Posted On: July 31, 2013

Judge Robinson considers various motions and construes claim terms

In Gevo, Inc. v. Butamax Advanced Biofuels LLC, et al., C.A. No. 13-576-SLR (D. Del. Jul. 26, 2013), Judge Sue L. Robinson recently considered several motions for summary judgment, construed disputed claim terms and ruled on a motion to exclude expert testimony.

The Court construed the following terms of U.S. Patent Nos. 8,017,375 (“the ‘375 patent”) and 8,017,376 (“the ‘376 patent”), which relate to the production of biomass-derived biofuels:

a ketol-acid reductoisomerase, id. at 6-7;

an a-ketoisovalerate decarboxylase from Lactococcus lactis, id. at 7;

wherein said recombinant yeast microorganism has reduced endogenous PDC activity as compared to the corresponding yeast microorganism that has not been engineered to have reduced endogenous PDC activity, id.;

is further engineered or selected to grow on glucose independently of C2-compounds at a growth rate substantially equivalent to the growth rate of the corresponding yeast microorganism that has not been engineered to have reduced endogenous PDC activity, id. at 8;

activator of ferrous transport (Aft) proteins, id. at 10;

which increase the dehydratase activity of DHAD, id.;

wherein said ketol-acid reductoisomerase is an NADH-dependant ketol-acid reductoisomerase, id. at 10-11; and

a constitutively active Aft protein, id. at 11.

The Court granted one defendant’s motion for summary judgment of non-infringement as to the ‘376 patent and as to certain claims of the ‘375 patent, finding the doctrine of equivalents inapplicable. See id. at 17-27. Plaintiff also did not argue that defendant literally infringed the ‘375 patent and conceded that fact with respect to the ‘376 patent. Id. at 23, 27.

The Court also granted the same defendant’s motion for summary judgment as to the invalidity of the ‘375 patent. Defendant argued lack of both written description and enablement. This patent claimed the creation of significantly higher yields of the patented invention than the yields the inventor had actually obtained. Id. at 32. The Court concluded that the patent was invalid for lack of written description because “persons skilled in art would [not] recognize in the patent’s disclosure a description of the higher yields of the claimed invention.” Id. at 33. “The parties’ experts agree that the technology at issue is both complex and unpredictable. . . . The specification provides no detail on how to practice claim 1 to achieve higher yields.” Id. The patent was also invalid for lack of enablement, for similar reasons. See id. at 36.

The Court did not grant either parties’ motions for summary judgment on the validity/invalidity of the ‘376 patent, finding that there were issues of material fact as to whether the patent was invalid for lack of enablement, specifically issues “bearing on the disclosures and the amount of experimentation required to practice the full scope of the claims.” Id. at 38.

Defendant also argued that the ‘376 patent was anticipated by defendant’s International Patent Application. The Court did not address the substance of this argument because issues of material fact remained as to whether the inventors of the ‘376 patent conceived and reduced their invention to practice before the priority date of the International Patent Application. Id. at 43-44. The Court did note that “if [this application] is found to be anticipatory, [plaintiff] is precluded from making substantive arguments against anticipation as it did not do so herein.” Id. at 44 n.29.

Finally, both defendants moved to exclude the testimony of plaintiff’s expert. The Court denied this Daubert motion because defendants’ “arguments that [the expert] did not independently conduct experiments as part of his analysis do not preclude his testimony or opinions.” Id. at 44.

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Posted On: July 30, 2013

Magistrate Judge Burke discovery rulings remind parties of need to support undue burden arguments with evidence

Magistrate Judge Christopher J. Burke recently issued an order resolving several discovery disputes and reminding litigants that a party opposing discovery on the basis of alleged undue burden typically must do more than simply argue that it will be burdened. E.I. du Pont de Nemours and Co. v. Heraeus Precious Metals North Am. Conshohocken LLC, C.A. No. 11-773-SLR-CJB (D. Del. July 26, 2013). Although Judge Burke found that information regarding the plaintiff’s conductive pastes used for non-photovoltaic applications was relevant to the defendant’s invalidity defenses, the Court did not order production of all such information, because “the burden for [the plaintiff] to produce ‘potentially thousands of records’ regarding ‘at least 1,500 products’ (nearly all of which are non-photovoltaic products) spanning ‘multiple years’ outweighs its likely benefit to [the defendant].” Id. at 2. The Court made this ruling even though the plaintiff failed to provide affidavits or other evidence to support its undue burden argument, which the Court noted would have been preferable. Id. at 2 n.1. Notably, though, the Court explained that the requested information was not truly needed by the defendant in light of admissions made by the plaintiff. Id. at 2-3 n.2.

Judge Burke next considered whether pre-2003 information in an electronic database was inaccessible under Rule 26(b)(2)(B). Here, because the plaintiff did not support its “inaccessibility” argument with an affidavit or other evidence, the Court could “not conclude that the data here is inaccessible.” Id. at 4. Similarly, the plaintiff argued that it would be unduly burdened by an order requiring that it produce batch-by-batch quality control data from pre-2006 testing, but the Court found that the argument was “brief,” “not particularly specific,” and moreover did “not provide the Court with enough detail regarding the likely time, cost or effort associated with the proposed search, sufficient to conclude that the request is unduly burdensome . . . .” Id. at 4 n.5. On the final issue, the Court ordered that [the plaintiff] identify certain ingredients in its pre-2006 conductive pastes, explaining that the plaintiff made "no attempt to specifically combat the relevance of this data, nor to make concrete the burden it would face in responding to this portion of the request.” Id. at 5.

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Posted On: July 30, 2013

Special Master Redfearn considers motion to compel answers to interrogatories

Special Master B. Wilson Redfearn recently considered plaintiff’s motion to compel a defendant’s response to its Interrogatories 1 and 10, which requested the following:

-Interrogatory 1: Identify and describe in detail your expectations of sales and actual sales of the Relevant Products or Relevant Services and mobile devices.

-Interrogatory 10: Describe all communications between you and any mobile network operator (e.g., Sprint, U.S. Cellular) regarding the sale or potential sale of Relevant Products.

EON Corp. IP Holdings, LLC v. Flo TV Inc., et al., C.A. No. 10-812-RGA (D. Del. Jul. 23, 2013) (emphasis added). As Special Master Redfearn explained, “the case has been bifurcated,” but plaintiff argued that the “information sought through these interrogatories is relevant to the infringement issues because it is probative of commercial success, a secondary consideration of nonobviousness.” Id. at 1. Defendant, on the other hand, argued that before it is required to respond, plaintiff must “first show a specific nexus between the commercial success of the product and the alleged infringing features.” Id. at 3. Special Master Redfearn disagreed with defendant’s contention and found that plaintiff “is allowed to propound discovery for the purpose of developing factual information which could assist in showing that its invention is valid, i.e., it can propound discovery which it reasonably believes will permit it to argue at trial that there was commercial success, which supports its position on nonobviousness (rebutting the invalidity contentions)." Id. at 4.

Nevertheless, Special Master Redfearn found that the scope of Interrogatory 1 should be narrowed. Specifically, Special Master Redfearn explained that defendant “must furnish actual sales information concerning its ‘Relevant Products,’” but “its response can be limited to (1) sales which involve products using the accused features; and (2) products which were sold within thirty-six months after they were put on the market.” Id.

Further, Special Master Redfearn concluded that Interrogatory 10 should be denied as “ambiguous and overbroad.” Id. at 5. He explained that “[i]n order for an interrogatory (or interrogatories) of this nature to be properly formed for a company the size of [defendant], with a national and international sales force, the Plaintiff would have to set out the type of communications to which it refers; narrow the persons (or at least the internal entities) from whom the information is being sought; and set out the relevant time period.” Id. at 4-5. The Special Master noted that “[e]ven then, there could well be valid objections on the basis of relevancy.” Id. at 5.

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Posted On: July 30, 2013

Judge Stark Construes Terms of Online Shopping Guaranty Patent

Plaintiff buySAFE filed a patent infringement action against Google on buySAFE’s U.S. Patent No. 7,644,019. The patent-in-suit relates to providing a guaranty service for online transactions, and buySAFE alleged that it covers a Google service called “Trusted Stores” by which Google provides consumers with information about quality online shopping experiences. The parties agreed that early claim construction would likely streamline the case and, accordingly, stayed discovery until after claim construction. The claim construction disputes were limited to two terms. BuySafe, Inc. v. Google Inc., C.A. No. 11-1282-LPS, Memorandum Opinion at 1-4 (D. Del. July 29, 2013).

Judge Stark first construed plaintiff’s proposed term, “transaction performance guaranty,” and defendant’s proposed term, “guaranty.” Finding that the issues for both terms were identical, Judge Stark adopted Plaintiff’s proposed construction for both. Id. at 5-7. On the second term at issue, “underwriting,” Judge Stark adopted a construction that the parties agreed to during oral argument at the Markman hearing and further found that the term was not indefinite. Id. at 7-9.

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Posted On: July 29, 2013

Judge Stark issues claim construction opinion

In a recent memorandum opinion, Judge Leonard P. Stark construed thirteen disputed claim terms across U.S. Patent Nos. 5,885,270 (“the ’270 Patent) and 5,885,272 (“the ’272 Patent”). Walker Digital, LLC v. Google Inc., C.A. No. 11-318-LPS (D. Del. Jul. 25, 2013). As Judge Stark explained, “the patents-in-suit – issued on the same date, listing the same named inventors, and sharing substantially identical specifications – relate to establishing anonymous communications.” Id. at 1. Judge Stark construed the following disputed terms:

-"cryptographic operation," as it appears in claim 3 of the '272 Patent.

- "cryptographic key," as it appears in claim 3 of the '272 Patent.

- "authenticating authorship," as it appears in claim 2 of the '272 Patent.

- "said [___],"as it appears in all asserted claims of the '270 Patent and '272 Patent.

- "identity"/ "identity of said first party"/ "identity of said second party," as it appears in all asserted claims of the '270 Patent.

- "anonymous party," as it appears in all asserted claims of the '270 Patent.

- "party data," as it appears in all asserted claims of the '270 Patent and '272 Patent.

- "party rule," as it appears in all asserted claims of the '270 patent and '272 Patent.

- "rule for releasing said identity of said ... party," as it appears in all asserted claims of the '270 Patent, and "rule for releasing said [first/second party] data," as it appears in all asserted claims of the '270 Patent and '272 Patent.

- "releasing/release said second party data pursuant to said second party rule," as it appears in all asserted claims of the '272 Patent.

- "exchanging said first and second data, except said identifies of said first and second parties, between said first and second parties" / "exchange said first and second data, except said identities, between said first and second parties" as it appears in all asserted claims of the '270 Patent.

- "after said exchanging step" / "after said exchanging operation," as it appears in all asserted claims of the '270 Patent.

- "receiving/receive a request from said second party for said first party information data; releasing/release said second party data pursuant to said second party rule; determining/determine, based on said second party data, whether said at least one first party rule has been satisfied; and if said at least one first party rule has been satisfied, providing/provide, to said second party, said first party information data for which said at least one first party rule has been satisfied," as it appears in all asserted claims of the '272 Patent.

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Posted On: July 29, 2013

Special Master Lukoff issues opinion and order regarding privilege log dispute

Special Master Paul M. Lukoff recently ruled on a dispute “over so-called third party consultants and the impact of their presence on what might otherwise be privileged communications.” Robocast, Inc. v. Apple, Inc., C.A. No. 11-235-RGA; Robocast, Inc. v. Microsoft Corporation, C.A. No. 10-1055-RGA, slip. op. at 2 (D. Del. Jul. 19, 2013). Special Master Lukoff addressed the issue on a document-by-document basis and ordered that some of the documents on plaintiff’s log were to be produced, as the presence of third parties had waived attorney-client privilege. Id. at 13-14.

As a preliminary matter, the Special Master examined, on a document-by-document basis, whether plaintiff complied with FRCP 26(b)(5)(A), which obligates a party claiming privilege to describe the withheld documents with sufficient detail, or whether noncompliance with this rule resulted in waiver. While the Special Master disagreed with plaintiff’s argument that some Delaware cases “stand for the proposition that the privilege proponent must always be given further opportunity, in the face of a Rule 26(b)(5)(A) challenge, to take another stab at an adequate description” (and in this case the plaintiff had already amended its log several times, id. at 3-5) the Special Master found “very few” Rule 26(b)(5)(A) issues in plaintiff’s current log. Id. at 4 n.5.

Turning to the specific issue in dispute, the Special Master observed that there was a “possibly irreconcilable split” between Third Circuit (non-Delaware) district courts as to the proper test for whether a non-employee was the “functional equivalent” of an employee for purposes of attorney-client privilege. Id. at 6-7. Additionally, there was no Third Circuit case “explicitly adopt[ing] the functional equivalent concept in any form.” Id. However, this issue “pose[d] no obstacle” to resolving this dispute because: (i) the Special Master was “comfortable with the notion that some functions of a relatively small company like [plaintiff] might be best or necessarily accomplished through independent contractors and/or non-employee consultants;” (ii) Third Circuit precedent made clear that “there is no discernible bright line to be followed when the privilege is assessed;” and (iii) “even if one adopts and then adheres to one interpretation of the functional equivalent test or the other, each individual document must be reviewed on a case-by-case basis to determine if it was created for the purpose of providing or obtaining legal advice.” Id. at 7 (internal citations omitted).

With these principles in mind, the Special Master examined the duties of various non-employees and discussed how their duties may or may not waive privilege when they were privy to communications. Id. at 7-11. The Special Master further explained that his “rationale for making any such determination [of waiver] will not be founded on [the third party’s] status as an ‘outsider’ or the ‘functional equivalent’ of a [plaintiff] employee, but rather on the individual’s relative position with respect to obtaining legal advice.” Id. at 13.

Special Master Lukoff mapped out his Rule 26(b)(5)(A) and privilege conclusions in a “lengthy chart,” and ordered plaintiff to produce copies of all documents in the log that the Special Master had concluded were not privileged based on waiver. Id. at 13-14.

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Posted On: July 29, 2013

Judge Robinson finds patents valid and infringed in ANDA litigation

In a recent post-trial opinion, Judge Sue L. Robinson considered infringement of U.S. Patent Nos. 6,200,604 (“the ’604 Patent”); 6,974,590 (“the ’590 Patent”); and 8,119,158 (“the ’158 Patent”), and the validity of U.S. Patent No. 8,092,832 (“the ’832 Patent”) and the ’158 Patent in this ANDA litigation. Cephalon Inc. et al. v. Mylan Pharmaceuticals Inc. et al., C.A. No. 11-164-SLR (D. Del. Jul. 22, 2013). Plaintiffs initiated this litigation after defendants filed ANDA No. 202577, which sought to market generic fentanyl citrate buccal tablets, a medication that aids breakthrough cancer pain. Id. at 1-2.

Before addressing infringement and validity, Judge Robinson was required to construe two disputed claim terms. “Providing a solid oral dosage form” was given its ordinary meaning, and “pH adjusting substance is not a component of said effervescent material” was construed to mean “pH adjusting substance is in addition to the components of said effervescent agent.” Id. at 13-18. Turning to the infringement of the asserted claims of the ’590 and ’604 Patents, Judge Robinson noted that the “only limitation of the asserted claims . . . that [defendants] argue[] is not met by the ANDA product ‘is at least one [salival activated] effervescent agent in an amount sufficient to increase absorption.’” Id. at 20. Judge Robinson ultimately determined that plaintiffs demonstrated that defendants’ ANDA practiced “each and every requirement of the disputed limitations.” Id. at 38. Further, there was no “genuine dispute of material fact that [defendants] will encourage use through its product labeling and sale of its generic tablets and is aware that the label presents infringement problems.” Id. at 37. Moreover, because “[t]he only authorized use for the ANDA products would infringe” the asserted claims, there was “no substantial noninfringing use.” Id. at 38. Judge Robinson thus concluded that defendants indirectly infringed the asserted claims of the ’590 and ’604 Patents through induced infringement and contributory infringement. Id. Next, Judge Robinson considered infringement of the ’158 Patent, noting that “[t]he only dispute for infringement is whether the ANDA products meet the limitation ‘wherein said pH adjusting substance is not a component of said effervescent material.’” Id. Defendants did “not offer any noninfringement defense under the court’s construction” of that limitation, and Judge Robinson concluded that defendants directly and indirectly infringed the ’158 Patent. Id. at 39-40.

Judge Robinson next considered whether the ’604 Patent anticipated certain asserted claims of the ’92,832 and ’158 Patents. Judge Robinson noted that those claims required dosages between 100 and 800 mcg of fentanyl free base. Id. at 43. Defendants’ expert argued that a “person of ordinary skill in the art would understand a ‘pharmaceutically effective amount’ taught by the ’604 Patent includes fentanyl free base in the range of 100 to 800 mcg,” because a person of ordinary skill in the art would have would have looked at “Actiq®, an FDA-approved product and recognized that its range of fentanyl, 200-1600 mcg, was pharmaceutically effective.” Id. at 43-44. Judge Robinson noted, however, that “extrinsic evidence of anticipation ‘must make clear that the missing descriptive matter is necessarily present in the thing described in the reference.’” Id. at 44. As Judge Robinson explained, Actiq® was “not mentioned in the ’604 patent or incorporated therein.” Id. Because Judge Robinson found that the “’604 patent does not disclose the claimed amounts of fentanyl, the [’92,832 and ’158 Patents] are not invalid for anticipation.” Id. at 43.

Judge Robinson also considered whether the asserted claims of the ’92,832 and ’158 Patents were obvious “in view of the ’604 patent in combination with the Actiq® brochure and the Handbook.” Id. at 45. Judge Robinson noted that defendants’ expert did “not offer an opinion that one of ordinary skill in the art, absent the benefit of . . . internal observations and documents, would have had any reasons to suspect stability issues, and therefore, be motivated to solve such issues. He cannot rely on the problems that the inventors ‘unexpected[ly]’ ran into in order to support a person of ordinary skill’s motivation to combine.” Id. at 51. Because defendants did not provide sufficient evidence of motivation to use “SSG, alone or combination with mannitol,” defendants failed to carry its burden of showing obviousness. Id. at 53. Judge Robinson additionally assessed secondary considerations of nonobviousness. Judge Robinson found “unexpected results . . . sufficiently supported by [plaintiffs’] testing,” which weighed in favor of nonobviousness. Id. at 53-56. On the other hand, Judge Robinson found that considerations of commercial success, praise, failure of others, and long-felt need did not weigh in favor of a finding of nonobviousness. Id. at 56-61. However, on balance, Judge Robinson concluded that defendants failed to demonstrate by clear and convincing evidence that the asserted claims of the ’92,832 and ’158 Patents were obvious in light of the prior art references. Id. at 61.

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Posted On: July 29, 2013

Judge Stark denies motion to dismiss based on laches, finding that ruling on defendant's defense requires consideration of matters outside the pleadings

Judge Stark recently considered AT&T's motion to dismiss United Access Technologies, LLC's amended complaint based on laches. United Access Technologies, LLC v. AT&T Corp., et al., C.A. No. 11-338-LPS (D. Del. Jul. 26, 2013). AT&T argued that laches barred plaintiff's claims because "with full knowledge of AT&T' s relevant activities, Plaintiff sat on its patent rights for nearly nine years without attempting to enforce them against AT&T." Id. at 1-2. Plaintiff's predecessor had previously sued AT&T in 2002 for infringement of several of the same patents-in-suit, but, after voluntarily dismissing the suit plaintiff waited nine years (and until after the patents expired) to file suit again. Id. at 2. Plaintiff responded that, among other things, "its alleged delay [was] not apparent from the face of the Amended Complaint, and therefore the laches defense is not amenable to resolution on a motion to dismiss. Id. Judge Stark agreed. "'[A] ruling on the defendant's defense of laches would necessarily involve a fact-intensive analysis and balancing of equities that would require the Court to consider matters outside the pleadings that are in dispute.' Discovery will be required before the laches defense can be fairly evaluated." Id. (quoting Lennon v. Seaman, 63 F. Supp. 2d 428, 439 (S.D.N.Y. 1999)).

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Posted On: July 29, 2013

Judge Stark Construes Terms of Integrated Circuits Patents

Judge Leonard Stark recently issued a claim construction opinion for patents relating generally to programmable logic devices and clock management for dynamic integrated circuits. Plaintiff Intellectual Ventures brought suit against several circuit companies, and after settlement with several defendants, only Altera and Xilinx remain. The Court held a Markman hearing in May, and Judge Stark has now construed the following terms, adopting the plaintiffs’ proposals for all but three terms for which he adopted a modified versions of the defendants’ proposals:
- “application specific field programmable gate array (‘ASFPGA’)”
- “fixed functional unit(s)”
- “bus interface(s)”
- “peripheral component interconnect”
- “application specific integrated circuit (‘ASIC’)”
- “during normal operation of the ASIC”
- “complements”
- “configured to”
- “individually programmable”
- “reconfigurable processor core”
- “whole processor unit(s)”
- “a controller having a plurality of clock outputs each coupled to a respective clock input of one of the whole processor units, wherein the controller is configured to independently vary a clock frequency of each whole processor unit”
- “each module having a defined function”
- “power-down” and “power-up”

Intellectual Ventures I LLC, et al. v. Altera Corp., et al., C.A. No. 10-1065-LPS, Memorandum Opinion at 4-22 (D. Del. July 26, 2013).

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Posted On: July 26, 2013

Judge Andrews construes claim terms of networking systems patents

In a recent claim construction opinion, Judge Richard G. Andrews construed the following terms of U.S. Patent Nos. 7,945, 736 B2, 7,948,921 B1, and 7,630,295 B2:

“configure(d),” id. at 1-3;

“data packet,” id. at 3-6; and

“communications interface configured to process the signal to activate and deactivate the link,” id. at 6-7.

Riverbed Technology, Inc. v. Silver Peak Systems, Inc., C.A. No. 11-484-RGA (D. Del. Jul. 23, 2013).

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Posted On: July 26, 2013

Judge Robinson grants motion for leave to amend complaint 9 months after deadline to amend pleadings

Judge Robinson recently considered a motion for leave to file a second amended complaint filed by plaintiffs in Novartis Vaccines and Diagnostics, Inc., et al. v. Medimmune, LLC, et al., C.A. No. 11-84-SLPR (D. Del. July 22, 2013). Plaintiffs previously filed a first amended complaint, and then a supplemental complaint adding Novartis Pharma AG, exclusive licensee of the patent-in-suit, as a co-plaintiff. Id. at 1. Over six months later, when defendant Alexion raised a concern that the amended complaint included "an erroneous assertion that both [plaintiffs] were alleging infringement by Alexion[,]" plaintiffs proposed amending the complaint a second time to clarify the allegations of infringement by Alexion and remove claims against MedImmune, who had previously settled with plaintiffs. Id. at 3. Defendant Biogen refused to consent to the proposed amendment. Id. at 3-4.

Judge Robinson analyzed whether plaintiffs had good cause, under Fed. R. Civ. P. 16(b), for delaying nine months after the deadline to amend pleadings to file its motion to amend. Id. at 5. Judge Robinson found that the delay was not of plaintiffs' making because defendants did not raise the issue with its interpretation of the infringement claims in the supplemental complaint until over six months after the deadline. Id. After the concern was raised, Plaintiffs behaved diligently, making "three separate proposed revisions" and engaging in several meet and confer sessions with defendants. Id. at 5-6.

Judge Robinson then considered the factors to determine whether leave to amend should be given:

(1) whether the amendment has been unduly delayed; (2) whether the amendment would unfairly prejudice the non-moving party; (3) whether the amendment is brought for some improper purpose; and (4) whether the amendment is futile.

Id. at 6 (citing Foman v. Davis, 371 U.S. 178, 182 (1962)).

The only factor at issue was defendant Biogen's claim that plaintiffs' allegation of willful infringement and request for treble damages was futile. Id. Judge Robinson noted that "allegations of willfulness and requesting treble damages have appeared in all three of the complaints filed in this action." Id. at 3 n.1. Regardless, Judge Robinson found that plaintiffs' claims were not fuitle after analyzing the claims under In re Seagate Tech., LLC, 497 F.3d 1360, 1371 (Fed. Cir. 2007). Specifically, plaintiffs provided evidence that Biogen knew about the alleged infringement at least two months prior to plaintiffs' filing of the suit. Id. at 7. Judge Robinson rejected Biogen's argument that plaintiffs' willfulness claims were barred because Novartis Pharma did not become the exclusive licensee of the patent-in-suit until 18 months after the filing of the suit. Id. 7. Judge Robinson noted that "courts have upheld willfulness claims based on conduct occurring before a plaintiff had standing to sue. Id. at 7-8.

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Posted On: July 24, 2013

Judge Robinson denies defendants’ request to preclude prior art from trial

In a recent memorandum order, Judge Sue L. Robinson denied defendants’ request to preclude plaintiffs “from presenting testimony or evidence relating to [defendants’] prior product ActiTUF.” Invista North America S.A.R.L. et al. v. M&G USA Corp. et al., C.A. No. 11-1007-SLR-CJB (D. Del. Jul. 16, 2013). Defendants argued that “ActiTUF is a plastics product with an iron-based system, rather than the cobalt-based system allegedly developed by [plaintiffs],” and thus “testimony or evidence relating to ActiTUF is not relevant to the issues at trial and will likely confuse a jury.” Id. at 1. Plaintiffs, on the other hand, argued that “ActiTUF is relevant to at least the state of the art at the time of the invention and secondary considerations.” Id. Specifically, plaintiffs asserted that they would “present evidence at trial regarding how the inventors of its claimed inventions looked to improve on the problems with ActiTUF’s iron-based system.” Id. at 2. Ultimately denying defendants’ request, Judge Robinson found that, “although ActiTUF is not an accused product in this litigation, testimony or evidence relating to it is relevant to the state of the art at the time of the invention and secondary considerations.” Id. She also noted that “[s]uch evidence would not likely confuse a jury because there is no dispute that ActiTUF uses a different approach and is not covered by the patents at issue.” Id.

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Posted On: July 24, 2013

Special Master Redfearn issues rulings and recommendations on protective order issues.

Special Master B. Wilson Redfearn recently issued rulings and recommendations on issues relating to the parties’ protective order. Eon Corp. IP Holdings, LLC v. FLO TV Inc., et al., C.A. No. 10-812 (RGA) (D. Del. July 10, 2013). First considered was the defendants’ argument that the prosecution bar be extended to include reexamination and resissue proceedings to guard against the “significant risk of plaintiff’s inadvertent use of defendants’ confidential information” absent such an extension. Id. at 2. Special Master Redfearn denied the requested extension, noting that the defendants failed to “substantiate any actual risk that might be incurred.” Id. He explained that in the context of reexamination, the “[d]efendants’ confidential information is basically irrelevant to” the determination of patentability over specific prior art.” Id. (quoting Xerox Corp. v. Google, Inc., 270 F.R.D. 182, 184 (D. Del. 2010)). Special Master Redfearn recommended, therefore, that the defendants’ request be denied for failure to satisfy their burden of demonstrating that the proposed extension of the prosecution bar was necessary. Id.

Special Master Redfearn also denied the defendants’ request that the defendants’ respective in-house counsel be permitted access to settlement materials between the plaintiff and settling defendants. The defendants sought in-house counsel access to “settlement and licensing information,” which Special Master Redfearn viewed as seeking “the specifics, and particularly the amounts, of the settlements with the dismissed defendants, as well as the monetary terms of the licenses, should such exist.” Id. at 3 n.4. Special Master Redfearn explained, “[t]his is not a situation where specific damages and/or settlement details in one case would affect the damages in other cases. Essentially each cause of action stands on its own and, as such, is subject to independent appraisal.” Id. at 4. Based on that, as well as the fact that the issue of damages was bifurcated and the defendants in any event failed to provide any legal support for their request, Special Master Redfearn recommended denial of the request. Id.

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Posted On: July 23, 2013

Judge Sleet grants motions to stay in multi-district litigation

Chief Judge Gregory M. Sleet recently granted several defendants’ motions to stay pending inter partes reexamination in a Multidistrict Litigation (“MDL”) transferred to the District of Delaware in May 2012. In re: Bear Creek Technologies Inc. (‘722 Patent Litigation), MDL No. 12-md-2344-GMS (D. Del. Jul. 17, 2013). The plaintiff had sued defendants for patent infringement related to voice-over internet protocol products in the Eastern District of Virginia in February 2011. Id. at 2. All defendants save one had been severed for misjoinder in August 2011. Id. Around that same time, a non-party to the current MDL, Cicso, had also filed a request for inter partes reexamination of the patent-in-suit. Id. at 4. All defendants, both those who had moved to stay and those who did not oppose these motions, had agreed to be bound by the results of this reexamination if the Court stayed the litigation. Id. at 4 & n.2.

The Court concluded that the relevant factors favored the grant of a stay. Not only had the PTO preliminarily rejected all claims of the patent-in-suit, but this reexamination “also raises questions as to the effective priority date for the Patent, the determination of which could impact issues of validity and obviousness.” Id. at 6-7 n.8. The Court therefore concluded that the reexamination could simplify issues for trial and that “the court and the parties’ time and resources could be wasted” absent a stay. Id. at 7 n.8. It further noted that it was “unpersuaded by [plaintiff’s] contention that the asserted claims will be confirmed in reexamination because they have not been cancelled in two prior ex parte reexaminations.” Id.

Most of the MDL cases were in the early phases of litigation, and this fact also favored a stay. Id. The Court also stayed two actions that had progressed further. One was into claim construction and early discovery but was still “sufficiently early to be a neutral factor in the stay analysis.” Id. (internal quotation marks omitted). The other was “significantly further along” but the Court still stayed this action. Prior to the MDL transfer, the parties were well into fact and expert discovery and had participated in a Markman hearing, but this action had been stayed pending the MDL determination and “as a result, a Markman construction was not issued.” Id. Additional discovery was likely to take place “due to the ‘passage of time’ since the initial discovery, the pending Markman construction, . . . [defendant’s] modifications and updates to its telecommunications network,” and also because the parties could supplement discovery following the Court’s issuance of a Markman decision. Id. “In view of these factors and the MDL coordination of these cases, the court concludes that [this action] should be stayed along with the other actions.” Id.

Finally, the Court disagreed with plaintiff’s arguments that it would be prejudiced. Plaintiff argued that “the defendants will benefit from the inter partes reexamination in that Cisco can ‘audition’ the invalidity arguments the defendants would present at trial and learn which are successful.” Id. But the defendants’ agreement to be bound by this reexamination meant that they would be “estopped from challenging the validity of the [patent-in-suit] as obvious . . . based on the combinations of prior art presented by Cisco.” Id. “Despite [Plaintiff’s] assertion that this estoppel is too limited and does not protect its interests, the court finds the defendants' estoppel sufficient to guard against prejudice.” Id. (internal citations omitted). The Court also disagreed that the reexamination would cause unnecessary and unfair delay. “[T]he examiner responsible for the reexamination is already familiar with the [patent] family, having previously examined the patent-in-suit and its parent . . . . Moreover, this examiner had previously decided the priority date issue that is raised in the . . . reexamination by virtue of the [parent patent] examination.” Id. at 8 n.8. Finally, the plaintiff was a non-practicing entity that could be adequately compensated by money damages. Id.

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Posted On: July 22, 2013

The Federal Circuit Advisory Council adopts Model Order Limiting Excess Patent Claims and Prior Art

The Federal Circuit Advisory Council announced today its adoption of a Model Order Limiting Excess Patent Claims and Prior Art. The Council offered the Model Order "to aid trial courts in the exercise of their discretion in crafting orders tailored to the facts and circumstances of each case." In adopting the Order, the Council considered several key issues, such as:

What. What should be limited—number of claims, number of prior art references, number of invalidity theories, number of terms for claim construction, number of accused products, or some combination?

Timing. When should the limits on asserted claims and prior art references take effect? Should the limits be applied only once, or should a phased approach gradually narrowing the scope of the case be followed? How should the need for discovery be balanced against the value of early streamlining?

Limitations. How should limits be formulated? Should the limits on
number of claims apply per case or per patent? How should the limits be
adjusted based on the variety of case-specific factors that courts have
considered? How can the due process rights of litigants be protected?

Effect. What effect does the judgment have on non-elected patent claims
and prior art references?

The Council concluded that "default numerical limits on the number of asserted patent claims and prior art references are workable." And, a "phased implementation" of numerical limits would "balance the need for discovery against the benefits of early streamlining."

The Model Order is attached below.

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Posted On: July 19, 2013

Chief Judge Sleet Construes Terms of Sunscreen Patents

Chief Judge Gregory Sleet recently construed the terms of two patents held by L’oréal and covering certain sunscreen compositions. Judge Sleet construed the following terms of the patents-in-suit:
- “cosmetically acceptable vehicle”
- “effective amount”
- “effective amount of at least 1% by weight”
- “cosmetic screening composition”
- “cosmetic”
- “cosmetically acceptable vehicle”
L’oréal S.A., et al. v. Johnson & Johnson Consumer Co., Inc., et al., C.A. No. 12-98-GMS, Order at 2-8 (D. Del. July 19, 2013). Judge Sleet also refused to construe certain preamble terms—including terms used in one claim at issue that was a Jepson claim—which did not recite “additional structure or steps underscored as important by the specification” and were therefore not claim limitations requiring construction. Id. at 2-4 n.2.

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Posted On: July 18, 2013

Chief Judge Sleet Construes Terms of Semiconductor Patents

Chief Judge Gregory Sleet recently construed the terms of four patents related to semiconductor packaging. Judge Sleet construed the following terms of the patents-in-suit:
- “a top surface”
- “the second metal layer serves as a reference to”
- “layer(s)”
- “top layer”
- “bottom layer”
- “isolating ground trace”
- “to isolate the signal traces and thereby provide noise shielding”
- “to isolate the two groups of signals”
- “to create a bottom-layer isolating ground trace”
- “identifying one or more groups of signals that need to be isolated due to noise”
- “to provide noise shielding”
- “to create a second-layer isolating ground trace”
Invensas Corp. v. Renesas Elecs. Corp., C.A. No. 11-448-GMS at 1-8 (D. Del. July 15, 2013). Judge Sleet also refused to construe two terms “in the absence of a genuine dispute” because the parties had reached agreement on constructions for the terms and refused to find that method claims of one patent-in-suit were required to be performed in the order recited. Id. at 3 n.3-5.

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Posted On: July 18, 2013

Judge Robinson denies motion for reconsideration of summary judgment ruling.

Judge Sue L. Robinson recently denied a defendant’s motion for reconsideration of a summary judgment ruling of indirect infringement. INVISTA North America S.à.r.l. v. M&G USA Corp., Civ. No. 11-1007-SLR-CJB (D. Del. July 12, 2013). The defendant argued that the Court’s summary judgment ruling “misapprehended the facts supporting [the defendant’s] position" when it found that the defendant had submitted no evidence to create a genuine issue of material fact on the question of whether the accused products include "at least some trace amount of cobalt salt . . ., even if some of it complexes." Id. at 3; see also summary judgment ruling, discussed here at 24-25. As the Court explained, the ruling was based on the defense expert's own testimony (which was ignored in the defendant's motion for reconsideration) that the expert "didn't have an opinion about the cobalt . . . .” Id. at 3 n. 2. The Court explained that the defendant’s “attempt to create an opinion from an expert who has provided sworn testimony that he has no opinion on the relevant issue cannot sustain a motion for reconsideration or create any credibility issues for a jury.” Id. at 4.

The Court also rejected the defendant’s untimely attempt to submit in opposition to summary judgment a former employee and prosecution consultant's declarations and testimony, which provided data and opinions drawn from that data. Id. at 4-5. The consultant was listed by the defendant as a fact witness, and he never prepared an expert report. Id. at 4-8. The Court considered the defendant's proffer, but found that the data did not "include self-evident facts that cobalt neodecanoate complexes completely" and that the opinions drawn from the data "would clearly require scientific, technical, or other specialized knowledge" -- i.e, expert testimony. Id. at 6. The Court explained that the witness's proposed testimony on the issue in the litigation context would "not [be] within the purview of a fact witness and, most significantly, [his] testimony (whether fact or expert) regarding the extent to which cobalt neodecanoate complexes was never vetted during discovery and, submitted on the eve of trial, is untimely.” Id. at 8.

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Posted On: July 18, 2013

Judge Andrews dismisses Black Hills Media LLC's indirect infringement and willfulness

Judge Richard G. Andrews recently considered defendant Yamaha Corp. of America's motion to dismiss Black Hills Media LLC's amended complaint for failure to state a claim of patent infringement. Black Hills Media LLC v. Yamaha Corp. of America, C.A. No. 12-635-RGA (D. Del. July 12, 2013). Judge Andrews denied Yamaha's motion as to the claims of direct infringement because the claims complied with the Federal Rules of Civil Procedure's Form 18. Id. at 1. Yamaha argued, among other things, that plaintiff had to "state that by its complaint, it [was] giving notice of direct infringement." Id. Judge Andrews noted, however, that there was no support that dismissal would be proper simply for failing to state that the plaintiff was giving notice by filing the complaint. Id. Doing so "would be exalting form over substance[.]" Id. at 1-2. Judge Andrews did, however, dismiss without prejudice plaintiff's indirect and willful infringement claims. Id. at 2. Among other things, plaintiff failed to allege facts that would make "the claim of prior knowledge of the patents plausible[.]" Id. at 1-2.

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Posted On: July 16, 2013

Judge Stark construes claims relating to minimally invasive surgery

Judge Leonard P. Stark recently construed fifteen disputed claim terms across U.S Patent Nos. 7,691,057; 7,819,801; and 7,905,840, each entitled “Surgical Access System and Related Methods.” NuVasive, Inc. v. Globus Medical, Inc., C.A. No. 10-849-LPS (D. Del. Jul. 12, 2013). The three patents-in-suit relate “to a surgical access system and methods for performing surgery — particularly lumbar surgery, commonly referred to as minimally invasive spinal lumbar surgery.” Id. at 1. Judge Stark noted that in November 2011, the Court ordered plaintiff “to reduce the number of asserted claims from 55 to 15” and the parties “to reduce the number of proposed claim terms to be construed at this point in the case to no more than 15.” Id. at 1 n.1. Judge Stark construed the following fifteen disputed terms:

- "handle assembly"
- "handle assembly being capable of moving said plurality of retractor blades"
- "pivoting said first and second pivotable arm members relative to one another"
- "actuating"
- "coupled" / "coupling"
- "rigidly coupled"
- "being positioned to abut one another and form a closed perimeter"
- "closed position"
- "open position"
- "being positioned generally away from one another and forming an open perimeter"
- "opened"
- "groove"
- "neuromonitoring/nerve monitoring"
- "trans-psoas"
- "using [at least one] stimulation electrode"

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Posted On: July 15, 2013

Judge Andrews issues claim construction opinion in ANDA case

In a recent claim construction opinion, Judge Richard G. Andrews construed the following terms of U.S. Patent Nos. 7,582,717 and 7,598,343: “pharmaceutical batches,” id. at 1-3; “wherein the batches have a pH adjusted by a base,” id. at 3-6; and “efficient mixing,” id. at 6-11. The Medicines Company v. Teva Parenteral Medicines, Inc., et al., C.A. No. 09-750-RGA (D. Del. Jul. 11, 2013).

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Posted On: July 11, 2013

Judge Andrews grants motions to intervene and sever, denies motions to stay

In a recent memorandum order, Judge Richard G. Andrews granted Adobe Systems, Inc.’s (“Adobe”) motion to intervene in two actions pending in the District of Delaware, C.A. Nos. 11-812-RGA and 12-1440-RGA. Select Retrieval LLC v. Amerimark Direct LLC, et al., C.A. No. 11-812-RGA (D. Del. Jul. 3, 2013). Judge Andrews also granted defendants’ motions to sever in C.A. No. 11-812, but denied defendants’ motions to stay in both actions.

Judge Andrews explained that while plaintiff has not sued Adobe, it has sued at least five of its customers in the District of Delaware. Id. at 2. Moreover, “there is litigation on the same patent between the Plaintiff and other Adobe clients” at least in the Southern District of California, Oregon, Illinois, and Maine. Id. Judge Andrews additionally noted that Adobe had filed a declaratory judgment against plaintiff in the Southern District of California, but there has recently been little activity in that action. Id. at 1-2.

Considering Adobe’s motion to intervene, Judge Andrews was guided by Fed. R. Civ. P. 24(a). First, Judge Andrews considered “the extent to which Adobe’s technology was at issue” and “whether Adobe has . . . a duty to defend and indemnify its clients” to determine whether Adobe had a “significant protectable interest.” Id. at 2-3. Judge Andrews noted that plaintiff “did not dispute that Adobe had a duty to defend and indemnify its five clients.” Id. Moreover, Judge Andrews noted that “[t]he fact that Adobe has acknowledged its duty to defend and indemnify is a fairly strong indicator that its technology is indeed at issue in these cases.” Id. at 3. Judge Andrews further explained that “the fact that these five Adobe clients (as well as at least four more Adobe clients in the four related cases) all are alleged to infringe the patent suggests that Adobe’s technology may be the common link that provides a basis to believe each of the nine or more companies infringes the patent.” Id. Judge Andrews thus found it unnecessary “to delve into the technology here to conclude that Adobe does have a significant protectable interest.” Id. Finding the remainder of the Rule 24(a) factors to weigh in Abode’s favor, Judge Andrews granted Adobe’s motion to intervene. Id.

With respect to the motion to stay the litigation, defendants argued for application of the “customer suit exception.” Judge Andrews first distinguished the instant matter from Pragmatus Telecom, LLC v. Advanced Store Co., Inc., C.A. No. 12-88-RGA (D.Del. Jul. 10, 2012) (discussed previously here), where defendants had also argued in favor of the customer suit exception. Id. at 3-4. Judge Andrews noted that in this case, the “manufacturer declaratory judgment is in another district” (weighing in favor of applying the exception). Id. at 4. On the other hand, in this action, “customer defendants have not agreed to be bound by the results.” Id. Moreover, Judge Andrews found that “given the lack of activity in the declaratory judgment action, I cannot think that [granting stay] presents a particularly fair (to the Plaintiff) alternative to the pending litigation.” Id. On balance, Judge Andrews found there were “too many loose ends,” and denied defendants’ motions to stay the litigation. Id.

Judge Andrews had no “hesitation in concluding that the four Adobe customers [in C.A. 11-812] are not properly joined to cases involving other defendants using technology obtained elsewhere.” Id. at 3. Judge Andrews thus granted defendants’ motions to sever, but the cases against them were consolidated with those of the other defendants for all purposes other than trial. Id. at 4.

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Posted On: July 11, 2013

Judge Sleet claim construction order

Chief Judge Gregory M. Sleet recently construed the claim terms of U.S. Patent Nos. 5,780,676 and 5,962,731 relating to plaintiff's Targretin® drug indicated for the treatment of cutaneous T-cell lymphoma. Eisai, Inc. v. Banner Parmacaps Inc., et al., C.A. No. 11-901-GMS (D. Del. July 2, 2013). The Court construed the following terms:

"co-transfection assay"
"useful to treat skin cancer"

In construing the terms, the Court rejected defendants' proposed construction for "co-transfection assay" that was defined through reference to an article published in Science magazine. Id. at. n.1 After the Markman hearing, the defendants submitted a supplemental letter brief proposing a new construction that excluded reference to to the article. Id. The Court agreed with plaintiff that the supplemental brief was untimely, but did not reach the decision on whether it should consider the brief regardless:

The court agrees that the timing of the defendants' proposed construction comes late in the claim construction process and, without the court granting leave for further briefing, limits the plaintiff's opportunity to fully respond to the merits of the new proposed construction. However, because the court agrees with the plaintiff's proposed construction of this term, it does not need to reach a decision on whether the defendants' second proposed construction should be considered.

Id.

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Posted On: July 10, 2013

Judge Sleet grants motion to stay pending inter partes review

Chief Judge Gregory M. Sleet recently granted defendants’ motion to stay litigation pending inter partes review of U.S. Patent No. 8,212,094, entitled “Process for the Manufacture of Diesel Range Hydocarbons.” Neste Oil Oyj v. Dynamic Fuels, LLC, et al., C.A. No. 12-744-GMS (D. Del. July 2, 2013).

The Court concluded that the relevant factors governing the grant of a stay, “when taken together, favor granting the defendants’ motion.” Id. at 3. As to the “sub-factors” governing the undue prejudice factor, defendants’ “prompt filing” of its petition and its motion to stay favored granting a stay, but the early stage of the review proceedings increased the risk of prejudice. Id. at 4. The parties were competitors, but “there is some dispute as to the practical scope of the market in which they operate,” with plaintiff arguing that the parties were the only competitors in the market and defendants arguing that the market was broader. Id. at 5-6. The Court, “largely unpersuaded by [plaintiff’s] arguments regarding the practical size of the market,” concluded that the parties were “merely indirect competitors in the large, subsidy-driven market for biomass-based diesel.” Id. at 6 & n.3. Additionally, plaintiff had not sought a preliminary injunction. All of these sub-factors combined favored the grant of a stay because the risk of prejudice to the plaintiff was low. Id. at 7.

The Court also concluded that the potential for simplification of issues favored a stay, see id. at 7-9, and the status of the case “strongly” favored a stay as the case was “in its infancy.” Id. at 9.

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Posted On: July 9, 2013

Judge Andrews Lifts Stay Pending Reexamination

Judge Richard Andrews has lifted a stay pending reexamination of patents-in-suit in several pending cases filed by Pragmatus Telecom LLC. Judge Andrews noted that two of three patents-in-suit are now free of reexam and the third had survived significant steps of reexam. Essentially, “reexamination proceedings are over, unless [the defendants’ supplier] appeals the inter partes decision on [the third patent.]” Accordingly, Judge Andrews found, “the basis for granting a stay pending re-examination is eroding away” and there “is nothing of significance to be gained by keeping the stay in place.” Judge Andrews also denied the plaintiff’s request to strike the defendants’ response, which “appears to go out of its way to impugn the Plaintiff’s behavior and to label it a ‘troll.’” While this language “should have been avoided,” Judge Andrews denied by request to strike because he does not “generally believe in redacting or rewriting history.” Pragmatus Telecom LLC v. Alcatel-Lucent USA, Inc. et al., C.A. No. 12-1534-RGA, Order at 1-2 (D. Del. July 3, 2013).

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Posted On: July 9, 2013

Judge Robinson grants parent company's motion to dismiss infringement claims

In a recent memorandum opinion, Judge Sue L. Robinson granted a parent company's motion to dismiss infringement claims made against it based on the alleged conduct of its subsidiaries. Gevo, Inc. v. Butamax(TM) Advanced Biofuels LLC, et al., Civ. No. 12-1724-SLR (D. Del. July 8, 2013). As the Court explained in granting the motion, the plaintiff’s only factually supported allegations were that (1) the parent had two subsidiaries; (2) one of those subsidiaries was involved in a joint venture with another defendant; and (3) one of the defendants disclosed an infringing recombinant yeast strain. Id. at 5. “The remainder of [the plaintiff’s] allegations are conclusory statements.” Id.

More specifically, the Court explained that the complaint provided no underlying facts supporting the conclusory allegation that the parent controlled its subsidiaries’ infringing conduct, therefore “the court is not obligated to accept as true the proposition that [the parent] controls the activities of the subsidiary defendants or the activities of any business ventures owned by the subsidiaries.” Id. at 6. The Court noted that although “[i]t could be argued . . . that [the plaintiff] is not privy to such facts without discovery . . . indicia of control [such] as overlapping boards or officers or consolidated financial statements generally are within the public domain and should have been related if available.” Id. at 6 n.1. The Court also found insufficient the plaintiff’s allegation, made on information and belief, that the parent had actual notice of the defendant’s patent applications so as to support allegations of infringement of plaintiff’s provisional patent rights. The Court explained that this “actual notice” allegation was “not buttressed by any specific facts and is even further diluted by the use of “and/or” in the paragraph.” Id. at 7. For the same reasons, the Court found that the plaintiff did not adequately allege joint infringement or indirect infringement against the parent. Id. at 9-10.

The Court also granted the parent's motion to dismiss the plaintiff’s contributory infringement claim, explaining that the plaintiff did not plead that the parent "sold, offered to sell, or imported a component of the infringing product into the United States. Nor has [the plaintiff] offered facts that would support such a claim.” Id. at 10-11 (footnotes omitted). Finally, the Court granted the parent's motion to dismiss the plaintiff’s willful infringement claim, explaining that “the only circumstance identified by plaintiff to substantiate its willfulness claims . . . is the litigation itself[.]” Id. at 12.

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Posted On: July 9, 2013

Judge Stark denies motion to stay pending post-grant review

Judge Leonard P. Stark recently denied a defendant’s motion to stay pending post-grant review under the AIA’s Transitional Program for Covered Business Method Patents (“CBM Review”). Benefit Funding Systems LLC, et al. v. Advance America, et al., C.A. No. 12-801-LPS (D. Del. June 28, 2013). The Court explained that its denial was discretionary, and made without prejudice to the defendant’s right to seek a stay in the event the PTAB should ultimately grant the petition for CBM Review. Weighing the factors in Section 18(b) of the AIA, the Court found that (i) a stay would probably simplify issues for trial but likely would not eliminate the need for a trial altogether; (ii) although in its early stages, the Court and parties had invested significant resources in the litigation already whereas CBM Review had not yet been granted; (iii) a stay would prejudice the plaintiff, including by making the plaintiff’s licensing efforts more difficult; and (iv) a stay would not substantially reduce the burden of litigation on the parties and the Court. Id. at 3-4. Judge Stark also ordered that the defendant provide substantive responses to discovery requests, explaining that “Defendant’s effort to essentially grant itself a stay by resisting discovery due only to its pending motion for a stay is improper.” Id. at 1. Finally, the Court granted the plaintiff's motion for leave to amend its complaint to assert claims against one of the defendant's vendors, through which the defendant offered its allegedly infringing services. The Court explained that the defendant did "not have possession, custody, or control of core technical documents for [the vendor], and has been unable to persuade [the vendor] to produce such documents voluntarily." Id. at 2.

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Posted On: July 8, 2013

Judge Fallon denies defendant’s motion to transfer venue, denies plaintiff’s motion to strike

In a recent memorandum opinion, Magistrate Judge Sherry R. Fallon denied defendant’s motion to transfer venue to the Northern District of California and denied plaintiff’s motion to strike portions of the declaration of William Pringle, who defendant employs as a compliance associate. Agincourt Gaming, LLC v. Zynga, Inc., C.A. No. 11-720-RGA-SRF (D. Del. Jun. 18, 2013) (publicly-available redacted version issued Jun. 27, 2013 (D.I. 62)). Considering defendant’s motion to transfer, Judge Fallon found plaintiff’s forum preference weighed against transfer, “although not as strongly as it would if [plaintiff] had its principal place of business in Delaware.” Id. at 4. On the other hand, Judge Fallon found that defendant’s forum preference, and "to a lesser extent," the location of books and records, and “practical considerations” favored transfer. See id. As Judge Fallon explained, defendant’s forum preference had a “legitimate basis,” as it maintains its principal place of business in the Northern District of California where “most of its employees are located.” Id. Further, Judge Fallon found that the location of the books and records weighed slightly in favor of transfer because while defendant did not deny “that it [would] produce all relevant records electronically,” plaintiff did “not dispute that most of the relevant documents are located in the Northern District of California.” Id. at 6. Moreover, with respect to practical considerations that could make the trial easy, expeditious, or inexpensive, Judge Fallon noted that “[plaintiff] does not deny the fact that it will be more expensive and less convenient for [defendant] to litigate in Delaware, and does not contend that it would be substantially more convenient and less expensive for [plaintiff] to litigate in Delaware.” Id. at 7. Finding that the other public and private interest factors did “not add much weight to the balancing and are neutral,” Judge Fallon denied defendant’s motion to transfer. Id. at 4, 8.

With respect to the motion to strike, plaintiff first argued that the court should strike Paragraph 7 of William Pringle’s declaration because “he did not select the five employees slated to testify at trial based on his personal knowledge.” Id. Denying plaintiff’s motion, Judge Fallon explained that “[n]othing in the record suggests that Pringle did not have personal knowledge of the responsibilities of the five listed witnesses, their knowledge of the accused products, whether they would testify at trial, and whether they lived in the San Francisco Bay area.” Id. at 9. Further, as Judge Fallon noted, defendant offered “additional evidence” of which employees would testify and their locations in the form of Pringle’s 30(b)(6) deposition. Id. Second, Judge Fallon denied plaintiff’s motion to strike Paragraph 13, in which Pringle stated that he “'ha[s] been informed' of matters relating to the content of possible trial testimony.” Id. Plaintiff argued this statement constituted inadmissible hearsay, but Judge Fallon found that Paragraph 13 was merely “intended to show that the previously identified . . . employees” of defendant are capable of testifying with respect to relevant topics. Id. Third, plaintiff moved to strike Paragraph 15 of Pringle’s declaration on the grounds that “Pringle lacked knowledge on which to base his assessment at his deposition regarding how burdensome and expensive it would be to litigate in Delaware.” Id. at 10. Denying plaintiff’s motion, Judge Fallon found that Pringle had “personal knowledge, based on the number of games at issue in the suit, that the production of documents could be substantial and costly.” Id.

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Posted On: July 8, 2013

Judge Robinson considers motions to strike and exclude evidence

In Invista North America S.A.R.L., et al. v. M&G USA Corporation, et al., C.A. No. 11-1007-SLR-CJB (D. Del. June 25, 2013), Judge Sue L. Robinson considered three motions related to the parties’ discovery.

Plaintiffs moved to strike portions of defendants’ expert’s reply report and this expert’s references to and reliance upon certain experimental data. Plaintiffs argued that parts of the report were untimely because they addressed topics beyond secondary considerations, but the Court concluded that “although not labeled as such, [the sections] at issue were submitted in response to arguments in [plaintiffs’ expert’s] rebuttal report that [defendants’ expert’s] report was incomplete for failing to specifically cite support for his opinions. Thus, viewed as a supplement, those . . . pages were timely filed and appropriately clarified [defendants’ expert’s] opening report. They included only subject matter that was originally disclosed in the opening report and presented no new or changed opinions.” Id. at 5. Even if there had been some prejudice, it was “curable” by plaintiffs, and this reply report was “of high importance to [defendants].” Id. Therefore, the Court denied the motion with respect to this argument. As to the experimental data on which this expert relied, the Court similarly found that “the extreme sanction of” exclusion was not warranted, but noted that defendants could not withhold data from these experiments even if their expert only relied on selected portions of the data. See id. at 6-7. Defendants were ordered to produce such data. The Court did grant plaintiff’s motion to the extent that this expert’s declaration contained “previously undisclosed theories of invalidity,” and the Court listed the relevant parts of the opinion to be struck. Id. at 7-8.

Defendants moved to exclude plaintiffs’ expert’s testimony regarding infringement and secondary considerations of non-obviousness. Regarding the infringement opinion, defendants argued that the testimony was not reliable because the expert did not perform any testing. The Court denied this motion, explaining that “[t]esting is not required to support an infringement opinion” and concluding that the expert’s analysis was reliable. Id. at 9. Regarding the secondary considerations opinion, the Court concluded that the expert, a polymer chemist with over 30 years of experience in the polymer industry, was qualified under “the liberal standard for ‘specialized knowledge’” under Rule 702. Id. at 10. As a result, defendants’ motion was denied.

Finally, plaintiffs moved to strike defendant’s summary declaration and supplemental interrogatory response regarding defendants’ core documents, arguing that they were untimely and “set forth a new non-infringement defense that [defendants’] core technical documents do not reflect the composition of the [accused products].” Id. at 10. This non-infringement defense had been raised for the first time in summary judgment briefing. Although defendants argued that certain of its discovery responses and depositions had put plaintiffs on notice of this issue, the Court found that this defense was “new and untimely” as it “alter[ed] the entire infringement and non-infringement landscape that was developed and vetted during fact and expert discovery. . . . [Defendants were] aware of [plaintiffs’] infringement theories and even confirmed to the court that its own non-infringement theories were premised on its proposed claim construction, not the sufficiency of the core technical documents. At best, [defendants] stood by silently as [plaintiffs] relied on the core technical documents . . . . At worst, [defendants] purposefully disregarded the scheduling order and engaged in trial by ambush with its eleventh-hour defense. Either way, to allow [defendants’] belated new non-infringement theory would substantially prejudice [plaintiffs]” and would be “almost impossible” to cure at this stage of the case. Id. at 12. As a result, the Court granted plaintiffs’ motion to strike the supplemental declaration and interrogatory responses underlying this new defense. Id. at 13.

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Posted On: July 8, 2013

Judge Sleet grants motion to lift stay and grants motion for leave to file sur-reply

In Fifth Market, Inc. v. CME Group, Inc., et al., C.A. No. 08-520-GMS (D. Del. June 19, 2013), Chief Judge Gregory M. Sleet considered motions related to a stay the Court had issued in May 2011 following defendants’ filing of a request for ex parte reexamination of one patent (“the ‘419 Patent”) and the filing of a draft request for inter partes reexamination of a different patent (“the ‘387 Patent"). Id. at 1-2.

The PTO issued a reexamination certificate for the '419 Patent in February 2013 and granted inter partes reexamination of the '387 Patent in September 2012. The Court explained that “[t]hese developments principally affect the court's assessment of the undue prejudice factor, as [plaintiff] complains of the defendants’ 'excessive delay' in seeking reexamination of the '387 Patent and the resulting delay of this litigation.” Id. at 3 n.1. The timing of defendants’ inter partes reexamination request and its intent to file a request for post-grant review of the ‘419 Patent as a covered business method patent “indicate that they have adopted a strategy of raising piecemeal PTO challenges to [plaintiff’s] patents,” which was “impermissibly tactical.” Id. (internal quotation marks omitted). The status of the reexamination and the fact that the defendants had not yet filed their request for post-grant review also “concern[ed] the court” in terms of potential delay. Id. Finally, “[w]hile the final ‘relationship between the parties’ sub-factor [of the undue prejudice analysis] remains both unchanged and untroubling given [plaintiff’s] status as a non-practicing entity, the defendants’ timing and the status of the '387 reexamination-as well as the planned '419 CBM review-suggest that the broader undue prejudice factor now favors lifting the stay. The defendants appear to have sought an inappropriate tactical advantage, and denial of this motion would expose [plaintiff's] suit to the various evidentiary risks associated with prolonged stays.” Id. (internal citations omitted). As a result, the Court granted the plaintiff’s motion to lift the stay.

In the context of plaintiff’s motion to lift the stay, defendants had moved to strike plaintiff’s reply brief or, in the alternative, for leave to file a sur-reply, which they had filed along with this motion. The Court agreed with defendants that the plaintiff had violated Local Rule 7.1.3(c)(2) when it had “include[ed] [in its reply] a discussion of the stay factors entirely ignored in its opening brief.” Id. at 4 n.2. But the Court “exercise[d] its discretion and grant[ed] the defendants' alternative motion to file a surreply rather than strike [plaintiff’s] reply brief. While [the] opening brief was deficient, the defendants have acknowledged that the three traditional ‘stay factors’ are well known, and they were able to address them in their own answering brief. Moreover, any prejudice that might have resulted from [plaintiff’s] improper reply is remedied by the court's consideration of the defendants’ sur-reply.” Id. (internal citations omitted).

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Posted On: July 8, 2013

Judge Sleet denies motion for reconsideration of order to produce documents under crime-fraud exception

In Shelbyzyme, LLC v. Genzyme Corporation, C.A. No. 09-768-GMS, Chief Judge Gregory M. Sleet had previously granted in part defendant’s request for the production of plaintiff’s privileged documents under the crime fraud exception, as detailed here. Here the Court considered plaintiff’s motion for reconsideration, and denied it. Slip op. at 1 (D. Del. June 25, 2013).

Plaintiff argued that “the court erred in drawing the inference that patent applicant knew of the abandonment [of a relevant application] by December 1999 and thus was mistaken in its subsequent finding on the ‘intent to deceive’ prong” of fraud. Id. at 3. Plaintiff argued that the Court’s finding was “predicated upon a misreading of” an email from a licensee to the related patent family to defendant, in which the licensee had explained that the application in question would become abandoned if the applicant did not pay a base issue fee. Id. at 5 n.3 (quoting the email in full). The plaintiff “now claims that [the prosecuting attorney and patent counsel] was the source of the information that the issue fee had not been paid.” Id. at 6. However, “the court continues to believe that the most reasonable interpretation of [this] email is that [the applicant] was the source of [the licensee’s] knowledge that the issue fee had not been paid and that [the licensee] conveyed that knowledge to [defendant]. A close examination of the message supports this view,” and, quoting passages from the email, the Court mapped out how the prosecuting attorney’s statement that the fee had not been paid was “conditional” and indicated that he was “unaware as to whether [the applicant] actually had paid the fee.” Id. The Court also noted that “the alternative interpretations presented in [plaintiff’s] Motion for Reconsideration suffer from serious flaws.” Id. at 7.

Plaintiff also “reference[d] a June 2, 2013 declaration [of the prosecuting attorney] in support of its position that [the attorney] was the source of [the licensee’s] knowledge that the issue fee had not been paid.” Id. at 9. The Court disregarded this declaration, explaining that “a motion for reconsideration should not be used ‘as a means to argue new facts or issues that inexcusably were not presented to the court in the matter previously decided.’ Here, [plaintiff] failed to present an equivalent to this . . . declaration in support of its initial [letter brief], making consideration of the above-quoted statement improper.” Id. at 10 (quoting Brambles USA v. Blocker, 735 F. Supp. 1239, 1240 (D. Del. 1990)). “The remaining evidence offered by [plaintiff] to challenge the court’s reading of the [email],” including testimony from various parties regarding this email and the source of information as to whether the issue fee had been paid, “[was] unpersuasive,” as it “[told] the court little about the actual source of [the] information.” Id.

Finally, plaintiff “[took] issue with the court's characterization of a declaration attached to the Petition for Revival, which the court referenced in its discussion of the ‘reliance’ element” of fraud. Id. at 3. “While the court recognizes that its prior characterization of the [this declaration] may have oversimplified matters, conflating [the declarant’s] own knowledge with that of the applicants, it does not believe that any error resulted in its conclusion as to the reliance issue” because its prior characterization was “not required to reach [its] conclusion” that the PTO had reasonably relied on the alleged misrepresentations in the Petition for Revival. Id. at 13.

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Posted On: July 5, 2013

Judge Stark Denies Motion to Dismiss Willful Infringement Claim

Judge Stark has denied a motion to dismiss claims of willful infringement from an amended patent infringement complaint. The plaintiff had previously filed and the Court granted a motion to amend its complaint to include a claim of willful infringement based on longstanding knowledge of a patent-in-suit. The defendant then moved to dismiss this newly-added claim under Rule 12(b)(6). See Cloud Farm Associates, L. P. v. Volkswagen Group of Am., Inc., C.A. No. 10-502-LPS, Memorandum Op. at 1-2 (D. Del. July 2, 2013). Judge Stark explained that he had “already addressed the sufficiency of [the plaintiff’s] pleading.” Id. at 3. “The Court considered and rejected [the] argument” that amendment of the complaint was “futile because it would not survive a motion to dismiss.” Id. Because the plaintiff “provides no reason for the Court to reconsider this conclusion,” and its motion “merely repackages its opposition to the earlier motion to amend,” the motion presented “neither an appropriate nor necessary occasion to delve further into . . . potentially competing lines of authority.” Id. at 3-4. Accordingly, Judge Stark denied the motion to dismiss.

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Posted On: July 5, 2013

Chief Judge Sleet Grants Motion to Transfer to Southern District of California

Chief Judge Sleet recently granted a motion to transfer in a patent infringement case involving software for managing collision insurance claims. See Audatex N. Am., Inc. v. Mitchell Int’l, Inc., C.A. No. 12-139-GMS, Memorandum Op. at 1 (D. Del. June 28, 2013). Both the plaintiff and defendant are Delaware corporations with principal places of business in San Diego, California. Accordingly, it was clear that the case could have originally been brought in the Southern District of California. Id. at 2-3. Finding that the Third Circuit’s Jumara factors favored transfer on balance, Judge Sleet granted the defendant’s motion to transfer.

Judge Sleet explained that the plaintiff’s choice “to litigate in the forum where it is incorporated, rather than the forum where its principal place of business is located . . . is entitled to less deference than it would typically receive. Consequently, [the plaintiff’s choice of forum] factor weighs against transfer and is accorded heightened, but not maximum, deference as an individual Jumara factor.” Id. at 5-6. Furthermore, although the question of “whether the claim arose elsewhere” is often neutral in patent infringement actions, “because the patent infringement claims arise from infringing products that were designed and manufactured in a single, discrete location, this factor weighs slightly in favor of transfer.” Id. at 6-7. Several other factors, including the convenience of the parties and practical considerations that could make the trial expeditious or inexpensive, also favored transfer, and only the plaintiff’s choice of forum weighed against transfer. Judge Sleet, therefore, concluded that the defendants “met their burden of demonstrating that the interests of justice and convenience strongly favor transfer.” Id. at 17.

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Posted On: July 3, 2013

Judge Stark denies defendant’s motion to dismiss and alternative motion to transfer venue

In a recent memorandum opinion, Judge Leonard P. Stark denied defendant’s motion to dismiss plaintiff’s complaint for lack of personal jurisdictional and improper venue, and denied defendant’s alternative motion to transfer venue to the Northern District of California. Graphic Properties Holdings Inc. v. Asus Computer International, Inc., C.A. No. 12-210-LPS (D. Del. Jun. 28, 2013). Plaintiff, a Delaware corporation with its principal place of business in New York, is asserting three patents, U.S. Patent Nos. 5,896,119 ("the '119 patent"), 6,816,145 ("the '145 patent"), and 8,144,158 ("the '158 patent"). Id. at 1-2. Moreover, plaintiff is asserting one or more of those three patents in at least eleven other ongoing actions in the District of Delaware. Id. at 1. Defendant is a California corporation with its headquarters in the Northern District of California. Id. at 2. Defendant “does not have employees, documents or places of business in Delaware,” and “none of [its] accused products were designed or manufactured in Delaware.” Id.

Defendant contested personal jurisdiction and venue only with respect to plaintiff’s asserted claims related to the ’119 patent; with respect to claims under the ’145 and ’158 patents, defendant had submitted to the Court’s jurisdiction. Id. at 5. Denying defendant’s motion to dismiss for lack of personal jurisdiction, Judge Stark explained why “jurisdiction is proper at least” under 10 Del C. § 3104(c)(3) based on “use” of the accused product in Delaware. Id. at 6. Specifically, § 3104(c)(3) permits the exercise of personal jurisdiction when a defendant “causes tortious injury in [Delaware] by an act or omission in [Delaware].” Id. As Judge Stark noted, defendant admitted that “in two instances an individual in Delaware returned a broken VH-242 monitor to [defendant], and [defendant] provided that individual with a replacement monitor in satisfaction of a warranty agreement.” Id. Judge Stark thus found that “[a]t a minimum,” plaintiff’s “indirect infringement claim . . . ‘arises from’ use of the accused products in Delaware by individuals who received the product from [defendant].” Id. at 7. Moreover, as Judge Stark explained, “[t]he direct infringement claim is likewise directly related to the delivery of the accused products to Delaware.” Id. Finally, Judge Stark found that the assertion of personal jurisdiction would comport with Due Process. In support of that finding, he noted that defendant “knowingly and intentionally shipped the accused products to two separate customers in Delaware” to satisfy its warranty. Id. Judge Stark also found the exercise of personal jurisdiction “fair and reasonable” based predominantly on defendant’s litigation with respect to the ’145 and ’158 patents that is moving forward in Delaware and the fact that the ’119 patent is being asserted in several other concurrent Delaware lawsuits. Id. at 8. Moreover, because the parties agreed that the “outcome of the venue issue should be the same as the outcome of the personal jurisdiction question,” Judge Stark denied defendant’s motion to dismiss for improper venue. Id. at 9.

Denying defendant’s alternative motion to transfer venue to the Northern District of California, Judge Stark found that “plaintiff’s choice of forum, practical considerations, administrative difficulty, and public policy” weighed against transfer. Id. at 16. Regarding plaintiff’s choice of forum, Judge Stark noted that “[t]he Court agrees with those cases that include a corporate entity’s state of incorporation as part of its home turf.” Id. at 10. Judge Stark thus found that plaintiff’s choice of forum was “entitled to ‘paramount consideration,’ or, at a minimum, ‘significant deference.’” Id. With respect to practical considerations, Judge Stark explained that plaintiff has “at least 11 other cases pending in Delaware, each of which involves one or more of the asserted patents,” and this factor therefore weighed “heavily” against transfer. Id. at 14. Relatedly, addressing administrative difficulties, Judge Stark noted that “[t]ransferring this case to California would only add to the workload of that Court without meaningfully reducing the workload of this one.” Id. at 15.

On the other hand, Judge Stark found that “defendant’s preferred forum, location of operative events, convenience to witnesses, and location of relevant evidence” weighed in favor of transfer, and that the remainder of the factors were neutral. Id. at 16. “Evaluating the factors as a whole, and according each factor its appropriate weight under the circumstances presented,” Judge Stark determined that defendant failed to demonstrate that “the balance of the convenience factors and interests of justice weigh strongly in favor of transfer.” Id.

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Posted On: July 3, 2013

Judge Stark grants motion for summary judgment of laches and dismisses in part Defendants' inequitable conduct affirmative defenses and counterclaims

Judge Stark recently granted defendants' motion for summary judgment of laches in the long-standing suit filed by St. Clair for infringement of patents related to power savings and management. St. Clair Intellectual Property Managment Consultants, Inc. v. Acer, Inc., et al., C.A. No. 09-354-LPS (consol.) (D. Del. July 2, 2013). "A laches defense requires a showing by a preponderance of evidence that (a) the patentee's delay in bringing suit was unreasonable and inexcusable, and (b) the alleged infringer suffered material prejudice attributable to the delay." Id. at 4 (quotations omitted). And, a presumption of laches arises if the patentee had actual or constructive knowledge of alleged infringing activity for six or more years before filing suit. Id. Defendants' argued, and Judge Stark agreed, that there was such a presumption here because St. Clair had constructive knowledge of "activities infringing the Fung patents" no later than October 2002, but did not file suit until May 15, 2009. Id. Specifically, Judge Stark found that:

The evidence presented by Defendants establishes that St. Clair, [its co-owner, and the patents' inventor], were aware of the existence of products embodying "technology similar to that for which [the patentee] holds a patent and [which] uses that similar technology to accomplish a similar objective." By its failure to act, despite this knowledge, St. Clair "shirk[ ed]" its "duty to examine the product or device more closely to ascertain whether it infringes ... on peril of triggering the laches period and perhaps ultimately losing [its] right to recover damages for the infringement."

Id. at 6. (quoting Crown Packaging Tech. , Inc. v. Rexam Beverage Can Co., 679 F. Supp. 2d 512, 520 n.42 (D. Del. 2010).

To rebut the presumtion of laches, St. Clair argued that the trigger date for laches was the date of the first accused infringement, which was August 2004, and that the pre-2004 accused products were immaterial "because a new laches period began as a result of design changes implemented in the newer accused infringing products." Id. at 7. Judge Stark rejected this argument because "St. Clair cannot avoid a laches defense by narrowing its infringement contentions, especially given that in 2002 St. Clair conducted an analysis of pre-2004 products." Id. at 8.

Judge Stark also granted-in-part St. Clair's motion for summary judgment dismissing certain bases for Defendants' inequitable conduct defenses. Id. at 8. Defendants' defenses were based on the named inventor misrepresenting that he was the sole inventor, the withholding of material prior art during prosecution, and the applicant's misrepresenting its entitlement to small entity status. Id. Judge Stark granted St. Clair's motion as to one prior art reference that was allegedly withheld during prosecution. Id. at 11. Specifically, Judge Stark found that Defendants' failed to establish that the applicant or its attorneys knew of the specific reference or intentionally withheld it from the PTO. Id. Judge Stark also found that Defendants failed to raise a triable issue of fact as to the applicant's intent to deceive the PTO regarding small entity status. Id. at 12-13.

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Posted On: July 3, 2013

Magistrate Judge Thynge issues report and recommendation on cross-motions for summary judgment relating to covenant not to sue and motion to strike portions of reply brief.

Magistrate Judge Mary Pat Thynge recently issued a report and recommendation addressing cross-motions for summary judgment, as well as the plaintiff’s motion to strike portions of the defendant’s reply brief in support of its summary judgment motion. Cornell Univ., et al. v. Illumina, Inc., C.A. No. 10-433-LPS-MPT (D. Del. June 25, 2013). Judge Thynge agreed with the plaintiff that the defendant’s “reply brief relie[d] on inadmissible evidence from the parties’ settlement negotiations[,]” and granted the motion to strike such evidence from the reply brief. Id. at 5. Although the defendant argued that the plaintiff’s own motion and opening brief opened the door to such evidence, Judge Thynge explained, “[e]ven if plaintiffs ‘opened the door,’ that door should remain closed where plaintiffs’ references to the settlement agreement were inappropriate, and neither parties’ evidence would be admissible.” Id. at 6. Judge Thynge agreed in part with the plaintiff’s additional argument that portions of the defendant’s reply brief should be stricken because they raised new arguments and facts not appearing in the defendant’s opening brief. Id. at 9-15.

Judge Thynge then considered the parties’ cross-motions for summary judgment. Construing a settlement agreement under California law, as well as issues of successor liability under Delaware corporate law, the Court agreed with the defendant that two of the plaintiffs, Life Technologies and Applied Biosystems, were bound by a covenant not to sue entered into by the defendant and Applera Corporation, because they were “affiliates” or “successors” of Applera under the agreement. Id. at 26. But the Court agreed with plaintiff Cornell University’s argument that it was not bound by the covenant not to sue because it was not an affiliate or successor of the settling party, which the defendant did not contest in briefing. Id. at 26.

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Posted On: July 3, 2013

Judge Andrews denies motion to redact portions of oral argument transcript

Judge Richard G. Andrews recently rejected a defendant’s motion to redact certain portions of an oral argument transcript relating to alleged inequitable conduct. St. Jude Medical Cardiology Division Inc., et al. v. Volcano Corp., C.A. No. 12-441-RGA (D. Del. June 17, 2013). Judge Andrews noted that the defendant had not provided any argument as to why the information should be redacted, other than a bare claim that it was highly confidential, and in denying the motion explained: “[n]o harm is alleged, and, indeed, it is apparent to me that there could not be any harm from the disclosure of specific allegations of inequitable conduct years and years ago that would justify sealing the transcript.”

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Posted On: July 3, 2013

Judge Robinson rules on summary judgment motions

In a recent memorandum opinion, Judge Sue L. Robinson considered plaintiffs’ motion for partial summary judgment on infringement and defendants’ cross-motion for non-infringement, in addition to defendants’ motion for summary judgment of invaldity and plaintiffs’ cross-motion for partial summary judgment of validity. INVISTA North America S.a.r.l. et al. v. M&G USA Corporation, et al., C.A. No. 11-1007-SLR-CJB (D. Del. June 25, 2013). Plaintiffs are asserting three patents—U.S. Patent Nos. 7,919,159 (“the ’159 patent”); 7,943,216 (“the ’216 patent”); and 7,879,930 (“the ’930 patent”)—each related to “plastic materials with applications in packaging for oxygen-sensitive foods.” Id. at 1. The ’216 and ’159 patents share a common specification and relate specifically to compositions (and containers and articles derived therefrom), which are alleged to possess strong gas barrier properties while yielding comparatively small amounts of yellowness and haze that traditionally accompanied compositions with similar properties. See id. at 2-4. The ’930 patent relates to “the use of certain colorants that do not completely deactivate” the transition metal catalyst in compositions such as those claimed in the ’216 and ’159 patents. See id. at 5.

With respect to the ’216 and ’159 patents, Judge Robinson granted summary judgment of no direct infringement. Id. at 19. The Court had construed the term “composition” as used in those patents to mean “a blend that contains the specified ingredients at any time from the moment the ingredients are mixed together.” Id. at 17. It was undisputed that defendants’ accused products—the PoliProtect products (“PoliProtect”)—are “manufactured as pellets” and have components that are separated into different layers. Id. at 17. Because the components were not “mixed together in a blend,” Judge Robinson found that PoliProtect did not practice the “composition” limitation. Id. at 18-19.

However, turning to indirect infringement of the ’216 patent, Judge Robinson found that the “only reasonable inference from the evidence of record is that [defendants’] customers mix the components of the pellets into blends to make their desired articles,” and “thereby necessarily practice the ‘composition’ limitation.” Id. at 20-21. Judge Robinson also found that, with the exception of one claim, PoliProtect practiced the remaining limitations of the seven asserted claims from the ’216 patent. See id. at 21-26. Further, as Judge Robinson noted, defendants “had knowledge of the ’216 patent at least from the filing of [the] lawsuit.” Id. at 26. Addressing contributory infringement, Judge Robinson found that defendants offered “no evidence to rebut [plaintiffs’] arguments that the PoliProtect products are not a staple of commerce that are suitable for noninfringing uses.” Id. at 27. With respect to induced infringement, Judge Robinson first noted that plaintiffs “established on the summary judgment record that the PoliProtect products have no substantial noninfringing uses.” Id. at 28. Moreover, Judge Robinson explained that “it is entirely appropriate to presume that one who sells a product containing a component that has no substantial noninfringing use in that product does so with intent that the component will be used to infringe.” Id. at 29 (quoting Ricoh Co. v. Quanta Computer Inc., 550 F.3d 1325, 1340, 1338 (Fed. Cir. 2008)). Judge Robinson therefore granted summary judgment of contributory and induced infringement for six of the seven asserted claims of the ’216 patent.

Judge Robinson, however, denied plaintiffs’ motion for summary judgment with respect to indirect infringement of the ’159 patent. Id. at 31. Plaintiffs argued PoliProtect literally infringed the ’159 patent because PoliProtect’s LiSIPA-containing copolyester meets both the “polyester” and “ionic compatibilizer” limitations. Id. at 29. Judge Robinson did note that “the doctrine of equivalents may be applicable even when its application would vitiate the requirement that two components be separate elements.” Id. at 30. Judge Robinson concluded, however, that defendants raised genuine issues of material fact regarding the “polyester” limitation under the doctrine of equivalents, precluding the entry of summary judgment. Id. at 30-31.

With respect to the ’930 patent, the parties summary judgment motions addressed only indirect infringement. See id. at 31. Judge Robinson found that plaintiffs offered evidence of infringement of the limitations at issue and thus created genuine issues of material fact, precluding the entry of summary judgment of no indirect infringement. See id. at 31-35.

Turning to the validity motions, Judge Robinson noted that defendants argued that the asserted claims of the ’159 and ’216 patents are invalid as obvious and for failure to comply with 35 U.S.C. § 112’s written description and enablement requirements. Id. at 34. With respect to obviousness, defendants asserted that the ’159 and ’216 patents are obvious in light of two prior art references. Id. at 35. As Judge Robinson explained, however, defendants’ expert “never addressed the combination of the . . . references in his expert reports,” and the argument was made for the first time in defendants’ reply summary judgment brief for invalidity. Id. at 35-36. Although defendants attempted to support the new theory with an expert declaration attached to the reply brief, the new opinions in the declaration were struck in a separate order as untimely and prejudicial. Id. at 36. Without expert testimony addressing the combination of the two references, Judge Robinson granted plaintiffs’ motion for partial summary judgment of validity on this ground. Id. at 36.

With respect to a lack of enablement, defendants first argued that the ’159 and ’216 patents recite a “metal sulfonate salt,” but did not provide any “meaningful disclosures, teachings, or supportive data” related to those salts, with the exceptions of sodium and zinc. Id. at 37. Judge Robinson found, however, that plaintiffs’ expert presented evidence that the patent specification “enables one of ordinary skill in the art to make and use the claimed invention.” Id. at 39. Thus, there remained an issue of material fact, and Judge Robinson denied entering summary judgment of lack of enablement on this ground. Id. at 39. Defendants had also set forth several other similar invalidity arguments under § 112 related to the ’159 and ’216 patents, which were all premised on a similar theory that the scope of the asserted claims were “substantially broader than the small number of examples provided.” Id. at 42-43. Once again, Judge Robinson found that entry of summary judgment for invaldity on these grounds was precluded “[i]n light of the conflicting expert testimony” regarding whether the examples provided in the specification enable a person of ordinary skill in the art to make the claimed invention. Id. at 43.

Defendant also argued that plaintiffs’ specification failed to disclose the “importance of sodium acetate . . . in controlling yellowness in the compositions of the ’159 and ’216 patents,” and that the patents were therefore nonenabling and lacked a sufficient written description. Id. at 39. Judge Robinson explained, however, that “[t]he enablement and written description requirements are both based on the invention as claimed,” and “sodium acetate is not a limitation in any of the asserted claims and is not mentioned in the specification.” Id. at 40-41. Judge Robinson therefore granted plaintiffs’ partial motion for summary judgment of validity on this ground. Id. at 42.

With respect to the ’930 patent, defendants moved for summary judgment of invalidity based on an insufficient written description, non-enablement, and indefiniteness. Id. at 43. Judge Robinson denied the parties’ motions for summary judgment on these issues in light of conflicting expert testimony. See id. at 43-45.

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Posted On: July 1, 2013

Judge Robinson denies motion to dismiss for lack of personal jurisidiction, without prejudice to renew following jurisdictional discovery

Judge Robinson recently considered defendant Daxtra Technologies Limited's ("Daxtra UK")' motion to dismiss plaintiff's complaint for lack of personal jurisdiction. Kenexa Brassring, Inc. v. Akken, Inc., et al., C.A. No. 12-660-SLR (D. Del. June 25, 2013). Daxtra UK is a Scottish company with places of business in the United Kingdom. Id. at 2. Defendant Daxtra Technologies Inc. ("Daxtra US") is a Delaware corporation and a subsidiary of Daxtra UK formed "for the purpose of marketing and selling software and providing support in the United States." Id.

To establish personal jurisdiction, the Court must determine whether there exists a basis for jurisdiction under Delaware's long arm statute, 10 Del C. sec. 3104(c)(1)-(4), and if so, whether the the defendant "purposefully availed" itself of the forum state such that it should reasonably anticipate being sued there. Id. at 4.

First, Kenexa argued that personal jurisdiction was appropriate "through direct contacts between Daxtra UK and the United States, including Delaware. Id. at 5. Kenexa pointed to the sale of a potentially infringing product in the United States that had been licensed to a U.S. company. Id. Judge Robinson found that this ground was not sufficient because it was unclear whether Kenexa would accuse that product of infringing the patents-in-suit. Id. Next, Kenexa asserted that personal jurisdiction was appropriate because Daxtra UK used its website to solicit job applicants in the U.S. Id. at 5-6. Judge Robinson rejected this ground because "Kenexa ha[d] not indicated any particular instance in which a U.S. applicant interacted with the website[.] Id. at 6.

Second, Kenexa argued that personal jurisdiction existed over Daxtra UK through contacts of its subsidiary, Daxtra US, pursuant to agency theory. Id. "Under agency theory, the court may attribute the actions of a subsidiary company to its parent where the subsidiary acts on the parent's behalf or at the parent's direction." Id. at 6-7 (quotations omitted). Four factors are relevant to the court's determination:

(1) the extent of overlap of officers and directors; (2) methods of financing; (3) the division of responsibility for day-to-day management; and (4) the process by which each corporation obtains its business.

Id. at 7 (quotations omitted).

Daxtra UK conceded that the officers and directors of Daxtra UK and Daxtra US overlapped completely. Id. Daxtra UK argued, however, that there was no overlap regarding the financing of the entities, and Judge Robinson found that Kenexa had not alleged otherwise, with reasonable particularity. Id. at 7-8. Regarding the third factor, Kenexa argued that Daxtra UK's CTO was assigned to Daxtra US, which was "indicative of his playing a larger role in the day-to-day management" of Daxtra US. Id. at 8. Daxtra UK responded that the CTO's re-assignment was temporary so that he could help "make sales calls and grow the business in the United States[.]" Id. Regarding the last factor, the court found that at least some of Daxtra US's business was obtained from Daxtra UK. Id. at 8-9.

In light of the foregoing, Judge Robinson concluded that "plaintiff ha[d] presented factual allegations that suggeste[d] with reasonable particularity the possible existence of the requisite contacts between Daxtra UK and Delaware." Id. at 9. Therefore, the Court permitted Kenexa to take jurisdictional discovery and denied Daxtra UK's motion, without prejudice to renew one month after the close of such discovery. Id. at 9-10.

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Posted On: July 1, 2013

Judge Andrews claim construction opinion

Judge Andrews recently construed the following claim terms of U.S. Patent No. 7,155,451 related to "methods of automating the presentation of computer content," which is asserted against Microsoft Corp. and Apple Inc. in two civil actions. Robocast v. Microsoft, et al., C.A. No. 10-1055-RGA, 11-235-RGA (D. Del. June 28, 2013):

"show structure of nodes"
"multidimensional show structure of nodes"
"nodes"
"plurality of accessible resources"
"content"
"on-line search"
"interactively variable duration information"
"at least two of said nodes are spanned concurrently"
"persistent content window"
"without requiring user input"
"in accordance with said show structure"
"providing"
"search results"
"wherein said show structure is created in response to said search results received in
response to said on-line search"
"Related to said selected category"

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