Claim for Indirect Infringement by Corporate Family Does Not Require Identification of Entity Responsible for Each Act of Infringement

The court denied defendants' motion to dismiss plaintiffs' induced and contributory infringement claims for failing to sufficiently identify which defendant committed acts of infringement. "Defendants argue that, because the FAC alleges [the parent defendant] to be [a subsidiary defendant's] alter ego, it is impossible to determine which of the three Defendants is responsible for any particular act of indirect infringement. Defendants further argue that the FAC attributes more conducts to each Defendant than each actually perform, e.g., the FAC appears to allege that [the parent] makes the cameras even though [it] does not do so. . . . The FAC alleges specific involvements of each Defendant in its respective role in the [defendant] family of companies. In the light most favorable to Plaintiffs, these allegations provide fair notice to Defendants."

Carl Zeiss AG et al v. Nikon Corporation et al, 2-17-cv-03221 (CACD September 27, 2017, Order) (Klausner, USDJ)

Waiting for Outcome of Rule 12 Motion Waives Objection to Improper Venue

The court denied defendant's motion to dismiss or transfer plaintiff's patent infringement action for improper venue because defendant waived its venue defense by waiting for the outcome of its earlier Rule 12 motion before raising its venue defense. "The rules specifically provide a system in which venue challenges are not available for tactical deployment. A party cannot wait to see how a motion to dismiss on the merits turns out before challenging venue. . . . [Defendant] had several weeks in which to notify the court that it wanted to supplement its pending motions to dismiss. During that time period, [defendant] notified the court of other recent decisions impacting the [35 U.S.C. §101] motion. [Defendant] similarly could have, and should have, notified the court of the [TC Heartland LLC v. Kraft Foods Group Brands LLC, 137 S. Ct. 1514 (2017)] decision if it did not want to waive the venue challenge. By waiting to see how the court would come out on its unpatentability motion, [defendant] waived its venue challenge."

InsideSales.com v. SalesLoft, 2-16-cv-00859 (UTD September 26, 2017, Order) (Kimball, SJ)

Defendant’s Decision to Pursue IPR Bars Pursuit of § 285 Attorney Fees Award

Following inter partes review, the court granted plaintiff's motion to dismiss its patent infringement action and defendant's invalidity and noninfringement counterclaims as moot and rejected defendant's request to allow 90 days of discovery to support its 35 U.S.C. § 285 claim. "Once the [patent] was determined to be unpatentable, the need for a declaratory judgement of invalidity and non-infringement became a moot issue. . . . If the Defendant had desired to conduct discovery to prove the egregious conduct alleged in their response to the Order to Show Cause, they should not have joined in the IPR, nor should they have filed a separate petition for IPR of all claims of the [patent] on the same grounds described in the then-pending IPR. Having chosen to invalidate the [patent] before the USPTO, they cannot now complain that they are denied the ability to avail themselves of this federal forum."

MD Security Solutions LLC v. Protection 1, Inc., 6-15-cv-01968 (FLMD September 26, 2017, Order) (Byron, USDJ)

IPR Estoppel Applies to Prior Art, Not Specific Combinations

The magistrate judge recommended granting plaintiff's motion for summary judgment that IPR estoppel barred defendant from asserting obviousness based on two non-petitioned prior art combinations because defendant reasonably could have raised them during inter partes review. "[Defendant argues] that because it did not disclose the two disputed combinations . . . in its invalidity contentions, and did not do so until after the . . . IPR was over, it is not barred from asserting them today. . . . The legislative history of the statute . . . confirms that Congress intended for estoppel to extend to 'prior art,' rather than to just 'combinations.'. . . Although [defendant] did not assert the specific combinations of prior art references that it now seeks to assert at trial, [defendant] knew that the [underlying] references existed, at least eight months before filing its IPR petition. Yet, [defendant] chose not to raise the specific references before the PTAB. . . . [A]llowing [defendant] to raise arguments that it chose not to raise during IPR, would give it the proverbial 'second bite at the apple,' by allowing it to enjoy the pros of IPR without risking the cons of estoppel."

Network-1 Security Solutions, Inc. v. Alcatel-Lucent USA Inc., et al, 6-11-cv-00492 (TXED September 25, 2017, Order) (Mitchell, MJ)

No Enhanced Damages for Willful Infringement Leading to HCV Cure

Following a jury verdict of willful infringement, the court denied plaintiff's motion for enhanced damages because plaintiff failed to establish the need for a punitive sanction or deterrence. "While the Court does not, of course, 'bless' the type of underhanded corporate piracy the jury implicitly found [defendant] committed, given that the result of that misconduct is a cure for a potentially-fatal disease afflicting millions of people around the world, and given that the jury's damages award is already the largest damages verdict ever returned in a patent trial (compensating [plaintiff] for what it lost), additional sanction is just not warranted. . . . The Court cannot confidently state that it should wish to deter the conduct the jury implicitly found [defendant] committed. . . . Here, without both parties' contributions, humanity may well have been deprived of a cure for HCV. Under the totality of circumstances, society's interest in deterrence of willful patent infringement does not justify enhancing damages here."

Idenix Pharmaceuticals LLC et al v. Gilead Sciences, Inc., 1-14-cv-00846 (DED September 22, 2017, Order) (Stark, USDJ)

Expert Testimony Concerning Mental Thought Processes of Examiner Excluded

The court granted defendants' motion to exclude the testimony of plaintiff's patent law expert regarding what a patent examiner would have done under different facts because it was unreliable speculation. "Defendants . . . seek to exclude portions of [the expert's] Report that discuss whether an examiner would have considered certain evidence, if presented, what an examiner would have done under an alternative set of facts, all as unreliable speculation. . . . In Barry v. Medtronic, the court excluded similar testimony under Rule 702: . . . '[the expert’s] resume fails to establish his education, training, or experience in the field of retroactive mind reading of the thoughts of patent examiners.' . . . Plaintiff’s argument that such opinions are supported by substantial evidence and reasoned analysis does not change the fact that they are intrinsically impermissible. [The expert] may not opine about the mental thought processes of a PTO examiner."

Network-1 Security Solutions, Inc. v. Alcatel-Lucent USA Inc., et al, 6-11-cv-00492 (TXED September 21, 2017, Order) (Mitchell, MJ)

Data Compression Patent Not Invalid Under 35 U.S.C. § 101 at Pleading Stage

The magistrate judge recommended denying defendant's motion to dismiss on the ground that plaintiff’s data compression patent encompassed unpatentable subject matter because the asserted claims were not directed toward an abstract idea. "The [patent] is directed to patent eligible subject matter because it discloses a specific improvement in computer capabilities: a system for an improved data compression technique. . . . [C]laim 1 of the [patent] is not simply encoding and decoding. It improves typical data compression by compressing the data stream through content dependent and independent data recognition, as well as a plethora of encoders to achieve its maximum compression. This results in real-time or pseudo-real-time compression."

Realtime Data LLC d/b/a IXO v. Carbonite, Inc. et al, 6-17-cv-00121 (TXED September 20, 2017, Order) (Love, MJ)