July 12, 2010

Special Master Seitz: Decision on objections to instructions that 30(b)(6) witness not answer questions

Special Master Seitz recently decided Defendants’ Objections to Plaintiff’s Instructions Not to Answer Questions at Deposition of Plaintiff’s Rule 30(b)(6) Witness. One of the four issues decided involved counsel for Plaintiff instructing the witness not to answer questions regarding communications between himself and a U.S. attorney employed as General Counsel of another entity. Id. at 2. Plaintiff argued that the communication was protected by the attorney-client privilege or, alternatively, the community of interest privilege. Id. Defendants objected because there was no attorney-client relationship, the communications were not described with particularity as required under Fed. R. Civ. P. 26(b)(5)(A)(ii) and the community of interest privilege does not apply because there is not a direct parent-subsidiary relationship between plaintiff and the other entity. Id. Special Master Seitz found that the attorney-client privilege did not apply and that the Plaintiff and its “sister subsidiary” could not be treated as a single entity for purposes of the community of interest privilege. Id. at 3. Moreover, Special Master Seitz noted that the witness, as Plaintiff’s corporate representative at a 30(b)(6) deposition may have spoke to the attorney to gather facts regarding the issues in dispute, but “those facts cannot be protected from disclosure simply because a lawyer provides that information to a corporate witness.” Id. at 4.

Special Master Seitz also addressed objections to counsel for Plaintiff’s instruction that the witness not answer questions regarding conversations with an employee of its sister subsidiary, questions regarding communications with a Swiss attorney employed as in-house counsel at Plaintiff, and questions relating to the witness’s preparation to testify about Plaintiff’s asserted reasonable royalty. Id. at 4-9.

Inventio AG v. ThyssenKrupp Corporation, et al., C.A. No. 08-874-ER (D. Del. June 3, 2010)

July 8, 2010

Magistrate Judge Thynge: Summary Judgment GRANTED in Patent Infringement Action

Last week, Magistrate Judge Thynge granted summary judgment of non-infringement in Innovative Patents, L.L.C. v. Brain-Pad, Inc., C.A. No. 07-680-MPT, Mem. Opinion (D. Del. June 29, 2010) [Innovative Patents II]. Plaintiffs Innovative Patents, L.L.C. and Forcefield, Inc. brought this infringement action based on Brain-Pad's sale of sweat bands with impact-absorbing inserts, which Forcefield alleges infringes U.S. Pat. No. 7,234,174.

This case again demonstrates the importance of claim construction. In January, we covered the claim construction opinion in this case, where the Court adopted defendant Brain-Pad's definition of "curved in configuration": "preformed, arcuate and having first and second ends." Innovative Patents, L.L.C. v. Brain-Pad, Inc., C.A. No. 07-680-MPT, at 4 (D. Del. Jan. 13, 2010). Now, the Court granted summary judgment for Brain-Pad because its accused products use pads that are not "curved in configuration" as required by the claims. Brain-Pad's pad inserts are "flaccid, shapeless loop[s] of perforated elastomeric material," which are neither "arcuate" nor have "first and second ends" (because they are loops). Innovative Patents II, at 9.

What about the doctrine of equivalents? It turns out that the "curved in configuration" limitation was added during prosecution to avoid the prior art, and the Court determined that prosecution history estoppel applies, blocking Plaintiffs from relying on the doctrine of equivalents. Id. at 10-13.

All in all, this shows that, while District of Delaware judges have counseled against summary judgment motions under certain circumstances, they remain a useful tool in Delaware.

Innovative Patents, L.L.C. v. Brain-Pad, Inc., C.A. No. 07-680-MPT, Mem. Opinion (D. Del. June 29, 2010)

July 8, 2010

Magistrate Judge Stark: Mylan Pharm. Motion to Amend Granted

On June 28th, Magistrate Judge Stark issued an order granting Mylan Pharmaceuticals, Inc.'s motion to amend its infringement response to include an allegation of unenforceability due to inequitable conduct, based on plaintiff Galderma Laboratories' failure to disclose an allegedly material FDA action during prosecution.

The Court held that the proposed amendment pled inequitable conduct with the required particularity, and it allowed the amendment because Mylan had not acted in bad faith or with a dilatory motive in omitting the allegation from its original answer, and because there was no undue prejudice to plaintiffs. Plaintiffs had failed to disclose the relevant FDA Memo despite the fact that it was responsive to a timely document request, and the Court accepted Mylan's explanation that it had not discovered the FDA litigation previously because it had "limited its search to patent infringement actions" (even though "it is clear that a search of all federal court decisions (on Westlaw or Lexis, for example) for [the drug name] would have retrieved the FDA action."). Id. at 6.

The Research Found. of State Univ. of New York v. Mylan Pharm. Inc., C.A. No. 09-184-GMS-LPS (D. Del. June 28, 2010)

July 7, 2010

Judge Robinson: Obviousness Found in Zymar case

Judge Robinson recently issued an opinion in Senju Pharmaceuitical Co. v. Apotex, Inc., C.A. No. 07-779-SLR (D. Del. June 16, 2010), holding that the patent at issue was infringed, but also invalid as obvious.

Senju had asserted several claims of U.S. Patent No. 6,333,045, which covered the use of a "Gatifloxacin ophthalmic solution containing disodium edetate [("EDTA")]," sold as the antibiotic eye-drop "ZYMAR." Apotex filed an abbreviated new drug application ("ANDA") with the FDA, seeking approval to market a generic version of the drug -- Gatifloxacin by itself was covered by a recently expired patent. Id. at 1. The patent at issue in this case, however, was filed later, and claimed the combination of Gatifloxacin and EDTA, as well as the method and uses of combining the two. Id. at 1-2.

The Court found that it would have been obvious to one of ordinary skill in the art to combine Gatifloxacin with EDTA. Id. at 22-33. As described by the Court, both Gatifloxacin and EDTA were known in the prior art, as were the uses and benefits of EDTA combined with compounds similar to Gatifloxacin. Id. at 4-9. The original Gatifloxacin patent recognized the similarity of Gatifloxacin and these other compounds, and also recognized that the "pharmaceutical formulations of Gatifloxacin would follow 'the routes well known ... ' with respect to 'oral[] and parenteral[]' administration.'" Id. At the time, such "routes well known" included combinations with EDTA. Id. Thus, it was obvious to one of ordinary skill to combine the substances.

The Court also evaluated the secondary considerations of non-obviousness, but found that they did not weigh in favor of either party. Id. at 33-37. The Court did not give much weight to the product's commercial success, because the prior Gatifloxacin patent blocked the entry of any generic competitors into the market. Id. Senju also argued that a contemporaneous invention had occurred, but the Court determined that the second inventor "did not recognize or appreciate the invention," and discounted this factor as well. Id. at 33-35. All in all, this was a fairly clear-cut obviousness opinion.

Senju Pharmaceuitical Co. v. Apotex, Inc., C.A. No. 07-779-SLR (D. Del. June 16, 2010)

July 5, 2010

Judge Joseph J. Farnan, Jr.: No Standing Where No Control Over Exclusionary Rights

It is black letter law that a party asserting patent infringement must have standing to sue before it can bring a claim for infringement. Enhanced Security Research, LLC v. Cisco Systems, Inc., C.A. No. 09-390-JJF, Memo. Op. (D. Del. June 25, 2010). Defendants in Enhanced Security Research, LLC v. Cisco Systems, Inc., brought a motion to dismiss arguing that pursuant to terms of a Purchase Agreement, the plaintiff did not maintain any rights to the patents-in-suit and “divorced nominal legal title to the patents-in-suit from the exclusionary rights to the those patents.” Id. at 3. The issue in this case came down to whether plaintiff can sue in its own name or must include the other party to the Purchase Agreement. Id. at 7. The court found that as a result of the Purchase Agreement, plaintiff retained title to the patents-in-suit and “the rights to use, exploit, enforce, [the patents-in-suit]” but “control over the exclusionary rights” resided with the other party to the Agreement. Id. at 9 (internal citations omitted). By virtue of the agreement, plaintiff is “prohibited from making any decision with respect to assertion of its patent rights, the conduct of litigation relating to the patents-in-suit, or the settlement of such litigation without the prior written consent” of the other party to the Agreement. Id. at 9. It further “relinquished its ability to freely assign, transfer, or license its rights in the patents-in-suit without the prior written consent” of the other party. Id. at 10. Therefore, under the Purchase Agreement, plaintiff lacks standing to bring the lawsuit and joinder of the other party cannot cure the defect. Id. at 11.

Enhanced Security Research, LLC v. Cisco Systems, Inc., C.A. No. 09-390-JJF, Memo. Op. (D. Del. June 25, 2010).

July 2, 2010

Joseph J. Farnan: Applicants' "Misjudgment" Precludes Finding of Intent to Deceive

In a wide-ranging post-trial opinion issued on Tuesday, District Judge Joseph J. Farnan Jr. covered many topics, including standing, reissue, obviousness, and inequitable conduct. Of these, the Court's decision on inequitable conduct is particularly noteworthy for its explanation of the contours of deceptive intent:

"While in hindsight it may be attractive to construct a deliberate scheme of deceptive intent from the actions of these individuals given the success of CRESTOR in the marketplace, it is at least equally plausible from their testimony and the contemporaneous documentary evidence, that a scheme to defraud was the furthest thing from the minds of these individuals at the relevant time and that their vision was limited to the overwhelming demands they faced daily in their severely understaffed department. Viewed in this context, which the Court is persuaded is the appropriate context given the testimony and evidence, actions suggestive of malfeasance become no more than a string of mishaps, mistakes, misapprehensions and misjudgment on the part of inexperienced and overworked individuals."

By its reference to the marketplace, the Court highlighted its thinking on not only deceptive intent, but also on the intersection of commercial success and inequitable conduct.

In re Rosuvastatin Calcium Patent Litig., C.A. No. 08-1949-JJF-LPS (D. Del. June 29, 2010) (Farnan, J.).

See also the Court's errata order, posted here.

June 28, 2010

Judge Baylson: Claim construction order

Judge Baylson issued a recent claim construction order construing the following terms:

"discrete region(s)"
"fixed upon a solid support according to an array comprising discrete regions"
"determining the possible presence and quantification of precipitate(s) in said discrete region(s)"
"correlating the presence and quantification of the precipitate(s) at the discrete region(s) with the identification and/or quantification of said target compound"
"colloidal gold particles coupled to the bound target compound"
"wherein the possible presence and quantification of a precipitate is obtained by reflection, absorption or diffusion of a light beam upon said precipitate"
"wherein binding of said targe compound to one or more of said multiple species of capture molecules leads to a catalytic reduction of a metal present in solution, and a formation of a metallic precipitate in one or more of said discrete region(s)
"wherein said computer is programmed to detect and/or quantitate said target compounds"

Update: Below is the order adopting the constructions. Here is Judge Baylson's July 12, 2010 memorandum opinion in support of the claim constructions.

Eppendorf AG v. Nanosphere Inc., C.A. 09-504 (D. Del. June 10, 2010)

June 28, 2010

Joseph J. Farnan: Multiplicity of Prior Art Leads to Stay of Proceedings

On Friday, District Judge Joseph J. Farnan Jr. granted a request for a stay pending reexamination. While this outcome is not unusual in Delaware, the Court made the notable observation that the sheer number of prior art references at issue made simplification of the case more likely following scrutiny by the PTO:

"[I]t is noteworthy that every claim of both [patents-in-suit] is currently being rexamined by the same PTO Examiner, and that the PTO has already issued an office action rejecting all claims of the '975 patent. Also, inter partes reexamination of the '975 patent was granted in view of thirty prior art references . . . . Ex parte reexamination of the '236 patent was granted in view of fifteen prior art references. In these circumstances, the Court is persuaded that there is a strong likelihood that a stay pending reexamination will simplify the prior art issues and invalidity defenses which are likely to be raised in this action."

Although only one factor in the Court's analysis, the prior art in the aggregate helped persuade the Court that staying the proceedings would be the most efficient course.

Enhanced Sec. Research LLC v. Cisco Sys. Inc., C.A. No. 09-571-JJF (D. Del. June 25, 2010) (Farnan, J.).

June 25, 2010

Leonard P. Stark: Document Production Prior to Amendment Deadline Precludes New Counterclaim

Although parties to litigation enjoy a wide latitude in amending pleadings, the ability to change one's case theory midstream has its limits. A recent decision by Magistrate Judge Leonard P. Stark demonstrates these boundaries. In the underlying infringement litigation, Facebook sought to amend its false-marking counterclaim outside the confines of the scheduling order. Looking to Rule 16(b)'s "good cause" standard, the Court denied Facebook's request on diligence grounds.

Specifically, the Court emphasized Facebook's possession of the documents necessary to its proposed pleading prior to the amendment deadline:

"[I]t appears that Facebook possessed documents containing examples of how Leader marked its . . . products before it previously moved to add the false marking claim. Facebook provides no explanation for why, in light of this information, it could not reasonably have complied with the Scheduling Order. Accordingly, the Court concludes that Facebook has not shown that good cause exists to amend its responsive pleading with regard to the false marking counterclaim."

By doing so, the Court gave clear guidance to the litigator: diligence for purposes of Rule 16(b)'s "good cause" standard includes a timely review of an opposing party's document production.

Leader Technologies, Inc. v. Facebook, Inc., C.A. No. 08-862-LPS (D. Del. June 24, 2010) (Stark, M.J.).

In a related decision, Judge Farnan approved two discovery orders issued by Magistrate Judge Stark in this case - one on the common-interest privilege and the other allowing a restricted reopening of discovery. Read the decision here.

June 23, 2010

Federal Bar Association Honors Judge Joseph J. Farnan, Jr.

The Delaware Chapter of the Federal Bar Association honored district judge Joseph J. Farnan, Jr. today at its annual meeting in Wilmington. The event, also sponsored by the United States District Court for the District of Delaware, brought together a number of Delaware federal judges, past law clerks, and practitioners from around the country to celebrate Judge Farnan's twenty-five distinguished years on the bench. Judge Farnan, who is retiring in July, addressed the capacity crowd at the Hotel duPont's Gold Ballroom with an emotional and, as always, thoughtful speech.

All of us at the Delaware IP Law Blog express our heartfelt appreciation to Judge Farnan for his many years of public service and for his substantial contributions to the District and to the quality of justice in Delaware.

FBA Luncheon