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Judge Christopher J. Burke recently recommended the Court grant-in-part defendants’ 12(b)(6) motion to dismiss for lack of subject matter jurisdiction under 35 U.S.C. § 101.  Versata Software, Inc., et al. v. Netbrain Techs., Inc., et al., C.A. Nos. 13-676-LPS-CJB, C.A. Nos. 13-678-LPS (D. Del.  Sept. 30, 2015).  Plaintiffs asserted five patents against defendants: U.S. Patents Nos. 6,834,282; 6,907,414; 7,363,593; 7,426,481; and 7,082,454.  For four of the five asserted patents, containing collectively 201 claims, defendants asserted that all claims were directed to unpatentable subject matter.  Id. at 9.  But, because defendants only “meaningful[ly] addressed a few of the claims, Judge Burke declined to “make a final determination” for the other claims to which defendants gave “negligible attention.”

In short, defendants argued, and the Court agreed, that the claims were directed to the abstract ideas of: “representing data in a hierarchy” (id. at 14-15); “taking data that is not stored in a hierarchy and putting it in hierarchical form before presenting it to a user” (id. at 29);  “displaying data organized in hierarchical form” (id. at 35); “searching data using features and product numbers” (id. at 41); and “providing access to a file by determining if the file exists in a storage system (cache), returning the file to the requester if the file exists, and if not, creating, storing, and sending the requested file” (id.at 47-48).

Judge Burke also determined that the “patent claims do not require anything beyond the use of generic and conventional computer hardware and software[,]” therefore not providing an inventive concept. Id. at 20.  See also 30-31,  36-37, 43, 50.

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In Vanda Pharmaceuticals Inc. v. Inventia Healthcare PVT. Ltd., C.A. No. 15-632-GMS (D. Del. Sept. 22, 2015), Judge Gregory M. Sleet denied Defendant’s motion to dismiss due to lack of personal jurisdiction, as well as its motion to transfer the case to the Northern District of West Virginia in the alternative.

In finding that the Court had personal jurisdiction over this ANDA defendant, the Court cited its prior holding in AstraZeneca that “the act of filing an ANDA application that potentially infringes the patent of a Delaware entity provides sufficient minimum contacts with the State of Delaware under a specific jurisdiction analysis.” Id. at 2. The Court’s exercise of jurisdiction also did not violate the Due Process Clause, as Plaintiff “would be substantially burdened if forced to bring a lawsuit against any ANDA filer challenging the [patent-in-suit] in the location selected by the defendant.” Id. at 3 (citing AstraZeneca). “Thus, considerations of fair play and substantial justice also justify the exercise of jurisdiction.” Id.

As to Defendant’s alternative motion to transfer the case, the Court concluded that the Jumara factors did not favor transfer. Only Defendant’s forum choice weighed in favor of transfer, while questions of convenience all weighed against it: “[w]hile neither entity maintains a principal place of business in Delaware, Vanda is already involved in litigation regarding [the patent-in-suit] in this district. As a result, the witnesses are available here. [Defendant] fails to demonstrate that the Northern District of Western Virginia is a more convenient location.” Id. at 4. Plaintiff’s forum choice was neutral here, where it had brought suits both in this District and in the transferee district; as a result, “the ‘first-filed’ rule [that would favor this District] does not apply where the plaintiff brought identical suits to both districts.” Id. at 4.

The Court further found that the Jumara public interest factors weighed against transfer. Local interests were neutral in a patent infringement action, but “practical considerations weigh[ed] heavily against transfer” because Plaintiff had filed a related case in the District involving the same patent and drug. Id. “Thus, it would be easier, quicker, and less expensive to hear both cases here. Moreover, resolution of the issues relating to [the patent-in-suit] in a single district would promote judicial economy and avoid the possibility of inconsistent outcomes.” Id.

As a result, the Court denied the motion to discuss for lack of personal jurisdiction or to transfer in the alternative.

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In a recent Memorandum Order, Judge Richard G. Andrews drew a distinction between the “ability to access” documents and “control of” documents in denying a motion to compel.  TQ Delta LLC v. Pace PLC, et al., C.A. No. 13-1835-RGA (D. Del. Sept. 28, 2015).  Judge Andrews explained that the defendants and Broadcom (the entity with actual control of the documents at issue) are “unrelated, independent corporations” and explained that NDAs between Broadcom and the defendants “appear to keep all legal rights to the specifications and documents with Broadcom.”  Judge Andrews added, “I think there is a difference between having the present ability to access the items and having control of the items.  Plaintiff’s request is denied.”

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Judge Gregory M. Sleet recently granted defendants’ motion to stay pending inter partes review of four patents-in-suit (U.S Patent Nos. 6,487,200, 6,993,353, 7,907,714, and 8,855,147).   AT&T Intellectual Property I, L.P., et al. v. Cox Communications, Inc., et al., C.A. No. 14-1106-GMS (D. Del. Sept. 24, 2015).  Plaintiffs objected to the proposed stay because defendants would not be prejudiced absent a stay, whereas plaintiffs would suffer prejudice since the parties are direct competitors.  Id. at 2.  Moreover, the fact that the parties were in the middle of discovery and that the IPR petitions covered only four of the nine patents-in-suit weighed against stay.  Id.  Judge Sleet disagreed.  Defendants “requested review of more than half the claims asserted in this case” and “[t]he results of the IPR may affect not only validity of the asserted claims, but also their scope.”  Id.at 3 n.4.  Therefore, the IPRs will simplify issues in this litigation.  Moreover, Judge Sleet found that the stage of the case did not weigh against a stay because trial was not scheduled until October 2016.  Id.

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Yesterday, in Elm 3DS Innovations, LLC v. Samsung Electronics Co., Ltd., et al., C.A. No. 14-1430-LPS-CJB (D. Del. Sept. 29, 2015), Magistrate Judge Christopher J. Burke recommended denial of Defendants’ motion to dismiss induced infringement claims to the extent Plaintiff was seeking pre-suit infringement damages. Plaintiff had only alleged pre-suit induced infringement of one of the patents-in-suit (the ‘239 patent). Plaintiff’s operative complaint cited no direct evidence that Defendants had reviewed or cited to the ‘239 patent before the suit, but did contain circumstantial evidence. See id. at 4-5. In finding that the complaint had sufficiently alleged pre-suit knowledge of this patent, the Court concluded that its allegations “suggest[ed] that . . . Defendants had some fairly detailed, specific discussions about the ‘239 patent’s parent – and went on to cite other patens from the same patent family thereafter. . . . [T]hese facts at least help make it seem more plausible that Defendants did in fact have actual knowledge of the ‘239 patent.” Id. at 5 (emphasis in original). “Plaintiff’s allegations that the’239 patent is well known and frequently referenced in the semiconductor industry, and that it has been frequently cited by Defendants’ competitors . . . over the last many years” supported the same conclusion: [t]hese pleaded facts are relevant . . . because if true . . . they render it more likely that Defendants . . . may have been similarly aware of the ‘239 patent’s existence and its contents.” Id. at 5-6.

Even though these two categories of allegations “may not have been sufficient” by themselves, and did not “make pre-suit knowledge probable” when taken together, “considered as a whole, they render it a least plausible that Defendants were aware of the ‘239 patent and its claims prior to suit,” which was sufficient to withstand a motion to dismiss. Id. at 6-7 (emphasis in original).

Defendants also argued that Plaintiff had failed to adequately plead their knowledge of their customers’ infringement. The Court also rejected this argument. The complaint had set out “how or why these products infringement at least [one claim],” Plaintiff had plausibly alleged knowledge of the ‘239 patent (as discussed above) and that Defendants would have been able to understand the content and scope of its specifications and claims. Id. at 7-8 (emphasis in original). Further, Plaintiff has plausibly alleged that Defendants knew its semiconductor chips were incorporated into its customers’ finished products imported and sold in the U.S. Id. at 8. Taken together, these facts plausibly alleged Defendants’ knowledge of its customers’ infringement. Id. at 9.

Finally, Defendants argued that Plaintiff had insufficiently pled specific intent to infringe. The Court also rejected this position, explaining that the complaint alleged Defendants’ “encourage[ment]” for their customers to incorporate Defendants’ products into finished products, “all after having sufficiently described what it is about Defendants’ semiconductor chips that is said to render them infringing apparatuses in the first place, and why Defendants had knowledge that those chips infringed. This is sufficient to plead specific intent.” Id. at 9.

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In Greatbatch Ltd., v. AVX Corp., C.A. No. 13-723-LPS (D. Del. Sept. 22, 2015), Chief Judge Leonard P. Stark (i) denied defendants’ motion to strike plaintiff’s “Percolation Network” theory of infringement; and (ii) denied plaintiff’s motion to strike defendants’ newly disclosed prior art references.   As to defendants’ motion to strike plaintiff’s infringement theory, Judge Stark found that “whatever prejudice Defendants may have suffered (or will suffer) from Plaintiff[’s] . . . ‘percolation network’ theory of infringement is outweighed by other factors, including the importance of the information Defendants seek to strike.” Id. at 2. Judge Stark explained that defendants themselves acknowledged that the theory “is the entirety of the [plaintiff’s] infringement case for the ’779 patent.” Judge Stark also noted that plaintiff’s expert “in effect disclosed the . . . theory in his opening expert report,” and therefore defendants “failed to show that they were unfairly surprised or meaningfully prejudiced.” Id. Judge Stark also found it “notabl[e]” that defendants’ “expert opined on a percolation network theory of infringement in his responsive expert report and Defendants had an opportunity to depose Plaintiff’s experts regarding this theory.” Id. Judge Stark also found the other three Pennypack factors to weigh in plaintiff’s favor, and thus denied defendants’ motion to strike. Id.

Denying plaintiff’s motion to strike defendants’ newly disclosed prior art references, Judge Stark first found that plaintiff “has not specifically articulated what unfair prejudice it may suffer if Defendants’ allegedly late disclosure of prior art references and combinations is not stricken.” Id. at 3. Second, Judge Stark explained that “whatever prejudice Plaintiff may have suffered (or will suffer) is outweighed by other factors, including the importance of the information Plaintiff seeks to strike.” Id. Lastly, the court noted that it did not find “willful deception or flagrant disregard of any court order. To the contrary, the Court intended – by issuing its Order of July 28, 2015 – that Defendants would finally identify their invalidity contentions by August, 17, 2015, and this is exactly what Defendants did.” Id. (internal citation omitted).

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Judge Richard G. Andrews recently adopted two reports and recommendations on a number of summary judgment claims.  Impulse Technology, Ltd. v. Microsoft Corp., C.A. No. 11-586-RGA (D. Del. Sept. 22, 2015).  In his memorandum adopting the Magistrate Judge’s recommendations, Judge Andrews discussed the “doctrine of vitiation,” which he characterized as “an obscure way of applying the ‘judgment as a matter of law’ standard to doctrine of equivalents cases.'”  Id. at 4.  Judge Andrews explained, quoting Federal Circuit decisions, that the doctrine of vitiation is “nothing more than a conclusion that the evidence is such that no reasonable jury could conclude that an element of an accused device is equivalent to an element called for in the claim, or that the theory of equivalence to support the conclusion of infringement otherwise lacks legal sufficiency.”  Id. (quoting Cadence Pharm. Inc. v. Exela Pharmsci Inc., 780 F.3d 1364, 1371 (Fed. Cir. 2015) (quoting DePuy Spine, Inc. v. Medtronic Sofamor Danek, Inc., 469 F.3d 1005, 1018-19 (Fed. Cir. 2006)).  The Court added that “[i]t seems to me that the ‘doctrine of vitiation’ can be essentially the application of the ‘insubstantial differences’ test to limit the ‘function-way-result’ test” for determining equivalents.  Id. at 5.  “When cases talk about the claimed equivalent being the ‘opposite’ or ‘antithesis’ of the claimed limitation, it looks a lot like the cases are saying that the differences are to substantial to be overcome by the ‘function-way-result’ test.”  In this case, the Court agreed with the Magistrate Judge that the “difference between the claims’ defined physical space (known ‘prior’ to set up of the system) and the accused product’s hardcoded values (meaning the physical space is only known ‘after’ the set up of the system) is too great to be covered by the doctrine of equivalents.”  Id. at 5-6.

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In Cronos Technologies, LLC v. Expedia, Inc., C.A. Nos. 13-1538, 13-1541, 13-544-LPS (D. Del. Sept. 8, 2015), Chief Judge Leonard P. Stark denied defendants’ motion for judgment on the pleadings pursuant to Fed. R. Civ. P. 12(c), which sought to invalidate certain claims of U.S. Patent No. 5,644,110 (the “’110 patent”) for being directed to patent-ineligible subject matter. The ’110 patent discloses methods and systems for “remote ordering of products.” Id. at 1. Judge Stark observed that despite challenging the validity of 12 claims, defendants’ analysis was “directed almost exclusively to [independent method] claim 22,” which defendants contended is “representative of all the asserted claims.” Id. at 4.

Denying defendants’ motion, Judge Stark explained that “[t]here are several considerations relevant to deciding a Rule 12 motion that challenges the patent eligibility of multiple patent claims based on analysis of a single representative claim.” Id. at 4. First, Judge Stark found that defendants “have not adequately articulated why each of claim 22’s dependent claims relates to the same abstract idea purportedly embodied by claim 22; nor have they adequately explained why each of the dependent claims fails to include an inventive concept.” Id. at 5. Defendants also failed to “address the concepts embodied in claim 22 as a whole.” Id. at 6. Judge Stark further observed that “the Court cannot say at this time” that there is no set of facts “that could be proven that would result in the challenged claims being patent-eligible.” Id. at 7. To that end, Judge Stark explained that “[t]here may be a set of facts related to preemption, questions of patentability, and/or whether claim 22 (and its dependent claims) are directed to a technological improvement rather than a generic computer implementation of an abstract idea that prevents the Court from determining that the challenged claims are patent ineligible.” Id.

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In Courtesy Products, L.L.C. v. Hamilton Beach Brands, Inc., C.A. No. 13-2012-SLR-SRF (D. Del. Sept. 1, 2015), Judge Sue L. Robinson denied defendant’s motion to stay litigation pending IPR of U.S. Patent Nos. 7,311,037 (“the ’037 patent”) and 7,770,512 (“the ’512 patent”). In addition to the ’037 and ’512 Patents, plaintiff is also asserting U.S. Patent No. 7,258,884 (“the ’884 patent”) against defendant. Id. at 1. As Judge Robinson explained, “[t]he PTAB declined to institute IPR proceedings with respect to, inter alia, the ’884 patent or to asserted claims 19 and 26 of the ’037 patent.” Id. at 2. As to the stage of the proceedings, “the parties have pursued fact discovery and just commenced the claim construction exercise. Trial is scheduled to commence in March 2017.” Id. Finding that stay was not warranted, Judge Robinson first observed that “the IPRs instituted by the PTAB do not address all of the claims at issue, meaning that the parties’ dispute will not be fully resolved by the IPRs, regardless of the outcome of such.” Id. at 3. Second, Judge Robinson explained that “if the outcome of the PTAB is not favorable to [defendant], [defendant] has the option of asserting the rest of its arsenal of defenses in this court, not only prolonging the ultimate resolution of the dispute, but expending the resources of the parties and two public agencies.” Id. Finally, and “perhaps most significantly,” Judge Robinson noted that “[plaintiff] is in direct competition with, and has lost business to, [defendant].” Id.

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Judge Goldberg recently granted-in-part declaratory judgment-plaintiff Transcend Medical, Inc.’s motion for summary judgment of invalidity finding the claim term “choroid” invalid as indefinite.  Transcend Medical, Inc. v. Glaukos Corporation, C.A. No. 13-830 (D. Del. Sept. 18, 2015).  The indefinite term was found in claims of all patents-in-suit–U.S. Patent Nos. 7,857,782, 8,075,511, and 8,579,846.  The parties agreed that the plain and ordinary meaning of the term was “vascular layer of the eye located between the sclera and retina.”  Id.at 10.  But, Transcend Medical argued that the term was invalid because the patents-in-suit “define the term in multiple inconsistent ways[,]” sometimes in accord with the term’s plain and ordinary meaning and at other times inconsistent with that meaning.  Id.  Glaukos argued that the other descriptions were not inconsistent, relying on its expert’s testimony about what a person of ordinary skill would understand.  Id. at 12.  Judge Goldberg determined, however, that the expert’s opinion failed to account for contrary argument Glaukos made to the USPTO.  Id.  As such, Judge Goldberg disregarded the expert’s testimony because it “contradict[ed] the clear import of the prosecution history and the language of the specification.”  Id. at 13 (citing Teva Pharm. USA, Inc. v. Sandoz, Inc., 789 F.3d 1335, 1342 (Fed. Cir. 2015)).  Finding that the “choroid” term was defined inconsistently in the specification and during prosecution, Judge Goldberg held the specification “fail[ed] to inform, with reasonable certainty, those skilled in the art as to the scope of the term ‘choroid.'”  Id. at 15.  Judge Goldberg denied Transcend Medical’s summary judgment motion in all other respects, finding a genuine issue of material as to written description and indefiniteness of other claim terms.  Id. at 3-8,  15-18.

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