April 9, 2012

Judge Andrews Grants Motion to Transfer Where Plaintiff is the “Equivalent of a Non-Delaware Corporation” and Balance of Convenience Favors Transfer

In Signal Tech, LLC v. Analog Devices, Inc., C.A. No. 11-1073-RGA, Judge Andrews recently granted defendant’s motion to transfer concluding that the “balance of convenience” factors favored transfer. Id. at 8. Plaintiff in this case is a Delaware limited liability company, which was formed less than two months before filing suit for patent infringement against defendant. Id. at 4. Defendant, on the other hand, is a Massachusetts corporation with its principal place of business in Massachusetts. Id. at 2. After filing its answer to the complaint denying plaintiff’s allegations of infringement, defendant filed a motion to transfer this case to the District of Massachusetts. Id. at 2. Following full briefing and oral argument on the motion to transfer, the Court concluded that the balance of convenience tipped in defendant’s favor and that transfer to the District of Massachusetts was warranted. Id. at 8. The Court found that there was “no connection at all to Delaware” but that there was “a substantial connection to Massachusetts.” Id. at 8.

In its analysis of the Third Circuit’s Jumara factors, the Court noted that plaintiff, in large part because it had just recently been formed as a Delaware entity, had “no principal place of business” and “no claim on Delaware as venue based on its incorporation.” Id. at 4. The Court also noted that plaintiff had “no employees,” with the exception of a “lawyer owner in North Carolina” and two other “owners/investors” in Washington, D.C. Id. at 5. The Court pointed out that, for purposes of its analysis, plaintiff was the “equivalent of not being a Delaware corporation.” Id. at 7. Thus, plaintiff’s choice of Delaware as the forum in this case was not entitled to as strong a weight as it would have been if plaintiff had its principal place of business (or any business) in Delaware. Id. at 4. After considering the applicable Jumara factors and the Fed. Cir.’s recent decision in In re Link_A_Media Devices Corp., the Court ultimately concluded that on these facts the “only connection to Delaware in this case is that it is the plaintiff’s choice of forum – which since plaintiff is (the equivalent of) a non-Delaware corporation with no connection of any kind to Delaware, is not entitled to ‘paramount’ consideration.” Id. at 9. In contrast, the Court noted that defendant had 3,200 U.S. employees and two-thirds of those employees worked in Massachusetts. Id. at 4. In considering the location of witnesses, the Court further noted that the bulk of the fact witnesses (i.e., defendant’s current and ex-employees) would likely be located in Massachusetts and that it was unlikely that there would be any witnesses from Delaware or the surrounding states. Id. at 5. The Court also found that there were no records identified as only being available in one of the two fora. Id. at 6.

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April 9, 2012

Judge Andrews Reviews Objections to Counterclaims and Applies New Federal Circuit Standard

In Quantum Loyalty Systems Inc. v. TPG Rewards Inc., C.A. No. 09-22-RGA (D. Del. April 4, 2012), Judge Andrews reviewed the findings of a Magistrate Judge, after the plaintiffs filed objections to those findings.  Judge Andrews first found that two of the plaintiffs’ objections were subject to review for abuse of discretion and that there had not been such an abuse.  Therefore, those objections were denied.  Id. at 1-2.

He then considered the plaintiffs’ two objections that the Magistrate Judge’s rulings were “contrary to law.”  The first of these was the Magistrate Judge’s decision that the defendants’ counterclaims for noninfringement and invalidity of patents related to the patent-in-suit did not state a “case or controversy.”  After the Magistrate Judge’s decision, the Federal Circuit decided Streck, Inc. v. Research & Diagnostic Systems, Inc., 665 F.3d 1269, 1283 (Fed. Cir. 2012), in which it held that “a counterclaimant must show a continuing case or controversy with respect to withdrawn or otherwise unasserted claims.”  Because the defendants had not met this standard, Judge Andrews found the plaintiff’s objection well-taken and dismissed the counterclaims.  Id. at 2.

Finally, Judge Andrews denied the plaintiffs’ motion to transfer cybersquatting counterclaims to the Southern District of New York.  Although the parties had previously settled litigation there, their settlement agreement provided only that issues concerning that court’s final judgment were subject to the jurisdiction of that court.  The present controversy related to a different domain name and would involve only issues concerning the settlement agreement rather than the previous judgment.  Therefore, there was no basis to transfer the counterclaims.  Id.

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April 9, 2012

Claim Construction in LASIK Patent Litigation

In Neev v. Abbot Medical Optics, Inc., C.A. No. 09-146-RBK (D. Del. Mar. 26, 2012), the plaintiff was the owner and inventor of a patent encompassing a laser used in LASIK corrective vision surgery.  He brought suit against the defendant for its sale of a product used in LASIK, and the defendant asserted invalidity and noninfringement counterclaims.  After holding a Markman hearing, the Court adopted several claim constructions the parties had agreed upon and construed the following terms itself:

  • “operating the source and manipulating the beam parameters”
  • “manipulating beam parameters”
  • “manipulating parameters of the beam”
  • “adjusting characteristics of the electromagnetic radiation beam”
  • “varying at least one of the following beam parameters”
  • “interaction energy transients”
  • “preparing the target region of the target material by spatially or temporally varying at least one of an absorption characteristic of the material or a scattering characteristic of the material at the target region”
  • “operating the source at a pulse repetition rate greater than 0.1 pulses per second until a target volume in the target region has been modified”
  • “allowing interaction energy transients caused by the electromagnetic pulses to substantially decay so that material modification is effected”
  • “allow interaction energy transients caused by the pulsed electromagnetic radiation beam to decay sufficiently such that the material can be modified”
  • “cumulative residual thermal energy left in the material by a pulse train”
  • “controlled, variable rate material modification”
  • “highly controllable, variable rate material removal”
  • “target material”
  • “target region”
  • “material removal by a continuously emitting, continuous wave (CW) beam of electromagnetic radiation”
  • “continuously emitted electromagnetic radiation”
  • “redistributing the beam in time and space to form at least one modified beam comprising a plurality of pulses”
  • “plasma”

The Court adopted the defendant’s construction of “target region” and “target material,” but adopted the plaintiff’s construction of all other terms.  The Court also denied the defendant’s motion to strike parts of the plaintiff’s opening Markman brief, finding that the sections in question, which explained the state of the known research in the field as well as the plaintiff’s state of mind at the time of the plaintiff’s invention, were relevant and were not hearsay.

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April 6, 2012

Judge Robinson Denies Summary Judgment of Claim Preclusion

Recently, in SRI International, Inc. v. Symantec Corporation, C.A. No. 11-131-SLR (D. Del. Mar. 30, 2012), Judge Robinson denied summary judgment of claim preclusion.  SRI had previously litigated the same patents against Symantec in a separate case.  In that previous case, one witness discussed MSS, the accused product of the present case.  The jury was not, however, asked to determine whether MSS infringed the patents-in-suit.  Symantec then argued in the present case that “because there was mention of MSS during the course of the [previous] case and at trial, SRI should be precluded from pursuing the instant litigation.”  Id. at 9.

Judge Robinson found, however, that Symantec’s position suffered from “two infirmities, both of which are undisputed.  First, despite multiple discovery requests in the [previous] case, Symantec did not provide SRI with any technical data on MSS.  Second, there was no specific judgment entered in the [previous] case about MSS.”  Id. at 9-10.  Because the Court found that Symantec had not proven that MSS was essentially the same as the previously-litigated product, it denied Symantec’s motion for summary judgment.

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April 3, 2012

Judge Andrews Issues Claim Construction for Patent Directed to Dynamic Logic Circuit Technology, Rejects Argument That Disputed Claim Terms Are Indefinite

In AVM Technologies, LLC v. Intel Corporation, C.A. No. 10-610-RGA, Judge Andrews recently issued a claim construction opinion construing claim terms for U.S. Patent No. 5,859,547 (“the ‘574 Patent”), which is a patent that claims “an improved dynamic logic circuit ‘that has increased speed and reduced power.’” Id. at 2 (citation omitted). In the opinion, the Court construed the following terms:

“coupled to”
“coupled between”
“couplable to”
“coupling”
“anti-float circuit”
“precharge node”
“dynamic logic circuit”
“dynamic logic block” or “logic block”
“evaluation transistor”
“precharge transistor”
“a delay”
“for simultaneous activating”
“during a major portion of the evaluation phase”
“during a major portion of an evaluation clock phase”
“during a minor portion of the evaluation clock phase”

In both its claim construction briefing and at the Markman hearing, defendant argued that: (a) the “during a major portion of the evaluation phase” language of claim 1 of the patent-in-suit and (b) the “during a major portion of an evaluation clock phase” and “during a minor portion of the evaluation clock phase” language of claim 21 of the patent-in-suit were “not amenable to construction” and thus, “indefinite and . . . invalid under 35 U.S.C. § 112, ¶ 2." Id. at 13. The Court, however, rejected these arguments. Citing to the Federal Circuit’s decisions in Praxair v. ATMI, Inc., 543 F.3d 1306, 1319 (Fed. Cir. 2008) and Honeywell Int’l Inc. v Int’l Trade Comm’n, 341 F.3d 1332, 1338-39 (Fed. Cir. 2003), respectively, for the propositions that “the standard of indefiniteness is high” and that “a claim is indefinite only if the ‘claim is insolubly ambiguous, and no narrowing construction can properly be adopted,’” the Court held that these disputed terms were not indefinite and construed each of them. Id. at 13-15. This opinion is interesting because it provides some insight as to how the Court may handle indefiniteness arguments and other indefiniteness-related issues raised during claim construction.

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April 3, 2012

Judge Robinson Denies Motion to Dismiss Willfulness, Direct and Indirect Infringement Claims, Concludes That the Claims As Pled Satisfied the Pleading Standard of Form 18

In Netgear, Inc. v. Ruckus Wireless, Inc., C.A. No. 10-999-SLR, Judge Robinson denied defendant’s Rule 12(b)(6) motion to dismiss plaintiff’s claims of direct infringement, induced and contributory infringement, and willful infringement. Id. at 1. Plaintiff filed an amended complaint in this action against defendant for infringement of four patents-in-suit relating to wireless communication technology. Id. In the amended complaint, plaintiff alleged that defendant “induces and/or contributes to infringement by third parties, and willfully infringes the patents-in-suit.” Id. at 2. Defendant moved to dismiss these allegations for failure to state a claim. Id. at 1-2. Defendant argued that the amended complaint should be dismissed because it: “(1) lacks basic factual support; (2) fails to comply with Form 18; (3) fails to state a claim for indirect infringement; and (4) fails to sufficiently allege willful infringement.” Id. at 2. The Court, however, disagreed. Regarding the claims for direct infringement, the Court concluded that plaintiff’s amended complaint asserts a cause of action for direct infringement “in a manner sufficient for defendant to formulate a response and defense” and that it “provides sufficient factual support and mimics Form 18.” Id. at 7. In its analysis, the Court noted that because, among other things, the amended complaint mimicked Form 18 and identified, by name, certain of defendant’s products that allegedly infringe the patents-in-suit, it complied with “the level of detail required to satisfy the pleading standard for Form 18.” Id. at 5. Similarly, regarding the sufficiency of plaintiff’s claims for inducement and contributory infringement, the Court held that they too were “facially plausible” and provided “defendant with adequate notice” of plaintiff’s indirect infringement claims. Id. at 10-11. Lastly, regarding the claims for willful infringement, the Court found that plaintiff sufficiently alleged that defendant had “pre-filing knowledge” of at least one of the patents-in-suit and that defendant had “infringed and continues to infringe the patent.” Id. at 11. Moreover, the Court expressly declined “to require more detail with respect to plaintiff’s willful infringement claims than is required by Form 18.” Id. at 11.

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April 3, 2012

Chief Judge Sleet issues findings of fact and conclusions of law invalidating patents

The Court recently issued its findings of facts and conclusions of law following a 7 day bench trial in an ANDA case related to alleged infringement by Watson, Sandoz, and Paddock Laboratories of four patents (the ‘978, ‘359, ‘448, and ‘635 patents) that were listed in the Orange Book in connection with SANCTURA XR®, a once-a-day form of tropsium chloride used to treat overactive bladder. Allergan, Inc., et al. v. Watson Laboratories, Inc.-Florida, et al., C.A. No. 09-511 (GMS) (D. Del. Mar. 31, 2012). The Court directed the Clerk of Court to enter final judgment based on its findings that (1) the asserted claims of the patents-in-suit are invalid due to obviousness; (2) the asserted claims of the patents-in-suit are not invalid due to anticipation; (3) asserted claim 1 of the ‘978 patent and asserted claim 1 of the ‘449 patent are not invalid due to indefiniteness; (4) asserted claim 1 of the ‘359 patent is not invalid for failure to meet the written description requirement; and (5) the defendants’ proposed products infringe the asserted claims of the patents-in-suit assuming, arguendo, they are not invalid.

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April 3, 2012

Special Master White limits plaintiff to 25 asserted claims, reduced from 60 claims

In XPRT Ventures, LLC v. eBay, Inc., et al., C.A. No. 10-595-SLR (D. Del. Mar. 26, 2012), after the completion of discovery and a couple weeks before the deadline for opening claim construction and summary judgment briefs, defendants filed an emergency motion to compel plaintiff to reduce the number of claims asserted in the case from sixty to twenty.  Plaintiff opposed defendants’ motion arguing that, while it can and should reduce the number of claims, defendants’ motion was premature.  Id. at 5. Plaintiff asked that the Court “permit XPRT the time to complete its analysis of the claims and to continue to assert all of the claims that do not contain duplicative issues of infringement or validity.”  Id. at 6.  Special Master White responded with the question, “if not now, then when?  The time has come to present the issues in dispute to the Court in an orderly fashion.”  Id.  Because plaintiff “must know what claims will be pursued before preparing its claim construction brief[,]” Special Master White order plaintiff to disclose no more than 25 asserted claims by noon on the day plaintiff’s opening claim construction brief was due to be filed.  Id.

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April 2, 2012

Judge Andrews Construes Claim Terms in Patent Dispute Involving Semiconductor LED Technology

In Cree, Inc. v. SemiLEDS Corporation, C.A. No. 10-866-RGA, Judge Andrews recently issued a claim construction opinion construing claim terms for five patents-in-suit involving semiconductor light emitting diode (“LED”) technology used for general lighting purposes. In the opinion, the Court construed the following terms:

“dominant wavelength”
“area”
“radiant flux”
“sidewall”
“layer”
“reflector layer”
“ohmic contact layer”
“conductive barrier layer”
“directly on”
“LED structure”
“adjacent to”
“light extraction structures”
“spreader layer”
“non-transparent feature”
“non-ohmic contact”
“wherein the metal contact forms on ohmic contact”
“is aligned with the non-transparent feature”
“in a region other than a reduced conductivity area of the surface of the p-type semiconductor layer”
“photon absorbing wire bond pad”
“contact metal”
“reflective structure”
“substantially congruent”

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March 30, 2012

Judge Stark clarifies pleading standard for willfulness.

In St. Clair Intellectual Property Consultants, Inc. v. Hewlett-Packard Co., C.A. No. 10-425-LPS (D. Del. Mar. 28, 2012), Judge Stark clarified the pleading standard for an allegation of willful infringement. The defendant moved to strike the plaintiff’s willfulness allegations as insufficiently pled, prompting the plaintiff to move to amend its complaint. Id. at 1. The defendant argued that amendment would be futile because the plaintiff’s proposed amended willfulness allegations still failed to allege both the defendant’s “knowledge of the asserted patents and knowledge of the infringement.” Id. at 4. The Court rejected that argument, and clarified that a willfulness allegation is sufficiently pled if it “plead[s] facts giving rise to ‘at least a showing of objective recklessness’ of the infringement risk.” Id. (citing In re Seagate Technology, LLC, 497 F.3d 1360, 1371 (Fed. Cir. 2007)). Finding that the proposed amended complaint sufficiently pled willfulness under Seagate, the Court granted the plaintiff’s motion to amend and denied the defendant’s motion to strike as moot. Id. at 6.

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