May 5, 2010

Special Master: Vincent J. Poppiti: Discovery Dispute over Production of Worldwide Sales Information

Special Master Poppiti ordered defendant Chi Mei Optoelectronics Corporation to produce its worldwide sales data and technical information because such information is relevant to: "(i) inducing infringement liability; (ii) determining direct infringers; (iii) commercial success; and (iv) a reasonable royalty determination." Apeldyn Corporation v. AU Optronics Corporation et al., C.A. No. 08-568-SLR, Special Master's Report and Recommendation Regarding CMO's Production of Worldwide Sales and Technical Information for All VA Mode Products, at 2 (D. Del. Apr. 12, 2010). The Special Master further found that Chi Mei must produce the information with the following data fields: "date, customer, product, quantity, price and shipping destination." Id. This discovery was not limited to products known by the defendant to enter the United States, but instead covers all worldwide sales, regardless of whether the defendant knows where its products are going. Id. Defendant Chi Mei was required to produce this data starting 6 years prior to the filing of the Complaint to the present because such data could be instructive on such issues as commercial success. Id. Finally, Special Master Poppiti noted that he does not believe the law regarding inducing infringement has become "more restrictive" as argued by defendant Chi Mei, and the scope of such liability will not "dictate the scope of discovery." Id. at 3-4.

Apeldyn Corporation v. AU Optronics Corporation et al., C.A. No. 08-568-SLR, Special Master's Report and Recommendation Regarding CMO's Production of Worldwide Sales and Technical Information for All VA Mode Products (D. Del. Apr. 12, 2010).

May 4, 2010

Magistrate Judge Leonard P. Stark: R&R on Claim Construction

In a report and recommendation regarding claim construction on patented technology for processing debit card transactions, Magistrate Judge Stark construed the following claim terms:

- "telecommunication means"
- "debit styled card"
- "debit purchase transactions"
- "purchasing value of a card in response to card use"
- "entering a customer authorization code for authorizing access to a customer database of a host data provider"
- "entering an authorization code through the keypad for having the computer initiate communication with a host data processor"
- "requesting a response of approval or disapproval from the host data processor"
- "credit authorization provider"

Stored Value Solutions, Inc. v. Card Activation Technologies, Inc., C.A. No. 09-495-JJF-LPS, Report and Recommendation Regarding Claim Construction (D. Del. Apr. 28, 2010).

Issue re: means-plus-function: The parties disputed whether the term "telecommunications means" is in means-plus-function format. The court concluded that there was not sufficient sstructure for performing the described function to overcome the presumption that the term is in means-plus-function format. Id. at 7.Specifically, defendant argued that the distance between the disputed term and the element that describes the function is inconsistent with means-plus-function format, but cited no authority to support their position. Therefore, Judge Stark found that the term was in means-plus-function format. Id. at 7-8.

Stored Value Solutions, Inc. v. Card Activation Technologies, Inc., C.A. No. 09-495-JJF-LPS, Report and Recommendation Regarding Claim Construction (D. Del. Apr. 28, 2010).

April 29, 2010

Amended Local Rules Effective 4/30/2010

The District Court of Delaware has issued amended Local Rules (Civil) which become effective April 30, 2010. The majority of changes bring the Local Rules in line with the 2009 amendments to the Federal Rules of Civil Procedure that deal with computation of time.

One of the bigger changes is in Rule 7.1.3 and deals with the length of briefs. All opening and answering briefs are now limited to 20 pages and all reply briefs to 10 pages (exclusive of any table of contents or table of authorities).

Rule 7.1.5 also limits motions for reargument to 10 pages. Rule 7.1.5 has also been amended to state that a party seeking review of an order, decision or report and recommendation of a Magistrate Judge must file objections under Fed. R. Civ. P. 72 and cannot file a motion for reargument before either the Magistrate Judge or the District Court Judge.

All depositions must now be notice at least 10 days prior the date of the deposition. D. Del. LR 30.1.

A copy of the Amended Rules is set forth below.

D. Del. Local Rules Effective April 30, 2010

April 27, 2010

Magistrate Judge Mary Pat Thynge: Motion to Amend or Motion to Supplement?

In Masimo Corporation v. Philips Electronics North America Corporation, defendant Philips filed a motion for leave to amend its counterclaims pursuant to Federal Rule of Civil Procedure 15 to add a newly acquired patent. C.A. No. 09-80-JJF-MPT, Memo. Order (D. Del. Apr. 20, 2010). Plaintiff argued that this motion to amend was actually an attempt to supplement the pleadings because it was adding a patent that was unrelated to the asserted patents and further was an attempt by defendants to "'buy up' new counterclaims and hinder litigation of [plaintiff's] claims." Id. at 4 (internal citations omitted).

The Court did treat the motion as a motion to supplement and not a motion to amend, but found that the standard under Rule 15(d) is "'essentially the same' as that under Rule 15(a)." Id. at 5 (internal citations omitted). Using that standard, the court found that the newly-added patent is potentially related and inclusion of the patent in the pending litigation "will promote judicial efficiency" since the accused products were already accused of infringing defendants' other asserted patents in the pending litigation. Id. at 6-7. Judge Thynge also found that inclusion of the newly-added patent in the pending litigation would not cause undue delay since no scheduling order had been entered and discovery was in its early stages. Id. at 7. Finally, the court found that there was no evidence to support a finding that defendants acted in bad faith when moving to add the newly-acquired patent. Id. at 8.

Masimo Corporation v. Philips Electronics North America Corporation, C.A. No. 09-80-JJF-MPT, Memo. Order (D. Del. Apr. 20, 2010).

April 27, 2010

Jury Verdict in Robert Bosch, LLC v. Pylon Manufacturing Corp.

A jury returned a mixed verdict on Friday, April 23, in the patent infringement suit between Robert Bosch, LLC v. Pylon Manufacturing Corp. C.A. No. 08-542-SLR, Verdict Sheet (D. Del. April 23, 2010).

There were three patents-in-suit, all relating to wiper blade technology. The first patent asserted by plaintiff is entitled "Glass Wiper Blade for Motor Vehicles" (U.S. Patent No. 6,292,974). The jury found that the asserted claims were invalid in light of two prior art references. It also found this patent invalid because one or more of the named inventors did not himself invent the subject matter but learned of it from another.

The jury found that the accused Bosch products infringed certain claims of the second patent entitled "Wiper Blade for the Glass Surfaces of Motor Vehicles with an elongated, spring-elastic support element" (U.S. Patent No. 6,675,434). It also found, however, that one claim was not infringed. The jury found that two of infringed claims were obvious in view of two U.S. patents and that one of the remaining infringed claims and the non-infringed claim were valid.

The jury found the third patent, U.S. Patent No. 6,944,905, entitled "Wiper blade for cleaning screens in particular on motor vehicles." to be infringed and valid.

Of note in this case, the verdict form contained quite a bit of detail compared to a typical verdict form in this district. The redacted form is set forth below.

Robert Bosch, LLC v. Pylon Manufacturing Corp. C.A. No. 08-542-SLR, Verdict Sheet (D. Del. April 23, 2010).

April 26, 2010

Magistrate Judge Leonard P. Stark: Confirmation Hearing Held

As we previously mentioned in an earlier blog post, Magistrate Judge Leonard P. Stark has been nominated by President Obama to fill the current D. Del. vacant judgeship. (see post here) The Senate Judiciary Committee held a confirmation hearing last Thursday, April 23, 2010 regarding his nomination. The committee members may still provide written questions to Magistrate Judge Stark before the committee votes. The nomination must be approved by the full committee and then confirmed by the full Senate.

For a more comprehensive recap of the hearing, below is a link to the Delaware News Journal Article of April 24, 2010.

Delaware News Journal Article April 24, 2010

April 26, 2010

Chief Judge Gregory M. Sleet: Post-Trial Op Reminds Counsel of Duty of Candor

Note to Counsel: Remember your duty of candor to the tribunal. In a recent post-trial findings of fact and conclusions of law, Chief Judge Gregory M. Sleet noted in a footnote the following:

“Santarus asserts that Dr. Allen, one of Par’s expert witnesses testified that ‘there are substantial differences between omeprazole and leminoprazole.’… This is, at best, a highly misleading statement and is one of the more egregious examples of the distortions of the record contained in Santarus’ post-trial briefing. The portion of the transcript that Santarus cites for its characterization of Dr. Allen’s testimony contains two questions that call for some comparison between leminoprazole and omeprazole. The first question and its response consisted of the following:

Q. You would agree that Laminoprazole is substantially different from omeprazole; correct?
A. It is a ben—
Q. Thank you, sir.

Tr. 710:19-22. The second question, as reworded after an objection by Par’s counsel, discussed a hypothetical, abstract patent containing leminoprazole and asked whether, for the purposes of doctrine of equivalents rather than non-obviousness, the substitution of omeprazole would constitute a ‘substantial difference’ such that it would not infringe under the doctrine of equivalents. (Tr. 711-25.) To that abstract, hypothetical question concerning a wholly different area of patent law, Dr. Allen answered “I believe that is true. Id. at 712:1. The court is trouble that on this basis, Santarus asserts in the context of its obviousness argument that Dr. Allen ‘testified’ that leminoprazole and omeprazole were substantially different.

Sadly, such distortions are not confined to these examples – both at trial and in the post-trial briefing. At trial, counsel for Santarus implied that one of Par’s witnesses was ‘embarrassed’ by his opinion in this case based on the witness’s statement during deposition that he hoped the confidentiality of his participation in the case would be respected… In its proposed findings of fact and conclusions of law, Santarus’ counsel represented to the court that Dr. Orlando was unable to explain the meaning of an article at trial… Counsel neglects to mention, however, that the testimony cited was in response to a question that counsel withdrew after Dr. Orlando asked to see the context in question… Furthermore, both parties’ briefs cite portions of the transcript that provide no support for the propositions for which they are cited. These tactics make it far more difficult and time-consuming for the court to examine the record when preparing its findings of fact and conclusions of law. Both the court and the parties suffer undue inconvenience when counsel engages in such tactics. Equally important, counsel who engage in such sharp practices run the risk of severely damaging their credibility and, thus, their effectiveness in the place and at the time when they most need to be viewed as honest and ethical brokers of the facts and the law.

Santarus, Inc. v. Par Pharmaceutical, Inc., C.A. No. 07-551-GMS, Memo., at 35 n.10 (D. Del. Apr. 14, 2010).

Santarus, Inc. v. Par Pharmaceutical, Inc., C.A. No. 07-551-GMS, Memo. (D. Del. Apr. 14, 2010).

April 26, 2010

Magistrate Judge Mary Pat Thynge: Inequitable Conduct: Pleading and Discovery

This opinion follows a series of discovery disputes between the parties surrounding requests for production of documents concerning drugs other than the drug that is the subject of the plaintiffs’ NDA, defendant Mylan’s ANDA and the patent-in-suit. Eurand, Inc. v. Mylan Pharmaceuticals, Inc., C.A. No. 08-889-SLR, Memo. Order (D. Del. Apr. 13, 2010) (Thynge, Magistrate) (see prior opinion and post here). As part of its Second Amended Answer, defendant Mylan asserted the affirmative defense and counterclaim of inequitable conduct alleging that Mylan failed to disclose another material patent during the examination of the patent-in-suit. Mylan sought to discovery documents “evidencing the two inventors’ awareness of and understanding of” certain pieces of prior art during the period prior to and during the filing and prosecution of the patent-in-suit. Id. at 3.

Mylan’s Second Amended Answer asserted a claim of inequitable conduct solely based on one piece of prior art, a U.S. patent. Mylan also sought documents, however, related to two other references that were not mentioned in its Answer, but Mylan argued were relevant to plaintiffs’ subjective intent. Id. at 8-10. Such discovery was necessary, Mylan argued, before it could assert additional claims of inequitable conduct under Rules 9 and 11. Judge Thynge held that “[i]t is improper to use discovery in search of a factual predicate required to be pled in the first instance.” Id. at 10.

However, as to the documents sought to establish knowledge and intent related to the U.S. patent that Mylan did plead in its counterclaim and affirmative defense, those documents are relevant and should be produced. Plaintiffs argued that they conducted a thorough search of all relevant files including all development and product files related to the drug claimed in the patent-in-suit and those files would have encompassed the prior art sought by Mylan. Id. at 5, 11. They further argued that the proposed search by Mylan of the emails of the two inventors would “involve review of a large number of potential emails and substantial expense…and contains terms that have nothing to do with the present inequitable conduct claim.” Id. at 11. Noting the hesitancy of the court to opine on such “mysteries of keyword search techniques,” the court stated that it in determining the “adequacy” of search terms or methodology, a reasonableness test is applied. It further found that plaintiffs’ search of materials related to the drug claimed in the patent-in-suit “did not include keywords on the inventors’ knowledge or awareness of the materiality of the [prior art] patent” and that “[s]uch knowledge under the circumstances…would most likely be found in the emails of the inventors.” Id. at 13. Therefore, the court ordered plaintiffs to search and produce all emails that “are relevant to the inventors’ knowledge and materiality of the [prior art] patent to the [patent-in-suit] and failure to disclose the [prior art] patent during the prosection of the [patent-in-suit]” during the period from the filing of the [prior art] patent to the date of issuance of the [patent-in-suit].” Id. at 14.

Eurand, Inc. v. Mylan Pharmaceuticals, Inc., C.A. No. 08-889-SLR, Memo. Order (D. Del. Apr. 13, 2010) (Thynge, Magistrate)

April 23, 2010

Judge Robinson: Lanham Act Opinion Involving Neutrogena and Coppertone Sunscreens

Plaintiffs Schering-Plough HealthCare Products, Inc. (makers of Coppertone-brand sunscreen) brought an action under Section 43 of the Lanham Act against Neutrogena Corporation (makers of Neutrogena-brand sunscreen) for releasing advertisements containing false and misleading statements. Defendants counter-claimed under the Act based on advertisements by Plaintiffs.

Defendant's advertisements involved a bar graph showing "UVA" and SPF ratings for the competing products:
Plaintiffs argued that the graphs were misleading, and the Court agreed, based on the literal falsity of the graph's "double-counting" of UVA protection. The upper, yellow portion of the graph represents the sunscreen's UVA protection, while the bottom, red portion of the graph represents the SPF rating. According to the Court, however, the red portion of the graph is based on an SPF measurement that already accounts for UVA protection. Thus, by adding the yellow portion of the graph, Defendants were double-counting their UVA protection, which was literal falsity. The Court was unpersuaded by Defendants' argument that the falsity affected the graphs of both products: "While it is true that these errors are present with respect to both products compared in the graph, the absence of bias caused by the double-counting does not eliminate the falsity of the message." Id. at 12.

Defendants asserted a counterclaim based on claims made in Plaintiff's TV ads. The ads involved an establisment claim that Plaintiff's sunscreen provided "better coverage," as well as text apparently asserting that Defendant's spray sunscreen consisted of "28% Propellant":
The Court held in favor of Defendants on both claims. For the establishment claim, the Court held that Plaintiffs had failed to actually test the properties of the products in the ad, and that "[t]his type of unsubstantiated 'scientific' claim is precisely what the Lanham Act seeks to prevent." For the "28% Propellant" statement, the Court held that

"The overlay of the words "Neutrogena" and "28% propellant" on the (bare) chest of one of the athletes (as compared to, for example, pictures of the respective cans) reinforces the message that 72% sunscreen and 28% propellant is applied to the body, rather than merely contained inside the can. There is no qualifying statement or language from which a consumer could conclude that the propellant is not deposited onto the skin in this amount or, alternatively, that the sunscreen (lotion) expelled by the can is 100% (and not 72%) sunscreen. This is an unambiguous message conveyed by necessary implication and, therefore, is literally false."
Id. at 24.

Continue reading "Judge Robinson: Lanham Act Opinion Involving Neutrogena and Coppertone Sunscreens" »

April 20, 2010

Judge Joyner: Denial of Motion to Stay highlights considerations when submitting ANDA applications

In Millenium Pharms., Inc. v. Teva Parenteral Medicines, Inc., C.A. No. 09-105 (D. Del. Apr. 13, 2010), Plaintiffs brought suit after defendants filed their Abbreviated New Drug Application (“ANDA”) for a generic version of Plaintiffs’ drug. Id. at 2. Pursuant to their ANDA, Defendants submitted a Paragraph IV certification that Plaintiffs’ patents in the corresponding New Drug Application (“NDA”) were invalid, unenforceable or would not be infringed. Id. at 3-4. Due to Defendants’ Paragraph IV certification, Plaintiffs had 45 days to bring the suit to establish validity of their patents (which they did), thereby staying Defendants ANDA for 30-months. Because Defendants were the first to file a Paragraph IV certification, they are entitled to a 180-day market exclusivity after ANDA approval, provided Defendants begin marketing their generic drug within 75 days of a final judgment that Plaintiffs’ patents are invalid, unenforceable, or not infringed. In addition to the Paragraph IV certifications, Defendants submitted Paragraph III certifications which would delay FDA certification of Defendants’ ANDA until Plaintiffs’ patents expire, in 2014. The result was that Defendants could lose their 180-day exclusivity period, even if they are successful in the litigation. Id. at 5. Therefore, Defendants subsequently sought a stay of the litigation.

Judge Joyner denied Defendants’ Motion to Stay, however, after weighing the potential hardships to both Plaintiffs and Defendants. Judge Joyner noted that “Defendants have shown that they will be harmed if a stay is not entered, as they will likely forfeit their 180-day exclusivity period. Defendants, however, have only themselves to blame for this result. . . . Although Defendants did not file this suit, they were well aware that their ANDA triggered the start of a 45-day period for Plaintiffs to defend the validity of their patents, and, in this sense, did control the timing of the present litigation.” Id. at 8. Because the harm to Defendants of denying the stay was “one of their own creation,” that harm cannot outweigh any harm to Plaintiffs if the stay is granted. Id.

Millenium Pharms., Inc. v. Teva Parenteral Medicines, Inc., C.A. No. 09-105 (D. Del. Apr. 13, 2010)