Posted On: July 31, 2012

Judge Andrews: Motion to Dismiss Counterclaims Denied and Motion for Judgment of Invalidity on the Pleadings Granted

Judge Richard Andrews recently issued an order granting judgment of invalidity as a matter of law in a District of Delaware ANDA case. See Shire LLC v. Teva Pharms. USA Inc., C.A. No. 10-329-RGA (D. Del. Jul. 23, 2012). Plaintiff Shire dedicated its patent to the public but left it listed in the Orange Book. Shire then moved to dismiss all counterclaims relating to that patent and Defendant Teva cross-moved for judgment on the pleadings that the patent was invalid. Judge Andrews found that the Court “retains jurisdiction over a patent dedicated to the public where, as here, it remains listed on the Orange Book and therefore has the potential to create a triggering event for the first-filer’s exclusivity.” Furthermore, judgment of invalidity was appropriate because “express dedication to the public comprises abandonment under 35 U.S.C. § 102(c).” Judge Andrews therefore granted judgment of invalidity on the pleadings and denied Shire’s motion to dismiss. Referring to the Federal Circuit’s decision in Teva Pharms. USA, Inc. v. Eisai Co., 620 F.3d 1341 (Fed. Cir. 2010) (discussed at Patently-O), Judge Andrews further found that the Court retained jurisdiction over the Defendants’ remaining claim for attorneys’ fees.

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Posted On: July 31, 2012

Judge Andrews clarifies “futility” in connection with motion to amend pleadings.

In a recent order, Judge Andrews rejected a plaintiff’s argument against amendment of an answer and counterclaims. XpertUniverse Inc. v. Cisco Systems Inc., C.A. No. 09-157-RGA (D. Del. July 27, 2012). The plaintiff had argued that “the amended portions of Cisco’s Proposed Answer and Counterclaims are unlikely to survive summary judgment. Thus, Cisco’s proposed amendment is futile…” (D.I. 236 at 8) The Court explained that even accepting the argument that the amended portions of the answer and counterclaims likely would not survive summary judgment, “it is not the same thing as stating that amendment would be futile. Thus, Plaintiff has advanced no valid argument against amendment.”

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Posted On: July 30, 2012

Judge Andrews applies the America Invents Act and severs cases against computer manufacturers

Judge Richard G. Andrews recently considered motions to sever and transfer which raised the issue of whether the court should apply the joinder rule of Federal Rule 20(a) or that of the America Invents Act, 35 U.S.C. §299. IPVenture, Inc. v. Acer, Inc., et al., C.A. No. 11-588-RGA (D. Del. July 24, 2012). Judge Andrews decided that §299 applies, but that the result would have been the same under Rule 20 as well. Severance was appropriate because plaintiff’s “allegations of commonality [we]re painted with a broad brush and appear[ed] to be inconsequential to the critical patent issues.” Id. at 3-4. The allegations related to joinder included “that the accused computers include ‘common components’ such as [Intel microprocessors, ... cooling fans, operating systems (such as Microsoft Windows ...), [and] embedded controllers.” Id. at 4 (alterations in original). Judge Andrews pointed out that just because “computers generally have the same components and the same functionalities does not mean that they are ‘the same in respects to the patent.’” Id. Therefore, the “claims of infringement against the defendants’ products d[id] not share an aggregate of operative facts.” Id. Judge Andrews also noted that the defendants’ relationship to each other – that is, that they are all direct competitors – “significantly counsel[ed] against their joinder in the same case. Id. at 4-5.

Judge Andrews also granted defendant ASUS’s motion to transfer to the Northern District of California. Plaintiff was a California corporation with a principal place of business in the Northern District. Therefore, Judge Andrews noted that while plaintiff’s choice of forum weighs strongly in plaintiff’s favor, it weighs “not as strongly as if would if plaintiff had its principal place of business (or, indeed, any place of business) in Delaware. Id.at 6-7. After weighing all factors, Judge Andrews found that “little beyond plaintiff’s choice of forum” weighed against transfer. Id. at 11.

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Posted On: July 30, 2012

Judge Stark denies motion to stay pending reexamination, discusses pre-suit knowledge issues in ruling on motions to dismiss indirect and willful infringement allegations.

In a recent memorandum opinion, Judge Stark denied a motion to stay pending the conclusion of reexamination proceedings, finding that none of the three relevant factors weighed in favor of granting a stay. Softview LLC v. Apple Inc., et al., C.A. No. 10-389-LPS (D. Del. July 26, 2012). Specifically, the Court found that a stay would not result in simplification of the issues and trial, because “the scope of the issues to be resolved during litigation substantially exceeds the scope of the issues that can be resolved during the reexamination proceedings,” and the defendants were within their rights to refuse to be bound by any PTO decisions other than validity based on the particular prior art references raised during the reexamination. Id. at 3-4. The Court also found that although the litigation was still in the early stages, the parties and the Court had already expended significant resources on motions to sever, stay, and dismiss. Because the reexamination was also in its early stages, the Court found, on balance, that the “relative status of the litigation and reexamination proceedings does not favor a stay.” Id. at 7. Finally, the Court found that the plaintiff would be unduly prejudiced by a stay, because a stay would deprive the plaintiff of its chosen forum (potentially for several years), while giving the defendants a “clear and unwarranted tactical advantage.” Id. at 7-8.

The Court next considered whether the plaintiff had alleged a plausible basis for finding that the defendants had pre-suit knowledge of the patent to support a finding of willfulness or indirect infringement. The Court found that the plaintiff’s allegations of (1) an AT&T subsidiary’s knowledge of the patent; (2) AT&T’s relationship with the patent’s inventor; and (3) AT&T’s former role as exclusive seller of the patented technology raised (in the aggregate) a plausible basis for a finding of pre-suit knowledge. Id. at 9-10. The Court also found that the plaintiff alleged a plausible basis for pre-suit knowledge as to several defendants who were members of a defensive patent aggregate service ("RPX"), since RPX indisputably had knowledge of the patent. Id. at 13. The plaintiff failed, however, to adequately allege pre-suit knowledge by defendant Kyocera. The Court explained that the allegation that Kyocera had pre-suit knowledge as a result of the media’s publicity of an earlier lawsuit involving the patent was insufficient. Id. at 11.

After finding that the plaintiff failed to sufficiently allege pre-suit knowledge on the part of Kyocera, the Court considered whether the plaintiff’s indirect infringement claim could be based on post-filing conduct by Kyocera. Id. at 13. The Court noted, “[o]n this issue there is divided precedent in this District,” and agreed with the precedent finding that “the filing of a complaint is sufficient to provide knowledge of the patents-in-suit for purposes of stating a claim for indirect infringement occurring after the filing date.” Id. at 14 (citing Apple Computer, Inc. v. Unova, Inc., 2003 WL 22928034, at *5 (D. Del. Nov. 25, 2003)).

Finally, the Court considered whether an allegation of willful infringement requires pre-suit knowledge and/or a motion for a preliminary injunction to enjoin post-filing infringement. Id. at 15. The Court held that, under In re Seagate Tech, LLC, 497 F.3d 1360 (Fed. Cir. 2007), a patentee “cannot recover enhanced damages based solely on an accused infringer’s post-filing conduct whether the patentee has not sought a preliminary injunction.” Id. at 16 (emphasis in original). Because the plaintiff’s allegations against AT&T and the defendants affiliated with RPX was based also on pre-suit knowledge, the Court denied their motion to dismiss willfulness allegations. Id. at 17.

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Posted On: July 30, 2012

Chief Judge Sleet construes claim terms relating to refrigerator ice bin and dispenser technologies.

Chief Judge Sleet recently construed claims across ten different patents relating to refrigerator ice bin and dispenser technologies. LG Electronics U.S.A., Inc. v. Whirlpool Corp., C.A. No. 10-311 (GMS) (D. Del. July 10, 2012) (previously discussed here and here). The following claim terms were construed by the Court:

“refrigerating compartment”
“ice compartment”
“ice storage bin is dedicated to define a part of the cavity”
“that enables removal of at least a portion of the ice compartment from the refrigerating compartment”
“wherein the portion of the ice compartment that is removable from the refrigerating compartment is detachably installed within the refrigerating compartment”
“removing at least a portion of the ice compartment . . . including at least the ice storage bin and the [sic] at least one of the insulating walls”
“an interface . . . configured to receive air”
“freezing chamber/freezing compartment”
“an ice container positioned on the refrigerator door and configured to store ice made by the icemaker”
“a structure provided on the refrigerator door and corresponding to the ice container, the structure including an inlet configured to receive air”
“calculating a door-opening time when a door-open and a door-close are detected”
“cooling operation”
“obtaining a reset temperature lower than said negative limit temperature in accordance with the door opening time”
“determining and setting a reset temperature depending on the door-opening time, wherein the resetting temperature is lower than the negative limit temperature”
“executing a cooling operation until a temperature inside the refrigerator compartment reaches the reset temperature”
“the cover being movable between an open position to allow access to the ice bin and a closed position to prevent cold air from leaking from the ice compartment into the fresh food compartment”
“a cover for impeding cold air from passing from the ice compartment to the fresh food compartment”
“a cover adjustable into a closed position to cover the opening”
“finger activated release to move the latch member into an unlocked position”
“an unlocked position disengaged from the catch to permit the ice bin to be removed from the ice compartment”
“the cover being adjustable into an open position to permit removal of the ice bin from the ice compartment”
“auger”
“a refrigerator including a freezer compartment having an access opening and a closure member for closing the access opening”
“ice crusher blade”
“upper ice bin member”
“lower ice bin member”
“being disposed within the freezer compartment”
“an ice dispenser”
“a [first/second] end insert”
“interengaging”
“an aperture for receiving a fastener”

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Posted On: July 30, 2012

Claim construction in patent infringement suit over technology to prevent vehicle rollover

Judge Leonard P. Stark recently construed the following claim terms of U.S. Patent Nos. 5,529,153 and 5,437,354 relating to "technology for suppressing vehicular rolling motion, i.e. the tendency of the vehicle to tilt when the vehicle turns a corner or is driven around a sharp curve." Cloud Farm Associates, L.P. v. Volkswagen Group of America, Inc., C.A. No. 10-502-LPS (D. Del. July 27, 2012)

"partially filled with hydraulic fluid"
"a chamber having two portions partially filed with hydraulic fluid"
"seal" /"sealing" /"seals"
"prevent flow of said fluid"
"preventing tilting of the frame or body of the vehicle"10/"preventing tilting
of the body of the vehicle"
"prevent movement of the piston and further tilting of the body of the
vehicle"
"a plate within said chamber having a substantially central opening
separating said fluid within the chamber into a lower portion and an upper
portion"
"a plate within said chamber having at least one opening separating the fluid
within the chamber into two portions"
"means within said chamber to separate said fluid within the chamber into
two portions"
"sealing means"
"means for sensing the tilt" terms
"means for moving the sealing means to seal"
"electromagnetic means to move said sealing means to seal"
"electromagnetic means for operating said sealing means"
"predetermined tilt position of the body"/"set tilt position of the body"
"electrical switch"/"means [including] an electrical switch"
"means ... for energizing said electromagnetic means"
"said at least one opening"
"mercury switch"
"prevent any flow of said fluid"
"means for dampening the movement of the piston when the piston is
compressed or extended"
"being below"

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Posted On: July 30, 2012

Judge Andrews denies plaintiffs' request to amend ANDA complaint to join non-ANDA claims

In Novartis Pharmaceuticals Corp., v. Actavis South Atlantic LLC, C.A. No. 11-1077-RGA (D. Del. July 25, 2012), Judge Andrews denied plaintiffs' motion to amend its complaint to add a non-ANDA claim to the existing ANDA litigation. In doing so, Judge Andrews found that permitting amendment would prejudice defendant, without justificiation, by expediting the non-ANDA claim and by depriving defendant of the opportunity to file case dispositive motions for that claim.

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Posted On: July 27, 2012

Federal Circuit Denies Mandamus in District of Delaware Case Under In re Link_A_Media Devices

The Federal Circuit recently issued a decision applying In re Link_A_Media Devices Corp. and denying a writ of mandamus directing the Judge Stark of the District of Delaware to transfer a patent infringement case to the Northern District of California. The case involved two Delaware limited liability companies as plaintiffs and four Delaware corporations as defendants. Because the defendants were all headquartered on the west coast, they moved for transfer under 28 U.S.C. § 1404(a), but Judge Stark denied their motions. See Intellectual Ventures I LLC, et al. v. Altera Corp., C.A. No. 10-1065-LPS (D. Del. Jan. 23, 2012).

Three of the defendants sought a writ of mandamus from the Federal Circuit, and the Federal Circuit denied their petition. In re Altera Corp., et al., Misc. Doc. No. 121, at 5 (Fed. Cir. Jul. 20, 2012) (slip op.). In its opinion, the Federal Circuit noted that under Link_A_Media it “has jurisdiction to issue a writ of mandamus to correct a denial of transfer, but only to the extent that the trial court’s analysis amounted to a clear abuse of discretion.” Id. at 3 (citing In re Link_A_Media Devices Corp., 662 F.3d 1221, 1223 (Fed. Cir. 2011)). The Court went on to explain that “the district court afforded the respondents’ choice of forum substantial weight . . . [and] concluded that the convenience of [potential] witnesses was entitled to little weight.” Id. at 2-3.

These were proper considerations according to the Federal Circuit: “[S]tatus as Delaware corporations is not entitled to controlling weight insofar as no office or employees are located in Delaware. Still, the relevant inquiry is broad enough to include the Delaware court’s interest in resolving disputes involving its corporate citizens . . . .” Id. at 3. “Moreover, the decision to deny transfer draws support from the fact that numerous potential non-party witnesses having knowledge related to the engineering and sales of the accused products appear to be located close to Delaware. In light of these circumstances, a rational basis existed for denying transfer of this case.” Id. at 4.

The Court also distinguished Altera from Link_A_Media, noting that Link_A_Media “did not go so far as to limit the trial court’s discretion to deny transfer in this case.” Id. The Court held that Altera was “clearly distinguishable; in it thorough opinion, the district court endeavored to evaluate each of the forum non conveniens factors . . . and there is no clear indication that the court failed to meaningfully consider the merits of the transfer motion. Moreover . . . there are rational grounds for denying transfer given that all of the parties . . . had incorporated in Delaware and some witnesses would potentially find Delaware more convenient.” Id.

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Posted On: July 27, 2012

Jury awards damages of $50 million based on 6% royalty rate for contributory and induced infringement of patent relating to enzyme replacement therapy to treat Fabry disease.

A jury recently awarded a plaintiff $50 million in damages based on a 6% royalty rate after finding that the defendant induced and contributed to the infringement of U.S. Patent No. 7,011,831 (“Recombinant α-galactosidase A therapy for Fabry disease”), and that the asserted claims were not invalid as anticipated, for failure to meet the written description requirement, or for failure to meet the enablement requirement. Shelbyzyme LLC v. Genzyme Corp., C.A. No. 09-768-GMS (D. Del. July 17, 2012).

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Posted On: July 24, 2012

Judge Stark denies defendants' Rule 11 sanctions motion filed after defendants prevailed on summary judgment

In BAE Sys. Info. and Elec. Sys. Integration Inc. v. Aeroflex Inc., C.A. No. 09-769-LPS (July 23, 2012), Judge Stark denied defendants' Rule 11 sanctions motion, filed after Judge Stark granted defendants' summary judgment motion of noninfringement pursuant to 28 U.S.C. § 1498 and summary judgment motion on plaintiff's remaining state law claims on statute of limitiations grounds. Id. at 1-5. Defendants argued that Rule 11 sanctions were appropriate because plaintiff' brought a "knowingly frivolous" and "baseless" patent infringement action against defendants. Id. at 5-7. Judge Stark disagreed. Specifically, defendants did not prove that plaintiff's proposed claim constructions supporting its claims were not reasonable. "While [defendants] proposed an alternative construction . . . that proves only that there was a dispute, not that [plaintiff] was frivolous in its advocacy." Id. at 9 (emphasis in original).

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Posted On: July 24, 2012

Judge Andrews applies Therasense and denies summary judgment motion of no inequitable conduct

Judge Andrews recently issued a memorandum order denying plaintiff’s motion for partial summary judgment of no inequitable conduct. Bristol-Myers Squibb Co. v. Teva Pharmaceuticals USA, Inc., C.A. No. 10-805-RGA (D. Del. July 19, 2012). Defendant’s inequitable conduct defense was premised on the failure of the inventor of the patent-in-suit and two prosecuting attorneys to disclose to the PTO prior art relating to “the compound 2’-CDG.” Id. at 1. Judge Andrews explained the applicable law set forth by the Federal Circuit in Therasense, Inc. v. Becton, Dickinson & Co., 649 F.3d 1276, 1290-91 (Fed. Cir. 2011) (see write up at Patently-O) and noted that it “was intended to cut back on inequitable conduct as a defense.” Id. at 3. At the Summary Judgment stage, Judge Andrews stated that the only issue was “whether at least one of the three accused individuals knew the withheld information was material and made a deliberate decision to withhold it.” Id. Despite plaintiff’s evidence that the inventor and two attorneys did not make an intentional decision to withhold the prior art and did not consider the prior art material, Judge Andrews decided that summary judgment would be inappropriate because “the ‘materiality’ question [was] one on which two experts differ, and [he did] not know which one [he was] going to accept.” Id. at 4. Judge Andrews concluded by noting that “[i]t is often difficult to prove someone’s state of mind about something the person did yesterday. To prove by clear and convincing evidence that a person intended to deceive the PTO twenty years ago in the absence of any direct evidence that he did so, is about as difficult as climbing Mt. Everest. I cannot say, however, as a matter of law that it cannot be done.” Id.

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Posted On: July 24, 2012

Judge Andrews grants defendant's motions to exclude two of plaintiff's experts

Judge Andrews recently granted defendant's motions to exclude two of plaintiff's experts in Bristol-Myers Squibb Co. v. Teva Pharmaceuticals USA, Inc., C.A. No. 10-805-RGA (D. Del. July 17, 2012). Judge Andrews excluded plaintiff's patent law expert because the report and testimony would not assist the trier of fact. Id. at 1. Judge Andrews also excluded, as cumulative and redundant, plaintiff's chemistry expert, "with the understanding that Defendant will not object based on the expert discovery rules to Plaintiff's other 'esteemed nucleoside chemist' covering the same material[.]" Id.

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Posted On: July 23, 2012

Judge Richard Andrews Applies Twombly and Iqbal to Claims of Direct and Indirect Patent Infringement

Judge Andrews has continued to issue orders regarding the sufficiency of pleadings under Twombly and Iqbal in several recent patent infringement cases. We have previously covered several Judge Andrews orders regarding pleading standards, including IPLearn, LLC v. BeeLine Acquisition Corp., HSM Portfolio LLC v. Fujitsu Ltd., Real Time Social Inventions LLC v. CMI Marketing Inc., and IPVenture Inc. v. Lenovo Group Limited, et al. Judge Andrews recently considered similar motions to dismiss or amend direct and indirect infringement claims in three new orders, Pragmatus Telecom, LLC v. Ford Motor Co., C.A. No. 12-92-RGA (D. Del. Jul. 5, 2012); Chalumeau Power Sys. LLC v. Alcatel-Lucent, C.A. No. 11-1175-RGA (D. Del. Jul. 18, 2012); and Howard Foundation Holdings Ltd. v. Int’l Vitamin Corp., C.A. No. 12-35-RGA (D. Del. Jul 11, 2012).

Judge Andrews addressed direct infringement in Pragmatus, reiterating that compliance with Form 18 is sufficient to adequately plead direct infringement under In re Bill of Lading Transmission and Processing System Patent Litigation, 681 F.3d 1323 (Fed. Cir. 2012) (write-up at Patently-O). On this basis, Judge Andrews refused to dismiss claims of direct infringement. Pragmatus at 2.

But on indirect infringement, Judge Andrew granted motions to dismiss in Pragmatus and Chalumeau. In both cases, he found that insufficient facts were alleged to allow an inference that the allegations of indirect infringement were plausible: “The allegations of both forms of indirect infringement suffer from the bare bones nature of the complaint. Some facts would put some flesh on the bones, and might, or might not, make the allegations plausible. Until such facts are pled, however, the complaint fails to state a claim for indirect infringement.” Pragmatus at 2-3. Furthermore, “[b]oth induced infringement and contributory infringement require the defendant to know of the patent, and to know that the defendant’s actions are either inducing or contributing to another’s direct infringement. . . . [T]here are only insufficient factual assertions to support the legal conclusion of actual knowledge, and no factual assertions at all to support the legal conclusion of specific intent.” Chalumeau at 1-2. On this later issue of knowledge of the patent, Judge Andrews again stated that under Global-Tech Appliances, Inc. v. SEB S.A., 131 S. Ct. 2060 (2011) (write-up at Patently-O), “[s]ervice of the original complaint gives the defendants actual notice of the patent’s existence. It might also make plausible the claim that the defendant has the knowledge that third parties who are selling its product are directly infringing the [patent-in-suit].” Chalumeau at 2-3; Pragmatus at 2-3.

Finally, Judge Andrews addressed allegations of willful infringement in Chalumeau and Howard. Here too, he found that the complaints at issue had not plausibly alleged that the defendants knew or should have known that their actions constituted infringement of a valid patent. Chalumeau at 3; Howard at 1. Moreover, in Howard, which involved a complaint against a customer of allegedly-infringing technology, Judge Andrews stated: “I do not think . . . that someone telling a manufacturer that it infringes a patent supports as a plausible inference that the manufacturer broadcasts the allegation to its customers.” Howard at 1 n.1.

Although Judge Andrews dismissed claims of indirect and willful infringement in Pragmatus and Chalumeau, he either did so without prejudice to amend “before the close of fact discovery should any of [the plaintiff’s] theories gather more factual support” or indicated that he would “not foreclose” the possibility of amendment after a Rule 16 conference. Pragmatus at 3; Chalumeau at 3. In Howard, despite concluding that the plaintiff had not adequately plead willfulness, he granted the plaintiff’s motion for leave to file a first amended complaint. Howard at 1 n.1.

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Posted On: July 18, 2012

Judge Gregory Sleet Issues Markman Order in Fluid Filtering Patent Infringement Case

Chief Judge Sleet recently issued a claim construction order after holding a Markman hearing in the patent infringement case Hollingsworth & Vose Filtration Ltd. v. Delstar Techs., Inc., C.A. No. 10-788-GMS (D. Del. Jul. 10, 2012). In the order, Judge Sleet construed the following terms:

- “comprising . . . a blend of polypropylene fibres and dry spun halogen free acrylic fibres”
- “substantially smooth surfaces”
- “significantly reduced cracks and fissures in the surfaces of the acrylic fibres than if produced by wet spinning”

In construing the first of these claim terms, Judge Sleet found the defendants’ reliance on Dippin’ Dots, Inc. v. Mosey, 476 F.3d 1337 (Fed. Cir. 2007) (write-up at Patently-O) “for the proposition that the term ‘comprising’ does not create an open-ended claim” improper. Id. at 1 n.1. Rather, he noted, the term “comprising” traditionally means “including, but not limited to.” Judge Sleet therefore construed this claim term to mean “a mixture of fibres that includes at least polypropylene fibres and dry spun halogen free acrylic fibres.” Id. at 1 (emphasis added).

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Posted On: July 13, 2012

Judge Andrews construes claims relating to electronic imaging technology.

On June 22, 2012, Judge Andrews issued an opinion construing thirteen claim terms in L-3 Communications Corp.’s patents relating to electronic imaging technology. L-3 Communications Corp. v. Sony Corp., et al., C.A. No. 10-734-RGA (D. Del. June 22, 2012). The patents claim inventions that “use imaging arrays to convert invisible light to electrical signals that create a viewable image. The imaging arrays are formed by combinations of image elements, or pixels, which are further composed of various circuit components.” Id. at 2. The following disputed claim terms were considered:

“Provide” and “Providing”

“Image element”

“Charge storage element”

“Storage means for storing said charge at said image element”

“Gain control element”

“Charge drain”

“Means for draining stored charge from said charge storage means in response to an element resetting signal”

“Logic gate having a pair of inputs”

“An output switch having a control input which is one of said pair of inputs and when closed connecting said output voltage level to an output signal conductor”

“Means for randomly accessing said image elements”

“Means for photovoltaically producing an electrical charge in response to incident light”

“Connecting said stored charge to an output device only in response to an interrogation signal to said image element”

“Wherein said step of providing said output amplifier includes providing a transistor at said image element”

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Posted On: July 13, 2012

Judge Andrews stays customer suit pending resolution of later filed DJ action filed by supplier

In Pragmatus Telecom, LLC v. Advanced Store Company, Inc., C.A. No. 12-088-RGA (D. Del. July 10, 2012), Judge Andrews granted defendants' motion to stay the case pending resolution of a later-filed declaratory judgment action filed by the supplier of the allegedly infringing technology. Judge Andrews determined a stay was warranted in the interest of judicial economy and efficiency, finding that any ruling in the later-filed action would "most likely be dispositive of this case[,]" and that the case was in its early stages with no trial currently scheduled. Id. at 4-5. Judge Andrews also found that plaintiff would not be prejudiced by a stay. "Pragmatus is solely in the business of monetizing patents, and since Customers are not 'direct competitors,' injunctive relief is not available. Any purported harm that Pragmatus suffers from a stay can be fully compensated by monetary damages." Id. at 5. Defendants also argued that the Customer Suit Exception to the First-Filed Rule also favored a stay. Judge Andrews determined, however, that while the reasoning behind the Customer Suit Exception supported granting a stay, the exception itself did not apply. "The First Filed Rule is a forum favoring rule, i.e., one that applies when multiple claims exist in multiple jurisdictions. Here, both [actions] are before this Court, and no 'forum favoring' is needed." Id. at 6.

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Posted On: July 12, 2012

Court denies motion to compel production of expert interview notes, summaries

Magistrate Judge Schneider of the District of New Jersey, sitting by designation, recently issued a letter opinion denying a party's motion to compel the production of notes and summaries prepared by its counsel regarding interviews with expert witnesses. Bayer CropScience AG v. Dow AgroSciences LLC, C.A. No. 10-1045 (RBK/JS) (D. Del. July 6, 2012). Although Dow claimed it was seeking only facts through its discovery request, Judge Schneider found that "the facts included in the documents are inextricably intertwined with the core work product of Bayer's attorneys and they cannot be separated. Bayer's notes are replete with counsel's opinions, impressions, strategy, etc., and the Court finds that it is not feasible or practical to separate the core work product from the remainder of the documents." Id. at 1-2. Judge Schneider added that Bayer would not be required to summarize the facts from its expert interviews in interrogatory answers, citing the Supreme Court's seminal decision in Hickman v. Taylor, 329 U.S. 495, 512-13 (1947). Id. at 2 n.1.

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Posted On: July 10, 2012

Judge Andrews Considers Motions to Dismiss, Sever

Judge Andrews has issued orders on motions to dismiss and sever in IPLearn, LLC v. BeeLine Acquisition Corp., C.A. No. 11-825-RGA (D. Del. July 2, 2012). As in other recent orders, Judge Andrews found that compliance with Form 18 is all that is needed to state a claim of direct infringement, citing In re Bill of Lading Transmission and Processing System Patent Litigation, 2012 WL 2044605 (Fed. Cir. June 7, 2012). He further found that the “plaintiff names specific products, and thus more than meets the requirements of Form 18.” Id. at 2. Judge Andrews also stated that the “allegations [were] insufficient to state a claim for indirect infringement” because there was “no allegation stating that [the defendant’s] customers directly infringe.” Id.

With regard to contributory infringement and induced infringement, Judge Andrews found that the allegations were “wholly devoid of any identifiable factual information.” In considering the requirement of knowledge of the patent, however, Judge Andrews noted: “I think that an allegation that a defendant was served with a complaint alleging patent infringement sufficiently alleges a factual basis that, beginning with the date that the complaint was served, the defendant knew of the patent. It does not provide any basis for knowledge predating such service.” Id. at 3 n.4.

Judge Andrews also granted motions to sever based on the Federal Circuit’s recent decision in In re EMC Corp., 677 F.3d 1351 (Fed. Cir. 2012). As Judge Andrews explained, “The Federal Circuit’s standard is that defendants should not be ‘joined under Rule 20’s transaction-or-occurrence test unless the facts underlying the claim of infringement asserted against each defendant share an aggregate of operative facts.’ Further, ‘joinder is not appropriate where different products or processes are involved.’ And, ‘independently developed products using differently sourced parts are not part of the same transaction, even if they are otherwise coincidentally identical.’” IPLearn, at 2 (citations omitted). Because there were no allegations in the complaint of any connection between the moving defendants or their products and any other defendant, Judge Andrews granted severance.

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Posted On: July 9, 2012

Judge Andrews Applies Recent Appellate Decisions to Motions to Dismiss

Judge Andrews recently considered the motions of several defendants to dismiss claims of direct infringement, indirect infringement, and willfulness in HSM Portfolio LLC v. Fujitsu Ltd., C.A. No. 11-770-RGA (D. Del. July 3, 2012). Applying the Federal Circuit’s recent decision in In re Bill of Lading Transmission and Processing System Patent Litigation, 2012 WL 2044605, *7 (Fed. Cir. June 7, 2012), Judge Andrews denied motions to dismiss claims of direct infringement, because the “minimal allegations set forth in the counts against each of the defendants . . . are all that are required to satisfy Form 18 and to state a claim of direct infringement.” HSM Portfolio, at 2.

Judge Andrews dismissed claims of indirect infringement, however, finding that the allegations were “insufficient to state a claim for indirect infringement [because] . . . [a]mong other things, there are no allegations of direct infringement accompanying the allegations of indirect infringement.” Id. at 2. Considering the Supreme Court’s recent decision in Global-Tech Appliances, Inc. v. SEB S.A., 131 S. Ct. 2060 (2011), Judge Andrews further stated: “There is no allegation that the defendant knew about the existence of the patent-in-suit. . . . Stating that the defendant was on notice of a patent as of a certain date is insufficient to provide a factual basis for alleging knowledge” that the acts the defendant induced or contributed to constitute patent infringement. HSM Portfolio at 3.

On willfulness, Judge Andrews stated that a claim of willfulness “may be alleged generally, but that there must be facts alleged that are sufficient to show that the plaintiff has a plausible claim for relief.” Id. (internal quotations omitted). In this case, Judge Andrews found, there was no factual support for the allegations of willfulness.

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Posted On: July 9, 2012

Judge Robinson grants motion to maintain status quo ante pending appeal of order denying preliminary injunction.

Judge Robinson recently granted a Rule 62(c) motion to maintain the status quo ante pending the appeal of an order denying a preliminary injunction. Butamax Advanced Biofuels LLC v. Gevo, Inc., C.A. No. 11-54-SLR (D. Del. July 6, 2012). The Court considered four factors in deciding whether to grant the motion, and added that the factors need not be given equal weight: “(1) whether the stay applicant has made a strong showing that he is likely to succeed on the merits; (2) whether the applicant will be irreparably injured absent a stay; (3) whether issuance of the stay will substantially injure the other parties interested in the proceeding; and (4) where the public interest lies.” Id. at 2 (citing Hilton v. Braunskill, 481 U.S. 770, 776 (1987); Standard Havens Prods., Inc. v. Gencor Indus., Inc., 897 F.2d 511, 512 (5th Cir. 1990)). Although the Court previously found that a preliminary injunction was not warranted because the plaintiff was unlikely to succeed on its infringement claim in light of the Court’s construction of certain claim terms, (see June 19, 2002 memorandum opinion), Judge Robinson explained that “the court readily acknowledges that the Federal Circuit could disagree with the court’s construction of these [terms] and, consequently, its ultimate conclusions.” Id. at 3. Further, the Court explained, “if the Federal Circuit reverses and finds the ‘899 patent valid and infringed, plaintiff will suffer irreparable harm…” Id. at 4. In addressing the equities, the Court considered that the defendant had argued previously that an injunction was unnecessary because “the parties were not head to head competitors in the automotive fuel blending industry.” Id. at 5 (internal quotation marks omitted). Under the circumstances, the Court explained, “it does not strike the court as inequitable to require defendant to restrict its business efforts pending appeal consistent with its representations in this litigation.” Id. at 5. The Court granted the plaintiff’s motion, “conditioned on plaintiff’s seeking … an expedited appeal … and posting a bond with the court.” Id. at 6 (emphasis in original).

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Posted On: July 9, 2012

Judge Andrews denies motion to dismiss direct infringement claim.

Judge Andrews recently issued a memorandum order denying a motion to dismiss direct infringement claims relating to a patent for “Multi-User On-Line Real-Time Virtual Social Networks Based upon Communities of Interest for Entertainment, Information or E-Commerce Purposes.” Real Time Social Inventions LLC v. CMI Marketing Inc., C.A. No. 12-182-RGA (D. Del. June 29, 2012). Although the Court noted that the allegations of direct infringement were “sparse”, it explained that “[n]o more is required.” Id. (citing In re Bill of Lading Transmission and Processing Sys. Patent Litig., 2012 WL 2044605 (Fed. Cir. June 7, 2012) (“whether [a complaint] adequately pleads direct infringement is to be measured by the specificity required by Form 18.”)). In response to the defendants’ alternative request for “early claim construction that should resolve this case without the need to spend any resources on fact discovery”, (Reply Br., D.I. 12), Judge Andrews indicated that early claim construction could be discussed at the Rule 16 conference after the defendants filed answers to the complaint.

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Posted On: July 5, 2012

Judge Andrews grants defendant's motion to dismiss plaintiff's first amended complaint and denies plaintiff's motion to amend its complaint a second time

In IPLearn LLC v. K12 Inc., C.A. No. 11-1026-RGA (D. Del. July 2, 2012), Judge Andrews recently granted defendant's motion to dismiss the indirect infringement claims of plaintiff's first amended complaint and denied plaintiff's motion to file a second amended complaint. Judge Andrews found that plaintiff's amended complaint contained no allegations that defendant's customers directly infringed the patents, nor did it adequately plead defendant's knowledge of the patents-in-suit. Id. at 2. Regarding knowledge, Judge Andrews noted that "each count alleges that, 'K12 knew or should have known of the [patent-in-suit] prior to the filing of this action because [Plaintiffs] patents directly related to the [patent-in-suit], and which share identical or identical-in-part specifications with the [patent-insuit], are referenced by, or were referenced during the prosecution of, K12's own patents and patent applications.' The factual support offered in the latter part of the sentence comes close to making an allegation of 'should have known' plausible; they do not make an allegation of actual knowledge plausible." Id. (alteration in original).

Judge Andrews also dismissed plaintiff's willfulness allegations, finding that "[a]t most, the factual allegations plausibly support the conclusion that both the Plaintiff and K12 had patents in the same field." Id. at 3.

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Posted On: July 3, 2012

Judge Burke declines to modify Court's form langage in scheduling order regarding location of corporate depositions

In Invensas Corporation v. Renesas Electronics Corporation, C.A. No. 11-448-GMS-CJB (D. Del. June 27, 2012), Judge Burke recently considered defendant's request to modify the general default standard in the Court's scheduling order regarding the location of depositions of party representatives in Delaware, unless the Court makes an exception. Id. at 1-2. The form scheduling order for Judges Stark, Andrews, Burke and Fallon contain the following language regarding the location of depositions:

"Any party or representative (officer, director, or managing agent) of a party filing a civil action in this district court must ordinarily be required, upon request, to submit to a deposition at a place designated within this district. Exceptions to this general rule may be made by order of the Court. A defendant who becomes a counterclaimant, cross-claimant, or third-party plaintiff shall be considered as having filed an action in this Court for the purpose of this provision." Id. at 1-2.

When submitting the scheduling order, the parties disputed whether the default provision should apply and Judge Burke permitted supplemental briefing on the issue. Defendant, whose principal place of business is in Japan, asked the Court to eliminate this standard language and instead require corporate depositions take place at the party's principal place of business (i.e., Japan). Id. at 2. Judge Burke declined to modify the Court's form language in the scheduling order, finding that defendant "ma[de] the general assertion that it would be burdensome for its employees to travel to the United States for corporate depositions, but ha[d] not made a particularlize showing as to how this would be the case." Id. at 6. Defendant's request was "non-specific and premature" because, "[a]t this early stage of the case, topics for corporate depositions have not been noticed, nor have specific witnesses . . . been identified[,]" such that the court could know the impact travelling to the United States would have on one or more witnesses. Id.

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Posted On: July 3, 2012

Judge Sleet Refuses to Alter Discovery Sanctions

In a multidistrict patent infringement case concerning plaintiff Cephalon’s armodafinil drug, Chief Judge Sleet entered an order, precluding Cephalon from relying upon any secondary considerations of non-obviousness due to Cephalon’s late production of documents. Judge Sleet, however, left Cephalon with the opportunity to later argue that it could rely on certain documents if they had been timely produced and would not prejudice the defendants. Cephalon subsequently filed a motion to narrow Judge Sleet’s order to allow reliance on “non-commercial” secondary considerations. In re Armodafinil Patent Litigation, C.A. No. 10-md-2200-GMS, at 1 (D. Del. June 26, 2012).

Cephalon argued that the defendants would not be prejudiced by allowing it to rely on the secondary considerations of copying and long-felt-need because all documents it sought to rely on were timely identified. The Court found, however, that the defendants were prejudiced by having been denied the opportunity to conduct full discovery on issues raised by late-produced documents. Because “[o]bviousness is determined in light of all the circumstances surrounding the alleged invention . . . even if Cephalon timely-produced some documents related to some secondary considerations, the defendants remain prejudiced because the late-produced documents may contain relevant information that the defendants could have relied upon to rebut the timely-produced materials.” Id. at 2 n.3. “It would be inherently unfair,” Judge Sleet wrote, “to give Cephalon the unfair advantage of being able to rely upon cherry-picked secondary considerations of long-felt need and copying, while those documents potentially unfavorable to its position remain buried within its late production to the defendants.” Id.

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Posted On: July 3, 2012

Judge Andrews denies motion for attorneys’ fees, finding no showing of subjective bad faith.

Judge Andrews recently considered whether to award attorneys’ fees under 35 U.S.C. § 285 to a defendant in a case where “the overall picture that is presented is that the Plaintiff’s strategy was to file suits against a large number of defendants, and, due to the huge expenses inherent in patent litigation, force nuisance value settlements.” Commonwealth Research Group LLC v. Lattice Semiconductor Corp., C.A. No. 11-655-RGA (D. Del. June 28, 2012). The defendant argued that the case was "exceptional" due to the plaintiff’s insufficient pre-suit investigation, as well as the plaintiff's delay in dismissing the suit, which resulted in the defendant unnecessarily expending time and resources on claim construction. Id. Although the plaintiff also prepared a claim construction brief, the Court “charitably described” it as “a very modest effort.” Id. at 2. In considering the plaintiff’s pre-suit investigation, the Court noted that a detailed infringement analysis had been conducted by the plaintiff, but the plaintiff had not reverse engineered the defendant’s product even though the product, itself, was inexpensive to purchase. Id. at 4, 6. The Court explained, “I am not sure whether such reverse engineering would have made [plaintiff’s] suit any more or less meritorious in its eyes. I do not think that doing reverse engineering is required, even if, as [the defendant] asserts, its product could have easily been purchased for $100.” Id. at 6 (footnote omitted). With regard to the defendant’s claim construction efforts, the Court found that the plaintiff acted “fairly promptly” to dismiss the case upon learning of the defendant’s strong indefiniteness positions, but that the case was not promptly dismissed at least partially because the defendant was seeking from the plaintiff compensation for its defense costs. Id. at 4. Overall, the Court explained, “I do not find that [the defendant] has shown, by either of its arguments, ‘subjective bad faith,’ and I will deny [the defendant’s] motion.” Id. at 6.

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