October 7, 2013

Judge Andrews denies customer's motion to stay case pending resolution of supplier's declaratory judgment action

Judge Andrews recently considered General Motor's motion to stay pending resolution of its supplier's declaratory judgment action filed against plaintiff, Pragmatus. Pragmatus Telecom LLC v. General Motors LLC, C.A. No. 12-1545-RGA (D. Del. Oct. 3, 2013). Judge Andrews noted that in many circumstances motions to stay customer cases can be resolved easily. In those cases:

[t]he supplier makes a product, transfers it to the customer, and the customer sells it to third parties. The resolution of the supplier case will almost certainly resolve the customer case. If the supplier wins, the patent holder is collaterally estopped against the customer. If the supplier loses, the patent holder cannot get any additional damages against the customer.

Id. at 1.

The case at hand, however, did not present such an easy question. Even though the customer agreed to be bound by the Court's infringement decision in the supplier action, "'with respect to infringement or non-infringement' of the patents 'based on [the customer's] use of the supplier's technology'", such an agreement would not "have as much value as a representation that the customer will be bound by the validity/invalidity decision." Id. at 2 (alteration in original). At least under the facts of this case, and with the absence of such an agreement to be bound, Judge Andrews determined that the equities did not support the granting of a stay. Id.

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October 7, 2013

Judge Robinson grants-in-part defendant’s motions for summary judgment, denies Daubert motion, and construes claim terms

In Netgear, Inc. v. Ruckus Wireless, Inc., C.A. No. 10-999-SLR (D. Del. Sept. 30, 2013), Judge Sue L. Robinson recently considered a number of motions and cross-motions for summary judgment, a Daubert motion, and construed several claim terms. The five patents-in-suit in this case are “directed to wireless communications systems, which use radio waves to communicate.” Id. at 2.

The Court denied plaintiff’s motions for summary judgment for infringement and validity, and granted-in-part defendant’s motion for summary judgment of invalidity (as to four of the patents-in-suit) and non-infringement (as to three of the patents-in-suit). In the course of construing disputed claim terms, the Court found a number of claim limitations, across four patents-in-suit, indefinite. The Court therefore granted summary for invalidity as to the asserted claims of these four patents. Because “the court [could not] complete a meaningful infringement analysis” and because the claims were invalid, the Court additionally granted summary judgment for non-infringement of three of these patents. See, e.g., id. at 24 n.2.

The Court also considered other invalidity arguments with regard to U.S. Patent Nos. 6,621,454 (the ‘454 Patent), 7,263,143 (the ‘143 Patent), and 5,507,035 (the ‘035 Patent). As to the ‘454 Patent, the Court denied competing motions for summary judgment as to enablement because the plaintiff had offered “some” evidence of support for the limitation in the claim at issue, and therefore genuine issues of material fact remained. Id. at 34-35. The Court also denied plaintiff’s motion for summary judgment of no invalidity due to obviousness and/or anticipation because genuine issues of material fact remained. Id. at 36. As to the ‘143 Patent, defendant argued the asserted claims did not meet the requirements of 35 U.S.C. § 101, but the Court concluded that the defendants had not identified clear and convincing evidence of invalidity under this section. Id. at 40. The Court also denied competing summary judgment motions on invalidity of the ‘143 Patent for lack of written description. Id. at 40-42. Finally, as to the ‘035 Patent, the Court concluded that it did not recite patent eligible subject matter under § 101: “[t]he '035 patent is an abstract idea, a strategy which consists of making random selections over multiple attempts, determining whether the attempt is successful and, if not, trying again. That the strategy is limited to the field of antenna diversity does not transform the abstract subject matter into patent eligible subject matter. . . . Moreover, the reference in the patent to a controller and means to accomplish certain functions does not supply an inventive concept that represents a nontrivial, nonconventional human contribution or materially narrows the claims relative to the abstract idea they embrace. . . . The recited means are also not indispensable to the claimed strategy.” Id. at 48-49 (internal citations and quotation marks omitted).

Defendant had moved to exclude the testimony of plaintiff’s expert regarding the source code related to the patents-in-suit, arguing that “he did not review the entirety of the source code, rather, he reviewed selections of source code provided to him by counsel” and because the expert did not test any accused infringing products. Id. at 49-50. The Court denied this motion because the expert “was not required to test the accused products. Defendant has not shown that [the expert's] testimony is based on unreliable sources, indeed, it is based on defendant's source code and the testimony of defendant's witnesses. Defendant's concerns go to the weight of the testimony and may properly be addressed on cross-examination.” Id. at 50.

Finally, the Court construed a number of disputed terms across the five patents-in-suit. As noted above, the Court concluded that several disputed terms were indefinite. Having found that other terms were not indefinite, the Court construed those terms:

“[O]ptimal conditions,” id. at 18-20;

“[M]eans, responsive to said conditions, for selecting at least one of said beams having one of said orthogonal polarizations for data transmissions from said first transmitter,” id. at 22-23;

“[M]eans to analyze the topology broadcast messages and enter in said topology table the network addresses of the wireless node transmitting the topology broadcast message and network addresses of other nodes contained in the topology broadcast messages; and,” id. at 25-26;

“[M]ultibeam antenna,” id. at 32-33;

“[S]canner,” id. at 33 (defendant argued this was means-plus-function limitation and moved for summary judgment for invalidity for indefiniteness; the Court concluded that this was was not a means-plus-function limitation and denied summary judgemnt. Id. at 33 n.10);

“[P]eriodicity,” id. at 33 & 38;

“[A] data transmission antenna pattern with a null in the direction of said interference,” id. at 33-34;

“[G]ain control circuit,” id. at 37;

“[R]eceiver gain,” id.

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October 3, 2013

Judge Robinson precludes defendant from raising untimely non-infringement arguments at trial

In a recent order, Judge Sue L. Robinson found that defendant’s “non-infringement arguments relating to the limitations in claim 1 . . . , having been proposed for the first time in [defendant’s expert’s] June 14, 2013 Rebuttal Report and [the expert's] September 16, 2013 Supplemental Report . . . , may not be raised at trial.” Vehicle IP, LLC v. Werner Enterprises, Inc., C.A. No. 10-503-SLR (D. Del. Sept. 20, 2013). As Judge Robinson explained, “the non-infringement arguments in dispute were introduced for the first time through [defendant’s] expert without any of the underlying factual bases being vetted through fact discovery.” Id. at 1. For instance, Judge Robinson found certain arguments were waived because they were not “raised in response to plaintiff’s infringement contentions,” and were raised for the first time in the defendant’s expert’s Rebuttal Report. Id. at 2. Judge Robinson also found other non-infringement arguments waived because they were not raised during claim construction, or were inconsistent with the Court’s claim construction and were raised for the first time in the expert’s Supplemental Report. Id.

In a footnote, Judge Robinson explained that “[w]hile expert discovery is part of the discovery process, it is the part where the experts opine on the facts vetted during fact discovery; the facts vetted during fact discovery are those identified as relevant to the parties’ respective contentions. By not timely identifying its non-infringement contentions, defendant has turned the process on its head, to the detriment of both the court and the plaintiff.” Id. at 1 n.1

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October 3, 2013

Judge Stark enters judgment in favor of defendant on infringement claims in light of prosecution history estoppel

In a recent memorandum opinion, Judge Leonard P. Stark found that plaintiff did not overcome its presumption of prosecution history estoppel and therefore entered judgment in favor of defendant on plaintiff’s claims of infringement under the doctrine of equivalents for claims 1, 3, and 6 of U.S. Patent No. 5,865,866 (“the ‘866 Patent”), and claim 2 of U.S. Patent No. 5,873,862 (“the ‘862 Patent”). ICU Medical, Inc. v. Rymed Technologies, Inc., C.A. No. 07-468-LPS (D. Del. Sept. 30, 2013). This opinion comes after a May 2012 bench trial, where Judge Stark considered “the viability of the jury’s verdict of infringement under the doctrine of equivalents, in light of prosecution history estoppel.” Id. at 1.The parties were in agreement that “the presumption of prosecution history estoppel applies, and further agree[d] that [plaintiff had] an opportunity to attempt to rebut that presumption by showing that the rationale for the amendment bore no more than a tangential relation to the equivalent in question.” Id. at 7.

First, Judge Stark found that plaintiff failed to carry its burden in establishing that the amendments 1, 3, and 6 of the ‘866 Patent “bore no more than a tangential relation to the equivalent in question.” Id. at 7, 20. Judge Stark noted, among other things, that “[t]he prosecution history is silent as to why [plaintiff] followed the Examiner’s recommendation and added the configuration limitations and not just the O-ring elements limitation that [plaintiff] believed was necessary to overcome the prior art rejection. Simply following the Examiner's unexplained suggestion, without any explanation from [plaintiff], does not, on this prosecution history, suffice to satisfy the tangentiality exception.” Id. at 14. Judge Stark also noted “the Court is unable to conclude, on the record before it, that the PTO necessarily would have allowed an amended claim 1” without the limitations that plaintiff claimed were tangential to patentability (i.e., configuration limitations). Id. at 16.

Judge Stark similarly found that plaintiff failed to carry its burden in overcoming the presumption of prosecution history estoppel with respect to claim 2 of the ‘862 Patent. Id. at 20. Judge Stark noted that with respect to claim 2, plaintiff had a “stronger argument that there is an objectively discemable reason for the amendment, an amendment which added the O-ring elements but no additional limitations relating to their configuration.” Id. at 19-20. However, “the Court [was] uncertain whether “the ‘equivalent in question’ [was] the O-ring elements.” Id. at 20. As Judge Stark explained, the finding of infringement of equivalence may have been predicated on a finding of the presence of O-ring elements only by equivalence, yet the existence of O-ring elements was not tangential to the claim amendment.” Id.

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October 3, 2013

Chief Judge Sleet grants motion to transfer to Southern District of Ohio

Chief Judge Gregory M. Sleet recently granted a Delaware corporation’s motion to transfer to the Southern District of Ohio. Verint Systems Inc., et al. v. CallCopy, Inc., C.A. No. 13-562-GMS (D. Del. Sept. 23, 2013). The plaintiffs in the case were Delaware corporations with principal places of business in New York and Georgia. The defendant was a Delaware corporation with its principal place of business in Columbus, Ohio. Weighing the Jumara factors, Chief Judge Sleet concluded that only one factor weighed against transfer—the plaintiffs’ choice of forum—and that factor was not given maximum weight because the plaintiffs’ principal places of business were not located in Delaware. Id. at 4. On the other hand, three factors were found to slightly favor transfer: where the claim arose, the location of books and records, and “practical considerations.”

Although the “where the claim arose” factor typically is neutral when the defendant operates on a national level, here the defendant argued that it “never had a Delaware customer, and that the Accused Products have not been sold in Delaware, are marketed solely in and from Columbus, Ohio, and were developed in Columbus, Ohio.” Id. at 4. The plaintiffs argued that the defendant “solicits sales in Delaware via its website …, and maintains sales positions that service the greater Philadelphia area, Baltimore, and New York City,” but the Court found that the “where the claim arose” factor weighed slightly in favor of transfer to Ohio. Id. at 4-5. The Court also found that the location of books and records in Ohio slightly favored transfer. Id. at 6.

Although the Court found the “convenience of the parties” factor neutral, the considerations involved in weighing that factor resulted in the Court finding that “practical considerations” favored transfer. Specifically, the Court found that while the plaintiffs would have to travel to either forum, the defendant’s traveling costs would be “substantially reduce[d]” if the litigation were transferred to Ohio. This consideration was given more weight because the plaintiffs were far larger than the defendant (“$796 million corporation with 3,200 employees” versus “$20 million corporation with 134 employees”). Those considerations did not result in a finding that the “convenience of the parties” factor weighed in favor of transfer because the defendant had chosen to incorporate in Delaware and, "therefore, [could not] argue that it is an inconvenient forum," but Chief Judge Sleet found that those considerations warranted transferring the litigation to Ohio based on practical considerations. Id. at 5, 7.

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October 1, 2013

Judge Stark Grants Leave to Amend Adding Claims of Inequitable Conduct, Unclean Hands, and Breach of Contract

In a recent decision, Judge Stark granted a patent infringement defendant’s motion to amend its answer to add claims of inequitable conduct, unclean hands, and breach of contract. Defendant Amneal filed the motion to amend on the last day of fact discovery, well after the scheduling order deadline to amend pleadings. Accordingly, Amneal had to show good cause to modify the case schedule under Rule 16(b)(4). Galderma Labs. Inc., et al. v. Amneal Pharma., LLC, et al., C.A. No. 11-1106-LPS, Memo. Order at 1-2 (D. Del. Sept. 30, 2013). Judge Stark found that Amneal had shown good cause because Amneal did not learn of the facts underlying its new claims until approximately one month before filing its motion. At that time, Amneal learned at its deposition of prosecution counsel that counsel had only disclosed a portion of the data of which counsel was aware to the PTO and that litigation counsel had improperly participated in patent prosecution. Accordingly, the proposed amendment was timely. Id. at 2. Judge Stark further explained that the amendment would not be futile because the amended pleading raised questions for the Court to consider, and the amendment would not cause undue prejudice because it was filed nearly a year before trial was to begin, leaving sufficient time for the limited discovery required. Id. at 2-3.

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October 1, 2013

Judge Sleet grants motion to stay discovery from defendant customers

Judge Gregory M. Sleet recently granted-in-part defendants' motion to stay litigation against defendant Bruker-AXS, Inc.'s customers pending the plaintiff's suit against the manufacturer of the accused products, Bruker-AKS, Inc. Vertical Analytics LLC v. Bruker-AXS, Inc., et al, C.A. No. 12-1187-GMS (D. Del. Sept. 27, 2013). Judge Sleet denied defendants' request to stay the entire litigation, but did stay discovery against the defendant customers until plaintiff could demonstrate that it needed such discovery because the information obtained from defendant Bruker-AXS, Inc., was insufficient. Id. at 1-2.

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September 28, 2013

Judge Sleet denies post-trial motions contesting invalidity and non-infringement, denies motion for attorney’s fees

In Finjan, Inc. v. Symantec Corp. et al., C.A. No. 10-593-GMS (D. Del. Sept. 19, 2013), Chief Judge Gregory M. Sleet denied several post-trial motions. Following a thirteen-day jury trial in December 2012, the jury returned “a unanimous verdict in favor of each of the defendants on the issues of infringement with respect to each asserted claims on the patents-in-suit,” U.S. Patent Nos. 6,480,962 and 6,092,194. Id. at 1-2. The jury additionally found “that the asserted claims of the patents -in-suit were invalid due to obviousness and anticipation.” Id. at 2. During the trial, defendants and plaintiff had moved for judgment as matter of law (“JMOL”) on numerous grounds pursuant to Fed. R. Civ. P. 50(a), and the court denied all of those motions. Id. at 1. After the trial, plaintiff filed renewed motions for JMOL, and, in the alternative, moved the court for a new trial. Judge Sleet first denied plaintiff’s renewed motions for JMOL with respect to invaldity, finding that defendants introduced substantial evidence sufficient to support a jury verdict of invalidity on the grounds of obviousness and anticipation. Judge Sleet similarly denied plaintiff’s renewed motions for JMOL with respect to the jury’s verdict of non-infringement. Judge Sleet additionally denied plaintiff’s alternative motion for a new trial.

Judge Sleet also denied one defendant’s motion for attorney’s fees. Judge Sleet noted, among other things, that “this case does not rise to a level of bad faith or vexatious litigation that warrants an award of attorney fees and costs.” Id. at 83. He similarly noted that “[f]or the most part, the parties defended their respective positions throughout this litigation in apparent good faith and the court does not find evidence in the record sufficient to support the assertion that [plaintiff] acted in subjective bad faith or conducted litigation in a manner warranting attorney fees.” Id. at 83.

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September 26, 2013

Judge Stark Grants Summary Judgment of Noninfringement of Withdrawn Claims

Judge Leonard Stark recently decided several summary judgment motions in the ongoing patent infringement dispute between patent-owner Personalized User Model, L.L.P. and Google. The patents-in-suit relate generally to methods for “providing a more personalized experience for internet users based on individual user interests.” Personalized User Model, L.L.P. v. Google Inc., C.A. No. 09-525-LPS, Memo. Op. at 1-2 (D. Del. Sept. 20, 2013). With only one exception, Judge Stark denied all motions for summary judgment including for findings of non-infringement, invalidity, breach of contract, declaration of ownership, and lack of standing. Considering Google’s motion for summary judgment of non-infringement, Judge Stark denied the motion with respect to two patents-in-suit, but granted it with respect to a third patent. That third patent, the ’031 patent, had been asserted earlier in the case, but the plaintiff dropped the asserted claims of the ’031 patent in response to the Court’s order to reduce the number of asserted claims to fifteen. The plaintiff argued that the Court could not grant summary judgment over unasserted claims “because the Court does not have jurisdiction over claims that have been voluntarily withdrawn.” Judge Stark noted, however, that the “parties have failed to come to an agreement regarding a stipulation of dismissal of the ’031 patent claims, so the Court believes it still has jurisdiction over claims relating to this patent. As there is no evidence to support a finding of infringement of the ’031 patent, the Court will grant summary judgment of non-infringement.” Id. at 8-9.

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September 25, 2013

Judge Stark construes claim terms of image data capture patent

In Transcenic, Inc. v. Google Inc, et al., C.A. No. 11-582-LPS (D. Del. Sept. 17, 2013), Judge Leonard P. Stark construed the following disputed terms of U.S. Patent No. RE 42,289, entitled “Spatial Referenced Photographic System With Navigation Arrangement:”

“database”

“a database”

“camera path”

“launch pad control”

“means for displaying.”

The Court adopted plaintiff’s proposed constructions with a few modifications, except where it resolved the parties’ dispute over a term and concluded that no construction was needed. See id. at 9. The Court concluded that the following terms would be given their plain and ordinary meaning: “image,” “orientation of the image,” “yaw orientation of the respective image,” and “multiple images aligned in a panorama.”

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