Friday, February 16, 2018

Audio-Video Doorbell Patent Not Invalid Under 35 U.S.C. § 101

The court denied defendant's motion to dismiss on the ground that plaintiff’s audio-video doorbell patent encompassed unpatentable subject matter because the asserted claims were not directed toward an abstract idea. "⁠[T]he Court has rejected arguments that a patent claim is abstract because its only concrete, physical component not relying on a computer’s generalized computing capabilities was well-known or long-practiced. . . . Detecting the presence of a person at a door, sending a video of the person to be viewed, and speaking with the person at the door are all concrete steps requiring more than the abstract thinking capabilities of a person or a computer. Regardless of anticipation or nonobviousness under §§ 102 and 103 -- neither of which is at issue in the present motion, and upon which the Court states no opinion -- Claim 1 is patent-eligible under § 101."

Eyetalk365, LLC v. Zmodo Technology Corporation Limited, 2-17-cv-02714 (NVD February 14, 2018, Order) (Jones, USDJ)

Thursday, February 15, 2018

Successful Motion to Intervene Waives Venue Challenge

The court denied intervenors' motions to sever and transfer plaintiff's actions against them for improper venue because intervenors waived venue through their intervention. "By definition, an intervenor is '⁠[s]omeone who voluntarily enters a pending lawsuit because of a personal stake in it.' This choice to intervene (or consent to proceed in a particular jurisdiction and venue) has real and far-reaching consequences. . . . [T]he intervenors cannot now question the propriety or convenience of a venue they chose to enter. The intervenors voluntarily entered this proceeding and now must litigate in this, their chosen venue."

Team Worldwide Corporation v. Wal-Mart Stores, Inc. et al, 2-17-cv-00235 (TXED February 13, 2018, Order) (Gilstrap, USDJ)

Wednesday, February 14, 2018

Serving Responses to Contention Interrogatories Near Close of Fact Discovery Justifies Monetary Sanctions Against Defendant and Counsel

The court granted plaintiff's motion for monetary sanctions against defendant and its counsel following plaintiff's successful motion to compel further contention interrogatory responses because defendant's behavior was not substantially justified. "⁠[Defendant] now asserts that it was 'substantially justified in relying upon the existing, valid legal authority directly on point' to delay responses to the Contention Interrogatories. The authorities [defendant] cites, however, do not justify a refusal to respond to contention interrogatories until the last few days before the discovery cut-off. . . . [W]hile [defendant] cites cases for the proposition that responses may be delayed until discovery is 'almost complete,' none stand for the unreasonable conclusion that a responding party can wait until the discovery period is over before responding to demands."

Bal Seal Engineering, Inc. v. Nelson Products, Inc. et al, 8-13-cv-01880 (CACD February 12, 2018, Order) (Scott, MJ)

Tuesday, February 13, 2018

Contractual and Fiduciary Duty of Loyalty May Estop Defendant From Asserting Invalidity Defense

The court denied defendant's motion to dismiss on the ground that plaintiff’s synthetic gem investment product patent encompassed unpatentable subject matter because there were genuine disputes of fact whether an individual defendant was estopped from challenging the patent's validity. "⁠[T]he Court is unpersuaded by defendants' contention that [plaintiff] is legally precluded from asserting an estoppel or contractual bar to [the individual defendant's] invalidity argument arising from his fiduciary and contractual duties to [plaintiff]. Whether those duties actually bar [the individual defendant] (and [the LLC defendant] as his alleged alter ego) in the way asserted by [plaintiff] is another matter, and one the Court cannot adjudicate at this stage of the litigation -- as it may depend on factual disputes that cannot be adjudicated at this point. The upshot is that the Court does not believe that it can appropriately decide defendants' invalidity challenge in the context of their motion to dismiss for failure to state a claim."

Gemshares LLC v. Lipton et al, 1-17-cv-06221 (ILND February 11, 2018, Order) (Kennelly, USDJ)

Monday, February 12, 2018

Common Interest Doctrine Does Not Protect Communications With Litigation Funder Prior to Written Agreement

The court overruled plaintiff's objection to the special master's order granting in part defendants' motion to compel the production of documents plaintiff provided to a third party as part of a litigation financing agreement that plaintiff withheld under the common interest doctrine. "Plaintiff argues that '⁠[l]itigation funders provide funds 'for the sake of securing, advancing, or supplying legal representation,' and thus have a common legal interest with the plaintiffs they fund.'. . . However . . . 'it [does not] appear that there was any written agreement at [the time of the communications] to have a legally 'common interest' in whatever was provided by Plaintiff.' Furthermore, the Special Master explained that the 'documents were provided before any agreement was reached between Plaintiff and [the litigation funder], and before any litigation was filed.' Thus, Plaintiff has not shown that Plaintiff and [the litigation funder] possessed identical legal interests in the patents-in suit or were otherwise 'allied in a common legal cause' at the time of the communications."

Acceleration Bay LLC v. Activision Blizzard, Inc., 1-16-cv-00453 (DED February 9, 2018, Order) (Andrews, USDJ)

Friday, February 9, 2018

Breach of Duty to Disclose Patent to Standards Setting Organization Equitably Estops Enforcement

Following a jury verdict of infringement and invalidity, the court granted in part defendant's motion for judgment as a matter of law that plaintiff was equitably estopped from enforcing its anticoagulant patent. "⁠[Plaintiff] had a duty to disclose its patent to [a standards setting organization] and it breached that duty through silence. . . . This Court agrees that there was credible testimony supporting the inference that [defendant] relied on [an SSO provision] for its continued use of the 15-25% procedures. . . . [Defendant] has shown that it would be economically prejudiced if [plaintiff] were permitted to enforce the patent against it. . . . Because [one] procedure does not comply with [the SSO provision], [plaintiff] is only equitably estopped from enforcing its patent against the 15-25% procedures."

Momenta Pharmaceuticals, Inc., et al v. Amphastar Pharmaceuticals, Inc., et al, 1-11-cv-11681 (MAD February 7, 2018, Order) (Gorton, USDJ)

Thursday, February 8, 2018

Defendant’s Attendance at Plaintiff’s Board of Directors Meeting Discussing Patented Technology Supports Willfulness Claim

The court denied defendant's motion to dismiss plaintiff's willful patent infringement claims for failing to sufficiently allege egregious behavior. "⁠[A] complaint must contain some allegations which make it plausible that the accused infringer’s behavior was egregious and that allegations of knowledge of the patents-in-suit alone are insufficient. . . . [A]mong other things, the SAC alleges that in 1997 [defendant] publicly acknowledged the value of [plaintiff's] technology. [Defendant] allegedly began investing in [plaintiff] in 2004, sent a representative to [plaintiff's] board of director meetings where [plaintiff's] patents and technology were discussed, and learned about [plaintiff's] technology during a 2006 presentation. . . . According to [plaintiff], despite the knowledge and a high likelihood of infringement, [defendant] allegedly incorporated infringing technology into its products in an egregious manner. These allegations clearly contain factual allegations that are more than a formulaic recitation of the legal standard using the word 'egregious.'"

Finjan, Inc. v. Cisco Systems, Inc., 5-17-cv-00072 (CAND February 6, 2018, Order) (Freeman, USDJ)

Wednesday, February 7, 2018

Auto Dealership Facilities Do Not Qualify as Regular and Established Place of Business of Vehicle Manufacturer or Distributor

The court granted defendants' alternative motion to transfer plaintiff's patent infringement action for improper venue because defendants did not have a regular and established place of business through their dealerships in the district. "Defendants are two distinct corporate entities. . . . The dealerships are also separate corporate entities. . . . [T]here is no fact supporting that Defendants are the parent corporations of the dealerships owners or operators. . . . [T]here are no facts that Defendants even own any interest in the dealerships. Plaintiff’s theory is predicated on the Defendants’ operating agreement with the . . . dealerships exerting such control that the dealerships are essentially the same entity. This theory ignores the separate corporate forms of Defendants and the dealerships. The Court finds no facts to support collapsing the corporate forms; the dealerships’ physical locations are not places of Defendants."

West View Research, LLC v. BMW of North America, LLC et al, 3-16-cv-02590 (CASD February 5, 2018, Order) (Sammartino, USDJ)

Tuesday, February 6, 2018

Expert's Application of Rubinstein Bargaining Model Renders Reasonable Royalty Opinion Unreliable

The court granted defendant's motion to exclude the testimony of plaintiff's damages expert regarding reasonable royalties for three patents because his application of the Rubinstein bargaining model was unreliable. "⁠[The expert's] method is simply fancy guesswork. . . . Although [his] method is not . . . a rule of thumb or a 50-50 split, [he] does not tether the methodology to the facts of this case. . . . Using [the parties' weighted average cost of capital] as a proxy for patience in the Rubinstein model does not consider the actual stakes in the hypothetical negotiation or even the specific patents negotiated. As a result, [his] model would split the gains in the same way for a fundamental patent at the core of a company's technology and for a piece of technology that the company might consider not at all valuable. . . . It is not that [the expert] chose the wrong [weighted average cost of capital] as an input -- it is that using [weighted average costs of capital] the way he does has no relationship to the patents in this case and cannot reliably show how the parties would negotiate over these patents."

Limelight Networks, Inc. v. XO Communications, LLC et al, 3-15-cv-00720 (VAED February 2, 2018, Order) (Gibney, USDJ)

Monday, February 5, 2018

Denial of Summary Judgment No Basis for Attorney Fees Award Under 35 U.S.C. § 285

The court denied plaintiff's motion for attorney fees under 35 U.S.C. § 285 for defendant's unsuccessful motion for summary judgment under the on-sale bar. "Plaintiff requests attorney fees and costs, asserting that Defendants filed this motion in bad faith. Plaintiff cites 35 U.S.C. § 285, which authorizes a court to award reasonable attorney fees 'to the prevailing party' in 'exceptional cases.'. . . At this point in the litigation, Plaintiff is not a prevailing party. Even if, somehow, the statute could be interpreted as applying to motion practice alone, the denial of Defendants' motion for summary judgment does not alter the legal relationship between the parties."

Morren v. Morren Plastic Molding, Inc. et al, 1-17-cv-00685 (MIWD February 1, 2018, Order) (Maloney, USDJ)

Friday, February 2, 2018

Improper Emergency Motions May Push Case into Exceptional Posture

The court denied plaintiff's emergency motion to strike defendant's previously undisclosed claim construction proposal and warned the parties about improper emergency motions. "The Court reminds the Parties that filing an Emergency Motion before the Court is an extremely disruptive process that represents to the Court that immediate action must be taken in order to prevent material, avoidable harm. . . . The Court analogizes the current situation to [defendant] striking a match to light its cigar while sitting in the balcony of a crowded theater, with [plaintiff] in response jumping to its feet and screaming, 'Fire!' There is no emergency here. . . . Should these Parties ignore the guidance going forward, they may find themselves in a position where the Court feels compelled to issue sanctions and ultimately, they may push this case into a posture of being exceptional."

EnerPol, LLC v. Schlumberger Technology Corporation, 2-17-cv-00394 (TXED January 31, 2018, Order) (Gilstrap, USDJ)

Thursday, February 1, 2018

Willful Blindness Alone Does Not Show Egregious Behavior Necessary for Willful Infringement Claim

The court granted defendant's motion for summary judgment that it did not willfully infringe plaintiff's condom patents because plaintiff failed to establish egregious behavior pre- or post-suit. "⁠[A]t oral argument, [plaintiff] agreed that willful blindness at most establishes 'knowledge,' rather than egregious behavior. . . . [I]nsofar as willful blindness does apply in willful infringement cases, it only substitutes for actual knowledge, as opposed to egregious behavior. Because a party's pre-suit knowledge of a patent is not by itself sufficient to show egregious behavior, willful blindness is also not sufficient. . . . [Plaintiff] does not allege that [defendant] had knowledge of, or was willfully blind to, the patents-in-suit at the time [plaintiff] alleges [defendant] failed to comply with [its patent clearance] internal policy. This is the only conduct which could conceivably raise a disputed issue of material fact about [defendant's] willfulness. Therefore, [plaintiff's] allegations of willful infringement rely on actions taken when the prerequisite of knowledge is missing."

Ansell Healthcare Products LLC v. Reckitt Benckiser LLC, 1-15-cv-00915 (DED January 30, 2018, Order) (Andrews, USDJ)