Magistrate Judge Mary Pat Thynge issued a claim construction order in the Innovative Patents, L.L.C. v. Brain-Pad, Inc. matter which involves a patent for an apparatus that enhances absorption and dissipation of impact forces for sweatbands (U.S. Patent No. 7,234,174). C.A. No. 07-680-MPT, Memorandum Order (D. Del. Jan. 13, 2010). The following claims were construed consistent with Phillips v. AWH Corp.:
Chief Judge Sleet recently denied a party's motion to stay and sever proceedings related to two patents-in-suit where an interference was pending at the USPTO. LG Electronics U.S.A., Inc. v. Whirpool Corp., C.A. No. 08-234-GMS, Order (D. Del. Jan. 6, 2010). The Court denied the motion on the grounds that it was filed "after the close of discovery and after a trial date had been set" and because "resolution of the interference proceeding may not resolve all of the asserted claims or issues" with respect to those two patents. Id. at 3. (Only certain claims of the two patents were before the PTO as part of the interference.)
A recent decision by district judge Joseph J. Farnan Jr. serves to remind litigators that bifurcation is not always a sure bet. In the underlying litigation, the Court rejected an attempt to carve out an inequitable-conduct defense:
"Defendants must meet a high burden to be successful [in proving the defense]. In light of this burden, the potential that duplicative evidence regarding the alleged prior art will be presented at an inequitable conduct trial and at subsequent trials on infringement and invalidity weighs against bifurcation . . . . Accordingly, bifurcating trial on the issue of inequitable conduct will not promote judicial efficiency."
The winning argument? Plaintiff's assertion that it would have to present "much of the same background testimony" in both proceedings to describe the scope of the patents-in-suit and contrast the prior art.
In December of 2009, Judge Robinson amended her form scheduling order in patent cases to provide for bifurcation of the issues of liability and damages/willfulness for both discovery and trial. In one of the cases in which these issues are bifurcated, the parties were referred to Magistrate Stark to resolve certain discovery-related issues. Teles AG Informationstechnologien v. Cisco Systems, Inc., C.A. No. 09-72-SLR-LPS, Order (D. Del. Dec. 28, 2009).
First, the court denied plaintiff's request to remove the confidential designation from certain documents related to defendant's commercial success so that it may submit the information to the PTO as part of the reexamination of its patents. Id. at 2. The Court found that plaintiff did not provide any authority to support its position that defendant had an obligation to provide the information to the PTO nor that it "suppressed" this evidence. Id.
Second, the court denied plainitff's motion for an additional deposition of defendant's 30(b)(6) witness on certain topics where the defendant properly objected to the testimony as outside the scope of limited damages discovery in the bifurcated case. Id. at 2-3. Specifically, plaintiff inquired about two routers that it says are accused products but were not identified in its infringement contentions and defendant's "cost of sales" which was not mentioned in plaintiff's submission to the Court addressing what commercial success evidence should be permitted. Id. at 3.
12/21: KANA Software Inc. v. Versata Enterprises Inc. (patent infringement)
12/21: Progressive International Corp. v. Sunbeam Products Inc. (patent infringement)
12/21: Telcordia Technologies Inc. v. Tellabs Inc., Tellabs Operations Inc. and Tellabs North America Inc. (patent infringement)
12/21: Trisport Ltd. and Pride Manufacturing Co. LLC v. MacNeill Engineering Co. Inc. and MacNeill Worldwide Pacific Ltd. (patent infringement)
12/23: Abbott Laboratories Inc. and Abbott GmbH & Co. KG v. Apotex Inc. and Apotex Corp. (patent infringement)
12/28: Medicines Co. v. Pliva Hrvatska d.o.o., Pliva d.d., Barr Laboratories, Inc., Barr Pharmaceuticals LLC, et al. (patent infringement)
12/28: Medicines Co. v. Teva Parenteral Medicines Inc., Teva Pharmaceuticals USA Inc., Teva Pharmaceutical Industries Ltd. (patent infringement)
12/29: Nokia Corp. v. Apple Inc. (patent infringement)
12/30: Transcore Link Logistics Corp. and 2201028 Ontario Inc. v. SkyBitz Inc. (patent infringement)
12/31: Vehicle IP LLC v. AT&T Mobility LLC, Cellco Partnership, Garmin International Inc., Garmin USA Inc., Networks in Motion Inc., et al. (patent infringement)
Plaintiff moved to compel certain communications between the defendant and its third-party supplier on the grounds that these communications are not subject to the common interest privilege or joint defense strategy. Robert Bosch LLC v. Pylon Manufacturing Corp., C.A. No. 08-542-SLR, Memo. Order (D. Del. Dec. 23, 2009). The Court found that there was no waiver of the privilege where the documents contained the "possible disclosure of attorney advice obtained by a third party [not defendant] and related to [defendant], rather than [defendant] disclosing advice from its counsel." Id. at 13. Furthermore, these documents involve patents other than the patents-in-suit and the opinions provided are "very general, broad and nonspecific." Therefore, defendant's production of these documents is not a waiver of the attorney-client privilege on infringement and invalidity. Id. at 14.
Plaintiff further argued that regardless of any waiver or lack thereof, these documents are not subject to any other form of privilege and therefore any redacted or withheld communications between the defendant, its third-party supplier and defendant's counsel should be produced. Id. The Court found that there was an understanding that the defendant and the supplier were using the same counsel to address concerns about possible patent liability and therefore a "joint-client relationship" exists supporting the claims of privilege. Id. at 14-15. Judge Robinson further noted, that the "fact that this arrangement was not memorialized in written form until later does not defeat the relationship...and the protection of the attorney-client privilege." Id. at 14.
Although a plaintiff's choice of forum is typically given great weight, Judge Pisano in granting a defendant's motion to transfer to the Northern District of California, recently afforded less deference to a plaintiff's choice to litigate in Delaware where Delaware was not plaintiff's "home turf" and none of the allegedly infringing acts occurred in Delaware. Qinetiq Limited v. Oclaro, Inc., C.A. No. 09-372-JAP, Opinion (D. Del. Dec. 18, 2009). Defendant's only connection to Delaware in this matter was the fact that it is a Delaware corporation. Id. at 7. This alone was not enough to warrant litigating the action in Delaware and therefore the Court transferred the case to the Northern District of California. Id. at 8.
In this patent infringement action, Quantum Loyalty Systems, Inc., et al. v. TPG Rewards, Inc., et al., C.A. No. 09-022-SLR-MPT (D. Del. Dec. 23, 2009), Defendant John Galinos (“Galinos”) moved to dismiss plaintiffs’ complaint for lack of personal jurisdiction and Defendants TPG Rewards, Inc. (“TPG”) and Galinos (collectively “Defendants”) moved to dismiss plaintiffs’ complaint for failure to state a claim for which relief may be granted. Regarding Galinos jurisdiction motion, Judge Thynge noted that the specific jurisdiction provisions of the Delaware long arm statute, 10 Del. C. § 3104(c)(1) and (c)(3), require plaintiff to prove a “nexus between the cause of action and the conduct used as the basis for jurisdiction.” Id. at 11 (internal quotation omitted). However, plaintiffs only allegation in support of jurisdiction was that Galinos incorporated TPG in Delaware, despite that the cause of action for patent infringement “[did] not arise from the act of incorporating.” Id. Furthermore, “the fiduciary shield doctrine prohibits acts performed by an individual in the individual’s capacity as a corporate employee from serving as the basis for personal jurisdiction over that individual.” Id. (internal quotation omitted). Plaintiffs alleged no facts “Galinos personally made, used, offered to sell, or sold any alleged infringing product in Delaware.” Id. at 12. Furthermore, plaintiffs failed to point to any support for the contention that any injury, under 10 Del. C. § 3104(c)(3), occurred in Delaware. Id. In fact, plaintiffs were incorporated in Nevada and had a principal place of business in Nevada, such that any injury would have occurred in Nevada. Id. at 12-13.
After finding that plaintiffs also failed to allege sufficient contacts to support a finding of general jurisdiction, Judge Thynge recommended the Court grant Defendants’ motion to dismiss for failure to state a claim because the facts support the conclusion that plaintiff claimed “infringement by a product whose only appearance in the market preceded the critical date of the patent-in-suit.” Id. at 21-22. “[P]roof that [defendants’] product infringes [plaintiffs’] patent would also prove that the product anticipates under 35 U.S.C. § 102(b) . . . .” Id. at 22.
District judge Sue L. Robinson recently denied a request for a permanent injunction in part on the ground that the movant failed to supply the necessary documentary and analytical evidence to prove irreparable harm. By doing so, the Court implicitly gave guidance to litigators seeking to satisfy their evidentiary burden under the so-called e-Bay factors:
"[P]laintiff's case suffers from several fatal flaws. It is most problematic that plaintiff points to no documentary (or other) evidence regarding the effects of defendants' infringement (on plaintiff). As noted previously, the court has no market data before it. There is also no clear indication of a direct link between defendants' infringing sales . . . , loss of goodwill to plaintiff or, more broadly, a change in the market landscape." (at 9-10)
Notably, the Court also dismissed the credibility of the evidence plaintiff did offer - a declaration by plaintiff's president of product strategy - characterizing it as "rife with impermissible speculation" (at 6 n.11) and "self-serving" statements (at 9 n.15). The lesson is clear: an argument on irreparable harm must be built on some evidence beyond a party's declaration.
Judge Stark recently considered Defendants’ Motion to Strike and Dismiss in his Report and Recommendation in Power integrations, Inc. v. Fairchild Semiconductor Int’l, Inc., et al., C.A. No. 08-309-JJF-LPS (D. Del. Dec. 18, 2009). Plaintiff filed this patent infringement action alleging that defendants infringed three of plaintiff’s patents. Defendants subsequently filed counterclaims alleging that plaintiff infringed three of defendants’ patents. Plaintiff’s answer, filed simultaneously with the Federal Circuit’s issuance of an opinion in Exergen, included “defenses and counterclaims based on [defendants’] allegedly inequitable conduct during the prosecution of the asserted [defendants’] patents.” Id. at 2. Both plaintiff and defendants subsequently filed various amended answers and amended counterclaims. Id.
Defendants’ pending motion was directed at plaintiff’s counterclaims alleging inequitable conduct. Id. Plaintiff’s counterclaim alleged that “‘at least one of the named inventors and at least one of the patent agents of records, with knowledge of the withheld material information and the specific intent to deceive, failed to disclose to the PTO material, non-cumulative prior art known to them during prosecution.’” Id. at 3 (citation omitted). Defendants argued that plaintiff failed to meet the heightened pleading standard under Exergen because plaintiff failed to prove “a particularized basis for its claims of inequitable conduct or the inferences that must be drawn with respect to knowledge and intent.” Id. at 14. Judge Stark agreed, “to a limited extent.” Id. For example, plaintiff’s counterclaim related to its ‘972 patent against a patent agent that prosecuted co-pending patents, but not the one in question, failed to be pled with particularity because “[the patent agent] was not the patent agent who prosecuted the ‘972 patent . . . and [plaintiff] does not allege any facts to show that [the patent agent] was otherwise an “‘individual associated with the filing or prosecution of’ the ‘972 patent.” Id. at 15 (citing Exergen). With regard to plaintiff’s ‘780 patent, Judge Stark found that plaintiff failed “to allege the ‘what’ and ‘where’ of its inequitable conduct allegations. Id. at 16.
