In Cordis Corporation v. Boston Scientific Corporation and Scimed Life Systems, Inc., C.A. No. 98-197-SLR (D. Del. Aug. 10, 2009), Judge Robinson reversed her March 2002 decision that nondisclosure of material prior art during prosecution of the patent-at-issue was inequitable conduct which tainted the prosecution of another patent, making both unenforceable. Id. at 1. The Federal Circuit had remanded, in June 2006, for additional findings of fact regarding deceptive intent and how the later patent was tainted by the inequitable conduct related to the first patent. Id. In reversing her prior decision, Judge Robinson applied the standard reinforced by the Federal Circuit in 2008 in Star Scientific, Inc. v. R.J. Reynolds Tobacco Co., 538 F.3d 1365 (Fed. Cir. 2008) related to the evidentiary burden to be met in order to prove inequitable conduct. Id. at 5-6. Although Judge Robinson determined that a material reference was not disclosed to the PTO, “defendants must prove, by clear and convincing evidence, that [the patentee] and/or [his attorney] ‘made a deliberate decision to withhold a known material reference.’” Id. at 8 (citing Star Scientific, 537 F.3d at 1366) (emphasis added). Judge Robinson determined that the clear and convincing standard had not been met by defendants because “the evidence cited in support of finding inequitable conduct is not clearly more compelling than the evidence cited in support of not finding inequitable conduct.” Id. at 8-9. In addition, nondisclosure of the material prior art could not carry over to the later patent because the prior art in question was identified in connection with this later patent and reviewed by the PTO examiner. Id. at 9-10.
In Wellman, Inc. v. Eastman Chemical Co., C.A. No. 07-585-SLR (D. Del. Aug. 13, 2009), Plaintiff filed an Emergency Motion to Modify Scheduling Order requesting postponement of deadlines for filing Daubert and Summary Judgment motions until after mediation. Judge Robinson denied Plaintiff's motion stating that “[m]ediation was scheduled with the present deadlines in place, the parties have not indicated that settlement is likely (and, therefore, the motion practice wasteful), and any movement of summary judgment deadlines puts the trial date at risk.” Id.
In Inventio AG v. Thyssenkrupp Elevator Americas Corp., C.A. No. 08-874-ER, at 2 (D. Del. July 31, 2009) Defendants filed a motion to compel answers to an interrogatory requesting construction of claims Plaintiff contends were infringed by Defendants. Plaintiff initially responded objecting to the interrogatory as premature and eventually responded that Plaintiff would “provide claim constructions in due course as required by the Scheduling Order in this case.” Id. at 3. In support of their motion Defendants cited district court decisions compelling claim construction interrogatories, none of which were from the District of Delaware. Id. at 5 n.1. Judge Robreno granted Defendants motion stating that “Plaintiff has represented to the Court that the claims it is pursuing are warranted under existing law and that they have evidentiary support. Thus, Plaintiff is in a position to articulate which claim terms Defendants have infringed.” Id. at 6.
7/29: AngioDynamics Inc. v. Vascular Solutions, Inc. (patent infringement)
7/30: Square Ring, Inc. v. John Doe-1, John Doe-2, John Doe-3, John Does 4-10, Ustream TV Inc. (trademark) (cable system piracy)
7/31: Genzyme Corporation v. Roxane Laboratories Inc. (patent infringement)
8/3: Enhanced Security Research LLC, Security Research Holdings LLC v. CISCO Systems, Inc., International Business Machines Corporation, Check Point Software Technologies, Ltd., Check Point Software Technologies Inc., SonicWALL Inc., 3Com Corporation, Nokia Corporation, Nokia Inc., Fortinet Inc. and Sourcefire Inc. (patent infringement)
8/3: SeaChange International Inc. v. Arris Group (declaratory judgment - patent infringement)
8/4: Re/Max International Inc. v. Riale Realty and Tim Reale (trademark infringement)
In a recent decision, district judge Sue L. Robinson addressed the unsettled issue of whether a plaintiff may accuse the same product of infringement in successive suits. Answering in the affirmative, the Court held that a party can maintain a second cause of action so long as the injury alleged in the second suit arises from acts that post-date those considered in the first action.
Analyzing the issue as one of claim preclusion, the Court explained its reasoning:
“A judgment cannot be give the effect of extinguishing claims which did not then even exist. Defendants did not have FDA approval to market the [accused product] in 2005. Plaintiff could not have anticipated when FDA approval, and subsequent marketing and U.S. sales . . . would have commenced. Plaintiff could not have accurately predicted the amount or value of such sales in 2005, nor could the availability of any non-infringing alternatives been assessed . . . ."
As a result, “[t]he conduct at issue in this litigation occurred after the first judgment and could not possibly have been sued upon in the 03-027 case.”
With this decision, it appears that the continuing-tort theory of patent infringement is alive and well in the District of Delaware.
Judge Joseph J. Farnan, Jr.: No Per Se Rule that a Reexamination Order Precludes the Possibility of Proving Willful Infringement
In June 2009, Magistrate Judge Stark granted Plaintiff St. Clair’s Motion for Leave to File a Second Amended Complaint to, among other things, add allegations for willful infringement against Defendant Nokia. St. Clair Intellectual Property Consultants, Inc. v. Matsushita Electronic Industrial Co., et al., C.A. No. 04-1436-JJF-LPS (D. Del. June 10, 2009). In opposition to St. Clair’s motion, Nokia, relying on Lucent Techcs. v. Gateway, Inc. and In re Seagate Tech., unsuccessfully argued that St. Clair’s proposed amendment would be futile because the PTO’s grant of a reexamination precludes a claim of willful infringement, as a matter of law. In his July 28, 2009 memorandum opinion, Judge Farnan agreed with Magistrate Judge Stark’s rejection of Nokia’ argument because the courts in Lucent and Seagate “clearly refrained from creating a per se rule that a reexamination order precludes the possibility of proving willful infringement on summary judgment.” St. Clair Intellectual Property Consultants, Inc. v. Matsushita Electronic Industrial Co., et al., C.A. No. 04-1436-JJF-LPS, at 6 (D. Del. July 28, 2009). As such, “Judge Stark correctly rejected Nokia’s reading of Lucent as support for its argument that reexamination order must make futile any attempt to amend a complaint to include a count for willful infringement. As Judge Stark stated, this is so even where the PTO and a District Court do not agree on claim construction because ‘the Court is not bound by [the PTO’s] construction.’” Id.
Collecting damages incurred following a finding of liability can be difficult. One avenue to collection that will not work, recounted in a recent decision by magistrate judge Leonard P. Stark, involves filing a new action.
According to the Court, such a maneuver constitutes improper claim-splitting:
"Because [plaintiff's] pre-trial requests for damages for infringement in [the earlier litigation] sought damages only for the period through the jury verdict . . . , the Court determined that [plaintiff] failed to preserve its right to an accounting necessary for obtaining damages . . . . To allow [plaintiff] to present the same waived claim - involving the very same infringement of the very same patents by the very same 106 Accused Products - in a new lawsuit would seem to permit claim-splitting."
Notably, however, the Court did not completely foreclose the availability of damages for later acts of infringement:
"I am not prepared to find on the record before me that a patentee that waives its right to a post-verdict accounting is absolutely prohibited from seeking damages from the same alleged infringer for later acts of infringement in a second suit . . . ."
Thus, at least for now, the line between the waived accounting damages and any new acts of infringement remains blurred.
The Federal Rules of Civil Procedure provide a trial judge with the ability to manage the presentation of a trial, particularly where complex matters are being tried before a jury. Patent misuse is a defense that courts have held can be tried to the jury or to the judge. Judge Thynge in Cordance Corporation v. Amazon.com, Inc., C.A. No. 06-491-MPT, Memo. Order (D. Del. July 28, 2009), was faced with the question of whether Amazon's defense of patent misuse should be tried before the jury or the bench. "[C]onsidering the Einsteinian analysis and Herculean task that Amazon is assigning to the jury by its proposed verdict form consisting of 14 pages with 20 questions containing over 160 subparts just to determine infringement and invalidity..." the Court chose not to "further burden and (potentially confuse) the jury with patent misuse" and therefore, that defense will be tried to the Court. Id. at 3.
In another portion of the opinion, the Court also found that plaintiff is only entitled to damages for infringement from the time the USPTO issued a certificate of correction for the patent-in-suit. Id. at 6. The corrections do not apply retroactively and prior to trial Cordance never articulated an infringement theory based on the uncorrected claims. Id. Thus, the damages period only runs from the date the PTO issued the certificate of correction.
Magistrate Judge Mary Pat Thynge: Summary Judgment Granted - No Willful Infringement Under Seagate Standard
In what is one of the first lengthy discussions on willful infringement from this District since the Federal Circuit issued its opinion in In re Seagate Tech., LLC, 497 F.3d 1360 (Fed. Cir. 2007) (see our earlier posting on the Seagate opinion here), Magistrate Thynge recently granted summary judgment of no willful infringement. Cordance Corp. v. Amazon.com, Inc., C.A. No. 06-491-MPT, Memo. Order (D. Del. July 27, 2009). Specifically, despite plaintiff's argument that Amazon had notice of its patents based on Amazon's level of activity and knowledge in the field of 1-click technology, the Court found that this was insufficient to demonstrate an objectively high likelihood that its actions constituted infringement of a valid patent. Id. at 10-11. Instead, the Court noted that Cordance's argument relied more on the "negligence standard for willful infringement overruled by Seagate." Id. at 11. Furthermore, the fact that Amazon moved for summary judgment of invalidity and non-infringement of the patents-in-suit demonstrated a "good faith belief in its defenses to Cordance's claims" and Cordance's own brief in support of its own motion for summary judgment states that the case "raises hotly contested issues of fact..." which are "likely to turn ultimately on conflicting expert testimony." Id. at 12. The Court therefore found that Cordance did not present enough evidence under the Seagate standard to demonstrate that Amazon acted despiste an objectively high likelihood that its acts constituted infringement, and granted Amazon's motion for summary judgment of no willful infringement. Id.
In multi-patent litigation, parties and the Court are often confronted with how to properly manage the sometimes unwieldy claim-construction process. To that end, Magistrate Judge Leonard P. Stark recently issued a noteworthy ruling that addressed how, at least in the case before him, Markman should be controlled. Specifically, the Court held that, in the underlying six-patent litigation, the parties would be limited to presenting twelve claim terms for construction.
While a claim limit is itself not unusual, the order also contains an incentive to agree: should the parties fail to settle on the twelve terms for construction, "the Court will limit the number of terms it will construe in conjunction with the Markman hearing to a maximum of ten (10)." Now that is incentive, indeed.