalla, J.)

Enhanced Damages Warranted Even Though Compensatory Damages Eliminated Infringer's Profits From Infringing Sales

In granting in part plaintiff's motion for enhanced damages, the court rejected defendant's argument that enhanced damages would cause severe prejudice because defendant's profits from the accused product were "not much more" that the awarded damages. "[Defendant's] contention that the $6 million of damages already awarded -- assuming that this amount represents [defendant's] entire profit it earned from infringing sales -- does not help it avoid an enhanced damages award. While the $6 million may compensate [plaintiff], it does not adequately punish [defendant]."

Power Integrations v. Fairchild Semicond., et. al., 1-04-cv-01371 (DED January 19, 2011, Order) (Stark, J.)

Release of False Marking Claims Applies to All Products Marked with Patent Numbers

Plaintiff's motion to amend his qui tam complaint for false marking to add a new defendant was denied as futile because two other relators had already settled their false marking claim against the proposed defendant. The court rejected plaintiff's argument that the accused product in the instant suit was not addressed by the other actions. "Having received money from [the proposed defendant] in exchange for broad releases of any claims of improper marking by [the proposed defendant] or of [the proposed defendant's] products with the [patent-in-suit], the United States has relinquished any right to damages from [the proposed defendant] in another lawsuit alleging improper marking with the same expired patent. . . . It is common for parties to settle contested litigation with broad releases of the type used in the [other] cases, which relinquished improper marking claims whether known or unknown, and whether or not asserted in any lawsuits. We see nothing in Section 292 that alters this basic tenet of contract law."

Simonian v. Irwin Industrial Tool Company, 1-10-cv-01260 (ILND January 18, 2011, Order) (Schenkier, M.J.).

Settlement Documents From Earlier Lawsuit Involving Patent-in-Suit Not Discoverable

The court denied defendant's motion to compel settlement documents from another case involving plaintiffs and one of the patents-in-suit. "The Court concludes that plaintiffs’ confidentiality interests in the [other] settlement agreement, as well as the federal policy of encouraging settlements by safeguarding the confidentiality of those agreements, outweighs defendant’s asserted need to discover documents evidencing the [other] settlement."

Carson Cheng, et. al. v. AIM Sports, Inc., et. al., 2-10-cv-03814 (CACD January 18, 2011, Order) (Abrams, M.J.)

Pequignot Does Not Address Pleading Requirements for False Marking Intent to Deceive

In denying defendant's motion to dismiss plaintiff's qui tam false marking action, the court rejected both parties reliance on Pequignot as applicable to the pleading standard for false marking claims. "[B]oth [plaintiff] and [defendant] have cited to portions of Pequignot v. Solo Cup Co., 608 F.3d 1356 (Fed. Cir. 2010), in which the Federal Circuit recently addressed Section 262(a) claims and addressed issues relating to the knowledge of the falsity of marks and a rebuttable presumption of intent. However, in Pequignot, the court was reviewing a lower court’s ruling on a motion for summary judgment and the issues addressed by the court related to the merits of the claims, rather than the pleading standard. Thus, Pequignot is not applicable to the instant action at this juncture. [Plaintiff] is not required to prove its case at the pleadings stage, and to require more facts from [plaintiff] concerning intent would impose even a higher pleading standard than is required under Rule 9(b), effectively foreclosing qui tam actions such as this, which Congress has indicated should be available to the public."

Patent Compliance Group Inc. v. Brunswick Corporation, 1-10-cv-04645 (ILND January 14, 2011, Order) (Der-Yeghiayan, J.)

Claim Reciting Multiple "Extensible Markup Languages" Is Not Invalid For Lack Of Written Description Even Though Specification Describes Only One

Defendant's motion for summary judgment of invalidity for lack of written description of plaintiff's encryption patent was denied. "[Defendant's] argument rests exclusively on the fact that [the claims] refer . . . to 'another Extensible Markup Language,' but 'nothing in the [patent] application, as filed, disclosed or suggested more than one Extensible Markup Language.' In the context of the [patent], however, [defendant's] argument reduces to mere semantic quibbling. . . . [T]he entire point of Extensible Markup Languages is that their syntax can be extended or modified to suit various purposes and applications."

TecSec, Incorporated v. International Business Machines, et. al., 1-10-cv-00115 (VAED January 12, 2011, Order) (Brinkema, J.)

Formation of Company to Prosecute False Marking Claims does not Manipulate Venue

The court denied defendants' motion to transfer venue of plaintiff's qui tam false marking action. "Although [plaintiff] was incorporated three days before [it] filed its first false marking suit, [plaintiff] was not formed to manipulate venue. . . . There is no dispute that [plaintiff] was formed in anticipation of litigation, and its business model is solely to bring false marking lawsuits. But there is a difference between forming a company in an attempt to manipulate venue and forming a company in anticipation of litigation. . . . [Plaintiff's] president and employee has lived in the Eastern District of Texas for over a year. . . . Therefore, the Court will give some weight to the fact that [plaintiff] is incorporated in Texas and conducts all relevant operations in the Eastern District of Texas."

Texas Data Co., LLC v. Target Brands, Inc., et. al., 2-10-cv-00269 (TXED January 12, 2011, Order) (Ward, J.)

False Marking Claim Preserves Jurisdiction to Award Attorneys' Fees and Declare Patent Unenforceable

Following defendant's multiple covenants not to sue, the court dismissed plaintiff's declaratory judgment claims of invalidity and unenforceability, but retained jurisdiction to declare defendant's patents invalid in connection with plaintiff's request for attorneys' fees. The court rejected defendant's argument that attorneys' fees could not be awarded because plaintiff was not a prevailing party given the court's dismissal of its declaratory judgment claims. "Defendant has neither alleged nor provided statutory or case law support for the proposition that attorney fees pursuant to [35 U.S.C.] § 285 is inapplicable to a claim of false patent marking. . . . Thus, it would be premature and inappropriate for the Court to hold that Plaintiff, as a matter of law, cannot be a 'prevailing' party for its claim of false patent marking, especially when that claim survived a motion to dismiss."

U.S. Rubber Recycling, Inc. v. Encore International Inc., et. al., 2-09-cv-09516 (CACD January 7, 2011, Order) (Otero, J.)

Obviousness Type Double Patenting Does Not Require Later-Issued Patent With Shorter Term to Abridge Term of Earlier-Granted Patent With Longer Term

Following a bench trial, the court found that plaintiffs' cinacalcet drug patents were not invalid for obvious-type double patenting. "Because of the change in patent terms as of June 8, 1995, the '068 and '003 patents on the genera compounds will expire after the later-filed and later-granted '244 patent on the species. Defendants argue that the '068 and '003 patents impermissibly extend patent protection to cinacalcet beyond the term granted by the '244 patent. . . . Normally, the later species patent term will expire after the earlier genus patent's term. Here . . . the legal changes to the patent terms, the timing of the applications, and the length of prosecution caused the species patent term to expire before the genus. . . . Here, even if the claims in the [later-filed] patent were identical to those in the [earlier] patents, the [later] patent's term could not extend the patent protection to which plaintiffs were already entitled on the [earlier] patents. Accordingly, the court finds that the later-filed, later-issued [patent] could not and did not create an 'unjustified timewise extension' of the earlier-filed, earlier-issued [patents]."

Brigham and Women's Hospital Inc., et. al. v. Teva Pharmaceuticals USA Inc., et. al., 1-08-cv-00464 (DED January 7, 2011, Order) (Bartle, C.J.)

Microsoft Word does not infringe patent claiming user interface that is "continuously responsive to user input" even though the accused interface

"from the user’s standpoint . . . remains continuously responsive"
Defendants' motion for summary judgment of noninfringement of plaintiff's internet search patent was granted because the accused software -- Microsoft Word -- was not "continuously responsive to user input." "[E]vidence that shows that the 'routines execute very quickly . . . so from the user’s standpoint, the user interface remains continuously responsive,' [and] 'it is unlikely that a user could physically enter a character or perform an operation during the short time that it takes the query preparation routines to execute.' . . . [However] [d]efendants’ correctly point out that the issue 'is not how long these software routines take to execute,' but whether Microsoft Word is literally unresponsive during the applicable routine execution. Defendants’ evidence establishes that, while [plaintiff's] evidence fails to adequately challenge it."

Walker Digital, LLC v. Microsoft Corporation, et. al., 2-09-cv-07514 (CACD January 3, 2011, Order) (Gutierrez, J.)

Exclusive Licensee of One Joint Patent Owner Lacks Standing to Sue for Infringement

Defendant's motion to dismiss a plaintiff for lack of standing was granted where that plaintiff was a licensee of only one of two patent owners. "As an exclusive licensee of only one joint owner, [plaintiff] has no 'right to prevent others from making, using, or selling the patented technology.'. . . Without the right to exclude, [plaintiff] lacks standing to bring an action against [defendant] for infringement of the [patent-in-suit]. Thus, the Court holds that an exclusive licensee of one joint patent owner is akin to a bare licensee for standing purposes."

EBS Automotive Services, et. al. v. Illinois Tool Works, Inc., et. al., 3-09-cv-00996 (CASD January 4, 2011, Order) (Sammartino, J.)

Evidence of Lump Sum Settlements Lacking Per-Unit Royalty is Inadmissible

The court granted plaintiff's motion to limit testimony from defendants' damages expert to the extent such testimony was premised on lump sum settlements. "[L]ump sum settlements, which do not in themselves provide any per-[accused product] royalty rate, should not be admissible. Expert witnesses can generally rely on inadmissible evidence, but in order to avoid jury confusion and unfair prejudice, [defendants' expert] should not testify regarding any lump sum settlement agreements."

LecTec Corporation v. Chattem Inc., et. al., 5-08-cv-00130 (TXED January 4, 2011, Order) (Folsom, J.)

Diligence Asserting Inequitable Conduct Measured from Date Prior Art was Known to be Relevant, not Date Prior Art was Known to Exist

Defendant's motion to file amended pleadings to add claims of inequitable conduct and false marking was granted following plaintiff's amendment of its pleadings. "[Defendant] makes the convincing counter-argument that even if it knew certain facts related to [certain] patents for the past few years, these facts did not become relevant until Plaintiff added those patents to this case. The Court agrees that [defendant's] diligence should be measured from the time it knew that certain prior art might be relevant, not from when it first knew of the existence of the prior art."

Aten International Co. Ltd. v. Emine Technology Co., Ltd., 8-09-cv-00843 (CACD January 3, 2011, Order) (Guilford, J.)

Curation, done well, takes a lot of time

A comment from this excellent blog post describes one of our core values here at Docket Navigator:

"Curation has to be tough and time-consuming. . . . The few (small minority of) people who do it well spend a lot of time doing it." Venkat Balasubramani, on the Exactly what do you mean by “curating”? blog post by Jason Wilson

In addition to a number of complex and proprietary automated processes, Docket Navigator invests approximately 20-26 human hours per day to sort, index and summarize a single day's events in the world of patent litigation for publication in the Docket Report and archival in Docket Navigator.

This post came to our attention through Greg Lambert on Twitter (@glambert)

Damages Award Exceeding Stipulated 4% Royalty Rate Was Not Excessive

Defendant's motion for judgment as a matter of law on damages was denied even though the jury awarded damages greater than the 4% royalty rate the parties had stipulated was reasonable. "'A reasonable royalty is not necessarily the actual measure of damages but is merely the floor below which damages should not fall'. . . . The jury was presented with evidence that the Plaintiffs would not have willingly granted a license to [defendant] at a 4% rate in 2005, and that there was a long standing contention between the parties because [defendant] had previously infringed [plaintiffs'] patents. Further, there was evidence that [defendant] was a direct competitor with the Plaintiffs . . . and that [one plaintiff] lost sales to [defendant's] infringing product. This evidence allowed the jury to find that a 4% royalty rate would not have been enough to adequately compensate Plaintiffs for the use of their patented ideas, or the damages derived from lost customers and the corresponding profits from lost sales."

Bendix Commercial Vehicle Systems LLC, et. al. v. Haldex Brake Products Corporation, 1-09-cv-00176 (OHND January 3, 2011, Order) (Nugent, J.)

Difficulty Determining Expiration of Patent Requires False Marking Complaint to Plead Knowledge of Expiration with Specificity

Defendant's motion to dismiss plaintiff's qui tam false marking action for failure to state a claim was granted. "[T]he Complaint fails to allege that [defendant's products] were marked after the expiration of the patent. . . . The Complaint also fails to allege that [defendant] knew of the expiration of the patent at the time any of [its products] were marked. Knowing generally that patents expire is not sufficient, since 'determining the expiration date of a patent can, at times, be difficult.' Without more specific factual allegations of knowledge, there is no good faith basis for plaintiff to allege an intent to deceive the public."

Herengracht Group LLC v. American Tombow, Inc., 2-10-cv-00362 (FLMD December 30, 2010, Order) (Steele, J.)

Religious Questions and Comments Create "Us v. Them" Mentality Warranting New Trial

Plaintiff's motion for a new trial on indirect infringement and damages was granted based on statements made by defense counsel during trial regarding the Jewish faith of one of plaintiff's owners and its client representative, including references to dietary rules and the trial of Jesus. "[Counsel's comments] impliedly aligns [defense] counsel’s religious preference with that of the jurors and employs an 'us v. them' mentality -- i.e., 'we are Christian and they are Jewish.' When these comments are considered as a whole, the court concludes that the comments prejudiced the jury’s findings regarding indirect infringement and damages. . . . [E]ven though no objections were made to these remarks, the court is convinced that the jury’s verdict is inconsistent with substantial justice. . . ."

Commil USA, LLC v. Cisco Systems, Inc., 2-07-cv-00341 (TXED December 29, 2010, Order) (Everingham, M.J.)