Expert Testimony Based on Press Releases and Promotional Materials Excluded as Unreliable

The court granted defendant's motion in limine to exclude the testimony of plaintiff's internet advertising expert and the related opinions of plaintiff's damages expert. "[The internet advertising expert] concluded that Automated Browsing System ("ABS") advertising increases Click Through Rates ("CTR") an average of 33% over static advertising. [The expert] bases this conclusion on eleven internet sources . . . . Statistical information in press releases and other promotional materials is of doubtful reliability. . . . I only have to consider that the five sources have a wide spread (21% to 68%), which one would not expect if they were accurately measuring the same thing. I also consider that the 'statistics' have nothing approaching a sufficient explanation of what they are purporting to measure. There is nothing approaching an explanation of the circumstances surrounding the measurements. The measurements themselves are described imprecisely, and it is apparent that [plaintiff's expert] does not, for the most part, know what the measurement actually measured. Garbage in, garbage out. . . . [The expert's] underlying data was unreliable, and was unreliably applied, and I therefore exclude his testimony and any testimony for which it forms a foundation."

Robocast Inc. v. Apple Inc., 1-11-cv-00235 (DED January 28, 2014, Order) (Andrews, J.)

Do 35 U.S.C. § 285 awards effectively deter litigation abuse?

As policy makers continue to discuss patent reform, commentators have opined that 35 U.S.C. § 285 does little to rein in unscrupulous litigation tactics because judges rarely impose the penalty.

A frequently cited statistic supporting this view states: “There were only six awards granted between January 1, 2010, and December 31, 2012 on contested, patent-specific judgments . . . where the judgment was predicated on litigation misconduct or frivolous, bad faith litigation . . .”

Docket Navigator data reflects a much higher number.
Click to see Docket Navigator's results.

Serial Litigation Strategy Resulting in Licensing Fees Below Litigation Costs Does Not Render Case Exceptional

Following a jury trial, the court denied defendants' motion for attorneys’ fees under 35 U.S.C. § 285 and rejected the argument that plaintiffs engaged in vexatious litigation conduct. "Defendants assert that [plaintiff's] business model is based on serial litigation intended to extract licensing fees below the cost of defending litigation. . . . Defendants may not agree with [plaintiff's] alleged licensing framework, but they fail to show that it has been used vexatiously against either [of them]. During license negotiations, sound business practice counsels considering litigation costs during negotiations, whether explicitly or implicitly. . . . Although Defendants provided some troubling evidence that [plaintiff] had a policy of using repeated and vexatious litigation to secure patent licenses, Defendants have failed to provide evidence that [plaintiff] acted in subjective bad faith by actually implementing that policy against [them]."

WI-LAN Inc. v. Alcatel-Lucent USA Inc., et al., 6-10-cv-00521 (TXED January 28, 2014, Order) (Davis, J.)

Stay Pending CBM Does Not Require “Threshold” Determination of Ripeness

The court granted defendant's motion to stay pending CBM review where defendant's petition for review was pending. "[Plaintiff] has suggested that there is a threshold question regarding whether the Motion for Partial Stay is ripe for review given that the PTO has not yet granted [defendant's] petition. While the Court does not find that this is a threshold issue, it can be considered in reviewing each of the four factors. Given, however, the probability that the claims will be heard, the Court does not find the fact that the petition has not yet been granted to weigh heavily against a stay."

Unwired Planet, LLC v. Google, Inc., 3-12-cv-00504 (NVD January 27, 2014, Order) (Du, J.)

Customer Suit Stayed Provided Customers Agree to Invalidity Estoppel

The court granted defendants' motion to stay plaintiff's infringement actions pending a nonparty manufacturer's declaratory relief action against plaintiff, but only as to the defendants who agreed to be bound by any invalidity decision in the manufacturer case. "I would have to be willfully blind not to understand that it is a significant tactical advantage for Plaintiff to be herding twenty-one defendant cats, and that it would significantly alter the tactical landscape if the defendants are able to sit on the sidelines and let their champion, [the manufacturer], do battle. . . . The theoretical reason for staying 'customer cases' is that the manufacturer is in a better position, and has a greater interest, in defending its product. The concept is a little more complicated here, because [the manufacturer] does not sell a product that the customers resell. Rather the claim is that the customers use the product, and perhaps modify it in doing so, and then make profits from its use in their diverse business operations. . . . [I]t seems to me that if I am going to force [plaintiff] to forego chasing its preferred targets, [plaintiff] ought to get something concrete out of it, which would also offer a better chance of locking in the simplification that could result from [the manufacturer] going first. In that regard, I think the defendants ought to get one shot at invalidity, and, if they are willing to have [the manufacturer] take that shot, then I believe that the balance tips in favor of granting a stay."

Infinite Data LLC v. Amazon.com Inc., 1-12-cv-01616 (DED January 24, 2014, Order) (Andrews, J.)

Patent May be Subject to CBM Review With Only One Claim Directed to Covered Business Method

In a Final Written Decision, the Board rejected the patent owner's argument that "the Board must conduct a claim-by-claim analysis and determine that every challenged claim is directed to a covered business method, before it is authorized . . . to review all of the challenged claims." "[The patent owner] asserts that the Board exceeded its 'statutory authority to institute review of any patent claim which the Board has not determined to be directed to a covered business method.' [Patent owner's] argument is based on an erroneous statutory construction that interprets the word 'patent' in the statutory provision on what is subject to review as 'claim.' We decline to adopt such an interpretation. . . . [W]hen specifying the subject matter for review, Congress could have used the language 'a claim that is directed to a method or corresponding apparatus' rather than 'a patent that claims a method or corresponding apparatus.' Section 18(d)(1) of the AIA sets forth a single threshold based on just one claim—the satisfaction of which qualifies an entire patent as eligible for review—rather than a test that must be applied on a claim-by-claim basis to justify review of each claim. Therefore, a patent is eligible for a covered business method patent review if the subject matter of at least one claim is directed to a covered business method."

Petition for Covered Business Method Patent Review by Liberty Mutual Insurance Company, CBM2012-00002 (PTAB January 23, 2014, Order) (Chang, APJ)

No Stay Pending IPR Given Coordinated Schedule for Multiple Related Cases

The court denied defendant's motion to stay pending inter partes review because the lack of potential simplification of issues, stage of the case, and undue prejudice to plaintiff weighed against a stay. "[A] stay is not likely to simplify this case or, more importantly, the overall collection of 13 related cases pending in this District, at least some of which involve the same patents-in-suit as the instant matter. . . . [A]ny PTAB proceeding may not be completed [for a year and a half], whereas in this litigation the Court has devoted substantial resources to working out a coordinated schedule (which has been entered today) of the 13 related cases, which includes a motions hearing later this month and a two-day Markman hearing in [ten months]. . . . [T]he purported prejudice to [defendant] of having to litigate in the PTAB and this Court is entirely the result of [defendant's] decision to file the petition for IPR."

Clouding IP LLC v. SAP AG, et al., 1-13-cv-01456 (DED January 21, 2014, Order) (Stark, J.)