Judge Andrews recently overruled objections to a report and recommendation on claim construction issued by Chief Magistrate Judge Thynge, previously discussed here. Hand Held Prods., Inc. v. Amazon.com, et al., C.A. No. 12-768-RGA-MPT (D. Del. Nov. 5, 2014). Judge Andrews noted with respect to one objection that the Supreme Court’s decision (issued between claim construction briefing and Judge Andrews’ consideration of Judge Thynge’s recommendations) in Nautilus, Inc. v. Biosig Instruments, Inc., 134 S. Ct. 2120 (2014) changed the legal standard for showing indefiniteness. The defendant argued that Judge Thynge erroneously applied the former “insolubly ambiguous” standard, but Judge Andrews disagreed and found that Judge Thynge correctly applied the standard enunciated in Nautilus. Id. at 8. Judge Andrews also rejected the defendant’s argument that Nautilus “eliminated the requirement that the party challenging the validity of a patent must prove invalidity by clear and convincing evidence.” Id. The Court explained that it “does not interpret the new standard to have any effect on the presumption of validity or to eliminate or change the evidentiary burden of proof. In fact, the Supreme Court expressly discussed the presumption and burden of proof and made no mention of changing or eliminating either.” Id. at 8-9 (citing Nautilus, 134 S. Ct. at 2030 n.10).
In EMC Corp., et al. v. Pure Storage, Inc., C.A. No. 13-1985-RGA (D. Del. Nov. 5, 2014), Judge Richard G. Andrews recently struck affirmative defenses of inequitable conduct and unclean hands against prosecuting attorneys of one of the patents-in-suit, but denied plaintiffs’ motion to strike these defenses against the inventors of this patent. Defendant alleged that the patent’s inventors and two prosecuting attorneys failed to disclose a certain prior art patent to the PTO with the intent to deceive. The focus of plaintiffs’ motion was on what defendant had alleged with respect to intent to deceive.
The Court first held that the prosecuting attorneys’ appointment of power of attorney for the prosecution of the patent (along with five other lawyers) was insufficient to show their “substantial involve[ment]” in the prosecution of that patent, nor was this fact sufficient to adequately plead an intent to deceive by these individuals. Id. at 3.
However, as to the patent’s inventors, the Court denied the motion to strike these defenses, finding that the allegations were sufficient. Defendant had alleged that the inventors of the patent not disclosed to the PTO were colleagues of the inventors of the patent-in-suit and that both “sets of inventors worked on the same family of products at the same company.” Id. at 4. Furthermore, defendant also alleged that the patent-in-suit’s inventors were familiar with and cited other works by at least one of the prior art patent’s inventors. Id. As a result, the Court granted the motion to strike in part and denied it in part.
In the Order, the Court also clarified that the legal standard for intent to deceive at the pleading stage was governed by Exergen Corp. v. Wal-Mart Stores, Inc., 575 F. 3d 1213 (Fed. Cir. 2009) rather than the higher standard articulated at a bench trial in Therasense, Inc. v. Becton, Dickinson Co., 649 F.3d 1276 (Fed. Cir. 2011). Plaintiff had cited Therasense for the legal standard. Id. at 2 n.2.
As previously reported here, Judge Andrews granted a motion for attorneys’ fees and costs under Section 285 and the Supreme Court’s Octane Fitness decision. Judge Andrews ordered the parties to make further submissions of “supporting documentation necessary to justify their fees as well as a brief explanation of those documents.” Having received those submissions from the parties, Judge Andrews determined last week that the defendants were entitled to a substantial portion of the fees they sought. Chalumeau Power Sys. LLC v. Alcatel-Lucent USA Inc., et al., C.A. No. 11-1175-RGA, Memo. Or. at 1-4 (D. Del. Nov. 6, 2014). Under the Lodestar approach, Judge Andrews determined that the “forum rate” for the case “must be governed by the rate for Delaware intellectual property attorneys” and that the “limited exception to the forum rule cannot apply because a number of Delaware attorneys can, and do, capably litigate patent matters.” Id. at 3.
Judge Andrews therefore concluded that “attorneys’ fees and expenses should be governed by the prevailing Delaware market rates for patent litigation” and that the calculation should not be adjusted up or down because these prevailing market rates reflect the “specialized skill that patent litigators possess, as argued by Defendants.” Id. His Honor was “not convinced that Defendants have demonstrated that there is an exceptional circumstance with respect to the result obtained or the amount involved” sufficient to justify an adjustment, nor should the rates “be adjusted downward simply because Defendants did not win on a dispositive motion or at trial.” Id. at 3-4. Finally, Judge Andrews rejected the plaintiff’s argument that fees prior to the Court’s granting of Defendants’ motion to amend to assert a licensing defense were unnecessary: “Because the licensing agreement predates the litigation, and this Court determined the licensing defense was not untimely, it is not clear why the recovery should exclude fees and expenses from before [the Court’s determination]. Defendants had to litigate the case until they learned of the licensing defense. It makes no sense (and perhaps that is why the argument is limited to a footnote) to say that defending the case was not reasonably necessary.” Id. at 4.
Judge Richard G. Andrews recently denied-in-part plaintiff CallWave Communications, LLC’s motion for leave to amend its complaints against defendants in a series of related cases. CallWave Communications, LLC v. AT&T Inc., et al., C.A. Nos. 12-1701-RGA, 12-1702-RGA, 12-1704-RGA (D. Del. Nov. 5, 2014). Previously, Judge Andrews granted Defendants’ motion to dismiss CallWave’s willfulness and indirect infringement claims. In its motion to amend, CallWave sought to remove the portions of its complaints no longer relevant in light of Judge Andrews’ previous order, but also sought to add new factual allegations. Id. at 3. Judge Andrews granted CallWave’s motion to permit it to remove allegations related to willfulness and indirect infringement, but denied the motion as to the new factual allegations because the proposed amendments would be futile. Id. The proposed amendments related to a meeting between CallWave and defendant Google that, according to CallWave, would be relevant to Google’s pre-suit knowledge of the patents-in-suit. Id. at 4. Judge Andrews found that the new allegations “serve no purpose.” Because the only claims “successfully pled” by CallWave relate to direct infringement, the new allegations relate to no existing claim and cannot “form the basis for CallWave successfully re-plead[ing] willful infringement against Google at some point in the future.” Id.
Judge Richard G. Andrews recently deferred ruling on the part of a Daubert motion which sought to preclude an expert from offering testimony on § 112 defenses on which the expert testified he deferred to counsel. IPLearn, LLC v. Blackboard, Inc., C.A. No. 11-876 (RGA) (D. Del. Oct. 2, 2014). Judge Andrews indicated he likely would exclude the expert’s opinion on § 112 defenses, explaining “I am not convinced that these are [the expert’s] opinions on the § 112 issues. I am quite sure that the legal citations . . . are not only not his, but to cases that he has not read. Therefore, I expect that I will exclude the opinions [addressing the § 112 defenses] of the report. I will, however, give Defendant an opportunity before trial to show that the § 112 opinions are indeed [the expert’s] opinions.” Id. at 4. The Court proceeded to schedule a pretrial hearing to examine and cross-examine the expert on his § 112 opinions.
Earlier in the decision, the Court denied the Daubert motion to the extent it sought to exclude the expert based on his unfamiliarity with the presumption of validity and the need to prove invalidity by clear and convincing evidence. The plaintiff had argued that the defendant’s invalidity expert should be excluded from trial for failure to apply the clear and convincing standard or the presumption of validity. Judge Andrews agreed with the defendant, though, that the expert’s “failure to offer opinions on legal standards has no relevance because that is not the role of the expert.” Id. at 2. As the Court explained, “[c]lear and convincing evidence and the presumption of validity are not standards required of expert opinion on invalidity, but standards used by a factfinder. These are legal concepts that are for jury determinations, not for expert witnesses.” Id. at 4.
Judge Andrews recently denied a defendant’s Daubert motion, which sought to exclude the plaintiff’s technical expert on a number of grounds. The defendant argued that the expert’s opinions “are too unreliable to be presented to a jury” because the expert “lacks familiarity with the infringing products, relied too heavily on someone else to provide him with relevant segments of source code to review, and used the Court’s claim construction to determine how the products work.” IPLearn, LLC v. Blackboard Inc., C.A. No. 11-876-RGA, Memo. Or. at 1-2 (D. Del. Sept. 29, 2014).
Judge Andrews explained that although the expert in question “never used the allegedly infringing products,” and reviewed only portions of the relevant source code selected by another individual, his opinion was “based on ‘thousands of pages of technical manuals, source code, and depositions transcripts.’” Id. at 2. “Even if [the expert] did not know the qualifications of the individual who selected the pieces of source code, or whether there might be other relevant segments of the source code, he was able to determine whether the sections of code related to the elements relevant to infringement. Therefore, his expert opinion is based on sufficient facts and reliable methods. Whether [the expert] should have consulted the complete source code, and might have missed something that would change his opinion, is an issue for cross-examination and, possibly, contradictory expert testimony by Defendant’s expert.” Id. at 3-4. Indeed, the expert “need not use the product if, as here, he has familiarized himself with it in other ways. Reviewing source code and other materials can be sufficient. [Accordingly] Whether [the expert] should have based his expert opinion on personal use with the product, rather than source code and other materials, is fodder for cross-examination, not a Daubert issue for this Court.” Id. at 2.
Further, Judge Andrews explained that “[w]hether [the expert] relied too heavily on his report in his deposition does not, in my opinion, raise a Daubert issue,” because this argument is essentially the defendant contending that the expert “will be a poor witness.” Id. at 3. Finally, Judge Andrews explained that it was “not self-evident from the deposition transcript cited by Defendant that [the expert’s] reference to the Court’s claim construction was an explanation of how the products work, rather than an application of the construed claims onto the product. . . . [T]he infringement expert[’s] . . . role is to compare the construed claims to the allegedly infringing products. Defendant has not shown that he has not done that.” Id. at 4.
In Comcast IP Holdings I LLC v. Sprint Communications Company LP, et al., C.A. No. 12-205-RGA (D. Del. Sept. 29, 2014), Judge Richard G. Andrews concluded that plaintiff’s damages expert had not adequately apportioned damages and thus the analysis was not admissible.
Defendants had filed a motion in limine seeking to exclude profits and or/revenues relating to the accused products, arguing that plaintiff’s damages expert had violated the entire market value rule because the products also contained unpatented features. Plaintiff argued its expert had, in fact, apportioned revenues between the patented and unpatented technology in the products. The Court had requested further submissions on this issue, including a proffer of this expert’s testimony. Id. at 1.
The Court found the expert’s proffer insufficient. The expert had identified three different functionalities of the accused products and noted that only one was “substantially implicated by the asserted patents,” but there was no indication that she had performed a “‘numerical calculation’ to arrive at a percentage to apply to the profits. Apportionment does not seem possible without a numerical calculation. There is no evident apportionment in the proffer,” nor in the expert’s deposition or report. Id. at 2.
On the other hand, the Court recognized that its request for additional submissions had focused on whether the entire market value rule had been violated, and that, if it had specifically asked for more detail on apportionment, the subsequent submissions may have been different. Therefore, the Court allowed plaintiff to submit a proffer “with some detail as to how much of the revenues and/or profits it apportioned to the patented technology, and what the basis for that apportionment is.” Id.
In a recent order, Judge Richard Andrews granted a motion in limine to exclude at trial evidence of the PTAB’s denial of an inter partes review petition of a patent-in-suit. Judge Andrews explained that evidence of the IPR petition was inadmissible under Rule 403 because it was “of marginal relevance, . . . the probative value is greatly outweighed by the expenditure of time that would be required to give the jury the full context necessary to fairly evaluate the evidence . . . [and] because of the complexity involved in giving the full context, there would also be a significant risk of confusion of the issues.” Interdigital Commc’ns Inc., et al. v. Nokia Corp., et al., C.A. No. 13-10-RGA, Order at 1-2 (D. Del. Sept. 19, 2014).
Judge Andrews explained his reasoning: “I agree that the . . . IPR denial is a final decision. I do not agree that it is a decision on the merits, any more so than a grant of an IPR is a decision on the merits. It is akin to a ruling on a preliminary injunction, where the merits are assessed with less than a full record and with less than a full adversarial proceeding.” Id. at 1. Furthermore, although the IPR denial is part of the prosecution history, “it is a relatively unique part of the prosecution history. First, a patent examiner cannot allow a patent to issue saying there is a reasonable likelihood that it is not obvious . . . [instead] [t]he patent examiner has to come to a conclusion that it is not obvious, or not allow the issuance of the patent. Second, the patent examiner is a person of ordinary skill in the art, whereas the IPR decisions are made by lawyers who are not persons of ordinary skill in the art.” Id. Judge Andrews did, however, allow the defendants to “truthfully state [to the jury] that the PTO did not have [IPR] reference before issuing the patent.” Id. at 2 n.1.
Judge Richard G. Andrews recently ordered a plaintiff to reduce the number of claim terms it was asserting from 52 to 32 by the filing of its opening claim construction brief, finding that there would be little or no prejudice associated with such a reduction. EMC Corp. v. Pure Storage Inc., C.A. No. 13-1985-RGA (D. Del. Sept. 19, 2014). Judge Andrews denied a request for an extension of page limits for claim construction briefing, however, but explained: “I find that having Plaintiff open the briefing with arguments for plain meaning is generally not very helpful. Thus, Plaintiff need only brief in its opening brief those terms for which it proposes a construction. Of course, Plaintiff will need to respond in its reply brief if Defendant proposes constructions for terms that the Plaintiff believes should be given their plain meaning.” Finally, the Court indicated that regardless of the number of claim terms the parties’ briefed, the Court would permit oral argument on no more than 10 terms.
In L-3 Communications Corporation v. Sony Corporation, et al., C.A. No. 10-734-RGA, Judge Richard G. Andrews recently issued rulings on defendants’ motion for judgment as a matter of law (D. Del. Sept. 12, 2014) (“JMOL Memorandum Opinion,” first document below) and both parties’ motions for entry of judgment (D. Del. Sept. 12, 2014) (“Memorandum (Entry of Judgment) and Final Judgement,” second document below). The Court found in defendants’ favor as to both sets of motions.
Following a jury verdict in plaintiff’s favor on defendants’ invalidity counterclaims only, defendants renewed their motion for judgment as a matter of law that the asserted patent claims are invalid as obvious. The Court granted the motion, finding the jury’s verdict legally insufficient. The only issue presented was whether it would have been obvious to add an “in-pixel amplifier” to a certain prior art reference. JMOL Memorandum Opinion at 2. The Court rejected plaintiff’s argument at trial that this reference taught away from adding an amplifier, finding its characterization of the prior art incorrect. See id. at 7-9. The Court also considered and rejected a new argument raised by plaintiff for the first time in its post-trial briefing even though this argument was not properly put before the jury. See id. at 7 n.7 and 9-12. The Court concluded that defendants had met their burden of proving obviousness, and granted their motion for judgment as a matter of law.
Both parties also moved for entry of judgment related to claims that not been tried because, due to the Court’s claim construction, plaintiff conceded that it could not prove infringement. The parties disagreed as to the proper language for the judgment, as defendant was “concerned that if it consents to [plaintiff’s] proposed judgment it will be precluded from raising [a challenge to the Court’s claim construction] on appeal.” Memorandum (Entry of Judgment) at 2. Plaintiff’s language quoted the Court’s constructions, noting that the accused products did not infringe “because they lack a ‘means for draining stored charge from said charge storage means in response to an element resetting signal,’ a ‘means for randomly accessing said image elements,’ a ‘gain control element interposed between said photoresponsive element and said storage element,’ or a ‘charge drain.’” Id. at 2. The Court pointed out that plaintiff’s proposed language had no basis in the record. Id. However, it found no reason not to enter judgment in defendants’ favor, and therefore entered judgment with revised language that did not include the above quotes, but instead stated that “under this Court’s Claim Construction Opinion and Order (D.I. 78), L-3 cannot prove that the Accused Products satisfy all elements of the Conceded Claims.” Final Judgement at 2.