The Delaware Chapter of the Federal Bar Association announced today that the first District of Delaware Bench and Bar Conference will be held on May 7-8, 2015 at the Hotel DuPont in Wilmington, Delaware. The event will feature judges from the District of Delaware, Third Circuit, and Federal Circuit; as well as other distinguished speakers. More details regarding the program agenda and events, such as dinner at Winterthur, will follow over the next few weeks.
Judge Andrews recently resolved a novel dispute involving anticipation by a prior art patent. On defendant Comcast’s motion for summary judgment of invalidity, Comcast and plaintiff Sprint agreed that the prior art patent in question discloses each of the elements of the asserted patent claims. Sprint Commc’ns Co. v. Comcast IP Holdings, LLC, et al., C.A. No. 12-1013-RGA, Memo. Or. at 4 (D. Del. Jan. 30, 2015). Sprint argued, however, that under section 102(e), anticipation requires a prior art invention “by another.” Because the prior art at issue shared an inventor with the asserted patent, Sprint reasoned, this requirement was not met. Id. at 5. Examining the testimony of this common inventor, however, Judge Andrews determined that “even though [the common inventor] was an inventor of both the [asserted patent] and the [prior art] patent, the two patents do not share a common inventive entity, as there is no evidence from which the factfinder could conclude that [the common inventor] was solely responsible for the asserted claims . . . and the anticipating disclosures . . . .” Id. at 5-6.
Judge Andrews recently granted defendants’ (“Comcast”) motion to exclude two of plaintiff’s (“Sprint”) damages expert opinions, and Sprint’s motion in limine, which sought to preclude Comcast from “offering into evidence, referencing, or eliciting testimony about settlement and license agreements entered into by Comcast relating to comparable technology.” Sprint Communications Co. v. Comcast IP Holdings, LLC, et al., C.A. No. 12-1013-RGA (D. Del. Jan. 29, 2015), (D. Del. Jan. 30, 2015).
As to the motion to exclude, Judge Andrews excluded one damages expert’s opinion pursuant to FRCP 26(a)(2)(B)(i), because that expert concluded that “6.5 to 7% of Comcast’s IMS network related to the patented subject matter, but provided no basis for how he determined which features ‘related to’ the patent.” Judge Andrews explained that “[t]his determination provides the entire basis for [the expert’s] opinion, and thus require[d] at least some explanation.” Judge Andrews also excluded this opinion because the “analysis is not tied to the improvements attributable to the patented invention, and . . . is [therefore] unreliable for purposes of Rule 702.” Judge Andrews also found the other damages expert opinion unreliable despite considering Georgia-Pacific factors, given that it provided “no evidence that ties Comcast’s savings to the claimed invention.”
Addressing plaintiff’s motion in limine, Judge Andrews explained that the motion implicates “the second Georgia-Pacific factor, which looks at ‘[t]he rates paid by the licensee for the use of other patents comparable to the patent in suit.’” Judge Andrews concluded that the four licenses at issue were “not sufficiently comparable to the hypothetical licenses, and, to the extent the lack of comparability could be accounted for, [the expert] has not attempted to do so.” As plaintiff observed, “none of the licenses include the patents in suit, three of the four licenses are with non-practicing entities, and all four licenses grant rights to additional patents and include international rights. Additionally, three of the four licenses occurred a number of years after the hypothetical negotiation dates. Finally, three of the four licenses resulted from the settlement of litigation, and thus do not represent the behavior of two willing licensors, as would be the case in the hypothetical negotiations between Comcast and Sprint.”
In a recent Order, Judge Gregory M. Sleet stayed fifteen related cases pending the inter partes review of U.S. Patent No. 6,978,346 (“the ’346 Patent”). Safe Storage LLC v. Dell Inc., C.A. No. 12-1624-GMS (D. Del. Jan. 22, 2015). While four defendants did not seek a stay of their cases, Judge Sleet sua sponte stayed those cases as well, explaining that those defendants “have put forward no objections, and judicial efficiency favors a stay of all of the cases, rather than allowing [those] four to go forward, perhaps unnecessarily.” Id. at 2 n. 4.
Considering the moving defendants’ motion to stay, Judge Sleet first noted that in “March 2014, the PTAB had initiated IPR proceedings for only seven of the nine claims of the ‘346 Patent” and that “[f]ollowing an additional petition for review filed by [other defendants], the PTAB instituted IPR over all nine claims.” Id. at 1 n. 2. Judge Sleet thus concluded that each of the traditional “factors weigh[ed] in favor of staying proceedings, especially in light of the PTAB’s recent decision to institute review of all of the claims of the ‘346 Patent.” Id. at 2 n. 4.
First, Judge Sleet found that the prejudice to plaintiff, “if any, would be minimal and not undue.” Id. Specifically, Judge Sleet explained that while plaintiff “would undoubtedly prefer a quicker resolution to a slower one, there is no suggestion that time is particularly important.” Id. Judge Sleet noted that although plaintiff “raises concerns about prolonged litigation reducing the value of its patents as licensing assets, . . . the court finds this anxiety to be overstated.” Id. Second, Judge Sleet found that staying the proceedings pending resolution of the IPR “would greatly simplify the issues for trial,” noting that plaintiff’s “initial objection that not all of the claims were under review has been rendered moot now that the PTAB instituted review over all nine claims in December 2014.” Id. Judge Sleet further explained that “[e]ven though the four non-moving Defendants are not similarly estopped, the court is convinced that the IPR findings will simplify some, if not large, aspects of those cases as well.” Id. Judge Sleet finally noted that “these cases are still in their relative infancies.” Id.
In a recent report, Magistrate Judge Christopher J. Burke recommended that a case involving patents related to controlling remote access to corporate resources be transferred to the Northern District of Georgia. Good Technology Corp. v. Airwatch, LLC, C.A. No. 14-1092-LPS-CJB (D. Del. Jan. 21, 2015). Judge Burke’s recommendation was based on a finding that, on balance, the combination of several factors under Jumara v. State Farm Insurance Co., 55 F.3d 873 (3d Cir. 1995) supported the recommended transfer. Id. at 26.
Of note, Judge Burke explained that two other patent infringement cases between the parties, both Delaware entities, had recently been filed in the Northern District of Georgia, id. at 3, and although the patents asserted in those cases were not related to the patents at issue in this case, they could all “generally be described as relating to ‘technologies for controlling remote access to corporate resources[,]’” and appeared “to use some of the same claim terminology.” Id. at 19, 19 n.8. Further, although “AirWatch is a global company, ‘virtually all of AirWatch’s research, design, development, and marketing of the accused AirWatch products took place in Atlanta’ and thus that the ‘foreseeable witnesses with knowledge of the design, development, operation, finances, sales, and marketing of these products reside and work in Atlanta, Georgia.” Id. at 11 (emphasis in original). Finally, Judge Burke agreed that administrative efficiencies could potentially be gained by transferring the case to the Northern District of Georgia where, it was undisputed, the time to trial (at least based on 2013 data) was on average 13.3 months shorter than in the District of Delaware, and where there were only 60 open patent cases (as of June 2014) compared to over 1,400 in the District of Delaware. Id. at 21. But in light of Chief Judge Stark’s recent adoption of new procedures in patent cases filed after July 1, 2014, which Judge Burke explained would “no doubt speed the average time to trial in patent cases like this one[,]” Judge Burke found that the defendant’s argument about administrative efficiencies weighed only slightly in its favor. Id. at 22-23. Nevertheless, considering the weight of all of the Jumara factors, Judge Burke recommended transferring the case.
On January 27, 2015, the jury in Round Rock Research, LLC v. Sandisk Corporation, C.A. No. 12-569-SLR returned a verdict finding infringement of some claims, but invalidity as to both patents-in-suit. The jury found some asserted claims of both patents-in-suit had been directly infringed, but none of the asserted claims were indirectly infringed. However, the jury also found all of asserted claims invalid as anticipated or obvious.
Judge Sue L. Robinson recently denied a motion to compel the plaintiffs to produce call notes made by their sales force personnel in connection with marketing efforts. Forest Laboratories, Inc., et al. v. Apotex Corp., et al., Civ. No. 13-1602-SLR (D. Del. Jan. 23, 2015). Judge Robinson explained that “3.5 million pages of documents already [had been] produced by plaintiffs in this litigation, including thousands of documents related to plaintiffs’ marketing and advertising to doctors . . . .” Id. at 1. The defendants were seeking to avoid liability for indirect infringement by showing that the accused products had a substantial non-infringing use, which they expected to be uncovered in the sales force’s call notes. But Judge Robinson found it “unlikely that, after 3.5 million pages of documents, a substantial non-infringing use (as opposed to speculation about a possible use) would be unearthed through the informal, personal reflections of individual sales personnel.” Id. at 2 (emphasis in original).
Judge Sleet was recently required to decide a unique issue in a copyright and trademark infringement case raised by the Digital Millennium Copyright Act’s (DMCA) notice and takedown Safe Harbor procedure. The plaintiff, Square Ring, is a boxing and mixed martial arts promoter that promoted a fight that occurred on March 21, 2009 and owns the copyright to the broadcast of that fight. The defendant, UStream, is a website that allows users to stream video of live events over the Internet. In the days leading up to the March 21 fight, Square Ring sent UStream four emails notifying UStream that the March 21 fight would likely be shared on UStream and requesting in advance that Square Ring be given either a “take down tool” or “appropriate staffing with the ability to simultaneously remove infringing content from your site.” Square Ring, Inc. v. John Doe-1, et al., C.A. No. 09-563-GMS, Memo. at 1-5 (D. Del. Jan. 23, 2015). UStream moved for summary judgment that it is immune from liability for copyright infringement due to the DMCA Safe Harbor provisions.
Judge Sleet first rejected Square Ring’s argument that Congress intended to exclude live broadcasts from the reach of the DMCA Safe Harbor. Id. at 8-9. His Honor then proceeded to the statutory analysis and addressed whether UStream met the Safe Harbor’s three threshold requirements. Judge Sleet found that because “UStream provides a website that allows its users to stream, share, and comment on user-generated video content . . . no genuine issue of material fact exists as to UStream’s qualification as a ‘service provider’ under” the DMCA. Id. at 9-10. Next, Judge Sleet addressed whether UStream satisfied the requirement for “reasonable implementation” of a “policy under which copyright holders can submit a take-down notice, such policy is available to the public through its website, and the service provider acts to remove infringing content once it receives adequate takedown notices.” Id. at 10. UStream has two office staffed with individuals who respond to DMCA takedown notices, and Judge Sleet found that “UStream has a strong DMCA policy, provides instructions for copyright owners to report alleged copyright infringement, takes active steps to limit incidents of infringement on its website and works diligently to keep unauthorized works off its website.” Id. Finally, to qualify for the Safe Harbor, “a service provider must accommodate and not interfere with standard technical measures used by copyright owners to identify or protect copyrighted works.” Id. at 10-11. Here, “Square Ring has not presented any evidence that UStream sought to conceal, delete, or suppress its ability to identify the March 21 Broadcast. Quite the opposite is true here. Square Ring’s monitoring agent was able to readily identify the channel names and URLs of the three purportedly infringing streams on the day that they were broadcast. . . . The court finds, as a matter of law, that UStream meets all three of the DMCA threshold requirements.” Id. at 10-11.
Judge Sleet then analyzed whether the specific requirements of the 17 U.S.C. § 512(c) Safe Harbor were met, and found under the circumstances that a material issue of fact remained for the jury as to “whether UStrearn was willfully blind such that it is not eligible for safe harbor protection” even though “UStrearn was not under an affirmative duty to discover and remove the March 21 Broadcast.” Id. at 12-13. Interestingly, the Court found that “questions related to UStrearn’s ‘red flag knowledge’ as a result of the pre-event notices are appropriately left to trial” and therefore “the lack of DMCA-compliant notice prior to the March 21 Broadcast is not fatal to Square Ring’s claims.” Id. at 13. Here, it was “clear . . . that Square Ring was incapable of providing a formal takedown notice compliance with the DMCA prior to the start of the March 21 Broadcast.” Id. at 13 n.5. Square Ring, accordingly, conceded that its emails prior to the March 21 fight were not adequate DMCA takedown notices, but contended that UStream had actual or constructive knowledge of infringement that precludes the safe harbor protections. Similarly, Square Ring contended that UStream did not act “expeditiously” to remove the March 21 Broadcast. Judge Sleet ultimately was “persuaded . . . by the complete lack of legal precedent for this factual situation” and was “not prepare to make a factual determination” when proceeding to trial would resolve such material issues of fact. Id. at 13.
In a recent Memorandum Order, Chief Judge Leonard P. Stark ruled on two issues following the pretrial conference. Intellectual Ventures I LLC v. Symantec Corp., C.A. No. 10-1067-LPS (D. Del. Jan. 21, 2015). First, Judge Stark ruled that “[t]he two newly-accused products will not be the subject of the trial beginning next week.” Id. at 1. Judge Stark provided this ruling, however, without prejudice to plaintiff “to seek relief related to [the newly-accused products] through an appropriate post-trial proceeding in this case or by filing a new suit.” Id.
Second, Judge Stark found that defendant would “not be permitted to present its false marking ‘defense’ at the forthcoming trial.” Id. Judge Stark explained that with respect to two of the three asserted patents, plaintiff is asserting only method claims, and “the marking requirement does not apply to method claims.” Id. With respect to the remaining patent-in-suit, Judge Stark found that “as an exercise of its discretion and as proper case management, that it would be unfairly prejudicial to [plaintiff] to allow [defendant], at nearly the final moment before trial (i.e., listing it as a contested issue in the proposed pretrial order), to put [plaintiff] in a position in which it must prove that it (or its predecessors and/or licensees) marked [its] embodiments.” Id. at 2. Specifically, defendant “mistakenly or misleadingly” identified failure to mark as an affirmative defense in its answer, but did not discuss § 287 in its responses to interrogatories, did not provide expert discovery on failure to mark, and did not propose a jury instruction on failure to mark at the time the parties exchanged instruction proposals. Id. On balance, Judge Stark determined that defendant “failed to give [plaintiff] adequate, meaningful notice that it contested marking,” and defendant therefore “waived and/or abandoned its right to contest marking at the forthcoming trial.” Id. at 2-3.
Chief Judge Stark recently issued a memorandum order with helpful guidance for parties regarding jury instructions in patent infringement cases. His Honor explained that an instruction on the entire market value rule should be read to the jury, “as doing so will assist the jurors’ understanding of the evidence on damages,” but that an “overly narrow” interpretation of the law governing the entire market value rule would be rejected. Intellectual Ventures I LLC v. Symantec Corp., C.A. No. 10-1067-LPS, Memo. Or. at 1 (D. Del. Jan. 23, 2014). Such an instruction should be read, Judge Stark explained, both when the plaintiff’s expert first addressed entire market value rule damages and again as part of final instructions. Id.
The specific instructions adopted by Judge Stark on the entire market value rule, reasonable royalty, the Georgia-Pacific factors, and damages generally are found in the Court’s order below.