December 31, 2009

New District of Delaware Intellectual Property Case Filings

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)

December 29, 2009

Judge Sue L. Robinson: No Waiver of Attorney-Client Privilege

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.

Robert Bosch LLC v. Pylon Manufacturing Corp., C.A. No. 08-542-SLR, Memo. Order (D. Del. Dec. 23, 2009).


December 29, 2009

Judge Joel A. Pisano: Motion to Transfer GRANTED Where Only "Delaware Connection" was Defendant's Incorporation

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.

Qinetiq Limited v. Oclaro, Inc., C.A. No. 09-372-JAP, Opinion (D. Del. Dec. 18, 2009).

December 28, 2009

Magistrate Judge Thynge: Recommended Defendants’ motions to dismiss for lack of personal jurisdiction and for failure to state a claim be GRANTED.

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.

Quantum Loyalty Systems, Inc., et al. v. TPG Rewards, Inc., et al., C.A. No. 09-022-SLR-MPT (D. Del. Dec. 23, 2009)


December 28, 2009

Sue L. Robinson: "Self-Serving" Declaration Cannot Support Finding of Irreparable Harm

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.

IGT v. Bally Gaming Int'l Inc., C.A. No. 06-282-SLR (D. Del. Dec. 22, 2009) (Robinson, J.).


December 22, 2009

Judge Stark: Report and Recommendation applying Exergen to plaintiff's counterclaims alleging inequitable conduct

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.

Power integrations, Inc. v. Fairchild Semiconductor Int’l, Inc., et al., C.A. No. 08-309-JJF-LPS (D. Del. Dec. 18, 2009)

December 22, 2009

Judge Stark: Two opposing personal jurisdiction decisions involving corporate parents and their subsidiaries

In this multidistrict litigation consolidating nine patent infringement actions, Judge Stark recently issued a Report and Recommendation Regarding Motions for Summary Judgment and to Dismiss and Order on Evidentiary Motions. In re Rosuvastatin Calcium Patent Litig., MDL No. 08-1949 (D. Del. Dec. 11, 2009). One such motion was Defendant Aurobindo India’s Motion for Summary Judgment of No Personal Jurisdiction. Id. at 5. Aurobindo India argued that if it is dismissed from the case, so must defendant Aurobindo USA because of the absence of “the necessary and indispensible Aurobindo India.” Id. However, Judge Stark agreed with plaintiffs that under Forest Labs., Inv. v. Cobalt Labs., Inc., 2009 WL 605745 (D. Del. Mar. 9, 2009), and considering the record, id. at 6-9, there was sufficient evidence to conclude that “Aurobindo USA ‘engages in [a] persistent course of conduct’ in Delaware, thereby establishing general jurisdiction.” Id. at 9 (citing 10 Del. C. § 3104(c)(4). Moreover, “[u]nder the alter ego and agency theories, these jurisdictional contacts of Aurobindo USA may be imputed to Aurobindo India.” Id.

A different result was reached when Judge Stark considered defendant Apotex Inc.’s Motion to Dismiss for Lack of Personal Jurisdiction or in the Alternative to Transfer to the Middle District of Florida. Id. at 10. Here, Judge Stark found insufficient contacts with Delaware but that transfer was warranted. Id. Judge Stark noted that “Apotex Inc. is a Canadian corporation with a principal place of business in Canada. It has no offices, facilities, telephone listings, bank accounts, or property in Delaware. It does not have employees, or do business, in Delaware.” Id. at 11. Although plaintiffs argued that defendant Apotex Corp.’s contacts with Delaware should be imputed to Apotex Inc., the same argument that was successful with the Aurobindo defendants, here, Judge Stark found that plaintiffs failed to meet their burden. Id. “Apotex Corp. generates its own revenue, with which it purchases the products it sells. Apotex Corp. decides which of Apotex Inc.’s approved products it will market. Apotex Corp. pays Apotex Inc. for administrative services rendered by Apotex Inc. and the two companies maintain distinct books, records, financial statements, and tax returns.” Id. at 11-12. Judge Stark subsequently transferred the suit against Apotex Inc. to Florida, where Apotex Inc. conceded jurisdiction exists. Id. at 12.

In re Rosuvastatin Calcium Patent Litigation, MDL No. 08-1949 (D. Del. Dec. 11, 2009)

December 21, 2009

Sue L. Robinson: How Waiver Can Affect a Motion for Reconsideration

Where is the line between rehashing arguments and offering new evidence in seeking reconsideration of a ruling? According to a recent decision by district judge Sue L. Robinson, the waiver doctrine can play a primary role in this determination.

In disposing of a request to recalculate a lost-profits award, the Court noted that the movant never raised its remittitur argument in the initial post-trial proceedings. As a result, the movant not only waived its ability to raise the argument, but also prompted a rebuke from the Court:

"The present motion reflects a fundamental misunderstanding of the limited appropriateness of motions for reconsideration. There is no alleged change in law or new evidence. A 'manifest injustice' does not result from the court's failure to consider arguments not properly made by defendant in its prior motion to amend the judgment. As this court has iterated in previous cases, a motion for reconsideration is not properly grounded on a request that a court rethink a decision already made."

Strong words to consider when formulating positions for a post-trial (or any) motion.

Siemens Medical Solutions USA Inc. v. Saint-Gobain Ceramics & Plastics Inc., C.A. No. 07-190-SLR (D. Del. Dec. 16, 2009) (Robinson, J.).


December 18, 2009

Judge Stark: Report and Recommendation Regarding Claim Construction

In Power Integrations, Inc. v. Fairchild Semiconductor International, Inc., et al., C.A. No. 08-309-JJF-LPS (D. Del. Dec. 18, 2009), Judge Stark recently construed the following claim terms.

“multi-sampling . . . during an off-time of said switching signal”sampling two or more times during one off-time of the switching signal

“a controller to generate the switching signal and to control the switching signal in response to a first feedback signal associated with a voltage control loop and a second feedback signal associated with a current control loop”a controller to generate the switching signal and to control the switching signal in response to a first feedback signal associated with a voltage control loop and a second feedback signal, distinct from the first feedback signal, associated with a current control loop

“controlling a switching signal to regulate the connection of the electrical power to output terminals in response to a first feedback signal associated with a voltage control loop and a second feedback signal associated with a current control loop”controlling a switching signal to regulate the connection of the electrical power to output terminals in response to a first feedback signal associated with a voltage control loop and a second feedback signal, distinct from the first feedback signal, associated with a current control loop

“sampling a voltage . . . and a discharge time”sampling a voltage from the auxiliary winding of the transformer when the transformer is discharging

“frequency variation signal”an internal signal that cyclically varies in magnitude during a fixed period of time and is used to modulate the frequency of the oscillation signal within a predetermined frequency range

“frequency jittering”varying the switching frequency of a switch mode power supply about a target frequency in order to reduce electromagnetic interference

“means coupled to the control input for varying the switching frequency, including: one or more current sources . . . and a counter”Means-plus function term, with a function of “varying the switching frequency of the oscillator,” and a structure of a digital-to-analog converter and a counter having at least four bits

Power Integrations, Inc. v. Fairchild Semiconductor International, Inc., et al., C.A. No. 08-309-JJF-LPS (D. Del. Dec. 18, 2009)

December 18, 2009

New Rules for Computing Time and Proposed Revised Local Rules for Comment

As most everyone is aware by now, new amendments to the Federal Rules of Civil Procedure became effective as of December 1, 2009 that change the way that deadlines are computed under the rules. The District Court of Delaware recently posted on its website, the following information regarding the computation time:

TIME (COMPUTATION OF TIME): Effective 12/1/2009, CM/ECF will no longer exclude intermediate weekends and holidays when calculating deadlines less than 11 days. Deadlines will be calculated in accordance with the changes to Fed.R.Civ.P.6 (i.e., 5 day deadlines will become 7 day deadlines, 10 and 15 day deadlines will become 14 day deadlines, etc.). CM/ECF will add 3 calendar days for mailing, as prescribed in the Administrative Procedures for Filing and Service by Electronic Means.

The District Court has also posted proposed amendments to the local rules for comment. These new local rules were drafted to address the December amendments to the Federal Rules of Civil Procedure and other court practices and procedures. Some proposed changes include the following:

- The addition of Rule 5.1(b) which states that when computing time periods under the federal rules, the clerk's office "shall be deemed inaccessible" any time when it is closed due to inclement weather.

- The rules that contained certain time deadlines were changed to conform to the federal rules including changes to the 10 day time period for filing an answering brief to 14 days and the 5 day period for filing a reply brief to 7 days.

- The proposal also changes Rule 7.1.3(a)(4) to limit all opening and answering briefs to 20 pages and all reply briefs to 10 pages (the current rule allows for 40 page opening and answering briefs and 20 page reply briefs).

- Rule 7.1.5(a) is also changed to limit all motions for reargument and answering briefs to 10 pages. Also added to this rule is a provision prohibiting the filing of a motion for reargument where an objection to a Report and Recommendation by a Magistrate Judge has been filed.

- Reasonable notice for a deposition pursuant to Rule 30 has been changed to "not less than 10 days."

Other proposed changes are shown in the redline of the current District of Delaware Local Rules attached below. The public has been asked to comment on the revisions by February 1, 2010.

Public Notice of Federal Court Proposed Revised Local Rules

Proposed Local Rules