Posted On: October 31, 2006

Judge Kent Jordan Denies "Meritless" Cross-Motions for Summary Judgment

<%media(20061031-Ampex Inequitable conduct SJ opinion.pdf|Ampex Corp. v. Eastman Kodak Co., C.A. No. 04-1373-KAJ (D. Del. Oct. 30, 2006))%>

In this decision, Judge Jordan denied both parties' cross-motions for summary judgment regarding inequitable conduct. The Court reasoned that because the materiality of the prior art references and the intent of the patentee are "hotly contested," summary judgment was inappropriate on the present record.

Judge Jordan went on in this opinion to make some general comments about motions for summary judgment. He stated: "Here, as sometimes happens, the parties have moved for summary judgment when it is plain that neither side can meet the requirements of Rule 56." <%media(20061031-Ampex Inequitable conduct SJ opinion.pdf|Op. at 3.)%> Describing the cross-motions as "meritless," Judge Jordan was perplexed that Ampex listed thirty-seven disputed issues of fact when opposing the other side's summary judgment motion, but then filed its own motion for summary judgment that there was no inequitable conduct. <%media(20061031-Ampex Inequitable conduct SJ opinion.pdf|Id. )%>

The lesson from this case is to make sure your arguments to the Court on an issue are consistent, if possible. In addition, litigants in Delaware should carefully decide whether to present arguments to the Court on summary judgment (especially in bench trials), for fear of losing the Court's confidence and agitating the Court.

Posted On: October 30, 2006

New District of Delaware Filings

10/24/06: Southwest Airlines Co. v. Applied Interact LLC, Intertech Holdings, LLC, Response Reward Systems, L.C.

Posted On: October 27, 2006

Transfer GRANTED!

The District Court, in a rare occurrence, granted a motion to transfer to the Eastern District of Wisconsin. <%media(20061027-Alloc v. Unilin (03-253-GMS).pdf|Alloc, Inc. v. Unilin Decor N.V., C.A. Nos. 03-253, 05-857 (D. Del. Oct. 26, 2006) (Sleet, J.))%>.

The Court seemed persuaded to transfer these cases because related litigation was already pending in Wisconsin between the same parties and involving the same patents. Discovery in that litigation had already begun and the litigation was well underway.

Although related litigation does not always buy your ticket to transfer, in this case (along with the fact that there was very little connection to Delaware other than some of the parties' incorporation here) it seemed enough.

Posted On: October 27, 2006

Delaware Judge Refuses to Construe Disputed Terms of "Academic Interest"

Is there a limit to the number of claims a district court will construe? Yesterday, a Delaware District Judge issued a claim construction opinion addressing that question. The Court, faced with the prospect of interpreting ninety-nine claim terms, sua sponte limited the scope of its opinion:

While a general interest in the terms of the patent is understandable, I cannot, consistent with my judicial responsibilities, answer questions that may be of no more than academic interest. Therefore, I have endeavored to construe only those terms that, based on the papers submitted, appear to be dispositive of issues brought to my attention. Ampex Corp. v. Eastman Kodak Co., C.A. No. 04-1373-KAJ, Memo. Op. at 1, n.1 (D. Del. Oct. 26, 2006). Given the increased awareness of Federal Circuit reversal rates of multi-claim decisions, perhaps the Court's action is a signal to the bar - the less claims, the better.

Ampex Corp. v. Eastman Kodak Co., C.A. No. 04-1373-KAJ, Memo. Op. (D. Del. Oct. 26, 2006).

Posted On: October 26, 2006

Philips Awarded Fees and Costs on Second Try

<%media(20061026-Philips.pdf|Philips Electronics N.A. Corp. v. Compo Micro Tech, Inc.)%>, C.A. No. 02-123-KAJ (D. Del. Oct. 23, 2006)

Judge Kent Jordan granted Philips Electronics' request for $285,690.44 in costs and $2,448,750 in fees. After finding the case exceptional under § 285 in March 2005, the Court required Philips to submit documentation in support of its request for fees and costs. Philips' first submission, however, was inadequate in the Court's eyes, and the Court required Philips to submit further documentation to "support the total number of hours worked, when the hours were worked, and what was done by whom during those hours." <%media(20061026-Philips.pdf|Op. at 1)%>. The Court then granted the request for costs and fees after Philips� second submission. Philips was represented by Sullivan and Cromwell, and locally by Potter Anderson and Corroon.

Of particular interest in this case is the way that Sullivan and Cromwell broke down their fees between multiple patents and multiple defendants. In this regard, the Court approved of Sullivan�s narrowing of fees as described on pages 5 through 8 of the Order. The Court did not allow recovery of expert witness fees, ambiguous copying and scanning costs, or �miscellaneous� expenses. However, the Court did allow Sullivan and Cromwell to use the rates charged by other highly-regarded New York City firms when calculating a reasonable hourly rate, instead of using the rates charged by Delaware firms (which, incidentally, are a bargain!).

In case you were wondering, the billing records and timesheets submitted to the Court were done so under seal. Darn. But the Bill of Costs can be found <%media(20061026-philips bill of costs.pdf|here)%>.

Posted On: October 23, 2006

New District of Delaware Filings

10/16/06: Aventis Pharma S.A. v. Baxter Healthcare Corp.
10/17/06: TriStrata Technology, Inc. v. Jeunique Int'l Inc., et al.
10/17/06: TriStrata Technology, Inc. v. Louise Bianco Skin Care, Inc.,
et al.
10/17/06: Kremers Urban, LLC and Schwarz Pharma Mfg., Inc. v.
Braintree Laboratories, Inc.
10/20/06: TriStrata Technology, Inc. v. Active Organics, Inc., et al.
10/20/06: TriStrata Technology, Inc. v. Emulgen Laboratories, Inc., et al.
10/20/06: TriStrata Technology, Inc. v. Purac America, Inc.

Posted On: October 20, 2006

Delaware Judge Rejects "Champertous" Assignment Argument

Yesterday, Chief Judge Sue L. Robinson issued an interesting decision addressing the ability of what is alleged to be a straw plaintiff's attempt to prosecute (and fund) an infringement action on behalf of another. The defendants KBC and others claimed that plaintiff was assigned rights to the patent-in-suit solely "to fund and pursue this suit" on behalf of the non-party assignor, who KBC contended was an indispensable party. According to KBC, such an assignment is "champertous and void."

The Court rejected this argument based on a supplemental brief filed by plaintiff that contained affidavits of the non-party assignor and the original inventors. In those affidavits, the non-parties agreed to be bound by the instant litigation and to refrain from initiating any other actions against the same defendants. The Court found this statement constituted a renunciation of any residual rights to the patent.

Thus, when pursuing or facing a 12(b)(7) motion, an assignor's (or would-be assignor's) testimony can be dispositive.

LP Matthews LLC v. Bath & Body Works Inc. et al., C.A. No. 04-1507-SLR (D. Del. Oct. 19, 2006) (Robinson, C.J.)

Related Opinions Issued Yesterday:

LP Matthews - Claim Construction
LP Matthews - SJ-Infringement
LP Matthews - SJ on Invalidity and Inequitable Conduct

Posted On: October 17, 2006

Judge Sue L. Robinson: Reference Posted To FTP Site Found To Be 102(b) "Publication"

In SRI Int'l Inc. v. Internet Security Sys., Inc., C.A. No. 04-1199-SLR, Memo. Op. (D. Del. Oct. 17, 2006), Chief Judge Robinson granted defendants' motion for summary judgment on invalidity, finding all of the claims at issue anticipated separately by two references. The more interesting of the two references was posted on an FTP (file transfer protocol) Internet site. In determining whether the reference was a "printed publication" under 102(b), the court looked to the Hall decision and its progeny. The court found that the FTP site was publicly accessible, the address of the site was distributed to members of the art in both presentations and via e-mail, the site was commonly referenced by individuals on Google Groups, and the site was referenced on an online newsgroup. In light of these findings and the court's interpretation of sufficient "indexing" of the reference such that members of the public could locate the paper on the FTP site, the court held the claims at issue invalid and entered judgment in defendants' favor.

Continue reading " Judge Sue L. Robinson: Reference Posted To FTP Site Found To Be 102(b) "Publication" " »

Posted On: October 17, 2006

Transfer Denied Even Where Similar Litigation Pending in Another District

To potential defendants BEWARE if you want to bolster your argument for transfer and you believe that some key witnesses will be former employees, be prepared to make a demonstration in your transfer briefs that they will be unwilling to testify voluntarily or that you cannot get their information in some other fashion. And know that if you are incorporated here in Delaware, and choose to reap both the legal and business benefits of being incorporated in this state, that you should expect to litigate here and there will be little sympathy for your motion to transfer elsewhere. Even similar litigation between the parties elsewhere may not be enough!

The District Court once again gave deference to plaintiff's choice of forum and refused to transfer a patent infringement case to the Northern District of Georgia where other litigation between the same parties is pending. Nice Systems, Inc. and Nice Systems, Ltd. v. Witness Systems, Inc., C.A. No. 06-311 (D. Del. Oct. 12, 2006) (Farnan, J.). The Court applied the Jumara factors (Jumara v. State Farm Ins. Co., 55 F.3d 873 (3d Cir. 1995)) including six private interest factors and six public interest factors in reaching its conclusion. Both parties in this case are incorporated in Delaware and the Court stressed that defendant, after choosing to incorporate here, cannot now complain that it is inconvenient to litigate here. In a question that frequently arises in this District, the Court again stressed that employee witnesses are presumed willing to testify at trial and therefore the convenience of current employees will not be part of the analysis. As to former employees, the Court admitted that they may be beyond the subpoena power of the Court, but would not tip the balance to transfer here because the defendant did not make any showing that the former employees would be unwilling to testify voluntarily or that their information was not available in some other way. Finally, even where this case involved some overlap of parties, products and technologies with three cases pending in the N. D. Ga., Judge Farnan concluded this did not weigh in favor of transfer. The cases in Georgia are "at various stages in litigation before three different judges and two of the pending cases have survived a motion to consolidate" and therefore the Court did not feel that transfer would serve the interests of judicial economy. Id. at 7.

Nice Systems, Inc. and Nice Systems, Ltd. v. Witness Systems, Inc.), C.A. No. 06-311 (D. Del. Oct. 12, 2006) (Farnan, J.)

Posted On: October 16, 2006

Is 2007 the Year for Patent Reform?

Conventional wisdom has it that the Patent Reform Act of 2006 is all but dead for the year. But the bipartisan measure, introduced to reform the examination process, among others, may see new life in the coming congressional session, Patently-O reported yesterday.

According to one source, there will be a renewed push in 2007 to pass the legislation, which has languished in some form or another for the past several years. "The Coalition for Patent Fairness," headed in part by several attorneys whose lobbying resume includes 1995's Private Securities Litigation Reform Act, hopes this time around will be different.

To see the reform article and the services, technology, telecommunications and energy companies that comprise the coalition, click here.

Posted On: October 12, 2006

New District of Delaware Filings

10/11/2006: Transmeta Corp. v. Intel Corp. (patent infringement)
10/13/2006: Rembrandt Technologies, LP v. Cablevision Sys. Corp. and CSC Holdings, Inc. (patent infringement)

Posted On: October 10, 2006

This Just In…Jury Finds Fairchild Semiconductor Int'l Inc. Willfully Infringed Power Integrations, Inc.'s Patents

A jury handed down its verdict today in the case of Power Integrations, Inc. v. Fairchild Semiconductor Int'l Inc. (C.A. No. 04-1371) finding that the defendant willfully infringed U.S. Patent Nos. 6,249,876, 6,107,851, 6,229,366 and 4,811,075. Plaintiff was awarded lost profit and reasonable royalty damages in the amount of $33,981,781.00.

Posted On: October 10, 2006

New District of Delaware Filings

10-10: Ciba Specialty Chemicals Corp v. 3V, Inc. (Declaratory judgment, patent)
10-10: Valeo v. CIF Licensing, dba GE Licensing (Declaratory judgment, patent)

Posted On: October 10, 2006

Alza and Impax Stipulate to Dismissal

Judge Joseph Farnan signed a stipulated dismissal in Alza Corp. v. Impax Labs. Inc., C.A. No. 05-642 (D. Del. Oct. 10, 2006) (Farnan, J.) today. This brings to an end litigation between these two parties that began in September 2005.

Alza Corp. v. Impax Labs. Inc., C.A. No. 05-642 (D. Del. Oct. 10, 2006) (Farnan, J.)

Posted On: October 10, 2006

Questions of Law and Fact Do Not Mix

A Delaware judge has issued a decision highlighting the sometimes overlooked distinction between issues of law and fact in the patent realm. In a decision released last week, the Court rejected an attempt to revisit an earlier claim construction of the term "MOS transistor" - or metal oxide transistor. The Court held that defendant's proposed construction was rendered moot because it raised the issue of the doctrine of equivalents, a theory of infringement plaintiff did not choose to pursue.

The decision resolves some uncertainty generated by the Court's earlier claim construction opinion, in which it declined to address a similar argument by defendant. There, the Court noted that the defendant's proposed construction involved a related component - a "DMOS transistor" - that the patent-in-suit did not claim and that would be relevant only to a claim under the doctrine of equivalents. Emphasizing that claim construction is a purely legal exercise, the Court refused to inject the factual issue of equivalence into its Markman discussion.

It seems that regardless of the effect an unclaimed term will have on the actual claims, as defendant unsuccessfully argued here, the legal exercise of claim construction will not intrude on the factual turf of the doctrine of equivalents.

Power Integrations Inc. v. Fairchild Semiconductor Int'l Inc., 2006 U.S. Dist. LEXIS 72718 (D. Del. Oct. 5, 2006).

Posted On: October 9, 2006

"Legal Right" and Not "Practical Ability" Required to Compel Party to Produce 3rd Party Documents

As a party to the litigation, what type of third party documents are considered within my "control" for Rule 34(a) purposes? This is the question that Magistrate Thynge answered in the recent decision of Inline Connection Corp. v. AOL Time Warner Inc., et al., C.A. No. 02-272-MPT, 2006 U.S. Dist. LEXIS 72724 (D. Del. Oct. 5, 2006).

The Court reaffirmed that the District of Delaware does not apply the "practical ability" test set forth by the Second Circuit, but instead will only consider documents to be within a party's "control" if they have a legal right to obtain the documents. Magistrate Thynge distinguished the Third Circuit opinion of Mercy Catholic Med. Ctr. v. Thompson, 380 F.3d 142 (3rd Cir. 2004) where the Court did apply the "practical ability" approach. In that case the relationship between the party litigant and the third party was that of a principal and agent and not between two independent corporations. The test may also be different should the parties have a parent-subsidiary relationship. The take-away message…if you don't believe the party-litigant to have the legal right to obtain the documents you need, make sure to subpoena that third party before the fact discovery cut-off.

Inline Connection Corp. v. AOL Time Warner Inc., et al., C.A. No. 02-272-MPT, 2006 U.S. Dist. LEXIS 72724 (D. Del. Oct. 5, 2006)

Posted On: October 9, 2006

Claim Construction and Summary Judgment Decision on Anthracycline Glycoside Patent

In Pharmacia & Upjohn Co. v. Sicor Inc. & Sicor Pharms., Inc, C.A. No. 04-833 (D. Del. Aug. 17, 2006) (Jordan, J.), the District Court construed the following terms in the context of a pharmaceutical patent for a ready to use form of anthracycline glycoside: "physiologically acceptable," "anthracycline glycolside," "sealed container," and "storage stability." Judge Jordan denied defendant's motions for summary judgment on issues of non-infringement, invalidity for lack of a written description and on anticipation. Plaintiff's motion for summary judgment on anticipation was granted.

Pharmacia & Upjohn Co. v. Sicor Inc. & Sicor Pharms., Inc., C.A. No. 04-833 (D. Del. Aug. 17, 2006) (Jordan, J.)

Posted On: October 9, 2006

European Patent Dispute Between Telecom Giants Heads Back to Delaware Chancery Court

Nokia Corp. v. Qualcomm, Inc.), No. 06-509-JJF (D. Del. Aug. 29, 2006)

Upon a motion to remand filed by Nokia, Judge Farnan remanded this dispute back to the Delaware Court of Chancery, where the suit was originally filed. The court decided whether Nokia's claims arose under federal patent law despite the fact that the claims are for breach of contract. Distinguishing the Federal Circuit U.S. Valves case (that found a federal question existed where interpretation of a patent was necessary to determine rights under a licensing agreement), the court held that interpretation of the patents at issue was not necessary to determine the parties' contractual obligations. The court found that the interpretation of provisions in Nokia's license agreement with Qualcomm depends on whether certain patents are declared "essential" under European Telecommunications Standards Institute (ETSI) procedures. Because the court found that Qualcomm had already voluntarily declared the patents "essential,"; however, no interpretation of the patents was necessary to interpret the license agreement.

Nokia Corp. v. Qualcomm, Inc.), No. 06-509-JJF (D. Del. Aug. 29, 2006)

Posted On: October 6, 2006

Sanofi-Aventis Prevails in Trademark Dispute

Chief Judge Sue Robinson ruled in favor of Sanofi-Aventis in this trademark suit and granted a permanent injunction against defendant's use of the "Advancis" mark. Sanofi-Aventis owned federal registrations for both "Aventis" and "Sanofi-Aventis" (the "Sanofi-Aventis" combination mark was registered after the merger of Aventis and Sanofi-Synthelabo). Sanofi brought claims of trademark infringement, false designation of origin, federal and state trademark dilution, unfair competition, and deceptive trade practices against Advancis. The court, after a lengthy likelihood of confusion analysis, concluded that the relevant consumers were likely to confuse the "Aventis" and "Advancis" marks. The court found in favor of Sanofi on all their claims, except their Federal Trademark Dilution Act (FTDA) claim.

This decision is notable for two reasons: 1) the holding that the combination of marks after a merger does not abandon a mark brought to the merger, nor does it dispose of the goodwill associated with the mark that was brought to the merger (pg. 12) and 2) the court's decision on Sanofi's federal dilution claim would be different under legislation pending the White House's approval (see post below on H.R. 683). As to this second interesting point, we reported on September 29th that amendments to the Federal Trademark Dilution Act had been passed by Congress and were awaiting the President's signature. On October 6, 2006, the President signed this legislation into law. In this case, the court found Sanofi had shown a likelihood of dilution sufficient to satisfy the state dilution claim, but had not shown actual dilution sufficient to satisfy the FTDA under Victoria's Secret. Thus, the change from an actual dilution standard (current law) to a likelihood of dilution standard (H.R. 683) would have enabled Sanofi to prevail on their FTDA claim.

I wonder if prevailing on the FTDA claim would have made any practical difference in this case. I would be interested in anyone's thoughts on this question.

Sanofi-Aventis v. Advancis Pharm. Corp.) C.A. No. 03-1083-SLR (D. Del. Sept. 26, 2006

Posted On: October 4, 2006

New District of Delaware Filings

9-27: Sepracor Inc. v. Dey, L.P. and Dey Inc. (patent infringement)
9-28: American Medical Systems Inc. and AMS Research Corp. v. Celsion Corp. (patent infringement)
9-29: Abbott Labs. and Advanced Cardiovascular Systems Inc. v. Johnson & Johnson Inc. and Cordis Corporation (declaratory judgment)

Posted On: October 3, 2006

Reasonable Apprehension of Suit Remains Even After Ameliorative Correspondence Sent

May a company threatening an infringement action avoid a declaratory judgment action against it by sending ameliorative correspondence after the d.j. action is filed? That was the question a Delaware judge recently rejected in Positec USA Inc. v. Milwaukee Electric Tool Corp.), C.A. No. 05-890 (D. Del. Sept. 25, 2006) (Sleet, J.).

After Milwaukee sent letters to Positec USA and its foreign counterpart indicating that it would commence a patent infringement action against any manufacturers and importers, Positec filed a declaratory judgment action. Milwaukee then sent a letter explaining that the earlier correspondence "was only intended to initiate a dialogue in the hopes of reaching an amicable global business resolution."

Judge Sleet found that the letter came too late to mitigate an apprehension of suit: "The court finds that Milwaukee's attempt, after the commencement of litigation of this lawsuit, to backpedal and 'explain' the real intention of its prior letters belies its assertion that it did not threaten litigation against Positec USA." Slip op. at 6 n.1. That Milwaukee sent the letter to the sister corporation - and not Positec USA - was equally unavailing: Milwaukee's original identification of manufacturers and importers sufficiently threatened litigation to all potential infringement defendants.

The lesson? Be prepared to follow through with your threats.

Positec USA Inc. v. Milwaukee Electric Tool Corp.), C.A. No. 05-890 (D. Del. Sept. 25, 2006) (Sleet, J.)

Posted On: October 2, 2006

Senate Confirmation of Judge Kent A. Jordan Still Pending

The Senate adjourned for its mid-term election break without voting to confirm United States District Judge Kent A. Jordan's nomination to the Third Circuit Court of Appeals. It is not clear when a vote by the full Senate can be expected, although the nomination appears on the Senate Executive Calendar for November 9, 2006. The Senate reconvenes on November 9, 2006 for the introduction of bills.

Posted On: October 2, 2006

Consider Your Bifurcation Options…

A recent case serves as a reminder that potential litigants in this district, and particularly before Judge Farnan, should consider their options in pursuing bifurcation should it be helpful to their case as the Court will be open to various combinations in managing these complex cases.

Judge Farnan recently held on a motion for reconsideration, that it is not a violation of a party's Seventh Amendment right to a jury trial to allow a bifurcated trial first on the issues of infringement and damages and then on the issue of invalidity. Power Integrations, Inc. v. Fairchild Semiconductor Int'l, Inc., et al., C.A. No. 04-1371-JJF (D. Del. Aug. 22, 2006). Although the same evidence may be presented at both trials, the Court followed Federal Circuit precedent in holding that these are not the same issues and therefore they may be presented to separate juries. Of particular note is the fact that willfulness was to be tried with infringement and damages before any decision on invalidity. The Court made a specific note that any potential problems in the damages calculation could be rectified by the jury verdict form or if necessary a recalculation by the court after the trial on invalidity.

On a procedural side note, the Court found that the defendants' motion for reconsideration was not untimely, as the timing set forth in Local Rule 7.1.5 begins when the order is entered onto the Court's docket (not when signed or orally entered). Therefore, when filing a motion for reconsideration, begin your 10 day countdown on the day of the entry on the Court's docket.

Power Integrations, Inc. v. Fairchild Semiconductor Int'l, Inc., et al., C.A. No. 04-1371-JJF (D. Del. Aug. 22, 2006)

Posted On: October 2, 2006

"Pilot" Patent Court Legislation Passes House

Late last week, the House of Representatives gave its assent to an experimental program designed to "encourage enhancement of expertise in patent cases among district judges." H.R. 5418, now pending in the Senate, would authorize the director of the Administrative Office of the Courts to designate at least five district courts in three or more circuits to administer the program.

Although individual district judges would sign up to participate, patent cases would remain randomly assigned. If a judge particularly averse to patents receives a case, he or she can decline the assignment. The orphaned case is then randomly reassigned to one of the designated "patent" judges.

With the successes and excesses of patent litigation recently in the news, the question becomes: Is this program, ostentatiously labeled a "pilot program," testing the waters for a separate patent trial court?