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In Motivation Innovations LLC v. Ulta Salon Cosmetics & Fragrance Inc., Civ. No. 11-615-SLR (D. Del. July 22, 2014), Judge Sue L. Robinson considered defendant’s motions for summary judgment of invalidity, non-infringement, and a Daubert motion to preclude plaintiff’s expert.

Having construed the means-plus-function claims in its order issued on the same day, the Court denied the motion for summary judgment of invalidity as to indefiniteness. Id. at 3-4. The Court also found that defendant had not shown that the claims were anticipated; its argument did not refer to expert testimony and was “superficial.” Id. at 4.

As to the Daubert motion, defendant pointed to the expert’s “lack of formal education,” but the Court pointed out that this expert had 38 years of experience in the relevant field and concluded that the expert was sufficiently qualified.  Id. at 8. The Court did exclude this expert’s testimony to the extent it was incompatible with the Court’s construction. Id. At 10. Examining the expert’s non-excluded testimony as to infringement and in light of the Court’s construction, the Court disagreed with the expert’s infringement analysis and granted motion for summary judgment on the basis of no literal infringement.  Id. at 11, 13.   The Court also granted the motion as to non-infringement under the doctrine of equivalents. Id. at 16.

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Judge Andrews recently considered defendants’ motion for leave to file an amended answer to add an inequitable conduct defense.  Unimed Pharms., LLC, et al., v. Perrigo Co., et al., C.A. No. 13-236-RGA (D. Del. July 23, 2014).  The proposed amended answer essentially alleged that the inventors and attorneys made inconsistent statements to the PTO during prosecution and to the Court during litigation.  Id. at 2.  Judge Andrews evaluated the allegedly inconsistent statements and found that they merely reflect different conclusions resulting from the application of different legal standards, but, in any event, defendants failed to demonstrate that the statements “support a reasonable inference by any particular individual of specific intent to deceive.”  Id.  Judge Andrews noted that “[e]ven if the inventors and/or applicants were aware of these ‘inconsistent’ statements, I do not find it plausible that they would recognize that the statements were inconsistent, and knowing that, intentionally fail to point them out, with intent to deceive the PTO.”  Id.  Judge Andrews also noted that while the amended answer painted “a detailed picture of the alleged inequitable conduct, . . . length (about 55,000 words) is not a substitute for clarity.”  Id.

 

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Judge Robinson recently ordered Amazon.com to submit “relevant time sheets supporting its request for attorney fees for [certain] categories of fees.” Technology Innovations, LLC v. Amazon.com, Inc., C.A. No. 11-690-SLR, Memo. Or. at 1 (D. Del. July 23, 2014). We have previously covered the Court’s decision that Technology Innovations (TI) had asserted a claim construction that was not “objectively reasonable” and should pay reasonable attorney fees to Amazon. Judge Robinson ordered Amazon to submit an accounting of its reasonable attorney fees, and additional briefing followed. As Judge Robinson explained, “having determined that attorney fees should be awarded to Amazon for TI’s pursuit of the ‘407 patent, it remains my obligation to confirm that Amazon expended a reasonable amount of time in defending against the ‘407 patent.” Id. at 4.

Judge Robinson then concluded that although there are “difficulties associated with segregating ‘precisely all of the fees and expenses [Amazon] incurred in defending itself against’ the ‘407 patent as opposed to the ‘965 patent,” it was “impossible . . . to discern whether the fees requested are reasonable based on the record presented.” Id. Her Honor therefore ordered Amazon to supplement its submission to include time sheets for work performed by Amazon’s counsel. Id. at 4-5.

These additional submissions were necessary in order to determine which fees were “attributable to the delay in reaching the critical claim construction exercise under [Judge Robinson’s] old scheduling regime and should not be attributed to TI.” Such “‘blended’ litigation efforts vis a vis both patents at issue” were not compensable due to the difficulty in account for them. Id. at 4. Instead, “the only fees appropriately compensable under the sanction are those fees denoted by Amazon as “‘407 specific” . . . and those attributed by Amazon to the ‘407 claim construction exercise.” Id. at 5.

Judge Robinson also denied Amazon’s request to hold TI and TI’s counsel jointly and severally liable for fees. Her Honor explained that she had “never intimated that any sanctions should be imposed against counsel” and “such matters are best left for resolution between a party and its
counsel, unless there is a showing of bad faith on the part of counsel.” Id. at 4-5.

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In Helios Software, LLC, et al. v. SpectorSoft Corp., C.A. No. 12-081-LPS (D. Del. July 18, 2014), Chief Judge Leonard P. Stark addressed plaintiffs’ motion to exclude the testimony of defendant’s expert, Christian B. Hicks, based on discussions that Mr. Hicks had with an employee of defendant that was the Director of Quality Assurance, Scott Bartel. Plaintiffs argued that because of defendant’s “failure to identify Mr. Bartel in its Rule 26 disclosure, and Mr. Hicks’ subsequent reliance on conversations with Mr. Bartel, the Court should exclude the relevant portions of Mr. Hicks’ testimony.” Id. at 2. As Judge Stark noted, the parties met and conferred in an attempt to resolve the dispute, and defendant proposed producing Mr. Bartel for a “3-hour video conference or telephone deposition.” Id. Defendant’s proposal, however, included a number of conditions, including, among other things (i) that the deposition occur at defendant’s office in Vero Beach, Florida where Mr. Bartel works, or at another location in Vero Beach; (ii) “that the deposition be conducted by video conference or telephone” unless plaintiffs advanced the costs and fees for an in-person deposition; (iii) “that the topics of Bartel’s questioning be limited to the subject matter of his discussion with Hicks, and that the deposition could be suspended if Plaintiffs asked questions beyond the scope of such topics and refused to withdraw the questions”; and (iv) that plaintiffs withdraw their motion to exclude. Id. at 3.

Considering the Pennypack factors, Judge Stark concluded that, on balance, defendant’s failure to disclose Mr. Bartel was harmless, and therefore denied plaintiffs’ motion to exclude. Id. at 3-4. However, contrary to a number of the conditions of defendant’s proposal, Judge Stark ordered that defendant shall make “Mr. Bartel available for a three (3) hour deposition on the subject matter that he discussed with Mr. Hicks as well as testing at SpectorSoft, to be conducted at a mutually convenient location, with each party bearing its own costs.” Id. at 4.

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Judge Richard G. Andrews recently considered Sprint’s motion for summary judgment that Comcast’s U.S. Patent No. 6,873,694 is invalid under 35 U.S.C. § 101 for lack of patentable subject matter.  Comcast IP Holdings I, LLC v. Sprint Communications Company L.P., et al., C.A. No. 12-205-RGA (D. Del. July 16, 2014).  The  only asserted claim at issue was claim 21, which claimed:

A telephony network optimization method, comprising:

receiving a request from an application to provide to the application service on a
telephony network; and

determining whether a telephony parameter associated with the request requires
acceptance of a user prompt to provide to the application access to the telephony
network.

Id. at 4.  Judge Andrews agreed with Sprint that “Claim 21 is ‘drawn to the abstract, and fundamental, idea of a conditional decision.’”  Id. at 5. Judge Andrews rejected Comcast’s argument that “‘[t]he claims do not simply recite making a conditional decision, but are narrowly directed to overcoming a specific problem of telephony networks by using telephony parameters to optimize bandwidth allocation on such networks.’”  Id.

Judge Andrews next determined whether the claim contained sufficient limitations restricting the otherwise abstract idea to a particular application.  Id. at 7.  Comcast argued that the claim contained such restrictions because claim 21 is “confin[ed] to the field of telephony.”  Id. at 8.  Judge Andrews disagreed:

Claim 21 merely covers the application of what has for a long time been conducted solely in the mind to modern, computerized, telephony networks. For instance, rather than an “application” requesting “service,” we can think of a “person” requesting a “telephone call.” The “person” makes a request through a telephone operator. The operator then looks to a “telephony parameter” associated with that request. Let us assume that the parameter is whether the call is “collect” or whether it is a standard call. Ifthe call is a standard call, the operator puts it through without a user prompt.2 I f the call is collect, the operator “determines” that the recipient will be asked to accept the charges. The operator has “determined” whether a “request” requires “acceptance of a user prompt.” The only difference is the identity of the requester. Here, the generic references to a telephony network and an application are not sufficient to render the claim patentable.

Id. at 9.

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Chief Judge Leonard P. Stark recently granted a plaintiff’s motion to strike an amended answer and counterclaim, and awarded the plaintiff costs and expenses associated with presenting the motion.  Helios Software, LLC, et al. v. Spectorsoft Corp., C.A. No. 12-081-LPS (D. Del. July 18, 2014).  As the Court explained, it had previously granted the defendant leave to file an amended answer to add a counterclaim asserting inequitable conduct.  That order allowed the defendant to file an amended answer “in substantially the form it has proposed.”  The defendant then filed an amended answer and counterclaim that was “significantly different from the Amended Answer it had proposed to the Court.”  The defendant admitted it violated the Court’s order, and asked the Court to modify that order.  As Chief Judge Stark explained:

The Court is troubled that Defendant intentionally violated the Court’s Order and then asked the Court to modify its decision instead of seeking the Court’s permission before filing its modified pleading.  Defendant could and should have reached out to the Court in the seven-day period that the Court gave Defendant to file its Amended Answer and should have sought leave to file its newly amended pleading.  Because Plaintiffs had to bear the unnecessary cost of filing this motion as a result of Defendant’s conduct, the Court will charge Defendant with Plaintiffs’ reasonable costs and expenses incurred in presenting this motion.

The Court granted the defendant leave to file an amended version of its amended answer and counterclaim, however, in a form that mostly removed the plaintiff’s highly confidential and privileged information contained in its stricken pleading.

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In a recent memorandum order, Judge Sue L. Robinson construed claim terms in U.S. Patent No. 5,612,527, entitled “Discount offer redemption system and method.”  Motivation Innovations LLC v. Ulta Salon Cosmetics & Fragrance Inc., Civ. No. 11-615-SLR (D. Del. July 22, 2014).  The following terms were construed:

  • “[A] circulation medium”
  • “[A]ssociating said identification code with data identifying items which are to be offered at a discount” / “associating said identification code means . . . with data identifying items to be offered at a discount”
  • “[A]ssociating said identification code means with the addressee of the circulation medium and with data identifying items to be offered at a discount”
  • “[A]ddressable by said identification code”
  • “[M]eans for reading said identification code provided with said circulation medium”
  • “[U]sing said code reading means to read the identification code indicia means and to create a data file”
  • “[A]ny discount corresponding to an item listed in said data is deducted from the price of the item in the tabulation”
  • “[P]roviding as part of said identification code identification indicia means on said medium for identifying the addressee of said medium”
  • “[T]he user”
  • “[U]sing each data file . . . as a means to study buying habits of the recipient of the medium”
  • “[M]eans associated with said code reading means for tabulating sales of items so that any discount corresponding to an item listed in said data is deducted from the price of the item in the tabulation”
  • “[M]eans for tabulating items”
  • “[M]eans for tabulating items and for recording the items purchased by the bearer of the circulation medium”
  • “[M]eans for calculating the at least one discount on the item offered at discount by said identification mode”

The parties agreed upon the construction of the following terms:

  • “[U]sing said means for tabulating items . . . to cause a discount to be debited against the purchased item”
  • “[T]he bearer of the circulation medium”

Finally, the Court denied the defendants’ motion to strike the plaintiff’s late asserted claim construction positions, noting that it “is ironic that defendant now seeks to prevent plaintiff from” modifying its claim construction positions when defendants’ submission “expressly stated that it ‘reserve[d] the right to modify the foregoing as discovery is ongoing, and in response to any of [p]laintiff’s proposed terms for construction or proposed constructions.”

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In a recent memorandum opinion, Judge Richard G. Andrews denied defendants’ motion for summary judgment, requesting that the court bar plaintiff’s claims in view of a license and estoppel. Comcast IP Holdings I, LLC v. Sprint Communications Co., et al., C.A. No. 12-205-RGA (D. Del. July 15, 2014). Specifically, defendants contended that they had a license to the asserted patent, either express or implied, “via a licensing agreement between Hewlett-Packard (‘HP’), the original assignee of the patent, and Lucent, the predecessor to Alcatel Lucent,” which manufacturers “many of the devices which [defendants] use[], and which [plaintiff] accuses of performing the patented methods.” Id. at 1, 3.

Judge Andrews denied defendants’ motion for summary judgment, finding that defendants failed to prove that the license at issue covered the asserted patent. Id. at 3. First, Judge Andrews found that the license did not expressly cover the asserted patent, as defendants failed to show that the patent “issued or [had] enforceable rights in any country of the world from an application filed on or before January 31, 2001,” as required by the license agreement. Id. at 3-5. In reaching that determination, Judge Andrews explained that the phrase “issued from” was not intended to include divisional or continuation applications, and that the “enforceable rights in any country” clause referred to “patents which are issued not in any country, but by a transnational body such as the European Patent Office.” Id. at 4-5.

Judge Andrews next found that an implied license, which arises under legal estoppel, did not cover the asserted patent. Specifically, Judge Andrews explained the license agreement “contains a ‘clear indication’ not to extend the license to continuation patents via an implied license.” Id. at 8. Judge Andrews thus concluded that because “the license does not cover continuation patents, [it] therefore does not estop [plaintiff] from asserting the [asserted] patent against [defendants].” Id.

Judge Andrews also addressed whether it would be appropriate to grant summary judgment in favor of plaintiff without plaintiff having filed such a motion. Id. at 8-9. Judge Andrews concluded that while the “Federal Rules of Civil Procedure allow me to grant summary judgment sua sponte, . . . they do not require me to do so.” Id. at 9. Given that the record was not “sufficiently developed,” Judge Andrews “decline[d] to grant summary judgment in [plaintiff’s] favor.” Id. at 8-9.

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Judge Robinson recently considered defendants’ motions to amend their answers in a patent infringement case to include counterclaims of false marking, false advertising, deceptive trade practices, and unenforceability due to inequitable conduct. Judge Robinson concluded that the motions to amend should be denied with the exception of one defendant’s motion to add an inequitable conduct counterclaim, which was granted. Cot’n Wash, Inc., et al. v. Henkel Corp, et al., C.A. No. 12-650-SLR, Memo. Op. at 18 (D. Del. July 11, 2014).

Judge Robinson first considered whether the delay in seeking to amend was undue. Because the two defendants had been in possession of the evidence forming the basis of its false marking, false advertising and deceptive trade practices claims since May 2013 and June 2013 but did not contact the plaintiff until October 2013 and then did not file motions to amend until late January and early February 2014, Judge Robinson found that the delay was undue. With respect to inequitable conduct, however, Judge Robinson found that defendant Sun had waited only one week after obtaining relevant information to raise it with the plaintiff. This did not constitute inequitable conduct. Id. at 9-10.

Judge Robinson next considered the prejudice to plaintiff from the amendments. With respect to the proposed false marking, false advertising and deceptive trade practices claims, Judge Robinson found that the plaintiffs would be prejudiced by the amendment because, although the plaintiffs had been in possession of the relevant evidence, they “did not have the opportunity to review and vet this evidence for discovery purposes in the context of false marking claims.” By contrast, the plaintiffs had agreed to stipulate to inequitable conduct claims “nearly identical” to those proposed by defendant Sun in two related cases in August 2013 and Sun had asserted the underlying claims in August 2013, so the plaintiffs had “adequate opportunity to take discovery on the relevant issues” and were not prejudiced. Id. at 10-11.

Finally, turning to futility of amendment, Judge Robinson found that the false marking allegations failed to state a claim and would therefore be futile but the inequitable conduct claims were adequate and not futile. With respect to false marking, there were not sufficient allegations that the plaintiffs had the requisite intent to deceive nor that the defendants had suffered competitive injury. Id. at 12-16. With respect to inequitable conduct, however, Judge Robinson found that the proposed amendment would not be futile, because defendant Sun had properly pled inequitable conduct under Exergen. Sun alleged that the patent applicants had failed to disclose an inventor of the patent-in-suit, failed to disclose that inventor had publicly demonstrated the invention more than one year prior to filing, and failed to disclose pieces of relevant prior art. These allegations properly pled the “who, what, when, where, and how” of the misrepresentation or omission to the PTO. Thus, Sun’s inequitable conduct amendment was not futile and was allowed. Id. at 16-18.

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In Pragmatus Telecom, LLC v. AT&T, Inc., et al., C.A. No. 12-1533-RGA (D. Del. July 7, 2014), Judge Andrews recently ordered each defendant to reduce the number of prior art references it was asserting to 5 per patent.  The plaintiff was also ordered to reduce the number of claims it was asserting to 8.  In a handwritten footnote, Judge Andrews explained that “upon a showing of diligence, and with due consideration for prejudice, a party may seek to modify this order for good cause shown.  A failure to seek such modification will constitute acquiescence to the limits contained in this Order.”

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