Delaware IP Law Blog

5/30: Dish Network Corp., Echostar DBS Corp., Echostar Technologies, LLC, Echosphere, LLC, Dish Network, LLC v. TiVo Inc. (declaratory judgment of patent non-infringement)
6/2: Cephalon, Inc. and CIMA Labs, Inc. v. Watson Pharmaceuticals, Inc., Watson Laboratories, Inc. (patent infringement)
6/4: W. Neudorff GmbH KG v. Falcon Lab LLC (declaratory judgment of patent non-infringement and invalidity)
6/4: LG Electronics USA Inc., LG Electronics Inc., LG Electronics Monterrey Mexico S.A., DE, CV v. Whirlpool Corp., Whirlpool Patents Co., Whirlpool Manufacturing Corp., Maytag Corp. (patent infringement)
6/4: Motivation Innovations, LLC v. DSW, Inc., Value City Department Stores, LLC, Bed, Bath & Beyond, Inc. and Hallmark Cards, Inc. (patent infringement)
6/5: Eli Lilly and Co., The Trustees of Princeton University v. Teva Parenteral Medicines, Inc. (patent infringement)
6/5: Forest Laboratories, Inc., Forest Laboratories Holdings, Ltd., MerzPharma GmbH & Co., KGaA and Merz Pharmaceuticals GmbH v. Apotex Inc. and Apotex Corp. (patent infringement)
6/6: Lannett Co., Inc. v. KV Pharmaceuticals, Drugtech Corp., Ther-RX Corp. (declaratory judgment for patent invalidity, non-infringement, unenforceability and unfair competition)

As the pace of invention (and litigation) has increased over the past several decades, so has the pressure for companies to design around their competitors’ patents. The freedom to develop non-infringing alternatives to protected products fosters both competition and innovation, two crucial aspects of the modern patent system. But what happens when two companies settle an infringement suit, only to have the alleged infringer immediately come to market with a different product utilizing the same technology?

According to District of Delaware Chief Judge Gregory M. Sleet, it is for the jury to decide whether the design around breached the parties’ settlement agreement. In the underlying litigation, defendant agreed to forego selling the disputed voltage regulator or “any other” products incorporating plaintiff’s circuitry. After defendant began marketing its design around, plaintiff brought an action seeking to enforce the settlement agreement.

On summary judgment, the Court declined the invitation to draw the boundaries of the design around, noting that competing expert opinions precluded an early disposition:

Although a close question, the court’s conclusion is supported by the parties’ experts’ opinions, which – not surprisingly – are diametrically opposed. . . . Thus, there appears to be a classic battle of the experts on the issue of whether the [design around] contains the ZX circuitry . . . . (slip op. at 11)

This factual issue, in turn, prevented the Court from determining whether plaintiff could enforce the settlement agreement against the disputed product. Practitioners take note: As a first litigation step, the jury must decide the composition of the design around.

Linear Tech. Corp. v. Monolithic Power Sys. Inc., C.A. No. 06-476-GMS (D. Del. May 23, 2008) (Sleet, C.J.).

5/19: S.O.I. TEC Silion On Insulator Technologies, S.A., Commissariat a l'Energie Atomique v. MEMC Electronic Materials, Inc. (patent infringement)
5/20: Smartrac NV, Smartrac IP BV, Smartrac Technology Inc. v. On Track Innovations Ltd., OTI America, Inc. (patent infringement)
5/21: Unilin Beheer BV, Flooring Industries Ltd. sarl v. Pergo (Europe) AB, Pergo LLC (patent infringement)
5/21: Finjan Software Ltd. v. Aladdin Knowledge Systems Inc., Aladdin Knowledge Systems Ltd., Does 1-100 (patent infringement)
5/22: AstraZeneca LP, Aktiebolaget Draco, KBI Inc. and KBI-E Inc. v. Barr Laboratories, Inc., Barr Pharmaceuticals, Inc. (patent infringement)
5/23: Power Integrations Inc. v. Fairchild Semiconductor International, Inc., Fairchild Semiconductor Corp. and System General Corp. (patent infringement)
5/28: Oxford Gene Technology IP Limited v. BioArray Solutions Ltd. (patent infringement)

5/28: Wyeth v. Sandoz Inc. (patent infringement)

Civil contempt. Not an issue that comes up frequently in patent litigation, but something the District of Delaware has shown it will take very seriously. The Court in Fisher-Price, Inc. v. Safety 1st, Inc., found that even inadvertent or insignificant sales of an infringing product will not excuse a violation of a court-ordered injunctive order. C.A. No. 01-051-GMS, Memorandum, at 5-6 (D. Del. May 5, 2008). Furthermore, when an injunctive order requires a party to "make every reasonable effort possible" to retrieve infringing products from retail shelves, the Court found that hiring another company to retrieve the products did constitute "reasonable effort", however, inconsistent behavior with different retailers and delayed retrieval efforts will not constitute "reasonable effort". Id. at 6-7.

See a copy of the opinion here.

5/5: J&J Sports Productions Inc. v. Lynn Tran, TRJAL LLC (copyright - cable system piracy)
5/5: J&J Sports Productions Inc. v. Jeff Haslow, Fenway Barr LLC (copyright - cable system piracy)
5/5: Hesco Bastion Limited v. ACS Holdings USA LLC (patent infringement and trademark infringement)
5/5: Edgecraft Corporation v. Luckyman Enterprise Co. Ltd. (patent infringement)
5/6: TRW Vehicle Safety Systems Inc., TRW Automotive GmbH v. Takata Corporation, TK Holdings, Inc., Takati Petri AG (patent infringement)
5/8: Autism Society of America Inc. v. Autism Society of Delaware, Lisa Albany, Karen Bashow, Yolanda Flanigan, Robert Gilsdorf, et al. (trademark infringement)
5/9: Kenexa BrassRing Inc. v. Vurv Technology, Inc. (patent infringement)
5/14: Apple Inc. v. Atico International USA Inc., New Atico International Limited Corporation (patent infringement, trademark infringement and unfair competition)
5/16: Hilite International Inc. v. BorgWarner Inc., BorgWarner Morse Tec Inc. (patent infringement)
5/16: Genetics Institute, LLC v. Novartis Vaccines and Diagnostics, Inc. (adjudication of priority of interfering patents)
5/16: Forest Laboratories, Inc., Forest Laboratories Holdings, Ltd., Merz Pharma GmbH & Co. KGaA, Merz Pharmaceuticals GmbH v. Orgenus Pharma, Inc. (patent infringement)

This morning's edition of IP Law360 (subscription) features an informative article on judges' pet peeves in patent litigation. Featured in the piece are two D. Del. judges: Chief Judge Sleet and Judge Farnan.

Of note are the judges' comments on summary judgment motions and the use of experts. On the issue of summary judgment, Chief Judge Sleet noted that:

Generally in these cases, both parties have experts who are ready, willing, and able to come to court and dispute the facts. It can be a significant waste of time and money to bring a summary judgment motion.

Judge Farnan agreed: "The problem is, if I'm a lawyer for a generic and I'm attacking a patent and I think it is obvious because of a combination of two prior pharmaceutical products, there's almost always going to be a dispute of facts."

On the topic of experts, Judge Farnan cautioned litigants against expert overkill:

I pretty much let [litigants] try the case they want, but I talk to them in the pretrial conference about the value [experts] offer. I have to write an opinion, and they want that opinion yesterday. So I tell them, 'the more you put into that trial record, the more I have to consider and address.'

Patent litigation is an aggressive, competitive field of law. The judges' comments today add valuable perspective - that of the decision maker - to how best to champion the causes of our clients.

Can earlier litigation on the same patent and in the same court justify a departure from the well-worn first-filed rule? According to District Judge Joseph J. Farnan Jr., it does not. The DJ plaintiff, who had earlier been sued in the Eastern District of Texas, argued against transfer there based on prior Delaware litigation involving the same patent.

The Court rejected this argument, holding that the earlier case did not constitute a "special circumstance" justifying a departure from the first-filed rule. Because that litigation involved a different Delaware judge, the Court could not be "substantially more familiar" with the patent-in-suit than the Texas district court. With no other aspects of the dispute favoring litigation in Delaware, the Court transferred the case.

Comcast Cable Communications LLC v. USA Video Tech. Corp., C.A. No. 06-407-JJF (D. Del. April 29, 2008) (Farnan, J.).

District of Delaware Judge Joseph J. Farnan Jr. recently weighed in on a patent-related document subpoena dispute, touching on professional conduct in so-called "rocket docket" litigation. By ordering an evidentiary hearing, the Court reminded the parties (and the reader) of its inherent supervisory power over litigants:

In the Court's experience, lawyering in fast paced, high stakes litigation can sometimes wander from the professional standards expected. . . . In order to resolve the legal issues presented by the petition and the professional issues presented by the briefing, the Court will conduct an evidentiary hearing.

To reinforce its point, the Court ordered that even if the "subpoena issues are fully resolved, the hearing must still go forward to resolve the professional issues." Patent litigators take note: in this district, allegations of unprofessionalism will be fully vetted.

Digacomm LLC v. Vehicle Safety & Compliance LLC, C.A. No. 08-MC-063-JJF (D. Del. April 29, 2008) (Farnan, J.).

A foreign corporation manufactures in a foreign country products alleged to infringe a U.S. Patent. They provide modules to original equipment manufacturers here in the U.S. who then incorporate them into products sold to consumers through retailers across the country and on the Internet. The foreign corporation also owns directly and indirectly subsidiaries which are Delaware corporations. Are these contacts with Delaware enough to establish personal jurisdiction over the foreign corporation? Judge Farnan recently answered that question in the affirmative in his decision denying a motion to dismiss filed by defendants in LG.Philips LCD Co., Ltd. v. Chi Mei Optoelectronics, Corp., et al., C.A. Nos. 06-726-JJF, 07-357-JJF, Memo. Op. (D. Del. Apr. 29, 2008).

Jurisdiction under the Delaware Long-Arm Statute was proper because the foreign corporation, Chi Mei Optoelectronics, "acted in consort" with the original equipment manufacturers here in the United States to place products containing the allegedly infringing modules into a national distribution network which ultimately allowed some products to be sold in Delaware. Id. at 12. The fact that there was a "middle man" through which the defendant sold its product did not protect it from the possibility of being subject to jurisdiction of the Delaware court. Id. Furthermore, the plaintiff, LG.Philips provided "sufficient evidence" of revenues from sales of the accused products in Delaware. Id. The Court noted and "found instructive" the defendant's failure to provide any evidence rebutting the "factual presumption that a portion of [their] large revenues from the United States market are the result of products incorporating its ... module sold in Delaware..." Id.

Jurisdiction also comports with Due Process, because given the defendant's contract with its original equipment manufacturers (and one major one in particular), the substantial quantities of modules it ships to the U.S. to be incorporated into end products and sold in retail stores here, and the size of its business, Judge Farnan found it "far from a stretch to conclude" that the modules would end up in Delaware. Id. at 14.

For a copy of the opinion click here.

4/18: UCB Inc. and CellTech Manufacturing CA Inc. v. KV Pharmaceutical Co. (patent infringement)
4/24: LG Electronics USA, Inc. and LG Electronics Inc. v. Whirlpool Corporation (patent infringement)
4/25: AstraZeneca AB, Aktiebolaget Hassle, AstraZeneca LP, KBI Inc. and KBI-E Inc. v. Teva Parenteral Medicines Inc., Teva Pharmaceuticals USA Inc. and Teva Pharmaceutical Industries, Ltd. (patent infringement)
4/25: Pfizer Inc., Pfizer Ireland Pharmaceuticals, Warner-Lambert Co., Warner-Lambert Co., LLC and Warner-Lambert Export Ltd. v. Teva Pharmaceuticals USA Inc. (patent infringement)