July 2, 2009

Judge Robinson: Plaintiffs not permitted to use information as a sword and a shield

Judge Robinson recently decided several discovery disputes between the parties in State of Florida v. Abbott Labs., C.A. 08-155-SLR (D. Del. June 23, 2009). Among other things, plaintiffs objected to defendants’ request for “rebates plaintiffs negotiate and receive for fenofibrate products.” Id. at 1. Plaintiffs objected on the grounds that the request sought (1) confidential information, and (2) that the information was not relevant. Judge Robinson rejected plaintiffs objections because: (1) if relevant, the information is discoverable. “Any problems with confidentiality can be resolved through a protective order . . . [;]” and (2) the rebates are relevant because plaintiffs broadly claimed their damages and so “cannot shield the rebate information from discovery . . . .” Id. at 2.

Among other things, defendants objected to plaintiffs’ request for settlement agreements. Judge Robinson reiterated her general practice to not “order the disclosure of settlement agreements, as such disclosure inhibits the very laudable purpose of settlement.” Id. at 3.

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July 2, 2009

Magistrate Judge Stark: assessing the adequacy of scienter when pleading fraud with particularity

In a recent trademark infringement and dilution case, Magistrate Judge Stark denied plaintiffs’ motion to dismiss defendants’ counterclaim seeking cancellation of plaintiffs’ trademark due to fraud on the Patent and Trademark Office. ING Bank v. the PNC Fin. Servs. Group, Inc., C.A. No. 08-514-GMS-LPS (D. Del. June 22, 2009). The basis of plaintiffs’ motion was that defendants failed to “state the facts and circumstances constituting fraud with particularity . . . .” Id. at 1. Among other things, plaintiffs’ argued that defendants failed to adequately allege scienter because they did not allege that the declarant, who made the statement-at-issue to the PTO, subjectively knew the statement was false when made. Magistrate Judge Stark rejected plaintiffs argument, however, because the declarant was clearing signing the statement to the PTO on behalf of the “applicant.” To assess the adequacy of scienter, the factfinder is “not limited to the subjective understanding of the corporate representative who made the statement . . . .” Id. at 5. Therefore, defendants adequately alleged scienter that “among those involved in the preparation of [the statement to the PTO] were those who knew or should have know that” plaintiffs were making a false statement. Id. at 7.


June 19, 2009

New District of Delaware Intellectual Property Case Filings

6/10: Aperio Technologies, Inc. v. Olympus America Inc., Hamamatsu Corporation and Hamamatsu Photonics KK (patent infringement)
6/11: Medicis Pharmaceutical Corporation v. Ranbaxy Inc. and Ranbaxy Laboratories Ltd. (patent infringement)
6/15: Pfizer Inc., Pfizer Ireland Pharmaceuticals, Warner Lambert Co., Warner Lambert Co., LLC v. Mylan Inc., Matrix Laboratories Ltd. and Matrix Laboratories Inc. (patent infringement)
6/15: Synchrome Technology Inc. v. Pioneer Electronics (USA) Inc., Pioneer North America, Asus Computer International, Teac America, Inc., Imation Corp., Memorex Products Inc, TDK Electronics, Mitsumi Electronics Corp. and Plextor LLC (patent infringement)

June 10, 2009

Judge Joseph J. Farnan, Jr.: Transfer Denied Where Defendants Not Subject to Suit in Transferee Forum

A defendant's motion to transfer will be denied where there is no evidence to establish that the defendant could have been sued in the transferee forum originally. Safety Braking Corp. v. Six Flags Theme Parks, et al., C.A. No. 07-127-JJF, Memo. Op. (D. Del. June 9, 2009). This is what Judge Farnan recently found in the Safety Braking Corp. matter in which the plaintiffs brought suit against several groups of theme park defendants all of which are Delaware entities that own and operate amusement parks in various locations across the United States. Defendants moved to transfer the litigation to the Central District of California where related cases involving similar technology and the same parties are pending. Id. at 2-3. The Court found that transfer was not appropriate because defendants did not submit sufficient evidence to show that plaintiffs could have properly brought suit in the Central District of California. Id. at 9.

Safety Braking Corp. v. Six Flags Theme Parks, et al., C.A. No. 07-127-JJF, Memo. Op. (D. Del. June 9, 2009).

June 9, 2009

New District of Delaware Intellectual Property Case Filings

5/13: Vianix LLC v. Nuance Communications Inc. (copyright infringement)
5/13: Future Fibre Technologies Pty Ltd. v. Optellios Inc. (patent infringement)
5/13: B. Braun Melsungen AG, B. Braun Medical Inc. v. Terumo Medical Corporation and Terumo Corporation (patent infringement)
5/15: CIMA Labs Inc., Azur Pharma Limited, Azur Pharma International III Limited v. Barr Laboratories Inc. and Barr Pharmaceuticals Inc. (patent infringement)
5/15: St. Clair Intellectual Property Consultants, Inc. v. Acer Inc., Acer America Corporation, Dell Inc., Gateway Inc., Lenovo Group Limited, Lenovo (United States) Inc. (patent infringement)
5/19: Dyson Inc. v. Hoover, Inc. and TTI Floor Care North America, Inc. (patent infringement)
5/20: Jonmor Investments, Inc. v. Seaboard Corporation (trademark infringement)
5/27: Qinetiq Limited v. Oclaro Inc. (patent infringement)
5/28: Stiefel Laboratories, Inc. v. KV Pharmaceutical Co. (patent infringement)
5/29: Human Genome Sciences, Inc. v. Immunex Corporation and Amgen, Inc. (patent infringement)
5/29: Enhanced Security Research LLC v. Cisco Systems, Inc., International Business Machines Corporation, Check Point Software Technologies Ltd., Check Point Software Technologies, Inc., Sonic WALL Inc., et al. (patent infringement)
6/1: Pioneer Hi-Bred Internaional Inc. and E.I. DuPont De Nemours and Co. v. BASF Corporation and BASF SE (patent infringement)
6/8: Saint Gobain Glass France v. Pittsburgh Glass Works, LLC (patent infringement)
6/8: Mark IV Industries Corporation v. TransCore Holdings Inc., Transcore LP, TransCore Partners LLC, Transcore ITS LLC, TLP Holdings LLC, Amtech Systems LLC, Amtech World Corporation and IntelliTrans LLC (patent infringement)

June 9, 2009

Chief Judge Gregory M. Sleet: Claim Construction Order

Chief Judge Sleet recently construed the terms of a pharmaceutical patent related to treatment of dysuria. In re: Alfuzosin Hydrochloride Patent Litigation, MDL Docket No. 08-md-1941-GMS, Order (D. Del. May 20, 2009). The following claim terms were construed:

- "dysuria"
- "effective dysuria controlling non-toxic amount of alfuzosine"
- "bladder neck disease"
- "neurological disorder"
- "benign hypertrophy of the prostate of alpha-adrenergic origin"

Specifically, the Court rejected certain proposed constructions where the party asked the Court to "import examples from the specification into the claims" as "contrary to Federal Circuit precedent." Id.

In re: Alfuzosin Hydrochloride Patent Litigation, MDL Docket No. 08-md-1941-GMS, Order (D. Del. May 20, 2009).

June 9, 2009

Judge Joseph J. Farnan, Jr.: Third Party Discovery

The District of Delaware was recently asked to decide a discovery dispute over third party documents related to litigation pending in California and Texas. Software Rights Archive, LLC v. Google Inc., Yahoo! Inc., IAC Seach & Media, Inc., AOL LLC and Lycos, Inc., Misc. No. 09-017-JJF, Opinion (D. Del. May 21, 2009). Specifically, the movants (Google Inc., Yahoo! Inc., IAC Seach & Media, Inc., AOL LLC and Lycos, Inc.) were seeking documents from the third parties (Delaware entities) related to: (1) jurisdiction; (2) "respondent's efforts, if any, to 'monetize' the patents-in-suit"; and (3) the patents and their inventors. Id. at 2.

Judge Farnan held that although the documents may be available from the opposing party, there is no rule that prohibits a party from also requesting those same documents from a third party or requiring them to request them from a party first. Id. at 4. Moreover, to ensure the "completeness" of discovery, "where a party requests documents from a non-party that are likely to be in the possession of an opposing party, production of documents is appropriate where those documents constitute a 'non-well-defined set' 'whose completeness is not readily verifiable.'" Id. at 6. (internal citations omitted). Therefore, the Court ordered the third parties to produce the documents despite the fact that the opposing party might also be in possession of the documents.

Software Rights Archive, LLC v. Google Inc., Yahoo! Inc., IAC Seach & Media, Inc., AOL LLC and Lycos, Inc., Misc. No. 09-017-JJF, Opinion (D. Del. May 21, 2009).

June 9, 2009

Judge Sue L. Robinson: Voluntary Substitution Continues In Personam Jurisdiction

Plaintiff Quinstreet Inc. filed a declaratory judgment suit in Delaware against a patent licensing firm EpicRealm for non-infringement of two patents. Quinstreet Inc. v. Parallel Networks, LLC, C.A. No. 06-495-SLR, Memo. Order (D. Del. May 28, 2009). A little over a year later, EpicRealm after its dissolution, in an unopposed motion, substitutes pursuant to Fed. R. Civ. P. 25(c), Parallel Networks as the defendant. Id. at 2. Parallel later moved to dismiss a third party declaratory judgment complaint for lack of personal jurisdiction. The Court found that the Delaware long-arm statute is inapplicable where voluntary substitution occurs under Rule 25(c). Furthermore, where in personam jurisdiction existed over the original party, in this case a Delaware limited partnership, the personal jurisdiction continues so long as service of the motion to substitute was effected. Id. at 5-6.

Quinstreet Inc. v. Parallel Networks, LLC, C.A. No. 06-495-SLR, Memo. Order (D. Del. May 28, 2009).

June 1, 2009

Mary Pat Thynge: Deposition Discovery Again Warrants Addition of Late Inequitable-Conduct Claim

In a patent infringement action, Magistrate Judge Mary Pat Thynge recently granted defendant SPI Pharma, Inc.’s (“SPI”) motion to amend their answer despite the deadline for amending pleadings having passed in May 2007. Roquette Frère v. SPI Pharma, Inc., C.A. No. 06-540-GMS (D. Del. May 21, 2009). SPI’s motion was hotly contested by plaintiff Roquette Frères (“Roquette”), despite Roquette amending their complaint twice (once after the deadline to do so had passed). Id. at 1. SPI initially responded to Roquette’s second amended complaint on July 13, 2007, but filed the present motion to amend on December 31, 2007, in order to include a defense and counterclaim based on inequitable conduct. Id. at 2. After deposing the inventors of the patent-in-issue in November 2007, testimony was elicited allegedly supporting a claim that “Roquette and/or its agents or representatives knowingly and intentionally misled the PTO regarding the content of prior art described in the . . . patent specification, and withheld material information.” Id. at 2-3. Magistrate Judge Thynge noted that “prejudice to the non-moving party is the ‘touchstone for the denial of an amendment.’” Id. at 12. However, Roquette claimed they would be prejudiced only because they “would have to address a new issue and rework its case, thereby incurring additional costs.” Id. When disregarding Roquette’s argument, Magistrate Judge Thynge stated that the inventors’ knowledge regarding the patent specification and their representations to the PTO were “within the control of Roquette.” Id. Moreover, SPI’s motion to amend was filed four months before the close of discovery and before a trial had been scheduled. Finally, Roquette failed to present evidence that SPI brought the motion in bad faith or that amendment would be futile. Roquette focused only on their disagreement with the merits of the inequitable conduct allegations, while failing to point to deliberate conduct or SPI’s failure to allege facts that could support a finding in its favor. Id. Roquette Frère v. SPI Pharma, Inc., C.A. No. 06-540-GMS (D. Del. May 21, 2009)
May 22, 2009

Chief Judge Gregory M. Sleet: Manufacturing and Selling Automobile Parts Incorporated Into Vehicles Manufactured in Delaware is Sufficient to Confer Personal Jurisdiction

In a patent infringement case, Chief Judge Sleet recently denied Defendant’s motion to dismiss for lack of personal jurisdiction despite the fact that Defendant (a Georgia corporation with its principal place of business in Georgia) has never had an office in Delaware, is not licensed to conduct business in Delaware and has never had any employees in Delaware. W.L. Gore & Assoc., Inc. v. Label Tech., Inc., No. 08-111-GMS, at 1 (D. Del. May 15, 2009). Judge Sleet determined that Defendant was subject to specific jurisdiction under Delaware’s long-arm statute because Defendant manufactures and sells automobile parts “knowing that its products would be installed into vehicles at Chrysler’s plant in Newark, Delaware.” Id. at 4 Any injury resulting from introducing Defendant’s product into the Delaware market is “sufficient to permit a Delaware court to exercise jurisdiction over [Defendant] under sections 3104 (c)(1) and (c)(4) of title 10 of the Delaware Code” Id. at 6. Although Defendants “contacts” with Delaware was minimal, due process is satisfied because Delaware’s interest in “discouraging injuries that occur within the state, which extends to patent infringement actions[,] is not outweighed by the burden on [Defendant] of litigating this action in Delaware.” Id. at 6-7.

W.L. Gore & Assoc., Inc. v. Label Tech., Inc., No. 08-111-GMS, at 1 (D. Del. May 15, 2009)