Chief Magistrate Judge Mary Pat Thynge recently considered defendants motion to dismiss Nexeon Limited’s amended complaint alleging direct and indirect infringement of the patents-in-suit. Nexeon Limited v. EaglePicher Technologies, LLC, et al., No. 15-955-RGA-MPT (D. Del. Jul. 26, 2016). Defendants previously moved to dismiss Nexeon’s original complaint prompting Nexeon to file a first amended complaint. Id. at 1. Defendants again moved to dismiss arguing that the amended complaint still fails to adequately state of claim for direct and indirect infringement. Regarding direct infringement, Judge Thynge noted that the complaint was filed prior to the amendment to the Federal Rules and the court “has discretion whether to apply the post-December 1, 2015 direct infringement pleading standard to the amended complaint.” Id. at 9. Judge Thynge decided that, in this case, Form 18 should be used to analyze the sufficiency of Nexeon’s amended complaint; and concluded that the requirements of Form 18 were met. Id. at 9-11. Regarding indirect infringement, Judge Thynge determined that Nexeon adequately pled inducement finding facts in the complaint alleging “specific intent for its customers to infringe and knowledge that the acts constituted infringement.” Id. at 12-14. Judge Thynge determined, however, that defendants’ motion should be granted with respect to Nexeon’s allegations of contributory infringement because Nexeon failed to plead that there are no substantial non-infringing uses. Id. at 14-15.
Judge Robinson recently issued a decision addressing the types of taxable costs that should be approved in a bill of costs. Among the guidelines that Her Honor set forth for that case were:
– Depositions that were “cited as important considerations in granting summary judgment” were reimbursable costs, because even if the Court “only cited the most critical pages of the depositions” in support of its decision, “that does not mean that the remainder of the depositions were not reviewed and used in a broader sense.” Apeldyn Corp. v. Sony Corp., et al., C.A. No. 11-440-SLR-SRF, Memo. Or. at 4-5 (D. Del. July 27, 2016).
– The costs of videotaping the deposition of an expert witness was not a reimbursable cost because the expert’s testimony “was not used in connection with the motion practice and, as an expert, it would be exceedingly rare for [the witness] to testify at trial via deposition (videotaped or otherwise).” Id. at 5.
– The costs of Bates labeling document productions were reimbursable as a “real-world necessity . . . [and] part of ‘making copies’ particularly in complex litigation requiring a large amount of documents to be produced.” Id. at 6.
– Costs associated with formatting e-discovery were only partially reimbursable due to inconsistencies in the defendants’ invoices, the lack of reliable information about the extent of certain formatting, and the fact that defendants “chose to oppose an early resolution and proceed with discovery.” Id. at 7-8.
In MobileMedia Ideas, LLC v. Apple Inc., C.A. No. 10-258-SLR (D. Del. July 21, 2016), Judge Sue L. Robinson denied Defendant’s motion for summary judgment regarding damages as well as its nd Daubert motion, and also denied Plaintiff’s Daubert motion.
As to the summary judgment motion, the Court disagreed with Defendant that the doctrine of intervening rights would apply to this case based on amendments Plaintiff had made during reexamination, as the Court concluded that the claims had remained substantially identical in scope. See id. at 3-9. The Court also denied the damages motion as to failure to mark. Reviewing case law that was split on the issue, the Court concluded that the burden of proof lies with an alleged infringer to “come forward with particular unmarked products allegedly triggering § 287” where, as here, there was a question as to whether the patentee actually marketed a product in the United States that practiced the patent-in-suit. Id. at 10. As Defendant had not met this burden, the motion for summary judgment was denied.
The Court also denied Defendant’s motion to exclude the testimony of Plaintiff’s technical expert, rejecting Defendant’s narrowing of “the field of pertinent art” in a way that would exclude the expert’s “opinions as outside his general experience.” Id. at 11. The Court also rejected Defendant’s criticisms of the reasonable royalty calculation of Plaintiff’s damages expert, who relied on royalty rates from a prior litigation, because he “offer[ed] reasons for his patent selection and acknowledges and adjusts the royalty rate for the differing circumstances of the prior litigation.” Id. at 13. Defendant also sought to exclude a question in Plaintiff’s survey evidence related to the claimed invention’s footprint in the marketplace as being too broad, but the Court concluded that the survey question was “sufficiently tied to [the technical expert’s] opinion regarding the benefit of the patent.” Id. at 15.
Judge Leonard P. Stark recently issued a memorandum order addressing a number of privilege log disputes. Idenix Pharmaceuticals, Inc. v. Gilead Sciences, Inc., C.A. No. 13-1987-LPS (D. Del. July 20, 2016) (and related cases, C.A. No. 14-109-LPS and C.A. No. 14-846-LPS). Among other rulings, Judge Stark found the following:
(1) a communication between a non-lawyer employee and another non-lawyer employee who was the “liaison with patent attorneys” was properly withheld as privileged. Id. at 5.
(2) an email between non-lawyers that discussed the terms for engaging patent prosecution counsel was not privileged. Id. at 5-6.
(3) a “scientific document” attached to a privileged email was not privileged. Id. at 6-7.
(4) a non-lawyer employee’s email to other non-lawyer employees expressing views on a competitor’s patent was not privileged. Id. at 9.
Plaintiffs Contour IP Holding, LLC and Ion Worldwide, Inc. filed this action alleging infringement of their patents relating to “a wearable digital video camera equipped with a wireless connection protocol and having the capability to provide remote image acquisition control and viewing.” Contour IP Holding, LLC, et al. v. GoPro, Inc., No. 15-1108-LPS-CJB (D. Del. Jul. 14, 2016). GoPro previously filed IPR petitions (after it was sued on these patents in Utah) that were instituted by the PTAB, with final decisions are expected October 28, 2016. Id. at 2. Judge Burke granted the motion finding that the potential for simplification of issues was high as nearly every asserted claim was at issue in the IPR proceeding and the estoppel will apply to GoPro, as the petitioner. Id. at 5. Furthermore, the case was in its early stages and Plaintiffs will not suffer undue prejudice because the IPRs were filed prior to the commencement of this litigation and the parties are not direct competitors. Id. at 6-8. Judge Burke also found that “Plaintiffs’ own actions  stymied the process of having their rights in the asserted patents timely adjudicated” by merging companies and transferring rights in the patents that led to the dismissal of the Utah case and subsequent filing of this action. Id. at 9.
Magistrate Judge Christopher J. Burke recently issued a report and recommendation on a motion to dismiss allegations of induced infringement made in a second amended complaint. GlaxoSmithKline LLC v. Teva Pharmaceuticals USA, Inc., C.A. No. 14-878-LPS-CJB (D. Del. July 20, 2016). At issue were allegations that a generic manufacturer induced infringement by (1) “promot[ing] on its website and other marketing materials the ‘AB rating’ of its generic carvedilol tablets and market[ing of] them as therapeutically equivalent” to the patented branded drug product; (2) its pre-patent issuance of press releases anticipating approval of the generic product for the to-be-patented method of treatment; (3) its obtaining a label for its generic product that suggested using the generic product for an off-label, patented use; and (4) its marketing of its generic product for the off-label, patented use and acknowledgement that its generic product was not suitable for substantial non-infringing uses.
Magistrate Judge Burke first addressed the defendant’s marketing efforts surrounding the “AB rating” by the FDA, and explained that “in the Court’s view (again, absent any other evidence that speaks to a generic manufacturer’s intent), a finding in this context that the promotion of an ‘AB rating’ could amount to a plausible induced infringement claim would go too far. It would rely too heavily on the mindset or misconceptions of third parties in an attempt to ascribe wrongful intent to the alleged inducer.” Id. at 20 (emphasis in original).
With respect to the press releases, Judge Burke explained that where alleged acts of inducement occurred before the issuance of the plaintiff’s patent, those acts generally cannot form the basis of an inducement claim. However, “where there are acts of inducement that continue after the issuance of a patent, courts have indicated that acts occurring prior to the patent’s issuance could still be relevant to an induced infringement claim.” Id. at 22 (emphasis in original). Here, Judge Burke sided with the plaintiff, and explained that “what the party did and said before the patent issued might at least bear on what its mindset was in the crucial post-issuance time period (so long as that party did, in fact, perform an inducing act in that post-issuance time period).” Id. at 23 (emphasis in original).
Turning to the label, Judge Burke explained that “there can, in fact, be situations where a generic manufacturer seeks and obtains a section viii carve-out for a use of a drug that is (according to the FDA) a ‘different’ use from a patented use – and yet the generic’s label could nevertheless be written in such a way that it evidences active steps to induce patent infringement.” Id. at 30. Here, Judge Burke agreed with the plaintiff that “it is plausible that Teva’s promotion of its skinny label encouraged infringement of the ‘000 patent during the relevant time period.” Id. at 31-32.
Finally, Judge Burke agreed with the plaintiff that “where a brand name drug is alleged to not have substantial non-infringing uses, it could be inferred that a generic company’s knowledge that some users of its product may be infringing the patent … evidences intent to induce infringement.” Id. at 37 (emphasis in original).
Plaintiffs sued Merck alleging infringement of their patents covering their “biologic product” “for treatment of certain patients with melanoma or nonsmall-cell lung cancer.” Bristol-Myers Squibb Co., et al. v. Merck & Co., Inc., et al., No. 14-1131-GMS, No. 15-560-GMS, 15-572-GMS (D. Del. Jul. 13, 2016). A non-party filed an action in the District of Massachusetts challenging inventorship of the patents-in-suit. Id. at 2. The Massachusetts court directed plaintiffs to file a motion in this Court requesting this Court decide whether transfer of the Massachusetts case to Delaware was appropriate in light of the “likelihood of substantial overlap.” Id. Judge Sleet determined that transfer was not warranted. As a threshold matter, the Massachusetts case could not have been brought in Delaware because the court could not exercise personal jurisdiction “over Japanese residents . . . to adjudicate  inventorship claims in Delaware because the inventorship action does not arise out of the infringement claims against Merck or out of any purposeful activities of [the Japanese residents] in Delaware.” Id. at 5. “Ultimately, the power of a District Court under § 1404(a) to transfer an action to another district does not depend upon the wish or waiver of the defendant, but upon whether the transferee district was one in which the action ‘might have been brought’ by the plaintiff. Hoffman v. Blaski, 363 U.S. 335, 342-44 (1960). Accordingly, because this court would not have had jurisdiction over [the Japanese residents], transfer may not occur under § 1404(a). Id. (reversing transfer where transferee court lacked personal jurisdiction over defendant).” Id. at 9.
Judge Andrews recently issued a decision denying a motion for Rule 11 sanctions finding that the defendants had waited too long to seek sanctions. Rule 11 contains several procedural requirements that must be met in addition to the showing that sanctions are warranted. In this case, the defendants observed the 21-day “safe harbor” of Rule 11(c)(2). But Rule 11, as interpreted by the Third Circuit, also requires that Rule 11 motions be served on the opposing party “promptly . . . before the entry of a final judgment and ‘[w]here appropriate, . . . at an earlier time—as soon as practicable after discovery of the Rule 11 violation.” Dragon Intellectual Property, LLC v. AT&T Services, Inc., et al., C.A. No. 13-2061-RGA, Memo. at 6 (D. Del. July 12, 2016) (internal quotations omitted).
In this case, the defendants argued that Rule 11 requires only “substantial compliance,” which was met by way of a letter the defendants sent to plaintiff in September 2014, expressing an intention to seek Rule 11 sanctions if plaintiffs did not dismiss the case. Defendants did not actually serve and file a Rule 11 motion, however, until November and December 2015, following a favorable Markman order and the withdrawal of plaintiff’s counsel, and a few months before judgment was entered in their favor. Thus, Judge Andrews determined that only the service of the actual motion met the requirements of Rule 11 and that the motion was untimely. Id. at 6-7. “Defendants waited for over a year, and until after the Court issued its Markman decision, to serve the Rule 11 motions. Therefore, Defendants did not serve their motions ‘as soon as practicable after discovery of the Rule 11 violation.’ There is simply no reason why the Rule 11 motions could not have been served earlier.” Id. at 8.
Additionally, because the plaintiff’s case failed based on a “failure to recognize an obvious prosecution history disclaimer,” Judge Andrews found that “it would be improper to award monetary sanctions against Plaintiff for conduct which relates entirely to legal issues” based on Rule 11(c)(5). That subsection of Rule 11 states that the court “must not impose a monetary sanction . . . against a represented party for violating” the requirement that an “attorney or unrepresented party . . . certify that claims, defenses, and other legal contentions are warranted by existing law or by a nonfrivolous argument for extending, modifying, or reversing existing law.” Id. at 8-9.
In a recent Report and Recommendation, Magistrate Judge Christopher J. Burke recommended granting defendants’ motions to dismiss certain of plaintiff’s claims pursuant to Rule 12(b)(6). Varian Medical System, Inc. v. Elekta AB, et al., C.A. No. 15-871-LPS (D. Del. Jul. 12, 2016). One group of defendants (the “U.S. Defendants”) sought dismissal of plaintiff’s claims for induced, contributory, and willful infringement. The other group of Defendants (the “Foreign Defendants”) sought dismissal of plaintiff’s claims for induced and contributory infringement. Id. at 1. The complaint named only one exemplary accused product–the Gamma Knife Icon–a radiation treatment device that defendants manufactured, marketed, and sold in the U.S. since 1987. Id. at 1-2.
Recommending dismissal of plaintiff’s claims for indirect infringement, Judge Burke first found that plaintiff failed to allege facts that would “plausibly suggest that a third party has directly infringed” the asserted patent-in-suit. Judge Burke explained that while “the Complaint does . . . make it clear who the general group of possible direct infringers are said to be,” it does not “adequately allege that any third party actually used the accused device.” Id. at 8-9. Next, Judge Burke noted that the “allegations are also defective because . . . even if the third party ‘customers and potential customers’ used the product[,] . . . the Complaint does not sufficiently articulate how this use of the product can be said to constitute infringement of at least claim 1 of the patent-in-suit.” Id. at 9-10.
The U.S. Defendants further contended that the complaint “lacks plausible allegations that they had pre-suit knowledge” of the patent-in-suit (the “’919 patent”), and Judge Burke agreed. One of the Foreign Defendants–Elekta AB–had discussed the ’919 patent before the USPTO, which demonstrated its knowledge of the ’919 patent. Id. at 11-12. In addition, Elekta AB is related to the U.S. Defendants: “U.S. Defendant Elekta Holdings U.S. is a wholly-owned subsidiary of Elekta AB, and U.S. Defendant Elekta, Inc. is, in turn, a wholly-owned subsidiary of Elekta Holdings U.S.” Id. at 12. Nevertheless, as Judge Burke explained, “knowledge of a patent by a parent corporation is not necessarily imputed to [its] subsidiar[ies].” Id. at 12. While plaintiff also tried to argue that knowledge of the patent should be imputed to the U.S. Defendants based on their “close-knit relationship” with Elekta AB, Judge Burke was unpersuaded given that the facts supporting this argument were not alleged in the complaint. Id. at 13-15.