May 24, 2013

Judge Sleet Denies Motion to Dismiss False Marking Claims under Rule 9(b)

Chief Judge Gregory Sleet recently denied a defendant’s motion to dismiss false marking counts of a complaint. See Devicor Medical Products, Inc. v. Biopsy Sciences, LLC, C.A. No. 10-1060-GMS, Order at 1 (D. Del. May 17, 2013). Defendant Biopsy Sciences sought to dismiss the false marking claims on grounds that the plaintiff, Devicor Medical Products, did not sufficiently plead the intent required by Rule 9(b). In his order, Judge Sleet acknowledged that Federal Circuit precedent required application of Rule 9(b)’s heightened pleading standard to false marking claims. Judge Sleet continued, however, that Devicor “is not required to prove its case at the pleadings stage. Rather, the court need only ask whether the [complaint] ‘allege[s] sufficient underlying facts from which [the] court may reasonably infer that a party acted with the requisite state of mind.’” Id. Because Devicor “offered specific allegations directed towards its position that Biopsy had knowledge of the alleged mismarking and took affirmative actions to mislead the public,” Judge Sleet found “the necessary ‘objective indication’ from which the court may draw a reasonable inference of intent” and deny the motion to dismiss. Id.

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May 21, 2013

Judge Burke recommends denial of defendants’ motion for leave to add claims and defenses of inequitable conduct

In a recent report and recommendation, Magistrate Judge Christopher J. Burke recommended that defendants’ motion for leave to amend their pleading with inequitable conduct claims and defenses be denied. INVISTA North America S.à.r.l. et al. v. M&G USA Corporation et al., C.A. No. 11-1007-SLR-CJB (D. Del. May 3, 2013). Plaintiffs are asserting U.S. Patent Nos. 7,943,216 (the “’216 Patent”); 7,879,930 (the “’930 Patent”); and 7,919,159 (the “’159 Patent”). Id. at 1. On August 6, 2012, the date which marked the deadline to amend the pleadings pursuant to the Scheduling Order, defendants moved for leave to amend their pleading with inequitable conduct claims and defenses with respect to each of plaintiffs’ asserted patents. Id. at 5. Defendants alleged that those responsible for the prosecution of the asserted patents submitted misleading and incomplete test data to the PTO. Id. at 11, 26. Judge Burke’s analysis was governed by Federal Rule of Civil Procedure 15(a). See id. at 5-6. Because plaintiffs opposed defendants’ motion “on the sole basis that [their] proposed amendments would be futile,” Judge Burke was required to assess only futility of amendment. Id. at 6. As Judge Burke explained, “the standard for assessing futility of amendment is the same standard of legal sufficiency that applies under Fed. R. Civ. P. 12(b)(6).” Id. at 7.

With respect to the ’159 and ’216 Patents, Judge Burke found that defendants failed “to sufficiently plead both the ‘who’ of inequitable conduct as well as the scienter requirement.” Id. at 25. Judge Burke explained that “[n]one of [defendants’] allegations tie specific conduct to any specific individual; instead, as to ‘who’ engaged in misconduct before the PTO, every allegation is pled generally, with reference to ‘Invista,’ ‘Applicant,’ ‘they,’ and ‘their.’” Id. at 17. Judge Burke further found that as to knowledge, the “problem with [defendants’] allegations circle[d] back to the Court’s finding with regard to [defendants’] insufficient pleading as to the ‘who’ of inequitable conduct.” Id. at 21. Specifically, Judge Burke explained that “[w]ith no real facts pled that are specific to any individual, there is a clearly insufficient basis to reasonably infer that any particular person . . . did in fact know of the materiality of this data, and intentionally failed to disclose the data or disclosed incomplete data.” Id. at 22. Moreover, with respect to an intent to deceive, Judge Burke noted that defendants failed to satisfy its burden “under Exergen by asserting that ‘Applicant’ or ‘INVISTA’ as a whole had a ‘desire to acquire patent rights in the gas barrier market,’ and then suggest[ing] that this general statement should lead to the inference that" a particular individual "knowingly withheld or misrepresented material data because of a specific intent to deceive the PTO.” Id. at 25.

Judge Burke further found that defendants’ proposed inequitable conduct defense with respect to the ’930 Patent “suffer[ed] from the same fatal flaws” as those related to the ’159 and ’216 Patents. Id. at 28. Specifically, defendants “failed to sufficiently identify the ‘who’ of [the] inequitable conduct,” which in turn “doom[ed] [defendants’] allegations regarding the scienter requirements of inequitable conduct in relation to the ’930.” Id. Judge Burke additionally found that defendants failed to sufficiently plead “but-for” materiality with respect to the ’930 Patent. Id. at 29. As Judge Burke explained, “[m]ere claims that the PTO would not have granted the patent had it known of the omission or misrepresentation are insufficient because they are conclusory legal conclusions under Iqbal.” Id.

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May 21, 2013

Judge Sleet denies defendants’ request to file motion for summary judgment

In Edwards Lifesciences LLC, et al. v. Medtronic CoreValve LLC, et al., C.A. No. 12-23-GMS (D. Del. May 13, 2013), Chief Judge Gregory M. Sleet recently issued an Order denying defendants’ letter request to file a motion for summary judgment asserting invalidity for lack of enablement of U.S. Patent No. 8,002,825. The Court explained that issues of material fact remained as to “(1) whether the 18 French limitation is a novel feature of the claimed invention; and (2) if this limitation is novel, whether the '825 Patent disclosure is enabling.” Id. at 1 n.1.

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May 21, 2013

Judge Thynge issues early claim construction order at request of parties

In two consolidated actions, Magistrate Judge Mary Pat Thynge recently issued a Memorandum Order construing the term “promotional code” in U.S. Patent Nos. 5,717,866, entitled “Method for comparative analysis of consumer response to product promotions,” and 5,924,078, entitled “Consumer-provided promotional code actuatable point-of-sale discounting system.” Codepro Innovations LLC v. Safeway Inc., C.A. No. 12-970-MPT and Codepro Innovations LLC v. The Stop & Shop Supermarket Company LLC, et al., C.A. No. 12-1482-MPT, at 1 (D. Del. May 14, 2013). The parties had requested early claim construction for this term. Id.

Judge Thynge construed this term as “a series of publicly distributed or advertised characters associated with discount information corresponding to a product or products.” Id. at 18.

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May 20, 2013

Judge Robinson Denies Motions to Transfer, Dismiss

Judge Sue Robinson recently considered motions to transfer and dismiss filed by patent infringement defendant Callidus Software. Plaintiff Versata Software is a Delaware corporation with a principal place of business in Texas, and Defendant Callidus is a Delaware corporation with a principal place of business in California. Callidus moved to transfer to the Northern District of California and to dismiss under Rule 12(b)(6), and Judge Robinson denied both motions. See Versata Software, Inc., et al. v. Callidus Software Inc., C.A. No. 12-931-SLR, Memo. Op. at 1-2 (D. Del. May 16, 2013).

Referring to her previous decision in Helicos Biosciences Corp. v. Illumina, Inc., 858 F. Supp. 2d 367 (D. Del. 2012), Judge Robinson noted that both parties preferred venue would be a legitimate venue. But because “‘convenience’ is separately considered in the transfer analysis, the court decline[d] [to] elevate a defendant’s choice of venue over that of a plaintiff based on defendant’s convenience.” Id. at 3-4. Carefully weighing all of the Third Circuit’s Jumara factors, Judge Robinson ultimately concluded that “Versata chose a legitimate forum which all parties have in common—their state of incorporation. As is usual in these cases, the convenience factors do not weigh in favor of transfer, because discovery is a local event and trial is a limited event. Although Delaware is not the locus of any party’s business activities, it is a neutral forum and no more inconvenient for Calllidus than Texas, the locus of Versata’s business activities. Given that both Versata and Callidus have experience litigating in multiple jurisdictions, the court is not persuaded that transfer is warranted in the interests of justice.” Id. at 3-6.

Judge Robinson then turned to Callidus’ motion to dismiss for failure to state a claim. Her Honor first found that with respect to “Versata’s claims of direct infringement . . . Versata’s complaint sufficiently identifies the accused software . . . as required by Fed. R. Civ. P. Form 18.” Id. at 9. Consistent with her practice in previous cases, Judge Robinson also found that Versata had adequately plead indirect infringement. Relying on Walker Digital LLC v. Facebook, Inc., 852 F. Supp. 2d 559 (D. Del. 2012), Judge Robinson held that the complaint’s allegation of knowledge of infringement as of the date of filing provided adequate notice under Global-Tech. Id. Furthermore, the pleading of induced infringement without identification of a specific customer was adequately supported because Callidus “licenses and/or sells the accused products” and Versata also alleged direct infringement. Finally, the pleading of contributory infringement was adequately supported because Versata alleged direct infringement and knowledge of lack of substantial non-infringing uses. Id. at 10. For these reasons, Judge Robinson found that all of the allegations of the complaint “satisfied the requirements of Twombly and Iqbal.” Id. at 7-10.

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May 17, 2013

Judge Sleet construes claims in ANDA litigation

In Pfizer Inc. et al. v. Sandoz Inc., C.A. No. 12-654-GMS-MPT (D. Del. May 7, 2013), Chief Judge Gregory M. Sleet recently issued an order construing the following six disputed terms of U.S. Patent No. 8,026,276, which is alleged to cover a pharmaceutical that treats advanced renal cell carcinoma:

- “CCI-779”

- “w/v”

- “w/v of citric acid”

- “parenteral composition”

- “preparing”

- “combining”

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May 15, 2013

Judge Thynge construes claim terms of Internet search patent

In Collarity, Inc. v. Google, Inc., C.A. No. 11-1103-MPT (D. Del. May 6, 2013), Magistrate Judge Mary Pat Thynge recently construed the following disputed claim terms of U.S. Patent No. 7,756,855, entitled “Search Phrase Refinement by Search Term Replacement:”

-“keyword,” id. at 4-8;

-“association graph,” id. at 8-10;

-“anchor keyword/non-anchor keyword,” id. at 10-12;

-“designating, by the search system, one or more keywords as anchor keywords and the remaining keywords as non-anchor keywords,” id. at 12-14;

-“order of steps,” id. at 14-19.

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May 14, 2013

Magistrate Judge Burke Construes Terms of Patents Asserted Against Microsoft Kinect

Magistrate Judge Burke recently issued a thorough report and recommendation on claim construction in a patent infringement dispute between plaintiff Impulse Technology and defendants, Microsoft and the makers of several games for Microsoft’s Xbox 360 system and Kinect sensor. See Impulse Tech. Ltd. v. Microsoft Corp., C.A. No. 11-586-RGA-CJB, Report and Recommendation at 1-4 (D. Del. May 13, 2013). In addition to the parties’ agreed-upon constructions, Judge Burke construed the following disputed terms related to tracking the position of a player in physical and virtual spaces:

- “a tracking system”
- “defined physical space” and “first/second physical space”
- “virtual space”
- “player virtual location[s] in a virtual space corresponding to the physical location[s] of the player[s]”
- “positioning the representation of the user on the monitor” and “moving the representation of the user to reflect movement of the user”
- “representation”
- “overall physical location”
- “moving in the physical space”
- “[the view is from a] point of view in the virtual space corresponding to a location on a line directed outward from the display into the physical space”

Id. at 61-62.

UPDATE:
In a recent Order, Judge Richard G. Andrews adopted Judge Burke's recommended constructions, but provided additional clarification as to the proper construction of the following terms: "overall physical location" and "'positioning the representation of the user' and 'moving the representation of the user to reflect movement of the user.'" Impulse Technology Ltd. v. Microsoft Corporation, et al., C.A. No. 11-586-RGA-CJB (D. Del. Sept. 19, 2013).

Judge Andrews adopted Judge Burke's recommended constructions, but provided additional clarification as to the proper construction of the following terms: "overall physical location" and "'positioning the representation of the user' and 'moving the representation of the user to reflect movement of the user.'" See id. at 1-3.

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May 14, 2013

Magistrate Judge Fallon recommends dismissal of pro se patent infringement complaint for lack of standing.

Magistrate Judge Sherry R. Fallon recently recommended the dismissal of a pro se patent infringement complaint filed against the United States, various United States officials, and Kannalife Sciences, Inc. McDowell v. U.S., et al., C.A. No. 12-1302-SLR-SRF (D. Del. May 10, 2013). The pro se plaintiff was the inventor of U.S. Patent No. 7,597,910, “directed to compositions and methods for treating prostate disorders using a mixture of cannabis, shiitake mushrooms, and maitake mushrooms,” but had assigned the patent to SLGM Medical Research Institute. Id. at 1, 5. The inventor argued that he had standing to bring the complaint because he and SLGM Medical Research were “one and the same,” but Magistrate Judge Fallon rejected that argument, explaining that “only the owner of the patent has standing to sue.” Id. at 5. Magistrate Judge Fallon also recommended that the complaint against the United States and its officials be dismissed for lack of subject matter jurisdiction on the basis that 28 U.S.C. § 1498 requires that patent infringement actions against the United States be filed in the United States Court of Federal Claims. Id. at 6.

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May 13, 2013

Judge Sleet denies defendant’s 12(b)(6) motion to dismiss plaintiff’s direct and indirect infringement claims

In a recent order, Chief Judge Gregory M. Sleet denied defendant’s motion to dismiss plaintiff’s claims of direct, contributory, and induced infringement for failure to state a claim upon which relief may be granted. Segan LLC v. Zynga Inc., C.A. No. 11-670-GMS (D. Del. May 2, 2013). Plaintiff is asserting U.S. Patent No. 7,054,928 (the “’928 Patent”), which includes two independent claims, one system claim and one method claim. Id. at 1 n.1. With respect to plaintiff’s claims for direct infringement, defendant argued that “it cannot possibly directly infringe either the system or methods claims” because direct infringement requires a party to “commit all the acts necessary to infringe . . . either personally or vicariously,” and plaintiff’s asserted claims “require activity by multiple actors.” Id. Judge Sleet explained, however, that with respect to the “use” of a system, “physical or direct control of all the elements of a system is not required—the user must simply cause those elements to work for their patented purpose.” Id. at 2 n.1. In light of that standard, Judge Sleet found that plaintiff sufficiently pled direct infringement, as plaintiff alleged that defendant “has used its own games on social media websites.” Id.

Defendant also argued that plaintiff’s indirect infringement claims should be dismissed for failure to adequately plead “the requisite underlying direct infringement [and] the necessary knowledge and intent.” Id. Judge Sleet found, however, that plaintiff sufficiently pled the direct infringement prong by alleging that “on any given day 60,000,000 people (i.e., users) play Defendant’s games on social websites” and that the “games’ users . . . put the invention into service, control the operation of the system as a whole and obtain [a] benefit from it.” Id. Further, with respect to the knowledge and intent requirements for induced infringement, Judge Sleet contrasted the instant complaint from the deficient complaint in Chalumeau Power Sys. LLC v. Alcatel-Lucent, C.A. No. 11-1175-RGA (D. Del. Jul. 18, 2012) (discussed previously here). Id. at 3 n.1. In the Chalumeau complaint, there were “only insufficient factual assertions to support the legal conclusion of actual knowledge, and no factual assertions at all to support the legal conclusion of specific intent.” Id. In the instant matter, Judge Sleet found that knowledge was sufficiently pled since plaintiff alleged that it sent a letter to defendant’s officers with a full copy of the asserted patent on June 30, 2011. Id. Further, Judge Sleet found that plaintiff provided “several factual assertions permitting a reasonable inference that [defendant] acted with the requisite specific intent.” Id. With respect to the contributory infringement claim, Judge Sleet again found knowledge sufficiently pled based on the allegations related to plaintiff’s letter with the asserted patent attached. Id. Further, Judge Sleet found that plaintiff provided allegations sufficient to permit “the reasonable inference that [defendant] was aware that its games were ‘especially adapted for use in infringement’ of the ’928 Patent.” Id. Specifically, plaintiffs alleged that “[d]efendant has specifically designed, developed, and acquired [its] on-line games for game players to use on target websites” and that defendant "admits in its amended IPO statement that its games require game players (users) to access the internet, Facebook (or any target website [defendant] engages).” Id.

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