June 25, 2012

Judge Andrews denies motions to dismiss complaint finding direct infringement allegations pass muster under Form 18

Judge Andrews recently denied defendants' motions to dismiss plaintiff's amended complaint in Select Retrieval LLC v. Amerimark Direct LLC, et al., C.A. No. 11-812-RGA (D. Del. June 18, 2012), because the complaint's "minimal allegations" stating a claim for direct infringement satisifed Rule 18. Id. at 1. Judge Andrews also found plaintiff's willfulness allegations sufficient because the complaint alleged that shortly before the complaint was filed "the defendant was notified by letter of the existance of its patent, that the defendant infringed the patent, and that the plaintiff was offering a license agreement." Id. at 2.

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June 22, 2012

Magistrate Judge Fallon recommends transfer to District of Minnesota

In Ivoclar Vivadent AG v. 3M Company, C.A. No. 11-1183-GMS-SRF (D. Del. June 22, 2012), defendant filed a motion to transfer the case to the District of Minnesota where defendant first-filed a declaratory judgment action against plaintiff for non-infringement and invalidity of the same patent. Id. at 1-4. Plaintiff, a Liechtenstein company, opposed defendant's motion arguing that an exception to the first-filed rule applied "because [defendant] preemptively filed its declaratory judgment action in Minnesota with the intent to dictate venue prior to the formal termination of the [Confidential Disclosure Agreement that contained a covenant not to sue]." Id. at 10-11. Judge Fallon disagreed and ultimately recommended transfer rather than dismissal. Judge Fallon analyzed the Jumara factors and found that all but one factor weighed in favor of transfer or was neutral. Id. at 14-27.

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June 22, 2012

Magistrate Judge Thynge: Request for Preliminary Injunction Denied

Magistrate Judge Thynge recently issued a report and recommendation in Neology, Inc. v. Federal Signal Corp., C.A. No. 11-672-LPS/MPT (D. Del. June 18, 2012), recommending that the Court deny Neology’s motion for a preliminary injunction against infringing the patents-in-suit. The patents-in-suit cover RFID (radio frequency identification) tags, readers, and systems for us in the U.S. highway tolling industry. In considering whether the plaintiffs had a reasonable likelihood of prevailing on the merits at trial, Judge Thynge construed several terms and considered infringement and invalidity arguments. Although Neology demonstrated a likelihood of success on the merits for some of the patents-in-suit, Judge Thynge denied a preliminary injunction with respect to all of the patents in suit because she found no irreparable harm.

In concluding that there was no irreparable harm, Judge Thynge first found that Neology had delayed substantially in seeking a preliminary injunction, as it was first aware of a defendant’s alleged infringement in fall of 2009 and its first loss of sales to the defendant in spring of 2011, but did not file suit until July 2011 and did not seek an injunction until December 2011. Such delay weighed against granting an injunction. Id. at 40. She next rejected Neology’s arguments that the defendants had denied or would deny Neology entry into the relevant product market and that the defendants’ alleged infringement had caused Neology financial harm. She did find, however, the Neology’s apparent financial strength and attractiveness to investors may have been somewhat illusory and did not undercut its assertion of irreparable harm. Id. at 53.

Judge Thynge also rejected Neology’s argument that it would suffer irreparable reputational harm because defendants’ inferior products could jeopardize the market’s transition to the RFID technology in question. She determined both that the defendants’ products were not necessarily inferior, as they had been compared favorably by independent parties, and that the defendants’ products had not caused any reputational harm to Neology’s products. Id. at 62. Finally, Judge Thynge rejected Neology’s price erosion argument based on defendants’ putting downward pressure on the price of the technology in question. She did not find persuasive evidence that defendants were pricing their products improperly and did not agree with Neology’s assertion that its own pricing was relevant to the appropriateness of defendants’ pricing. Furthermore, Judge Thynge found that even if price erosion had occurred, damages could properly compensate Neology for this harm. Id. at 69.

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June 22, 2012

Judge Andrews grants in part motion to exclude expert testimony

In LG Electronics, Inc. v. Asko Appliances, Inc., C.A. No. 08-828-RGA (D. Del. June 22, 2012), Judge Andrews granted-in-part defendants' motion to exclude plaintiff's expert. Judge Andrews determined that the expert was not qualified to opine as to whether any reference was "prior art", but could opine as to "what different references teach, and to differentiate and compare references." Id. at 1. Judge Andrews also found that while the expert was qualified to opine about the secondary consideration of copying (due to "his expert ability to review and compare washing machine motors, their development, and their installation"), the expert could not opinion on other secondary considerations, such as commercial success, because the opinion was based on the expert's review of industry documents and knowledge of plaintiff's corporate witness, rather than his own expertise in the industry. Id. at 2.

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June 22, 2012

Judge Stark: Summary Judgment Denied on Non-Infringement, No Indirect Infringement, and Invalidity

Judge Stark recently considered summary judgment motions from defendants Canon and Adobe in a patent infringement action brought by Tarkus Imaging. Tarkus Imaging, Inc. v. Adobe Systems, Inc., C.A. No. 10-63-LPS (D. Del. June 14, 2012). Judge Stark ultimately concluded that summary judgment was not appropriate on any point because “the portions of this case at issue in the pending summary judgment motions present a ‘battle of the experts’ that is not amendable to resolution prior to presentation of evidence, including testimony.” Id. at 1-2.

Specifically, with regard to Canon’s motion for summary judgment of non-infringement, “[t]he Court [was] not persuaded, at this stage of the proceedings, by Canon’s contentions that Tarkus is barred from asserting doctrine of equivalents infringement theories due to application of prosecution history estoppel or that Tarkus has failed to create a genuine dispute of material fact because Tarkus’s expert has not identified specifically infringing source code.” Id. at 5. The Court also denied Adobe’s motions for summary judgment of non-infringement and no indirect infringement. On the issue of indirect infringement, Adobe argued that it had no knowledge of the patent-in-suit, but the Court found that Tarkus had “presented evidence that creates a dispute of fact as to whether Adobe was willfully blind to the existence of the [patent-in-suit].” Id. at 8-9.

Finally, the Court denied Canon’s motion for summary judgment that Tarkus’s patent was invalid on the ground that a claim term lacked an antecedent basis and was therefore indefinite. An expert opinion, the Court said, “based on the plain language of the claims and the specification, is sufficient to create a genuine dispute as to whether a person of ordinary skill in the art could determine the scope of the claim and the meaning of [the claim term] despite the lack of express antecedent basis [for that term]. As a claim term without an explicit antecedent basis may nevertheless be definite if the term ‘has a reasonably ascertainable meaning . . . decided in context,’ summary judgment is not warranted based on the present record.” Id. at 10-11.

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June 20, 2012

Judge Andrews excludes parties' patent law experts

In St. Jude Medical v. Volcano Corporation, C.A. No. 16-631-RGA-MPT (D. Del. June 15, 2012), Judge Andrews recently considered the parties’ motions to strike expert reports. Plaintiff moved to strike the expert report of defendant’s patent law expert. Id. at 1. Judge Andrews granted plaintiff’s motion finding that the contents of the report, which was “akin to a legal brief” on patent law, was not the appropriate subject of expert testimony and would not assist the trier of fact. Id. Defendant moved to strike the expert reports of plaintiff’s inequitable conduct experts. Id. Noting that no inequitable conduct defenses would be presented to a jury, and noting that portions of the reports might be inadmissible or irrelevant, Judge Andrews declined to strike the reports because parts of the reports were admissible and would assist the Court as the trier of fact on inequitable conduct. Id. at 2.

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June 20, 2012

Judge Thynge awards costs to defendant as "prevailing party" after upholding jury verdict of non-infringement, but reversing jury's invalidity verdict

In United Access Technologies, LLC v. Earthlink, Inc. C.A. No. 02-272-MPT (D. Del. June 14, 2012), Judge Thynge recently considered defendant’s bill of costs submitted after the Court’s opinion, that reversed the jury’s verdict as to invalidity but upheld the jury’s verdict of non-infringement, was affirmed on appeal. Id. at 1-3. Plaintiff objected to defendant’s bill of costs arguing, among other things, that defendant was not the prevailing party because defendant was unsuccessful on its counterclaim of invalidity. Id. at 4 Judge Thynge disagreed. Defendant was the prevailing party because the relief it received on the merits, i.e., that it did not infringe plaintiff’s patent and was free to continue operating its DSL business, altered the legal relationship between the parties. Id. at 9. It was irrelevant that defendant was unsuccessful on its invalidity counterclaims. Because plaintiff’s patent is presumed valid, the court’s finding that defendant failed to carry its burden to prove invalidity did not “materially alter the legal relationship between the parties by modifying [defendant’s] behavior in a way that directly benefitted [plaintiff.]” Id.

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June 19, 2012

Magistrate Judge Schneider denies motion for leave to amend infringement and invalidity contentions.

Magistrate Judge Schneider of the District of New Jersey recently reminded parties of the appropriate showing that must be made in connection with a motion for leave to amend infringement and invalidity contentions. Bayer CropSciences AG v. Dow AgroSciences LLC, C.A. No. 10-1045 (RMB/JS) (D. Del. June 7, 2012). The Court explained, “the key fact courts should look at to determine whether good cause exists to grant an amendment to a contention is the diligence of the moving party. Diligence has two aspects to it. One is whether the moving party acted diligently to discover that an amendment was appropriate. The second aspect is whether the moving party promptly moved to amend its contentions after it learned an amendment was necessary.” Id. at 3 (citing O2 Micro Intern. Ltd. v. Monolithic Power Systems, Inc., 467 F.3d 1355, 1365-67 (Fed. Cir. 2006)). In denying the motion, the Court explained, “good cause is not established simply because a party desires to respond to an amended contention. Otherwise, there would be a never ending series of amendments.” Id. at 4. In this case, Dow’s motion “did not demonstrate why its latest proposed amendment could not have been asserted earlier or why Bayer’s amendment was not anticipated.” Id.

The Court also rejected Dow’s attempt to amend its contentions through an incorporation by reference of its summary judgment briefs, explaining “[t]he Patent Rules [of the District of New Jersey] incorporated into the Court’s Scheduling Order provides that contentions may only be amended by motion. The mere fact of filing a brief is insufficient to amend a contention.” Id. at 5. Moreover, the Court explained that “Dow has not demonstrated why the contentions in its briefs were not included in its earlier filed contentions.” Id. at 6. Finally, the Court denied Dow’s attempt to add two prior art references “that were both discovered recently,” explaining that Dow’s motion “did not attempt to establish good cause for its failure to previously identify the references.” Id.

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June 19, 2012

Magistrate Judge Burke issues report and recommendation construing claims relating to dermatological topical gel.

Magistrate Judge Burke recently issued a report and recommendation construing claims relating to a low-viscosity gel composition that operates as a “delivery system” for pharmaceutical ingredients in the treatment of skin disorders. See Medicis Pharmaceutical Corp. v. Actavis Mid Atlantic LLC, C.A. No. 11-409-LPS-CJB (D. Del. June 12, 2012). The "delivery system" was described as follows: “through the use of a ‘lightly cross-linked polyacrylic acid polymer[],’ which has a low viscosity relative to its concentration in aqueous solutions . . . the gel composition offers two principal advantages: (1) more appealing cosmetic characteristics, such as a reduction in a ‘sticky’ feel or residue; and (2) more accurate application through improved flow and pourability.” Id. at 3.

Magistrate Judge Burke recommended the adoption of the parties’ agreed-upon construction of the following claim terms, finding that they were consistent with the intrinsic record:

-- “for a period of time sufficient to improve the skin disorder” construed to mean “over a course of treatment of sufficient duration to improve the skin disorder

-- “base to adjust pH.” construed to mean “a basic compound that can be used to adjust pH.”

Also recommended were the following constructions of disputed terms:

-- “lightly cross-linked polyacrylic acid polymer” construed to mean “a cross-linked polymer of acrylic acid with a viscosity of less than about 15,000 cP, where the polymer is in a 0.5% solution at pH 7.5, as measured by a Brookfield viscometer at 20 rpm”.

-- “container” as recited in “a container that accurately administers a portion of the composition” construed to mean “a container that has a sufficiently small orifice tip to dispense quantities of the low-viscosity gel composition in accordance with treatment instructions”

-- “container” as recited in “a container from which drops are accurately administered” construed to mean “a container that has a sufficiently small orifice tip to dispense generally spherical quantities of the low-viscosity gel composition in accordance with treatment instructions”

UPDATED: Judge Stark adopted Judge Burke's Report and Recommendation on July 16, 2012 after neither party filed an objection. Medicis Pharma. Corp. v. Actavis Mid Atlantic LLC, C.A. No. 11-409-LPS-CJB (D. Del. Jul. 16, 2012).

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June 17, 2012

Judge Andrews Affirms Magistrate Judge’s Decision to Exclude Prior Art Evidence as a Sanction for Discovery Violations

In St. Jude Medical, et al. v. Volcano Corp., C.A. No. 10-631-RGA (D. Del. June 5, 2012), Judge Andrews recently affirmed and overruled objections to the Magistrate Judge’s decision to exclude certain prior art evidence that was not properly disclosed by plaintiffs until nearly three months after the close of fact discovery. Id. at 2-3. In the opinion, the Court noted that plaintiffs’ invalidity contentions were “useless in terms of giving [d]efendant any information about what theories [plaintiffs] would actually pursue.” Id. at 3. The Court also noted that plaintiffs’ contentions included as invalidating prior art “100 patents, 21 publications, and 92 prior art systems” and that those references that were excluded were “buried amidst” these many other invalidating references. Id. at 3. The Court ultimately held that the Magistrate Judge’s decision to exclude the prior art references was neither “clearly erroneous” nor an “abuse of discretion”; concluding rather, that it was a sanction appropriately “tailored to the nature and extent of the violation.” Id. at 4.

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