Friday, June 22, 2018

Seven Month Delay While Actively Litigating Waives Venue Challenge

The court denied defendants' motion to dismiss or transfer for improper venue because defendants waived their venue challenge through their litigation conduct. "⁠[D]uring the seven months after the [TC Heartland LLC v. Kraft Foods Grp. Brands LLC, 137 S. Ct. 1514 (2017)] decision, [defendants] were actively litigating this case in this District. . . . [M]otions for summary judgment were denied. . . . A Claim Construction Order was issued shortly thereafter. . . . [Defendants] also filed two new motions for summary judgment before filing this Motion. . . . This procedural history reflects the type of 'tactical wait-and-see bypassing of an opportunity to declare a desire for a different forum' expressly identified in [In re Micron Tech., Inc., 875 F.3d 1091 (Fed. Cir. 2017)] as a paradigm for when an objection to venue could be waived notwithstanding the new law as to Rule 12(h). . . . TC Heartland changed the law with respect to the definition of corporate residence for the purposes of patent venue. However, it did not change the underlying prudential framework for the assessment of challenges to venue like the one raised here."

Adrian Rivera v. Remington Designs, LLC d/b/a iCoffee, 2-16-cv-04676 (CACD June 19, 2018, Order) (Kronstadt, USDJ)

Seven Month Delay Alone Does Not Waive Venue Challenge

The court granted defendant's motion to transfer for improper venue and rejected plaintiff's argument that defendant waived its venue challenge. "Plaintiff does not appear to challenge the contention that venue in this Court is improper. Rather, Plaintiff argues that . . . Defendant forfeited its privilege to challenge venue by waiting nearly seven months after the [TC Heartland LLC v. Kraft Foods Grp. Brands LLC, 137 S. Ct. 1514 (2017)] decision to file its motion. . . . [D]espite Defendant’s delay in filing the instant motion, Plaintiff cites no undue prejudice caused by the delay; nor can the Court discern any such prejudice to Plaintiff. Specifically, there has been no additional motion practice, an initial pretrial conference has not yet been scheduled, discovery has not yet commenced, and no trial date has yet been set."

Blue Rhino Global Sourcing, Inc. v. Sky Billiards, Inc. d/b/a Best Choice Products, 1-17-cv-00069 (NCMD June 20, 2018, Order) (Biggs, USDJ)

Thursday, June 21, 2018

Common Interest Doctrine Does Not Apply to Unrepresented Parties

The court granted plaintiff's motion to compel the production of an email with a third party manufacturer that defendants clawed back under the common interest privilege because the manufacturer was not represented by counsel. "There is support for the position that all parties must be represented by counsel for the common interest exception to apply. . . . The requirement that each party to a common interest arrangement have an attorney also comports with the intent behind the common interest privilege, to permit attorneys to develop a joint legal strategy. . . . While this Court was not able to locate any Ninth Circuit precedent that explicitly requires both parties be represented by separate counsel, nor was there any precedent that extended the benefits of the common interest exception to the attorney client privilege when the disclosure at issue involved an unrepresented third-party employed by a separate entity."

The Regents of the University of California et al v. Affymetrix, Inc. et al, 3-17-cv-01394 (CASD June 19, 2018, Order) (Stormes, MJ)

Wednesday, June 20, 2018

District Court Lacks Authority to Stay Execution of $68 Million Judgment Pending a Petition for Certiorari to the Supreme Court

Following the Federal Circuit's affirmance of the jury verdict, the magistrate judge recommended granting plaintiff's motion to enforce liability on defendant's $68 million supersedeas bond and rejected defendant's request to continue the stay pending its certiorari petition to the Supreme Court. "⁠[Rule 62(d)] does not specify when a stay under that provision expires or terminates. The great weight of authority regarding this issue, however, suggests that the Rule 62(d) stay expires when a circuit court issues its mandate. . . . I have found no authority to support [defendant's position] that district courts retain inherent authority to issue a stay of the judgment of a circuit court of appeals pending a petition for certiorari review to the Supreme Court. . . . [B]ecause the Federal Circuit has issued its final judgment and mandate affirming the . . . judgment in [plaintiff's] favor, the district court is obligated to enforce the Federal Circuit's mandate."

PPC Broadband, Inc. v. Corning Optical Communications RF, LLC, 5-11-cv-00761 (NYND June 18, 2018, Order) (Peebles, MJ)

Tuesday, June 19, 2018

Asserted Claims of Wireless Remote Control Patent Invalid Under 35 U.S.C. § 101

The court granted defendant's motion to dismiss because the asserted claims of plaintiff’s wireless remote control patent encompassed unpatentable subject matter and found that the claims were directed toward an abstract idea. "The court concludes that because the asserted claims are directed towards the result -- and therefore, abstract idea -- of wirelessly controlling remote devices, they are patent-ineligible. The specification refers to '⁠[a] method for controlling a remote device[] over a wireless connection.' 'underscor[ing] that [the asserted claims are] directed to an abstract concept.' More importantly, the asserted claims provide only for generic processes and components to achieve that result. . . . And although the Patent purports to solve a number of problems with remotely controlling devices, it does not solve those problems through an improvement in any specific technology."

Uniloc USA, Inc. et al v. HTC America, Inc., 2-17-cv-01558 (WAWD June 15, 2018, Order) (Robart, USDJ)

Monday, June 18, 2018

Plaintiff’s Lost Sales of Unpatented Products Supports Imposition of Preliminary Injunction

The magistrate judge recommended granting plaintiff's motion for a preliminary injunction prohibiting sales of the accused fire trucks and found that plaintiff established irreparable harm through lost sales of non-patented products. "The plaintiff, however, has shown by concrete examples, that when it sells its patent-covered quint to a fire department, there is a reasonable likelihood that the fire department will buy other fire apparatus as well. . . . If the defendants sell their allegedly infringing quints to customers, the plaintiffs opportunity to make sales of other apparatus to those customers in all likelihood will be lost. Moreover, there is no apparent way to quantify the value of those lost sales. Therefore, if the defendants can sell infringing quints, the plaintiff will suffer irreparable harm due to lost sales of other apparatus."

Pierce Manufacturing, Inc. v. E-One, Inc. et al, 8-18-cv-00617 (FLMD June 13, 2018, Order) (Wilson, MJ)

Friday, June 15, 2018

Institution of Claims Based on SAS Mandate May Not Simplify Issues for Trial Such That a Stay of Litigation is Warranted

Following the PTAB’s supplemental institution decision in light of SAS Inst., Inc. v. Iancu, ___ U.S. ___, 138 S. Ct. 1348, 1352–54 (2018) instituting inter partes review of all challenged claims of the patents-in-suit, the court granted defendants’ motion to stay because the potential for simplification of issues, the stage of the litigation, and lack of prejudice to plaintiff weighed in favor of a stay. “The PTAB issued the Supplemental Orders to review [new claims of two patents-in-suit] only because the SAS Institute decision dictates that result—not because [defendants] had demonstrated a reasonable likelihood that those claims were unpatentable on the challenged grounds. To the contrary, PTAB initially found that [defendants’] patentability challenges were lacking. . . . In the absence of a PTAB decision finding a reasonable likelihood that a claim is unpatentable, the question of whether a stay will simplify issues is not so clear. . . . Yet and still, staying [the case for the newly instituted claims] would have the effect of removing them from this case. It is hard to see how this result does not simplify the case. . . . [T]he developments since I last analyzed [the stage of litigation factor] do not alter the conclusion that ‘this case is not so far advanced that a stay would be improper.’ . . . Granting a stay on [the newly instituted claims] would leave [plaintiff] with only four remaining patents. But [plaintiff] does not contend that this amounts to any cognizable prejudice.

Huawei Technologies Co., Ltd. et al v. Samsung Electronics Co., Ltd. et al, 3-16-cv-02787 (CAND June 13, 2018, Order) (Orrick, USDJ)

Thursday, June 14, 2018

SAS Prompts Post-Trial Stay of Entry of Judgment on Willful Infringement Verdict

Following a jury trial but prior to the entry of judgment, the court sua sponte stayed plaintiff's patent infringement action pending inter partes review after the PTAB reinstituted review in response to the Supreme Court's decision in SAS Institute Inc. v. Iancu, 138 S. Ct. 1348 (2018). "A jury returned a verdict in [plaintiff's] favor, finding that the asserted claims of the [patent-in-suit] are not invalid and that [defendants] willfully infringed the asserted claims. . . . Following the jury trial but prior to entry of final judgment . . . the Supreme Court held that the PTAB must address every claim a petitioner has challenged. Because the PTAB did not previously address every claim challenged by [defendants] -- specifically, the claims at issue in this litigation -- the PTAB modified its institution decision 'to include review of all challenged claims and all ground presented in the Petition.'. . . The Parties are instructed to notify the Court of the PTAB’s decision within five days of such decision and the Court shall re-open the matter. "

Prisua Engineering Corp. v. Samsung Electronics Co., Ltd. et al, 1-16-cv-21761 (FLSD June 12, 2018, Order) (Moore, USDJ)

Wednesday, June 13, 2018

Discovery Concerning Potential Litigation Funding is Not Relevant or Proportional

The court denied defendants' motion to compel additional discovery regarding plaintiff's litigation funding because defendants failed to establish relevance or proportionality. "⁠[D]efendants move to compel production of Board minutes that discuss the potential funding, and move to complete the deposition of [plaintiff's board member], who declined to answer questions about the potential funding. . . . [Plaintiff] contests the relevance of the information requested and proffers an important piece of information: it does not have any third-party litigation financing. The Court is not persuaded that the materials sought are relevant to any party’s claim or defense and 'proportional to the needs of the case.' Even if litigation funding were relevant (which is contestable), potential litigation funding is a side issue at best. The Court finds that there is much discovery that would be more important in resolving the merits of this case. And the burden of responding would outweigh its likely benefit to defendants."

Space Data Corporation v. Alphabet, Inc. and Google LLC, 5-16-cv-03260 (CAND June 11, 2018, Order) (Cousins, MJ)

Tuesday, June 12, 2018

Lack of Specific Dosage Amounts and Frequencies of Administration Does Not Render Claims for Method of Treating Pain Invalid Under 35 U.S.C. § 101

The court denied defendant's motion to reconsider an earlier order granting plaintiff's motion for summary judgment that the asserted claims of its pain treatment patents did not encompass unpatentable subject matter. "The fact that certain of the claims do not recite specific dosage amounts and frequencies of administration is not fatal to the patent eligibility of the 'PK-only' claims under 35 U.S.C. § 101. A claim to a method of treating an illness is typically more than an expression of a natural law; if it were otherwise, pharmaceutical patents would be hard to come by, as most methods of treatment using pharmaceuticals consist simply of the administration of a drug that affects the human body in a manner that is dictated by laws of nature. . . . The claims in all of the claims asserted in this action . . . are 'treatment steps' -- that is, directed at a new and useful method of treating pain in a certain population of patients using a specific set of hydrocodone bitartrate formulations. For that reason, the Court views the claims as not directed to unpatentable subject matter by claiming patent protection for a natural law."

Pernix Ireland Pain Ltd. et al v. Alvogen Malta Operations Ltd., 1-16-cv-00139 (DED June 8, 2018, Order) (Bryson, CJ)

Monday, June 11, 2018

PTAB’s Final Written Decision Addressing Some But Not All Challenged Claims No Basis for Lifting Stay

The court denied plaintiff's motion to lift a stipulated stay pending inter partes review because the PTAB had not resolved two uninstituted claims following the Supreme Court's decision in SAS Institute, Inc. v. Iancu, 138 S. Ct. 1348 (2018). "Although the PTAB denied institution of IPR proceedings with respect to claims 5 and 10, and issued a final written decision on all remaining claims, the Supreme Court recently ruled that the PTAB must issue a final written decision 'with respect to the patentability of any patent claim challenged,' and 'in this context, as in so many others, "any" means "every."' For this reason, the Federal Circuit remanded [defendant's] appeal to the PTAB for issuance of a final decision regarding the patentability of claims 5 and 10. Consequently, the PTAB has yet to resolve the patentability of all challenged claims in the pending IPR proceeding, and the terms of the parties' stipulation have not been satisfied."

DermaFocus LLC v. Ulthera, Inc., 1-15-cv-00654 (DED June 7, 2018, Order) (Fallon, MJ)

Friday, June 8, 2018

Contract Law Expert Report Stricken as Unhelpful

The court granted plaintiff's motion to strike report of defendant's contract expert regarding whether defendant sold anticipating prior art before the critical date because the testimony was unhelpful. "There is little evidence in the expert report that [the expert] has brought any of his expertise to this exercise. . . . The [expert] indicates no particular expertise in review of purchase orders, invoices, product shipping records, or the like. He indicates no particular expertise in interpreting what the fact witnesses who have been deposed have said. He indicates no reliance on anything relevant to the particular industry. In my opinion, any reasonably literate English-speaker could apply the legal principles to the factual record on the relevant sale and offer to sell issues. . . . The only specialized knowledge that [the expert] has is the same thing -- contract law -- which in our system is my responsibility. For the most part, his expert report outlines the closing argument one might expect Defendant's lawyer to make after the jury has heard the underlying testimony and seen the underlying documents."

BASF Corporation v. Johnson Matthey Inc., 1-14-cv-01204 (DED June 6, 2018, Order) (Andrews, USDJ

Thursday, June 7, 2018

Judge Shopping Tactic Constitutes Serious Misbehavior Justifying Award of Attorney Fees

Following a dismissal for failure to prosecute after six years of litigation, the court granted defendants' motions for attorney fees under 35 U.S.C. § 285 because plaintiff's litigation tactics were unreasonable. "⁠[P]laintiff filed eight separate actions in this district against parties who turned out to be [the software developer defendant's] customers. None of those cases were marked as related. . . . [A week later] plaintiff filed nine more separate actions in this district, again against parties who turned out to be [the developer's] customers. Again, none of these cases were marked as related. . . . [B]efore any of the defendants had been served -- plaintiff voluntarily dismissed every case that had not been assigned to [one judge] except [for two cases]. Then . . . plaintiff filed five more cases in this district against four more of [the developer's] customers and against [the developer] itself. This time, plaintiff marked these cases as related to each other and related to [a case] which had been assigned to [that judge]. . . . The Court therefore finds that plaintiff deliberately . . . waited to file its case against [the developer] itself until it could mark that case as related to one in front of its preferred judge. That conduct, under the circumstances, is serious misbehavior."

DataTern, Inc. v. Blazent, Inc., et al, 1-11-cv-11970 (MAD June 5, 2018, Order) (Saylor, USDJ)

Wednesday, June 6, 2018

"Necessary" Distributor’s Place of Business Does Not Establish Venue for Supplier

The court granted defendant's alternative motion to transfer for improper venue because defendant did not have a regular and established place of business in the district through its "necessary" distributor. "⁠[T]here is abundant case law from other district courts holding that a distributor’s place of business cannot establish venue for its supplier. Citing no case law, [plaintiff] responds that this uniform line of cases is distinguishable because 'none of them involve the case where the use of a distributor is necessary to conduct the business of the defendant.' However, business necessity is insufficient to impute [a distributor's] place of business to [defendant]. . . . The purpose of the statutory limits on venue in the patent venue statute was to protect defendants from being sued in forums distant from their place of incorporation or residence. [Plaintiff's] proposed 'necessary distributor' rule would largely defeat that policy; indeed, given that smaller manufacturers are more likely to need to rely on distributors than larger ones, [plaintiff's] rule would have the perverse effect of subjecting smaller corporations more subject to suit in distant forums than larger ones."

EMED Technologies Corporation v. Repro-Med Systems, Inc. d/b/a RMS Medical Products, 2-17-cv-00728 (TXED June 4, 2018, Order) (Bryson, CJ)

Tuesday, June 5, 2018

Infringement by Defaulting Company Controlled by Former Employee Justifies Award of Enhanced Damages

The court granted plaintiff's motion for enhanced damages against a defaulting defendant because defendant's motivation for harm, lack of a good faith defense, lack of remedial action, duration of misconduct, and lack of closeness of the case favored treble damages. "⁠[P]rior to joining [defendant], [defendant's chairman] was employed at [company related to plaintiff], where he gained familiarity with [plaintiff's] intellectual property rights. . . and, prior to initiating this action, [plaintiff] sent [defendant] a letter notifying it of the [patent-in-suit] and [defendant's] infringing actions. Those facts, taken together with the fact that [the parties] are direct competitors, support an inference that [defendant] deliberately infringed the [patent], with the purpose of harming [plaintiff's] business. . . . [T]here is no evidence in the record to support a finding that [defendant] investigated the scope of the [patent] and formed a good-faith belief that it was invalid or that it was not infringed. . . . [T]he record is devoid of any evidence that [defendant] took remedial actions. . . . [Defendant] sold its infringing product [for almost a year]. Finally, because default judgment has already been entered as to [defendant's] liability for infringement, the closeness factor supports enhanced damages."

Sabinsa Corporation v. Olive Lifesciences Pvt. Ltd., 3-16-cv-03321 (NJD June 1, 2018, Order) (Wolfson, USDJ)

Monday, June 4, 2018

Valuation Cap Based on Difference Between Prior Offer to Sell and Prior Offer to License Patent-in-Suit Does Not Render Expert Opinion Unreliable

The court denied plaintiff's motion to strike portions of the rebuttal report of defendants' damages expert because his theory capping the value of a patent-in-suit based on prior licensing negotiations was not unreliable. "Plaintiff complains about [the expert's] conclusion that, because [a technology transfer company] offered to sell the [patent-in-suit] to [a third party] for $100 million in December 2011 and to license the patent for $70 million in March 2012, the $30 million difference means the value of [the patent] to all other potential licensees cannot be more than 30% of the value of the patent. . . . That the Federal Circuit may not have endorsed a damages theory does not make such a theory incorrect or unreliable -- it simply means it’s untested by an appellate court. Also, although Plaintiff may disagree with [the expert's] ultimate conclusion and reasoning, he clearly considered the passage of three years after [the transfer company's] negotiations with [the third party] in his analysis."

Kaist IP US LLC v. Samsung Electronics Co., Ltd. et al, 2-16-cv-01314 (TXED May 31, 2018, Order) (Payne, MJ)

Friday, June 1, 2018

Venue Statutes Do Not Apply to Foreign Defendant

The court denied defendant's motion to dismiss or transfer for improper venue. "While it was previously unclear whether § 1400(b) was controlling for foreign defendants involved in patent infringement suits, the Federal Circuit recently reaffirmed the 'long-established rule that suits against aliens are wholly outside the operation of all the federal venue laws, general and special.' Thus, a foreign defendant may be sued in any judicial district under 28 U.S.C. § 1391(c)(3). . . . Here, it is uncontested that the sole defendant in the case is a Swedish corporation. In light of this recent Federal Circuit case, the Court finds that venue is proper over [defendant] in this District."

Endo Pharmaceuticals Inc. v. Lupin Atlantis Holdings SA, 2-17-cv-00558 (TXED May 30, 2018, Order) (Gilstrap, USDJ)

Thursday, May 31, 2018

YouTube Video Qualifies as Printed Publication

The court denied plaintiff's motion in limine to exclude a YouTube video as a prior art reference on the ground that it was not sufficiently accessible. "Although the Federal Circuit has not explicitly ruled that YouTube videos qualify, 'the statutory phrase "printed publication" has been interpreted to give effect to ongoing advances in the technologies of data storage, retrieval, and dissemination.'. . . Plaintiff then notes that the [video] reference was uploaded on a channel which 'was not associated with a trade group or website well-known to the relevant community' and which no person would have a reason to search for. . . . A familiar user would know that you don’t need to search for a particular channel to watch the videos uploaded on it. . . . . Surely, the effort involved in composing a basic search query and scrolling down the page a few times does not exceed the 'reasonable diligence' that the law expects of a hypothetical prior art subject."

HVLPO2, LLC v. Oxygen Frog, LLC et al, 4-16-cv-00336 (FLND May 28, 2018, Order) (Walker, USDJ)

Wednesday, May 30, 2018

Bad Faith Patent Prosecution Supports Award of Attorney Fees Even Without Inequitable Conduct

Following summary judgment of invalidity and an appeal, the court granted defendant's motion for attorney fees under 35 U.S.C. § 285 and found that plaintiff's conduct during prosecution supported a finding that the case was exceptional. "Defendant has not proved that the patents would not have issued but for the withheld data. . . . However, the Court does take note of the withheld data for purposes of the totality-of-the-circumstances inquiry. . . . There is also evidence of intent to deceive the PTO. . . . Even if this did not constitute inequitable conduct, the Court finds that the selective disclosure of data and evasive responses provided to the Examiner are evidence of bad faith leading to a finding that this is an exceptional case. . . . Plaintiff's failure to notify the Examiner that [its expert] was an employee, rather than an independent expert, is an indication that this is an exceptional case, litigated in an unreasonable manner. . . . Presenting the declaration from [its expert] which explicitly contradicted his publications, and the failure to present the [expert's] papers themselves, are evidence of subjective bad faith leading to the conclusion that this is an exceptional case."

Howmedica Osteonics Corp. v. Zimmer, Inc. et al, 2-05-cv-00897 (NJD May 23, 2018, Order) (Walls, USDJ)

Tuesday, May 29, 2018

Storage Units Do Not Qualify as Regular and Established Place of Business

The court granted defendant's motion to dismiss plaintiffs' patent infringement action for improper venue because defendant did not have a regular and established place of business in the district through its storage units. "⁠[T]he storage units identified by Plaintiffs are likely 'physical places in the district' prong, insofar as they are 'building[s] or []part[s] of a building set apart for any purpose.' Plaintiffs also demonstrated that Defendant pays for these storage units, leading to a conclusion that the storage units are 'of the defendant'. . . . The question is whether the storage units are 'location[s] at which one carries on a business.' They are not. While Defendant’s customer service reps may 'typically' retrieve materials from the storage units to visit customers within this District, no 'employee or agent of [Defendant actually] conduct[s] business at' the storage units, whatsoever."

CDX Diagnostics, Inc. et al v. United States Endoscopy Group, Inc. et al, 7-13-cv-05669 (NYSD May 24, 2018, Order) (Roman, USDJ)

Friday, May 25, 2018

Defense Counsel’s Twenty-Year Representation of Plaintiff, Spanning Seven Months of the Instant Case, Does Not Justify Disqualification

The court denied plaintiff's motion to disqualify defense counsel who had previously represented plaintiff for 20 years on intellectual property matters and concurrently represented plaintiff in patent prosecution matters during seven months of the instant case because counsel's misconduct did not taint the underlying trial. "⁠[Counsel] has violated the Connecticut Rules of Professional Conduct. . . . However, not every violation of the Rules of Professional Conduct warrants disqualification. . . . [Plaintiff] has not . . . made any effort to identify any way in which it has been prejudiced or negatively affected by [counsel's] actions, let alone in a way significant enough to taint the integrity of the trial. . . . [T]here is no evidence that [counsel] obtained any confidential information from [plaintiff] in the course of its representation regarding the patent prosecutions. . . . [T]he subject matter of the current litigation is a different patent than those [counsel] prosecuted on behalf of [plaintiff], which representation originated from a joint venture with [defendant]. . . . Any substantive activity in [plaintiff's] patent prosecutions was completed with the issuance of the patents, the last of which occurred . . . over a year before [plaintiff] filed this case. . . . The parties agree that the extent of [counsel's] representation of [plaintiff] during the period of concurrent representation was limited to [plaintiff's] payment of an invoice and [counsel's] payment of a maintenance fee on the patent on [plaintiff's] behalf."

Rio Brands, LLC v. GCI Outdoor, Inc., 3-17-cv-00786 (CTD May 22, 2018, Order) (Hall, USDJ)

Thursday, May 24, 2018

Expert’s Reliance on Unaccepted License Proposal Does Not Render Opinion Unreliable

The court denied defendant's motion to exclude the testimony of plaintiff's damages expert regarding a reasonable royalty rate because his reliance on an unaccepted proposal was sufficiently reliable. "⁠[The expert] discussed several additional distinguishing characteristics between the contemplated cross-license and the hypothetical license, including that the cross-license was never executed, the negotiation was for a worldwide license, design-around costs, and the possible collaboration between the parties. . . . [Defendant] argues that [his] opinions regarding this contemplated royalty offer should be excluded, because offers -- particularly if never conveyed -- have little value. . . . [A]t the time of this offer, [plaintiff's predecessor] and [a third party] were discussing a cooperation agreement, a situation quite distinct from anticipation of litigation. [Defendant's] criticisms can be adequately addressed through cross-examination and the presentation of competing evidence."

Plastic Omnium Advanced Innovation and Research v. Donghee America, Inc. et al, 1-16-cv-00187 (DED May 22, 2018, Order) (Stark, USDJ)

Wednesday, May 23, 2018

Response to Interrogatory Seeking Conception and Reduction to Practice Dates May Not Identify Voluminous Documents

The court granted defendant's motion to compel further interrogatory responses regarding conception and reduction to practice. "⁠[Defendant] concedes that [plaintiff] has narrowed the dates (indeed, [plaintiff] has said it will use the filing date for [one patent-in-suit]) but the issue of [plaintiff] citing 'hundreds of documents' with no explanation of their relevance. . . . [Plaintiff] shall prepare a document entitled 'Date of Conception' as to the [other patent-in-suit]. The document shall list the documentary support for its date range and attach the relevant documentation -- limited to 10 documents -- which shall be highlighted. [Plaintiff] shall do the same for 'Reduction to Practice.' These documents will serve as a base line for conception and reduction to practice. Should [plaintiff] choose to amend the dates at some later date, it will have to be based on newly discovered evidence."

Magna Electronics, Inc. v. Valeo, Inc. et al, 2-13-cv-11376 (MIED May 18, 2018, Order) (Cohn, USDJ)

Tuesday, May 22, 2018

Ratification of Subsidiary’s In-District Facility Qualifies as Regular and Established Place of Business

The court denied a defendant's motion to dismiss plaintiffs' patent infringement action for improper venue because defendant had a regular and established place of business in the district by ratifying its subsidiary's manufacturing and research facility as its own place of business. "⁠[Defendant's] own corporate announcement and reports from San Antonio media reflect that [defendant] announced its move to San Antonio . . . more than 8 years ago. The court concludes that an 8-year presence reflects a regular and established place of business. . . . [W]hatever the lease arrangements are, the court concludes that [defendant] has ratified the San Antonio facility as its place of business. Also, [defendant] represents that it has a place of business in the district, as it lists the San Antonio facility as a place of business on its website, in the telephone and other web-based directories, and has placed its name on a large sign on the exterior of building."

Board of Regents, The University of Texas System et al v. Medtronic, Inc. et al, 1-17-cv-00942 (TXWD May 17, 2018, Order) (Yeakel, USDJ)

Monday, May 21, 2018

Technical Expert’s Indefiniteness Opinions Excluded as Irrelevant for Relying on Claim’s Intended Result

The court granted plaintiff's motion to exclude the testimony of defendants' technical expert regarding defendants' enablement and written description theories as irrelevant. "Defendants conclude the claim limitation doesn’t satisfy the written-description or enablement requirements because the reduction can be achieved in more ways than just reducing the thickness of the insulator. But the proper focus is on structure rather than the intended result. [The claim at issue] is directed to a device, and the specification describes an embodiment of that device . . . . While the limitation recites the result of selecting that range, that result is not a structural limitation of the claim. Because his opinion is based on an incorrect interpretation of the limitation, the Court will grant the motion and exclude as irrelevant [the expert's] opinion that the specification does not provide guidance as to how the parasitic capacitance is reduced."

Kaist IP US LLC v. Samsung Electronics Co., Ltd. et al, 2-16-cv-01314 (TXED May 17, 2018, Order) (Payne, MJ)

Friday, May 18, 2018

Disingenuous Licensing Discussions Sufficient to Support Willful Infringement Claim

The court denied defendant's motion to dismiss plaintiff's willful infringement claims for failing to sufficiently allege egregious conduct through defendant's licensing negotiations. "When considering [plaintiff's] allegations and other facts pled in the Complaint that show that [defendant] knew in detail about how it infringed each Asserted Patent as a whole, a reasonable inference can be drawn that [defendant's] licensing discussions were disingenuous. . . . As such, the Court finds that the Complaint contains sufficient facts from which a plausible conclusion could be reached that [defendant's] conduct went beyond those 'in a typical infringement case' and thus was egregious. . . . [T]o the extent that [defendant] is arguing that the allegations pertaining to the settlement discussions cannot lend any support to [plaintiff's] willful infringement claim at the pleading stage, the Court rejects that argument. Whether [plaintiff] has evidence to prove its claims is a matter for another day."

Finjan, Inc. v. SonicWall, Inc., 5-17-cv-04467 (CAND May 16, 2018, Order) (Freeman, USDJ)

Thursday, May 17, 2018

Pain Treatment Patents Do Not Claim Unpatentable Law of Nature

The court granted plaintiff's motion for summary judgment because the asserted claims of its pain treatment patents did not encompass unpatentable subject matter and found that the claims were not directed toward a law of nature. "⁠[Two claims] each recites a 'method of treating pain in a patient having mild or moderate hepatic impairment,' and teaches using a specific extended release formulation of hydrocodone bitartrate that has a particular release profile. Although the inventions recited in those claims were based upon a natural law -- the physiological response to hydrocodone in individuals with or without mild or moderate hepatic impairment -- the claims do more than merely report those physiological responses. Rather . . . the claims asserted in this case describe a specific dosing regimen to treat a specific condition based on the patient’s medical status."

Pernix Ireland Pain Ltd. et al v. Alvogen Malta Operations Ltd., 1-16-cv-00139 (DED May 15, 2018, Order) (Bryson, CJ)

Wednesday, May 16, 2018

Genotyping Patent Invalid Under 35 U.S.C. § 101

Following a jury trial, the court granted plaintiff's motion for judgment as a matter of law because the asserted claims of plaintiff’s labrador retriever genotyping patent encompassed unpatentable subject matter and found that the claims were directed toward a natural phenomenon. "⁠[T]he patent utilizes a number of scientific terms which at first review appear difficult to understand and make the patent appear impressive on its face. However, when the language is explained, the patent simply states that the search for the mutation involves the laboratory examination of Labrador Retriever DNA, which resulted in the discovery of the mutation, which in combination with similar mutations of Labrador Retrievers who mates with a carrier results in offspring having a higher probability of inheriting the mutation. The mutation itself and the fact that it is inherited through male and female dog carriers mating are both natural phenomena."

Genetic Veterinary Sciences, Inc. d/b/a Paw Prints Genetics v. LABOklin GmbH & Co. KG et al, 2-17-cv-00108 (VAED May 14, 2018, Order) (Morgan, SJ)

Tuesday, May 15, 2018

Software Qualifies as "Article of Manufacture" for Disgorgement of Profits Under 35 U.S.C. § 289

Following a jury trial, the court denied defendant's renewed motion for judgment as a matter of law that plaintiff was not entitled to disgorgement damages under 35 U.S.C. § 289 for infringement of its design patents because plaintiff's software qualified as an article of manufacture. "⁠[Defendant] argues that [plaintiff's patents] claim a 'display screen' as their article of manufacture and, because [defendant] only presented evidence of profits from a software product and not a physical 'display screen,' it cannot recover disgorgement damages. . . . [Defendant] has already admitted that its products . . . infringe the [patents]. Thus, [defendant] has already admitted that there exists an 'article of manufacture' to which the patented designs . . . have been applied. Moreover . . . [s]oftware is 'a thing made by hand or machine,' and thus can be an 'article of manufacture.'"

Microsoft Corporation v. Corel Corporation et al, 5-15-cv-05836 (CAND May 11, 2018, Order) (Davila, USDJ)

Monday, May 14, 2018

$75 Million Jury Verdict Reinstated

The court granted plaintiff's motion to reconsider an earlier order granting defendant a new damages trial and upon reconsideration reinstated the jury's $75 million verdict because the extensive evidence of unaccused products was not reflected in the verdict. "⁠[Defendant's] complaint is that the damages model 'is flawed' and 'contrary to law' inasmuch as a patentee 'can only receive infringement damages on those devices that actually performed the patented method during the relevant infringement period.' Yet [defendant] was not assessed damages on unaccused products because the jury was instructed that lump sum damages are available only for 'products [plaintiff] has accused in this case.'. . . [Plaintiff] simply populated the 'book of wisdom,' with information about projected sales of both accused and unaccused products. . . . Although [defendant] presented the jury with damages estimates that accounted for future sales of unaccused products, the jury’s $75 million assessment is consistent with the court’s instruction to award damages only for accused products. . . . Thus, while the jury’s assessment includes damages for future sales of accused products, which by definition is what a lump sum payment reflects, the award did not necessarily include damages for future sales of unaccused products."

Ericsson Inc. et al v. TCL Communication Technology Holdings Limited et al, 2-15-cv-00011 (TXED May 10, 2018, Order) (Payne, MJ)

Friday, May 11, 2018

Damages Expert Precluded From Relying on a Settlement Agreement He Was Unable to Review Due to Protective Order Restrictions

The court granted in part plaintiff's motion to exclude the testimony of defendant's damages expert regarding prior settlement agreements because the expert was not authorized to review one agreement under the protective order. "Plaintiff contends that because [the expert] cannot review the terms of [a settlement agreement], 'he cannot offer any opinion about whether the terms of the [OpenKey] Settlement Agreement are a reliable indicator of a reasonable royalty.' . . . Defendant’s argument that [its damages expert] can determine the circumstances surrounding [a] Settlement Agreement from [plaintiff's damages expert's] report alone is flawed. Plaintiff notes that [its own] expert report does not disclose the full terms or circumstances of the [agreement], and points out that the report states that [plaintiff's expert] was unable to draw any meaningful conclusions from [the agreement] under the Georgia-Pacific analysis. Thus, it seems implausible that [defendant's expert] knew of the circumstances or even the terms of the [agreement]. Since [defendant's expert] cannot review the terms of the [agreement], [he] may not rely on the [agreement] in offering his opinion."

S3G Technology LLC v. UniKey Technologies, Inc., 6-16-cv-00400 (TXED May 8, 2018, Order) (Mitchell, MJ)

Thursday, May 10, 2018

Pre-Alice Finding of Validity Collaterally Estops Defendant From Challenging Validity Under 35 U.S.C. § 101

The court granted plaintiff's motion for summary judgment that defendant's challenge under 35 U.S.C. § 101 was barred by collateral estoppel because a jury found the patent-in-suit valid in the parties' prior action. "While the Federal Circuit has yet to address squarely whether multiple theories of invalidity constitute 'different' issues for collateral estoppel purposes, the majority of courts that have considered the question view patent validity as a single issue. . . . [E]ven if [Alice Corp. Pty. v. CLS Bank Int’l, 134 S. Ct. 2347 (2014)] had constituted a change in the law, [defendant] does not explain how pre-Alice law would have precluded [it] from bringing a Section 101 defense. . . . There is no evidence that a Section 101 defense was completely unavailable to [defendant] under the framework set out in [Mayo Collaborative Servs. v. Prometheus Labs., Inc., 132 S. Ct. 1282 (2012)], or that such a challenge would have been futile prior to Alice."

XpertUniverse, Inc. v. Cisco Systems, Inc., 3-17-cv-03848 (CAND May 8, 2018, Order) (Seeborg, USDJ)

Wednesday, May 9, 2018

Plaintiff’s Former Officer and Lead Inventor Disqualified as Consultant for Defendant

The court granted plaintiff's motion to disqualify plaintiff's former officer/lead inventor of the patents-in-suit from consulting with defendant on non-confidential matters. "⁠[Defendant] contends that separate and apart from any confidential information he may have received from [plaintiff and its predecessor], [its consultant] has knowledge regarding the background and subject matter of the patents-in-suit that is not confidential. [Defendant] argues it has retained [him] to consult only about these matters, not confidential information or patent strategy. However, [plaintiff] need not show that [its former officer] has been retained to consult regarding [plaintiff's] confidential information or patent strategy, but need only show that he received confidential information 'that is relevant' to the current patent litigation. . . . Given that [the consultant] is an inventor of the technology at issue in this case, it is impractical to expect him to be able to parse 'the specifics of the knowledge [he] gained while working at [plaintiff's predecessor] and his knowledge generally.'"

Promptu Systems Corporation v. Comcast Corporation et al, 2-16-cv-06516 (PAED May 7, 2018, Order) (Sanchez, USDJ)

Tuesday, May 8, 2018

Working Closely With Corporate Affiliate Does Not Create a Regular and Established Place of Business Necessary for Venue

The court granted defendants' motion to transfer for improper venue because one subsidiary defendant's contacts with the district were insufficient to establish a regular and established place of business in the district for another subsidiary defendant. "Defendants concede that [one defendant] has a place of business in this district in the form of a retail store. . . . Defendants dispute some of [plaintiff's] allegations, but even if the court assumes that all of them are true, they show only that defendants are both subsidiaries of the same parent company and that they collaborate on matters common to both of them. That’s not sufficient to treat defendants as interchangeable for the purpose of determining whether each has a place of business in this district. . . . Because there is no authority for the view that venue is proper as to one corporation simply because that corporation 'works closely' with another corporation that may be sued in that district, [plaintiff] has failed to meet its burden to show that venue is proper in this district."

Unity Opto Technology Co., Ltd. v. Lowe's Home Centers, LLC et al, 3-18-cv-00027 (WIWD May 4, 2018, Order) (Peterson, USDJ)

Monday, May 7, 2018

Technical Expert Precluded From Offering Testimony at Odds With Plain and Ordinary Meaning of Patent Claim

The court granted in part defendant's motion to strike portions of the report of plaintiff's technical expert for applying improper legal principles. "The asserted claims require that each created reprogrammable communication protocol 'includes a command code set. . . .' The parties dispute the meaning of 'includes.' When asked whether a communication protocol that did not include a command code set would satisfy this claim limitation, [the expert] responded, '⁠[I]t’s a question of whether it’s capable of including a command code set that defines those signals to -- you have to have -- it needs to be capable.' That’s not the question. The plain and ordinary meaning of the phrase requires more than a mere capability that the communication protocols include a command code set: It requires actual inclusion. Accordingly, the Court will preclude [the expert] from advancing any argument that, with respect to this limitation, mere capability of inclusion is sufficient."

Salazar v. HTC Corporation, 2-16-cv-01096 (TXED May 3, 2018, Order) (Payne, MJ)

Friday, May 4, 2018

Ceasing Infringing Activity Eliminates Substantial Controversy Necessary for Declaratory Judgment of Infringement

The court granted defendants' motion to dismiss plaintiff's claim for a declaration of patent infringement for lack of subject matter jurisdiction. "Defendant, through its principal, declares under penalty of perjury that it has ceased the allegedly infringing conduct. . . . Defendant here has ceased the accused activity, employs a different design, and plans to destroy the prototypes. . . . [I]t is not clear that Defendant here stopped the accused activity prior to the commencement of the lawsuit. This is, however, a distinction without a difference. . . . Because Defendant has ceased the allegedly infringing activity, an opinion of declaratory judgment would amount to an advisory opinion based on hypothetical facts. Defendant has made sufficient representations to remove any reasonable apprehension of infringement. Further, Defendant is not currently infringing and no harm appears immediate."

Resh, Inc. v. Skimlite Manufacturing Inc. et al, 5-18-cv-00291 (CACD April 30, 2018, Order) (Bernal, USDJ)

Thursday, May 3, 2018

Early Daubert Motion Permitted for Law Professor Expert

The court denied plaintiff's motion to strike defendant's expert report from a law professor, but allowed plaintiff to file an early Daubert motion. "Plaintiff, mindful that such reports have about as much chance of seeing the light of day as the Washington Generals did of beating the Globetrotters, wants to quash it now. Defendant points out that the usual procedure is to dispose of such issues by means of a Daubert motion. Plaintiff wants to resolve the matter through the more expeditious and less expensive discovery dispute procedure. Unfortunately, it really is not a discovery dispute. In order to avoid unnecessary expense, however, I will permit Plaintiff to file a Daubert motion now. . . . If the Generals win, I will then permit Plaintiff to file an expert report from a law professor in reply."

BASF Corporation v. Johnson Matthey Inc., 1-14-cv-01204 (DED May 1, 2018, Order) (Andrews, USDJ)

Wednesday, May 2, 2018

Production of Entire iOS and watchOS Source Code Not Relevant and Proportional to Infringement of Step Counter Patent

The court denied plaintiff's motion to compel production of the entire source code for two of defendant's operating systems because plaintiff failed to establish that the additional code was relevant and proportional to the needs of the case. "⁠[Plaintiff] asks that [defendant] produce the entire source code for the iPhone/iPad’s and [Apple] Watch’s operating systems (iOS and watchOS, respectively). . . . [Plaintiff's] claims relate solely to the [patent-in-suit], a patent for a step counter. Apple iPhones, iPads, and Watches encompass hundreds or thousands of features wholly unrelated to those claims. . . . [Plaintiff] intimates that the way a code review 'usually' works is that the inspecting party’s code expert may 'look at whatever he thinks relevant.' [Plaintiff] cites no authorities for this proposition. . . . If [plaintiff] believes those particular code files are relevant and that [defendant] should produce them, and if [defendant] disagrees, the parties must meet and confer in good faith to try to resolve the dispute. . . . But [plaintiff] may not circumvent this procedure and demand that [defendant] produce all of its [operating system] source code so that [plaintiff] can 'paw[] through [defendant]’s source code without limitation.'"

Uniloc USA, Inc. et al v. Apple Inc., 4-18-cv-00362 (CAND April 30, 2018, Order) (Beeler, MJ)

Tuesday, May 1, 2018

Counsel’s Failure to Investigate Plaintiff’s Ownership of Patent-in-Suit Justifies $360,000 Sanctions Award

The court granted defendants' motion for more than $360,000 in sanctions under Rule 11 and 28 U.S.C. § 1927 against plaintiff's counsel because plaintiff's standing allegations and pre-suit investigation were unreasonable. "⁠[Counsel] disregarded any reasonable inquiry into the ownership or assignment of the [patent-in-suit], and asserted this claim for infringement without any objectively reasonable basis for the allegation that [plaintiff] was the owner of the right to enforce the [patent] by assignment. . . . [Counsel's] alleged reliance on its client does not absolve it of any of the violations of Rule 11. . . . [Counsel] improperly withheld the purported assignment documents, drafted in March 2016, until March 23, 2017. . . . [Plaintiff's] alleged oral, exclusive license, even if it had existed since prior to the original Complaint, would not have cured the standing defect or altered that [plaintiff's] claim for infringement of the [patent] was subject to dismissal. . . . [Counsel's] pattern of conduct demonstrates bad faith or a disregard of attorney obligations in filing and pursuing claims, which is akin to bad faith."

Sub Zero Franchising, Inc. v. Frank Nye Consulting LLC, d/b/a The Arctic Scoop et al, 2-15-cv-00821 (UTD April 27, 2018, Order) (Jenkins, SJ)

Monday, April 30, 2018

Infringement Claims Barred by Equitable Estoppel Following Ten-Year Delay in Filing Lawsuit

The court granted defendant's motion for summary judgment that plaintiff's patent infringement claims were barred by equitable estoppel due to its ten-year delay in filing suit and found that defendant was materially prejudiced by plaintiff's silence following its cease-and-desist letter. "In the six years leading up to [plaintiff's] suit, [defendant's] marketing and investment efforts in [the accused product] yielded sales that nearly quadrupled its revenue. Rather than demonstrate that the investment was 'simply a business decision to capitalize on a market opportunity,' as [plaintiff] claims, these facts indicate more strongly that [plaintiff] saw a market opportunity to resuscitate its previously abandoned claims in order to capitalize on [defendant's] stronger revenues. After ten years of failing to follow up on its threat of infringement, [defendant] would be undeniably prejudiced if the Court allowed [plaintiff] to bring forth its claims only after [defendant] made substantial investments in its product."

Akeso Health Sciences, LLC v. Designs for Health, Inc., 2-16-cv-07749 (CACD April 26, 2018, Order) (Otero, USDJ)

Friday, April 27, 2018

Patent Numbers in Surgical Technique Guides Do Not Provide § 287(a) Notice For Surgical Products

The court granted defendants' motion for summary judgment to limit plaintiff's damages for failing to mark its surgical products through its licensee's surgical guides. "Even though [the licensee] did not mark the licensed products or their packaging with [plaintiff's] patent number, [plaintiff] contends that the fact that [the licensee] listed the patent number in the surgical technique guides for these products as early as 2004 satisfies § 287(a)’s marking requirements. These guides are distributed to hospitals and at trade shows and are published on [the licensee's] website. Surgeons view and use the guides during the surgeries in which the device is used. . . . Because [plaintiff] has not established that the surgical technique guides were distributed or shipped with the licensed products, it cannot rely on the fact that these guides contain its patent number to show that it complied with the requirements of § 287(a)."

Acantha LLC v. DePuy Orthopaedics, Inc. et al, 1-15-cv-01257 (WIED April 25, 2018, Order) (Griesbach, USDJ)

Thursday, April 26, 2018

Improper Venue Does Not Limit Applicability of First-to-File Rule

The court granted defendants' motion to dismiss plaintiffs' second-filed declaratory relief action under the first-to-file rule even though the defendants' first-filed action was filed in an improper venue. "The plaintiffs . . . contend that the first-to-file rule is inapplicable because the Eastern District of Texas lacked venue, and therefore, lacked subject matter jurisdiction over the case. Improper venue does not strip a court of subject matter jurisdiction since Congress authorizes district courts to evaluate venue and to transfer a case in which venue is improper to a district where the case could have been brought. For this reason, improper venue in the first-filed court does not limit application of the first-to-file rule or alter this Court’s conclusion that the rule applies here."

Sandoz, Inc. et al v. Duke University et al, 1-17-cv-00823 (NCMD April 24, 2018, Order) (Eagles, USDJ)

Wednesday, April 25, 2018

Defendants' Improper Jury Arguments and Discovery Misconduct Justify Award of Attorney Fees

Following a jury verdict of $21 million, the court granted plaintiffs' motion for attorney fees under 35 U.S.C. § 285 because defendant's litigation conduct was exceptional. "⁠[T]here cannot be serious doubt that [defendant's] litigation strategies unnecessarily complicated the proceedings and needlessly increased costs. . . . At trial, [defendant] repeatedly argued claim construction positions -- that the Court had rejected -- to the jury, despite the Court’s admonitions not to do so. . . . [Defendant's] conduct was so egregious that the Court gave the jury a limiting instruction. . . . [Defendant] also seemed to purposefully ignore the Court’s orders in discovery. . . . Disclosing a completely unreasonable number of obviousness combinations in your contentions, waiting until opposing counsel objects, then supplementing them three weeks after the deadline with a reservation that you may still rely on the originally disclosed number of combinations serves no purpose other than to increase the litigation costs for both sides and the burden on the Court. It should be noted that none of Defendant's conduct in isolation makes this case exceptional. Considering [defendant's] litigation misconduct in sum, however, the Court finds that this case is exceptional and stands out in comparison to the mine-run of cases."

Elbit Systems Land and C4I Ltd. et al v. Hughes Network Systems LLC et al, 2-15-cv-00037 (TXED April 23, 2018, Order) (Schroeder, USDJ)

Tuesday, April 24, 2018

Claims of Dietary Supplement Patent Not Directed to Unpatentable Natural Phenomena

The court granted plaintiff's motion for summary judgment that the asserted claims of its dietary supplement patent did not encompass unpatentable subject matter and found that the claims were not directed toward a natural phenomena. "Notwithstanding that the plain claim language refers to producing oxidized CoQ[10] on an industrial scale, Defendants contend that the asserted claims are 'directed to' the natural phenomenon that certain microorganisms have the natural ability to produce at least 70 mole % reduced CoQ[10] under standardized culturing conditions. . . . [T]he claims are 'directed to' a superior method of producing a certain end product -- in this case, efficiently creating oxidized CoQ[10] on an industrial scale -- rather than to the inherent properties of certain biological materials. That the asserted claims rely on the ability of certain microorganisms to produce reduced CoQ[10] at a ratio greater than 70 mole % among the entire coenzymes Q[10] under standard culturing conditions does not indicate the claims are 'directed to' this phenomenon."

Kaneka Corporation v. Zhejiang Medicine Co., Ltd. et al, 2-11-cv-02389 (CACD April 5, 2018, Order) (Otero, USDJ)

Monday, April 23, 2018

Ordinary Observer Test for Design Patent Infringement Requires More than "Quick Glance" to Determine "Same Basic Shape"

The court granted defendants' motion for summary judgment of noninfringement of plaintiffs' vacuum cleaner design patents and rejected plaintiffs' argument that the ordinary observer test may be satisfied with a "quick glance" to determine "the same basic shape." "⁠[Plaintiffs' infringement expert] opined that when an ordinary observer is cognitively processing visual design, the process 'proceeds to a point where recognition takes place,' and '⁠[o]nce this happens, the ordinary observer does not (de facto) continue to view the product at greater levels of detail but simply confirms that the product matches the knowledge they have about a product and then moves on to the next visual or physical task.' According to this approach, 'when any design shape is perceived by the ordinary observer as a member of the [plaintiff's] patented category as determined by overall shape, the act of categorization may constitute baseline infringement. . . . The 'ordinary observer' assumed in [the expert's] analysis does not give the kind of attention to the designs that the Federal Circuit requires under the ordinary observer test. The ordinary observer must consider 'all of the ornamental features illustrated in the figures.' She cannot be assumed to simply take a quick glance at the two vacuums, conclude that they are the same basic shape, and stop looking. The ordinary observer is presumed to use more care in her evaluation."

Dyson, Inc. et al v. SharkNinja Operating LLC et al, 1-14-cv-00779 (ILND March 29, 2018, Order) (Dow, USDJ)

Friday, April 20, 2018

Disgorgement of Profits For Design Patent Infringement Does Not Preclude Award of Pre-Judgment Interest

The court granted plaintiff's motion for pre-judgment interest and rejected defendant's argument that plaintiff was not entitled to any interest because the jury awarded design patent profits under 35 U.S.C. § 289. "Under 35 U.S.C. § 284, a patent owner may recover 'damages adequate to compensate for the infringement . . . together with interest and costs as fixed by the court.' Under 35 U.S.C. § 289, a patent owner may recover an infringer’s 'total profit' made from the infringement. In this case, the jury awarded [plaintiff] $3,018,174 under § 289, the 'total profit' from [defendant's] infringement of the Design Patent. According to [defendant], prejudgment interest is unavailable to [plaintiff] because it can only be recovered under § 284. [Defendant's] position is without legal support and at odds with cases that have applied prejudgment interest to patent infringement awards for total profit under 35 U.S.C. § 289."

Columbia Sportswear North America, Inc. v. Seirus Innovative Accessories, 3-17-cv-01781 (CASD April 17, 2018, Order) (Hernandez, USDJ)

Thursday, April 19, 2018

Last Minute Trademark Infringement Claims Do Not "Ferryboat" Pendent Venue for Patent Infringement Claims

The court granted one defendant's alternative motion to transfer plaintiff's claims against it for improper venue and rejected plaintiff's attempt to establish pendent venue by asserting trademark claims in its amended complaint. "After the court requested supplemental briefing on where venue might be proper for the remaining defendants, [plaintiff] amended its complaint to add claims for federal and common-law trademark infringement. Based on those claims, [plaintiff] argues, the court should exercise pendent venue over all of [its] claims against [movant]. . . . Pendent venue is improper in this case. . . . The trademark infringement claims are to 'ferryboat in' venue for the underlying patent claim. [Plaintiff] waited six months to amend its complaint, and it did so only after the court requested additional briefing on where venue might be proper for all defendants. . . . Because the primary claim is for patent infringement and the patent venue statute contains the more specific provisions, pendent venue is not justified in this case."

Wet Sounds, Inc. v. Powerbass USA, Inc. et al, 4-17-cv-03258 (TXSD April 17, 2018, Order) (Rosenthal, USDJ)

Wednesday, April 18, 2018

Failure to Apportion Damages on Claim-by-Claim Basis Does Not Render Expert’s Opinion Unreliable

The court denied defendant's motion to exclude the testimony of plaintiffs' damages expert regarding a reasonable royalty for failing to apportion damages on a claim-by-claim basis. "Plaintiffs [argue] that [the expert's] opinion is economically justified because he opines that infringing any of the asserted patents would 'have the same economic effect as infringing all of them.' In other words, Plaintiffs lose the same profit whether one patent claim in one patent is infringed, or whether multiple claims in multiple patents are infringed. . . . [T]o the extent that Defendant quarrels with certain factual assumptions made by [the expert] in failing to apportion damages on a claim-by-claim basis, those disputes go to the weight that his testimony should be given. . . . [His] reasonable royalty opinion need not be excluded simply because he did not apportion damages on a claim-by-claim basis."

Integra LifeSciences Corporation et al v. HyperBranch Medical Technology, Inc., 1-15-cv-00819 (DED April 16, 2018, Order) (Burke, MJ)

Tuesday, April 17, 2018

Huawei Prohibited From Enforcing Chinese Injunctions Against Standard Essential Patents

The court granted defendant Samsung's motion for an antisuit injunction prohibiting plaintiff Huawei from enforcing injunction orders issued by a Chinese court and found that the Chinese injunction orders would frustrate domestic policies. "⁠[Defendant] argues that allowing [plaintiffs] to enforce the Shenzhen Court’s injunction would frustrate specific domestic policies against injunctive relief on [standard essential patents] and general public policies against anticompetitive conduct and breaches of contract. The bulk of precedent supports its position. . . . There is a risk of inconsistent judgments if I were to find that [plaintiff] is not entitled to seek injunctive relief for its SEPs. In addition, in the absence of an antisuit injunction, [defendant] faces the risk of significant harm, not just in China, but with impacts percolating around the world. The Chinese injunctions would likely force it to accept [plaintiffs'] licensing terms, before any court has an opportunity to adjudicate the parties' breach of contract claims. Under these circumstances, the Shenzhen Order 'interfere[s] with 'equitable considerations' by compromising the court’s ability to reach a just result in the case before it free of external pressure on [Samsung] to enter into a 'holdup' settlement before the litigation is complete.'"

Huawei Technologies Co., Ltd. et al v. Samsung Electronics Co., Ltd. et al, 3-16-cv-02787 (CAND April 13, 2018, Order) (Orrick, USDJ)

Monday, April 16, 2018

Change in Primary Reference Does Not Alter Scope of IPR Estoppel as to Non-Instituted Prior Art Combinations

The court denied in part plaintiff's motion in limine to exclude certain obviousness theories due to IPR estoppel. "⁠[F]or the combinations that Defendant tried to raise in the IPR, but which the PTAB did not institute, Defendant may pursue the combinations at trial. For those combinations 'A in view of B' on which the PTAB did not institute, I would regard that as reasonably raising 'B in view of A' also, and thus I reject Plaintiff's assertions to the contrary. On this point, Plaintiff's motion is denied."

Nox Medical ehf v. Natus Neurology Inc., 1-15-cv-00709 (DED April 12, 2018, Order) (Andrews, USDJ)

Friday, April 13, 2018

Questions of Fact Concerning Inventive Concept Preclude Dismissal for Invalidity Under 35 U.S.C. § 101

The court denied without prejudice defendant's motion to dismiss because plaintiff sufficiently pleaded that the asserted claims of its data organization patent encompassed patentable subject matter and that the claims did not lack an inventive concept. "Plaintiff contends that the [patent] solves a computer-specific problem by asking 'when a version should be deleted, not when it can be deleted.'. . . The statements in the specification, the allegations in the FAC and the language of Claim 8 . . . show that the FAC sufficiently alleges that deleting data in response to the combination of a particular time stamp and a measureable characteristic, 'thereby to increase a capacity of said memory' shows an inventive concept to the claims. Whether this recitation reflects a protectable, inventive concept is a question of fact."

Sound View Innovations, LLC v. Hulu, LLC, 2-17-cv-04146 (CACD April 11, 2018, Order) (Kronstadt, USDJ)

Thursday, April 12, 2018

$12.5 Million Infringement Verdict Remitted to $3.5 Million

Following a $12.5 million jury verdict for infringement of plaintiff's water system disinfectant patent, the court granted defendants' alternative motion for remittitur, subject to plaintiff's acceptance of a $3.5 million award, because the verdict was excessive. "Instead of apportioning its royalty claim based on a reasonable estimate of the value of the claimed technology, as is required, Plaintiff based its damages theory on the value to [defendants] of all of the chlorine dioxide it created. This theory inflated the damages Plaintiff was entitled to recover, because it included the chlorine dioxide [defendants] created through the use of a non-infringing and prior art technique. . . . [B]y adjusting the parties’ respective proposals by considering their methodological shortcomings, it is possible to ascertain the 'maximum amount sustainable by the proof.'. . . Balancing these two competing proposals, and considering the trial evidence in light of the apportionment analysis, the Court concludes that a remittitur to $3.5 million is appropriate. "

CH2O, Inc. v. Meras Engineering, Inc., 2-13-cv-08418 (CACD April 10, 2018, Order) (Kronstadt, USDJ)

Wednesday, April 11, 2018

Caller ID Patent Claims Invalid Under 35 U.S.C. § 101

The court granted defendants' motion to dismiss because the asserted claims of plaintiff’s caller ID patent encompassed unpatentable subject matter and found that the claims were directed toward an abstract idea. "Plaintiff disputes that the purpose of the Claims is abstract. According to Plaintiff, the purpose is 'to indicate to a subscriber to both call waiting and caller ID, who is already engaged in a call, using an audible tone signal, the existence of an incoming call from a third party whose directory telephone number has been flagged private.' Even accepting this purpose as stated by Plaintiff, the Court finds it to be directed to an abstract idea. That the claims involve functionality of known telecommunications equipment does not detract from this finding."

Morris Reese v. Sprint Nextel Corporation et al, 2-13-cv-03811 (CACD April 9, 2018, Order) (Wright, USDJ)

Tuesday, April 10, 2018

Patent for Displaying Location-Relevant Communications On a Phone Not Invalid Under 35 U.S.C. § 101

The court denied defendant's motion to dismiss on the ground that plaintiff’s patent for displaying location-relevant communications on a phone encompassed unpatentable subject matter because the asserted claims were not directed toward an abstract idea. "⁠[T]he claims of the Asserted Patents are best characterized as directed to: refreshing location-relevant communication services on a phone’s display by obtaining a current location from a location server, selecting communication services using logic in a datastore, and refreshing the display. . . . [T]he claims at issue do more than simply state a result (i.e., display communication services according to current location); they also recite the way in which it is accomplished (i.e., using location retrieved from the location server and functions stored in the datastore). Accordingly, because the specific improvement to the technology of user interfaces claimed in [Core Wireless Licensing S.A.R.L. v. LG Elecs., Inc., 880 F.3d 1356 (Fed. Cir. 2018)] was not an abstract idea, the Court must conclude that the similarly specific improvement to user interfaces claimed here is also not an abstract idea."

Local Intelligence, LLC v. HTC America, Inc. et al, 5-17-cv-06437 (CAND April 6, 2018, Order) (Davila, USDJ)

Monday, April 9, 2018

Signal Processing Patent Not Invalid Under In Re Nuijten

The court denied defendant's motion to dismiss on the ground that plaintiff’s signal processing patent encompassed unpatentable subject matter under In re Nuijten, 500 F.3d 1346 (Fed. Cir. 2007). "In Nuijten . . . the Federal Circuit held that transitory signals did not fall within one of the four categories of patentable subject matter and thus were patent ineligible. Defendant misses a key holding in Nuijten -- the Federal Circuit allowed processing claims and only denied patent eligibility for claims that covered the signals themselves. Here, Claims 5 and 18 describe the process of splitting and synthesizing signals. . . . Neither claim covers a signal, and thus, a Nuijten analysis is unnecessary."

Hybrid Audio, LLC v. Visual Land, Inc., 2-17-cv-08968 (CACD April 5, 2018, Order) (Lew, USDJ)

Friday, April 6, 2018

PTAB Joinder Does Not Limit Scope of IPR Estoppel

Following two inter partes review proceedings, the court granted plaintiff's motion for summary judgment that IPR estoppel under 35 U.S.C. 315(e)(2) barred defendants from asserting invalidity of previously instituted claims based on prior art that was known by defendants when they joined a third-party's IPR, but which defendant's failed to assert in that IPR. "When requesting joinder, Defendants did not raise any of the additional prior art patents and publications already identified in their invalidity contentions in this case. Defendants respond that because the 'PTAB routinely denies joinder if a second-filed petition might introduce new arguments or grounds into a pending IPR,' the only grounds that Defendants 'reasonably could have raised in the [third-party] IPR were the same grounds on which the PTAB already instituted the [third-party] IPR.' Contrary to Defendants’ arguments, there is no 'mirror image' rule for joinder. The PTAB has noted that requests for joinder can involve petitions that assert different grounds of invalidity. . . . Allowing Defendants to raise arguments here that they elected not to raise during the [third party] IPR would give them 'a second bite at the apple and allow [defendants] to reap the benefits of the IPR without the downside of meaningful estoppel.'. . . Accordingly, Defendants are statutorily estopped from arguing that the instituted claims of the [patent] are anticipated or obvious in light of prior art patents and publications discussed in their invalidity contentions."

ZitoVault LLC v. International Business Machines Corporation et al, 3-16-cv-00962 (TXND April 4, 2018, Order) (Lynn, USDJ)

Thursday, April 5, 2018

Invalidation of One Patent Does Not Justify Reduction of $7 Million Attorney Fees Award

The court granted plaintiff's motion for over $7 million in attorney fees under 35 U.S.C. § 285 and rejected defendants' argument that the fees should be reduced by 33% on the ground that one of the patents-in-suit was found to be invalid as obvious because the hours billed were inextricably intertwined. "⁠[Plaintiff's] counsels’ work on 'unsuccessful claims was intimately related to the work done on successful claims.' Most of [plaintiff's] counsels’ time was 'devoted to the litigation as a whole, making it impossible to divide the work done on each individual claim.' The number of witnesses called at trial did not increase as a result of the unsuccessful claims. Further, all of [plaintiff's] claims were so closely related that allocating the amount of time spent litigating each individual claim would have been impossible."

Imperium IP Holdings (Cayman), Ltd. v. Samsung Electronics Co., Ltd. et al, 4-14-cv-00371 (TXED April 3, 2018, Order) (Mazzant, USDJ)

Wednesday, April 4, 2018

"Designer of Ordinary Skill in the Art" and "Ordinary Observer" Inappropriate for Determining Article of Manufacture

The court granted in part defendant's motion to exclude the testimony of plaintiff's technical experts because their application of the "designer of ordinary skill in the art" and "ordinary observer" standards to identify the relevant article of manufacture was improper. "The Court finds that there is no basis for importing these perspectives, which are used in the infringement and validity contexts, into the article of manufacture inquiry. Furthermore, the Court finds that introducing these perspectives risks confusing and misleading the jury. However, the Court declines [defendant's] request to exclude all of the material that [defendant] identified as related to these perspectives. . . . [M]uch of the DOSA-related testimony would be relevant and admissible if [the experts] instead testify to these points from their own perspectives as experts in industrial design and icon and graphical user interface design."

Apple Inc. v. Samsung Electronics Co. Ltd., et al, 5-11-cv-01846 (CAND April 2, 2018, Order) (Koh, USDJ)

Tuesday, April 3, 2018

Success Rates on Requests to Stay Pending IPR, CBM, or PGR through 2017

Post-Hoc "Parade of Horribles" Does Not Justify Award of Attorney Fees

Following a jury trial, the court denied defendants' motion for attorney fees under 35 U.S.C. § 285 because plaintiff's litigation positions and tactics as a whole were not exceptional. "Defendants’ strategy with its § 285 Motion seems to be to throw out as many different aspects of Plaintiff’s behavior as it can to support its fee request and 'see what sticks.' But it would be both tedious and wasteful for the Court to consider each and every individual tree when it should be looking at the landscape in the bigger forest. . . . And while perhaps true that Plaintiff had some shortcomings in its litigation and pre-litigation conduct and positions, the Court is unconvinced that those shortcomings amount to a showing that Plaintiff’s behavior was exceptional. . . . A party cannot simply hide under a rock, quietly documenting all the ways it’s been wronged, so that it can march out its 'parade of horribles' after all is said and done. That is the tenor of many of Defendants’ arguments here. Or alternatively, where Defendants did come forward at some point and challenged Plaintiff’s positions with some success, Defendants have not proven that they have been exceptionally wronged -- they got at least some of the relief they sought."

ATEN International Co., Ltd. v. Uniclass Technology Co., Ltd. et al, 2-15-cv-04424 (CACD March 30, 2018, Order) (Guilford, USDJ)

Monday, April 2, 2018

Defendant’s Obnoxious Copying and Failed Design-Around Support Award of Enhanced Damages

Following a jury verdict of willful infringement, the court granted in part plaintiff's motion for enhanced damages because defendant's copying, lack of a good faith belief in noninfringement/invalidity, lack of closeness of the case, duration of misconduct, lack of remedial action, and motivation for harm favored an enhancement of $3.8 million on a $7.6 million award. "⁠[A]n attempted design around that ultimately fails to actually design around and is adjudged to be infringing necessarily copies where, as here, the adjudged infringer begins with a copy already existing technology and then proceeds to make changes. . . . [T]he record lacks any 'written evidence that anyone at [defendant] considered the full claim scope or alternative embodiments that might fall within it.'. . . [T]his case is one where the copying exhibited is 'so obnoxious as to clearly call for' 'discourage[ment] by punitive damage[s].' . . . [T]he jury awarded [plaintiff] approximately 90% of [its] proposed damages. . . . Although [defendant's] continued infringement lasted for 'only a year and eight months,' the Court must nonetheless weigh the period of time against [its] pre-suit notice and continued infringement. . . . [Defendant's] actions were preventative; they served to prevent expansion of the scope of the ongoing infringement as found at trial. . . . It is not 'good old-fashioned competition' to trespass upon other competitor’s property rights in pursuit of profits."

Whirlpool Corporation v. TST Water, LLC, 2-15-cv-01528 (TXED March 29, 2018, Order) (Gilstrap, USDJ)

Friday, March 30, 2018

$235 Million Verdict of Willful Induced Infringement Overruled for Failure to Prove Causation

Following a jury verdict of willful induced infringement of plaintiffs' congestive heart failure treatment patent and damages of $235 million, the court granted defendant's renewed motion for judgment of noninfringement as a matter of law because substantial evidence did not support the jury's finding that defendant induced doctors to infringe. "⁠[Plaintiffs] failed to prove by a preponderance of the evidence that '⁠[defendant's] alleged inducement, as opposed to other factors, actually caused the physicians [i.e., as a class or even at least one of them] to directly infringe,' by prescribing generic carvedilol and to do so for the treatment of mild to severe CHF. Without proof of causation, which is an essential element of [plaintiffs'] action, a finding of inducement cannot stand. . . . [Defendant's] uncontroverted evidence of alternative factors that caused physicians to prescribe carvedilol in an infringing manner cannot be ignored. . . . [G]iven the dearth of evidence that doctors read and understand and are affected by labels, and given the vast amount of evidence that doctors' decisions to prescribe carvedilol during the relevant periods were influenced by multiple non-[defendant] factors -- such an inference was an unreasonable one for the jury to have drawn."

GlaxoSmithKline LLC et al v. Teva Pharmaceuticals USA, Inc., 1-14-cv-00878 (DED March 28, 2018, Order) (Stark, USDJ)

Thursday, March 29, 2018

Failure to Obtain Product Sample Did Not Render Plaintiff’s Pre-Filing Investigation Inadequate

Following plaintiff's voluntary dismissal, the court denied defendant's motion for attorney fees under 35 U.S.C. § 285 because plaintiff's litigation positions were not unreasonable. "Defendant argues that [plaintiff's infringement analysis] was insufficient and that the Federal Circuit’s holding in Judin v. U.S., 110 F.3d 780, 784 (Fed. Cir. 1997) required Plaintiff to purchase a product sample prior to filing suit. . . . ⁠[O]btaining a sample of the infringing product is not a bright-line requirement to filing a patent infringement claim. . . . Plaintiff conducted an infringement analysis which included an informed comparison of the claims of the [patent-in-suit] against the publicly available information regarding the [accused product]. Under the Federal Circuit case law, this is sufficient to constitute an adequate pre-filing investigation."

Somaltus LLC v. The Noco Company, Inc., 1-17-cv-01111 (OHND March 27, 2018, Order) (Gaughan, USDJ)

Wednesday, March 28, 2018

Shelf is not a Place of Business Under Patent Venue Statute

The court granted defendants' alternative motion to transfer for improper venue because defendants did not have a regular and established place of business in the district. "The full extent of Defendants’ physical presence in the [district] is a shelf containing a piece of [one defendant's] telecommunications equipment. . . . [T]his equipment is involved in processing calls to and from New York-based phone numbers. . . . All electronic traffic flowing to [defendant's] equipment travels via [plaintiff's] network. . . . In a sense, the preposition is key: [defendant's] employees may direct telecommunications traffic through New York, but they do not engage in business from the shelf itself. . . . The Court acknowledges that a human-centered definition of 'place of business' may feel unsatisfying in an economy increasingly characterized by virtual transactions. But the Court is constrained to follow the text of the statute, which 'cannot be read to refer merely to a virtual space or to electronic communications from one person to another.'. . . Under a faithful reading of the statute, the Court must conclude that whatever a 'place of business' is, it is not a shelf."

Peerless Network, Inc. v. Blitz Telecom Consulting, LLC et al, 1-17-cv-01725 (NYSD March 26, 2018, Order) (Oetken, USDJ)

"Massive" Discovery Misconduct Justifies Attorney Fees Award

Following plaintiff's post-Markman stipulation of dismissal and a bench trial finding inequitable conduct, the court granted defendant's motion for attorney fees under 35 U.S.C. § 285 because plaintiff's severed litigation misconduct was exceptional. "While the finding of inequitable conduct alone warrants an award of attorney fees to [defendant], the Court need not rely on that ground, as [plaintiff's] conduct during litigation is surely enough. . . . [Plaintiff] specifically withheld: (1) non-privileged documents; (2) previously privileged documents as to which [plaintiff] affirmatively waived the privilege and which this Court ordered be produced . . . ; and (3) documents on the privilege log relating to precisely those topics waived [plaintiff] . . . when it filed its trial declarations. This misconduct began soon after the case was filed and continued until the Court finally conducted an in camera review of [plaintiff's] privilege log on the eve of trial. Only then, when it was too late to reopen discovery, did the Court discover the massive amount of information withheld from it (and from [defendant]) over the preceding year. Indeed, the extent of [plaintiff's] mischief was so vast that the Court noted it could not delay trial and require production of the documents to [defendant] without appointing a special master to oversee [plaintiff's] production -- to do so would likely be futile."

Regeneron Pharmaceuticals, Inc. v. Merus BV, 1-14-cv-01650 (NYSD March 26, 2018, Order) (Forrest, USDJ)

Tuesday, March 27, 2018

Patent Licensee Preliminarily Enjoined From Pursuing PTAB Petitions

The court granted plaintiff's motion for a preliminary injunction requiring defendants to withdraw their petitions to the PTAB seeking to invalidate plaintiff's patents-in-suit because plaintiff established a likelihood of success on the merits of its related breach of contract claim. "Both Plaintiff and Defendants have raised the issue of validity and enforceability with this Court through their complaint and counterclaim, and validity and enforceability are the same issues that [defendant] has placed before the PTAB. But for the parties’ licensor-licensee relationship, and Defendants’ interest in reducing or eliminating the royalties provided for under the [parties' license agreement] based on the claim of invalidity, there is no indication that [defendant] would be pursuing the PTAB proceedings at all. . . . Defendants essentially ask this Court to permit their belated attempt at forum shopping. District courts are authorized to decide patent validity challenges and Defendants’ preference for one forum over the other does not justify the PTAB Petitions if they are not, in fact, permitted under the [agreement] and that provision of the [agreement] is lawful."

DODOCASE VR, Inc. f/k/a DODOcase, Inc. v. MerchSource, LLC d/b/a Sharper Image et al, 3-17-cv-07088 (CAND March 23, 2018, Order) (Laporte, MJ)

Monday, March 26, 2018

FDA Advised of Defendant’s Litigation Misconduct and Sanctions

The court granted in part plaintiffs' motion for monetary sanctions after defendant disclosed corrected stability dissolution testing data during a bench trial and directed that the FDA be informed of defendant's conduct. "The conduct of [defendant] and [its drug manufacturer] reflects an appalling lack of awareness of a litigant’s responsibility to our justice system -- in [defendant's 30(b)(6) witness's] case conduct laced with mendacity as well. It is worth remembering that [the witnesses at issue] are not bit players here. [One] is the owner of [the manufacturer]. Both he and [defendant's 30(b)(6) witness] are members of [the manufacturer's] management team. . . . The FDA would be well advised to take notice of this pervasive corporate unwillingness to play by the rules. The Clerk is therefore directed to send a certified copy of this opinion to the General Counsel of the FDA. Sanctions are amply warranted here."

Shire LLC et al v. Abhai LLC, 1-15-cv-13909 (MAD March 22, 2018, Order) (Young, USDJ)

Friday, March 23, 2018

Unworkable Interplay Between Court and PTO Proceedings Requires Stay of Litigation

The court sua sponte stayed plaintiff's patent infringement action pending ex parte reexamination to conserve judicial resources. "⁠[H]appening essentially in real time, there are accusations of perjury being submitted to the PTO based on declarations and arguments before this Court, and there are arguments of inequitable conduct being submitted to this Court based on accusations of perjury before the PTO. The questionable and challenging interplay between these two proceedings has become unworkable. Continuing in this tandem fashion will only ensure that even more judicial and agency resources are wasted. . . . It’s become apparent that there’s no chance of the parties engaging each other in a civilized manner until the PTO has concluded its reexamination and the parties are done muddying the waters between the two proceedings."

Parallax Group International, LLC v. Incstores LLC, 8-16-cv-00929 (CACD March 21, 2018, Order) (Guilford, USDJ)

Thursday, March 22, 2018

Expert’s Flawed Royalty Rate Analysis Requires New Trial on $75 Million Verdict

Following a jury verdict of $75 million, the court granted defendant's motion for new damages trial because the application of plaintiff's survey expert's results by plaintiff's damages expert was unreliable. "⁠[Plaintiff's damages expert] directly translated the roughly 28% of survey respondents who allegedly would not have bought [defendant's] phone without the infringing feature to [defendant's] profit in an effort to determine the potential 'at-risk' profit. . . . [The expert] did not consider the numerous patented features on the accused phones, many of which a consumer would consider essential, assuming [another expert's] survey results were extrapolated. . . . [He] did not account for how his theory would result in the erosion of all of [defendant's] profit. Realistically, there are many features on a phone that would likely yield survey results similar to those obtained for the [patent-in-suit], e.g., ability to make a call, text messaging, Wi-Fi connection. To conclude that any one of these features -- simply because it is considered essential to a consumer -- could account for as much as a quarter of [defendant's] total profit is unreliable and does not consider the facts of the case, particularly the nature of smartphones and the number of patents that cover smartphone features."

Ericsson Inc. et al v. TCL Communication Technology Holdings Limited et al, 2-15-cv-00011 (TXED March 7, 2018, Order) (Payne, MJ)

Wednesday, March 21, 2018

Internal Invention Disclosure Document Protected by Attorney-Client Privilege

The court denied plaintiff's motion to compel the production of a clawed back deposition exhibit and found the document was privileged. "⁠[Senior in-house counsel] confirmed that [the exhibit] is consistent with the format required for submission of an invention disclosure to [defendant's Patent Review Committee] through the Portal. . . . Although [the exhibit] does not expressly state that it is a request for legal advice, the request is implied. . . . The fact that attorneys on the PRC required engineers or technical experts to assist them in evaluating the invention for purposes of determining whether to pursue a patent does not disqualify [the exhibit] from being covered by the attorney client privilege. . . . [Counsel's] declaration describes PRC’s function as making 'individual patenting decisions on specific intentions that have been submitted to the PRC.' The PRC attorneys 'assess whether the invention was novel and patentable.'"

The California Institute of Technology v. Broadcom Limited et al, 2-16-cv-03714 (CACD March 19, 2018, Order) (Rosenberg, MJ)

Tuesday, March 20, 2018

Doctrine of "Ancillary" Venue Does Not Provide Independent Basis for Venue

The court granted counterclaim defendants' motion to dismiss for improper venue because defendants lacked a regular and established place of business in the district and ancillary venue did not apply. "Even assuming that [defendants] have committed acts of infringement in the Northern District of Illinois, venue would still be improper because neither maintains a 'regular and established place of business' in the District. [One defendant] has no offices or property in the District, and no phone number or mailing address here. [The other defendant] likewise does not have a regular and established place of business in the District. . . . [Counterclaimant] cites no authority for the proposition that the doctrine of ancillary venue (whatever that really is) can override the clear terms of the patent venue statute. And [TC Heartland LLC v. Kraft Foods Group Brands LLC, 137 S. Ct. 1514 (2017)] puts the nail in the coffin: if the general federal venue statute does not supplement the patent venue statute, then it is unclear why a nonstatutory doctrine could do so."

Shure Incorporated v. ClearOne, Inc., 1-17-cv-03078 (ILND March 16, 2018, Order) (Chang, USDJ)

Monday, March 19, 2018

Pre-Markman Attorney Fees Awarded Due to Unreasonable Manner of Litigation

The court awarded defendant its attorney fees under 35 U.S.C. § 285 and rejected plaintiff's argument that defendant was not entitled to attorney fees prior to claim construction. "The Federal Circuit stated that '⁠[plaintiff's] suit became baseless after the district court’s Markman order.'. . . However, as the Federal Circuit identified, this was not the extent of [plaintiff's] misconduct. [Plaintiff] also 'litigated the case in an "unreasonable manner."'. . . [T]his Court, in an exercise of its discretion and as guided by the Circuit’s opinion and directive, finds that it is appropriate in this exceptional case to award [defendant] the fees it incurred from the time of filing through dismissal."

Adjustacam LLC v. Amazon.com, Inc., et al, 6-10-cv-00329 (TXED March 15, 2018, Order) (Gilstrap, USDJ)

Friday, March 16, 2018

Nonparty's Compilation of Prior Art Protected by Work Product Doctrine

The ALJ denied respondents' motion to certify for judicial enforcement its prior art subpoena to two nonparties whom complainants sued for infringement of the same patents in district court because the documents sought were protected attorney work product. "⁠[Nonparty] represents in its opposition that the prior art at issue 'was developed by [its] counsel because of' the district court litigation. [Respondent] speculates that [nonparty] may have also identified prior art 'outside the contours' of the district court case. [Respondent's] speculation, however, is groundless. . . . Such a compilation of prior art is protected under the work-product doctrine, even if the references themselves are publicly available. . . . [P]rotecting the mental impressions and thought processes of an attorney from disclosure is not the only interest protected by the work-product doctrine. The work-product doctrine also seeks to prevent attorneys from relying 'on wits borrowed from the adversary' instead of relying on their own efforts and professional judgment."

LED Lighting Devices, LED Power Supplies, and Components Thereof, 337-TA-1081 (ITC March 13, 2018, Order) (Lord, ALJ)

Thursday, March 15, 2018

Previously Undisclosed Market Share Apportionment Theory Stricken From Expert Report

The court overruled plaintiff's objections to the magistrate judge's order partially striking the report of plaintiff's damages expert. "⁠[Plaintiff] contends . . . all of the information [the expert] relied upon in forming his market share apportionment opinion was made known to [defendant] during fact discovery. To the extent [defendant] needed additional third-party discovery, [plaintiff] alleges it is [defendant's] fault for not seeking it earlier. The Court disagrees. Even if all the information [the expert] relied upon in forming his opinion was made known to [defendant], the market share apportionment theory itself was never disclosed prior to [his] report. Instead, [plaintiff] maintained only its two-player/product market theory, a theory that (at least in part) contradicts the newly-asserted market apportionment theory. That [defendant's] own discovery may have shown that the market was not a two-party/product market is not the issue."

Integra LifeSciences Corporation et al v. HyperBranch Medical Technology, Inc., 1-15-cv-00819 (DED March 13, 2018, Order) (Stark, USDJ)

Wednesday, March 14, 2018

Post-Trial Amendment of Pleadings Permitted to Assert Alter-Ego Claim Against Bankrupt Defendant’s Individual Owners

Following a $30 million jury verdict and defendant's filing for bankruptcy, the court granted plaintiff's motion to amend its complaint to add defendant's co-owners as defendants along with alter ego and veil-piercing claims. "⁠[Plaintiff] explains that it learned of [defendant's] and the [defendant's owners'] alleged efforts to avoid liability only when it reviewed the bankruptcy filings.⁠ . . . [Defendant] counters that [plaintiff] was 'on clear notice before trial of the substantial risk that [defendant] would be unable to pay the enormous sums [plaintiff] was seeking. Had it wanted to hedge its bets by asserting claims against other entities, it should have sought leave to do so long before now.' But that argument entirely misses the point. Veil-piercing and alter-ego claims are not mere contingency plans for uncollectable defendants. They are specific theories of liability which, absent plausible grounds, would be frivolous to plead. [Plaintiff] argues that the alleged abuse of the corporate form -- the necessary fact that underlies veil-piercing and alter-ego claims -- only came to light later on. The Court certainly will not punish [plaintiff] for failing to assert a claim prior to having the evidence to back it up."

FieldTurf USA, Inc. et al v. Astroturf, LLC, 2-10-cv-12492 (MIED March 12, 2018, Order) (Murphy, USDJ)

Tuesday, March 13, 2018

Apple Not Collaterally Estopped From Denying Infringement by Redesigned Version of FaceTime

The court denied plaintiff's motion for summary judgment that the redesigned version of defendant's adjudicated product infringed its network security patents because there were genuine disputes of material fact which precluded a finding of collateral estoppel. "⁠Apple argues that issue preclusion is inapplicable here, as the redesigned product differs in design and operation from the product at issue in the [earlier lawsuit]. . . . Particularly, Apple notes that the accept message from the FaceTime servers to the caller device was changed between the first version of FaceTime and the redesigned FaceTime. Apple suggests this change to FaceTime was so significant that the servers can no longer meet the 'indication' requirement of the claims. . . . [T]he accused devices in this case are not essentially the same as the devices at issue in the [prior] case. [Defendant] has raised a question of material fact as to whether the redesigned version of [the adjudicated product] infringes the claims of the asserted patents. The parties’ arguments stem from a fundamental factual dispute with respect to the design and operation of the redesigned product, which the Court declines to resolve at summary judgment. Whether, after the changes to the accept message, the [accused] servers fall within the scope of the court’s claim construction is a question of fact for the jury to resolve at trial."

VirnetX Inc. et al v. Apple Inc., 6-12-cv-00855 (TXED March 9, 2018, Order) (Schroeder, USDJ)

Monday, March 12, 2018

Office Closed a Few Weeks Before Lawsuit is a Regular and Established Place of Business for Venue

The court overruled defendant's objection to the magistrate judge's recommendation to deny its motion to transfer for improper venue because defendant had a regular and established place of business in the district through its office that closed a few weeks before plaintiff filed suit. "Abiding by the Federal Circuit's admonition that '⁠[i]n deciding whether a defendant has a regular and established place of business in a district, no precise rule has been laid down and each case depends on its own facts,' the undersigned finds that the fact that [plaintiff] filed suit in this District within weeks after [defendant] closed its doors is reasonable. Finding that [defendant's] established and regular business in the District weeks before suit was filed is sufficient for establishing venue pursuant to Section 1400(b) does not offend Section 1400(b)'s purpose 'to eliminate the "abuses engendered" by previous venue provisions allowing such suits to be brought in any district in which the defendant could be served.'"

ParkerVision, Inc. v. Apple Inc. et al, 3-15-cv-01477 (FLMD March 8, 2018, Order) (Davis, USDJ)

Friday, March 9, 2018

Clinical Activities Within § 271(e)(1) Safe Harbor Are Not “Acts of Infringement” For Determining Venue

The magistrate judge recommended granting defendants' motion for summary judgment of improper venue because there were no infringing acts in the district inasmuch as the accused activities fell under the safe harbor provision of 35 U.S.C. § 271(e)(1). "Plaintiff has not alleged any facts showing activities in this District other than those statutorily exempted from infringement by § 271(e)(1). . . . [T]he relevant question here is not whether Defendants engaged in uses outside the District that are not 'solely' or 'reasonably related' to seeking FDA approval, but rather, whether Defendants have engaged in any such uses in this District so that venue is proper. . . . [A]ll acts of infringement in the Eastern District of Texas are solely clinical, and therefore, the § 271(e)(1) safe harbor applies despite purported nonexempt activity in Minnesota."

Snyders Heart Valve LLC v. St. Jude Medical SC, Inc. et al, 4-16-cv-00812 (TXED March 7, 2018, Order) (Priest Johnson, MJ)

Thursday, March 8, 2018

Expert Testimony Based on Modified Claim Construction Precluded

The court granted in part plaintiff's motion in limine to preclude expert testimony premised on a revised construction of the claim term in question. "⁠[T]he court [previously] construed the claim term 'intumescent' to describe 'a substance that swells and chars upon exposure to heat or flame.' . . . [O]ver three years after the claim construction . . . [defendant] seeks to offer evidence from one of ordinary skill in the art that infringement of the claim term 'intumescent' requires proof that the coating 'swells to a sufficient degree to act as a thermal barrier to lessen the effects of heat or flame on the underlying fabric.' . . . [T]he court declines to further define the term 'swell.' . . . [Defendant] should be permitted to present evidence by an expert as to whether he observes any swelling . . . and criticisms of [plaintiff's] expert’s findings. . . . [H]e may not testify as to any opinion that the results reportedly observed by [plaintiff's expert] fail to indicate swelling 'to a sufficient degree to act as a thermal barrier to lessen the effects of heat or flame on the underlying fabric' because he has conducted no testing to support such a statement."

Precision Fabrics Group, Inc. v. Tietex International, Ltd., 7-17-cv-03037 (SCD March 5, 2018, Order) (Schroeder, USDJ)

Wednesday, March 7, 2018

Initiating Ex Parte Reexamination Instead of Inter Partes Review No Basis For Denying Stay

The court granted defendant's motion to stay pending its requests for ex parte reexamination and rejected plaintiff's argument that defendant was engaging in gamesmanship by not seeking inter partes review. "⁠[Plaintiff] argues that [defendant] only made this choice because it wanted to delay this litigation as much as possible, as evidenced by the longer timeline for completion of ex parte reexamination and the fact that reexamination does not have the same estoppel effect as IPR. . . . [I]t was reasonable for [defendant] to choose not to pursue IPR given that the constitutionality of the procedure is currently being considered by the United States Supreme Court. . . . Moreover . . . choosing ex parte reexamination makes economic sense because IPR filing fees alone would cost $50,000 more than reexamination."

Carlson Pet Products, Inc. v. North States Industries, Inc., 0-17-cv-02529 (MND March 5, 2018, Order) (Menendez, MJ)

Tuesday, March 6, 2018

CBM Estoppel Does Not Apply to Entire Statutory Provision, But to Discrete Prior Art References or Combinations

The court denied plaintiff's motion in limine to exclude evidence of obviousness because CBM estoppel did not apply to an entire statutory basis. "Plaintiff argues that, because [defendant's] CBM challenge was based on 35 U.S.C. § 103, Defendants are estopped from arguing invalidity under that statutory provision. Plaintiff thus asserts that 'ground' in the estoppel provision encompasses the statutory basis for an invalidity challenge to the patent. . . . The estoppel provision applying to CBM review is a fairly new legal rule, and case law does not clearly define its scope. But the Court can gain guidance from the Federal Circuit’s discussion of the term 'grounds' in the context of post-grant review before the PTAB. In [Shaw Industries Group, Inc. v. Automated Creel Systems, Inc., 817 F.3d 1293 (Fed. Cir. 2016)], the Federal Circuit described several different 'grounds' for obviousness that constituted varied combinations of prior art. . . . [T]he Court agrees with Defendants that the word 'ground' in the CBM estoppel provision refers to a discrete claim of invalidity based upon a prior art or a combination of prior art."

Solutran, Inc. v. US Bancorp et al, 0-13-cv-02637 (MND March 3, 2018, Order) (Nelson, USDJ)

Monday, March 5, 2018

Asserted Claims of Digital Advertising Distribution Patents Invalid Under 35 U.S.C. § 101

The court granted defendant's motion to dismiss because the asserted claims of plaintiff’s digital advertising distribution patents encompassed unpatentable subject matter and found that the claims were directed toward an abstract idea. "⁠[Plaintiff] argues that its patents constitute a 'paradigm shift, causing ad systems to behave in an unconventional manner' by providing for real-time insertion of advertisements, selected on attributes or other criteria, instead of 'preinserted' ads that result in all consumers viewing the same advertising content. . . . [T]he claims of the three patents are directed to an ineligible abstract idea: specifically, custom advertising based upon consumer qualities or other data. . . . The different patents and claims envision different arrangements of generic computers to implement this concept in different ways. But, at bottom, they do not represent or describe improvements in computing systems, specific new software or hardware or technology, or some other type of computing method that improves the computer's functionality or makes it more efficient, such as an information 'structure designed to improve the way a computer stores and retrieves data in memory.'"

Quantum Stream Inc. v. Charter Communications, Inc. et al, 1-17-cv-01696 (NYSD March 1, 2018, Order) (Engelmayer, USDJ)

Friday, March 2, 2018

Expert’s Secondary Considerations Opinions Struck Due to Inadequate Discovery Response

The court granted defendant's motion to strike portions of the report of plaintiff's infringement expert regarding previously undisclosed secondary considerations of nonobviousness. "⁠[Plaintiff] argues that [defendant's] interrogatory was premature because it asked for expert opinion, but [plaintiff] was at least obligated to provide the factual basis for any secondary considerations, and include this factual basis in the interrogatory response itself. . . . The important point, in the Court’s view, is that [plaintiff] not only failed to disclose the factual basis for any secondary considerations, but failed to even disclose any reliance on secondary considerations at all. The prosecution history includes a discussion of secondary considerations . . . yet even this basis for secondary considerations was not included in [plaintiff's] interrogatory response. . . . Although secondary considerations may be important, the prejudice to [defendant] is significant, particularly because [plaintiff] did not disclose the facts it already had knowledge of upon which it would rely."

Semcon IP Inc. v. Huawei Device USA Inc. et al, 2-16-cv-00437 (TXED February 28, 2018, Order) (Payne, MJ)

Thursday, March 1, 2018

Vibration Attenuation Patent Invalid Under 35 U.S.C. § 101

The court granted defendant's motion for summary judgment of invalidity because the asserted claims of plaintiff’s vibration attenuating patent encompassed unpatentable subject matter and found that the claims were directed to a law of nature. "There is no dispute that adjusting the mass and stiffness of the liner will change the amount of damping of a certain frequency. The claimed methods are applications of Hooke's law with the result of friction damping. . . . [T]he Asserted Claims do not disclose a method of manufacturing a propshaft; instead, considered as a whole, they are directed to the mere application of Hooke's law, and they fail to instruct how to design the tuned liners or manufacture the driveline system to attenuate vibrations."

American Axle & Manufacturing, Inc. v. Neapco Holdings LLC et al, 1-15-cv-01168 (DED February 27, 2018, Order) (Stark, USDJ)

Wednesday, February 28, 2018

Special Liaison Appointed to Investigate Expert’s Availability to Testify Following Medical Event

The court deferred ruling on defendants' motion to substitute one of its experts and appointed a special liaison to help determine whether the expert would be able to proceed at trial. "Subsequent to his retention, [the expert] experienced a medical event, which occurred at or near the time of his deposition [last month]. . . . [T]he Court has concluded that an experienced non-physician liaison is appropriate to facilitate further informational development in this matter and that appointment of a non-physician liaison is preferable to appointing a different neurologist. . . . As special liaison in this regard, [the liaison] shall gather and report information from [the doctor who examined defendants' expert], and all other available, material sources, regarding [the expert's] ability to recover and testify [at trial in 3 months], or some other future date."

Intellectual Ventures II LLC v. FedEx Corporation et al, 2-16-cv-00980 (TXED February 26, 2018, Order) (Gilstrap, USDJ)

Tuesday, February 27, 2018

Venue Not Determined When Cause of Action Accrues

The court granted one defendant's motion to transfer for improper venue because defendant lacked a regular and established place of business in the district through its former office that closed shortly before plaintiff filed suit. "⁠[Plaintiff] argues . . . that the location in Plymouth Meeting is sufficient to defeat [movant's] motion to transfer because [it] had a regular and established place of business in this district when the cause of action accrued, and Plaintiff initiated the relevant action on June 30, 2010, a reasonable time after [movant's] office closed in 2009. . . . Some courts have held that venue is proper under § 1400(b) when a defendant had a regular and established place of business in a district, and the plaintiff initiated the action within a reasonable time after the place of business was closed. However, this rule has not been adopted by the Third Circuit Court of Appeals, and this Court declines the invitation to apply said ruling in this patent case."

Infinity Computer Products, Inc. v. OKI Data Americas, Inc., 2-12-cv-06797 (PAED February 23, 2018, Order) (Alejandro, USDJ)