Posted On: August 28, 2008

Sue L. Robinson: Unclear Record Precludes Anticipation, Obviousness Findings

In another example of the difficulty of obtaining summary judgment in Delaware, district judge Sue L. Robinson has refused to invalidate a network-security patent on the grounds of anticipation and obviousness. By doing so, the Court also highlighted the importance of presenting one's case on summary judgment.

Examining the allegedly anticipating prior art, the Court concluded that "arguabl[e]" differences of scale created an "unclear" record. In a footnote, the Court then equated this lack of clarity with a failure to satisfy the controlling clear-and-convincing standard of review. As a result, the Court declined "to find through a motion practice" that the prior art anticipated the patent-in-suit. For substantially the same reasons, the Court also rejected the obviousness contention.

The import of the decision? When arguing (or defending) invalidity, an essential part of the litigation strategy includes mitigating (or creating) doubts in the Court's mind about the prior art.

SRI Int'l Inc. v. Internet Security Systems, C.A. No. 04-1199-SLR (D. Del. Aug. 21, 2008) (Robinson, J.).

Posted On: August 19, 2008

New District of Delaware Intellectual Property Case Filings

7/29: Softspikes LLC, Pride Manufacturing LLC v. MacNeill Engineering Company Inc. (patent infringement)
7/29: Trisport Ltd. Greenkeepers of Delaware LLC and Greenkeepers Inc. (patent infringement)
7/30: CRS LLC v. Napster LLC (patent infringement)
7/30: CRS LLC v. Bittorrent Inc. (patent infringement)
8/6: Boston Scientific Corporation and Boston Scientific Scimed Inc. v. Wall Cardiovascular Technologies LLC (patent infringement)
8/8: Purdue Pharma Products LP, Napp Pharmaceutical Group Ltd., Biovail Laboratories International SRL and Ortho-McNeil Inc. v. Impax Laboratories (patent infringement)
8/8: Aventis Pharma S.A. and Sanofi-Aventis US LLC v. Apotex Inc. and Apotex Corp. (patent infringement)
8/11: Sun Microsystems Inc. v. Versata Inc. (patent infringement)
8/13: ING Bank fsb and ING Direct Bancorp v. PNC Financial Services Group Inc., PNC Bank Delaware and PNC Bank National Association (trademark infringement)
8/13: Janssen Pharmaceutica NV, Ortho-McNeil-Janssen Pharmaceuticals Inc. and Synaptech Inc. v. Sandoz Inc. (patent infringement)
8/13: Uship Intellectual Properties LLC v. Pitney Bowes Inc. and NCR Corporation (patent infringement)
8/15: Fifth Market Inc. v. CME Group Inc. and Chicago Mercantile Exchange Inc. (patent infringement)
8/15: Purdue Pharma Products LP, Napp Pharmaceutical Group Ltd., Biovail Laboratories International SRL and Ortho-McNeil Inc. v. Impax Laboratories (patent infringement)

Posted On: August 15, 2008

Sue L. Robinson: "Small, Regional" Defendants Win Transfer to D. Ariz.

In an unusual outcome in the District of Delaware, a transfer motion has been granted. In a recent opinion, district judge Sue L. Robinson found that two affiliated defendant-companies, both located in Arizona, had overcome the strong presumption in favor of a plaintiff's choice of forum. The winning argument? Defendants' statement that, with only twelve employees and officers, litigating in Delaware potentially could result in the firms' failure:

"According to defendants, the absence of these officers and/or employees from their employment would be incredibly damaging to [its] nascent business operations and could possibly result in the business losing substantial revenue and/or failing. . . . In sum, defendants present themselves as small, regional businesses; weighing the convenience of the parties under the circumstances of record, the court agrees that maintaining the litigation in Delaware presents significant hardships to defendants."

Defendants often unsuccessfully assert inconvenience based on a lack of employees or records located in Delaware. This case is a rare example of the circumstances in which hardship stemming from location alone drives the transfer analysis.

L'Athene Inc. v. EarthSpring LLC, C.A. No. 08-114-SLR (D. Del. Aug. 7, 2008) (Robinson, J.).

Posted On: August 11, 2008

Six New Jersey District Judges Designated to Sit in Delaware

On the heels of the announcement that judges from the Eastern District of Pennsylvania will begin hearing cases filed in Delaware, Third Circuit Chief Judge Anthony J. Scirica has designated six judges from the District of New Jersey to do the same. The designation orders, effective last Thursday, increase the total non-Delaware judicial delegation to twelve (navigate to revised "7/28/2008" link).

According to the Wilmington News Journal, every fourth civil case will be assigned to one of the designated district judges. Although the judges will likely hear pretrial matters in either Pennsylvania or New Jersey, trials will be conducted in Delaware.

The six designated district judges from New Jersey are: Hon. Renee Marie Bumb, Hon. Mary Little Cooper, Hon. Noel L. Hillman, Hon. Robert B. Kugler, Hon. Joel A. Pisano, and Hon. Jerome B. Simandle.

Posted On: August 8, 2008

Sue L. Robinson: Noerr-Pennington Immunity Applies to Suits Brought on "Weak" Patents

Infringement actions often provoke a raft of counterclaims that assert non-patent theories, including business-competition torts. When a party pursues these unfair competition claims, however, the plaintiff retains some doctrinal immunity from suit. And, according to District of Delaware Judge Sue L. Robinson, this immunity extends to a party that relies on a "weak" but untested patent

In a recent post-trial decision, the Court assessed a defendant's unfair competition counterclaims in light of the so-called Noerr-Pennington doctrine, a judicially created immunity that bars application of the antitrust laws to those who petition the government for redress. The patentee, a generic manufacturer, had acquired a patent of questionable validity on the subject drug as a hedge against other competitors in the generic market. After initiating the underlying litigation, defendant responded with unfair competition, tortious interference, and antitrust counterclaims.

Analyzing the patentee's claims of immunity from suit, the Court criticized the business motives that led to the acquisition of the weak patent:

"The inference to be drawn from this chronology is that, instead of directing its efforts to launching a generic, [patentee] obtained and relied upon an admittedly 'weak' patent for protection from other generic competition."

Noting that even a questionable patent "enjoys a presumption of validity," however, the Court held that the infringement litigation could not be characterized as a sham suit. The Court highlighted the fact that no tribunal had invalidated the patent:

"The validity of the '183 patent has not be adjudicated by any court (or the USPTO on reexamination). This court has no occasion to judge the merits of [defendant's] invalidity arguments, and declines to issue a finding that [the patentee] 'should have known' of its patent's invalidity absent such findings."

The lesson? Until an objective basis exists for invalidity - i.e., a court or agency ruling - the infringement plaintiff will enjoy Noerr-Pennington immunity.

Braintree Labs. Inc. v. Schwarz Pharma Inc., C.A. No. 03-477-SLR (D. Del. July 31, 2008) (Robinson, J.).

Posted On: August 1, 2008

Motion to Transfer Denied: Inconvenience Will Not Take Precedence over Delaware Corporation's Choice of Forum

It is well-established that plaintiff's choice of forum will be a strong consideration in deciding a motion to transfer. Judge Sleet in denying the defendants' motion to transfer in the case Acuity Brands, Inc. v. Cooper Industries, Inc., again stressed the importance of plaintiff's choice of forum -- particularly where both parties are Delaware corporations and inconvenience is the only argument for transfer. C.A. No. 07-444-GMS, Memorandum (D. Del. July 31, 2008).

Defendants argued that their only tie to Delaware was the fact that they were incorporated here and that the case law provides for transfer where that is the only link to the forum. Id. at 3. The Court found the cases relied on by defendants distinguishable, however, since in those cases there was also simultaneous litigation proceeding in the transfer district, and there is no such parallel litigation here. Id. at 4.

In a continuing trend in D. Del. transfer opinions, the Jumara factors related to location of witnesses and documents are becoming less important to the analysis. The Court has held that party-witnesses such as employees "are presumed willing to testify at trial" and therefore are not part of the analysis. Id. at 5. And even in the case of third-party witnesses, "a flight to Delaware is not an onerous task warranting transfer." Id. Finally, in this age of electronic discovery, the location of documents becomes almost irrelevant. Id.

For a copy of the opinion see here.

Posted On: August 1, 2008

Judge Sleet Reports on the District of Delaware "State of the Court"

At the recent annual luncheon held by the Delaware chapter of the Federal Bar Association, Judge Sleet presented on the "state of the court." As part of his presentation, the Court provided attendees with a copy of the first "Annual Report of the United States District Court for the District of Delaware 2008." The report provides a number of interesting statistics on the continuing growth in case load and patent filings.

In 2007, 19% of civil case filings in the district were for patent cases. Delaware held 17 patent trials in 2007, 8 of which were bench trials. The total number of patent trials in Delaware during 2007 was nearly 20% of the total held nationwide. The District of Delaware continues to be first in the country for number of patent cases per judge. Finally, 157 patent cases were filed in this district last year, up from 139 in 2006.

Despite all of the discussions regarding a downturn in patent filings nationwide, patent litigation continues to grow and thrive in the District of Delaware!