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Judge Richard G. Andrews recently denied plaintiff Novartis Pharmaceuticals Corporation’s unopposed motion to seal the transcript of a court conference. Novartis Pharmaceuticals Corporation, et al. v. Actavis South Atlantic LLC, et al., C.A. No. 11-1077-RGA (consol.) (D. Del. Mar. 10, 2014). In the Court’s view, the portions of the transcript that Novartis requested the Court seal, “reflect[ed], at most, that Novartis engages in typical settlement discussions, which everybody in the pharmaceutical industry already must know.” Id. Because Judge Andrews did not find that the disclosure of the information would harm Novartis’s business, Judge Andrews denied the unopposed motion. Id.

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In Robocast, Inc. v. Microsoft Corp., C.A. No. 10-1055-RGA (D. Del. Feb. 25, 2014), Judge Richard G. Andrews granted defendant’s objections related to plaintiff’s request for an adverse inference instruction that the Special Master had previously granted. Judge Andrews concluded that “[w]hile the Special Master’s opinion was logical and well-reasoned, I find that bad faith is required in order for an adverse inference instruction to be appropriate. Because I cannot find that [defendant] acted in bad faith, I will not give an adverse inference instruction.” Id. at 3. In reaching this determination, Judge Andrews relied on a Third Circuit opinion in which the Court held that “where there is no showing that the evidence was destroyed in order to prevent it from being used by the adverse party, a spoliation instruction is improper.” Id. at 3 (quoting US. v. Nelson, 481 F. App’x 40, 42 (3d Cir. 2012)). Judge Andrews therefore concluded that “in order for a spoliation instruction to be proper in this case, there must be a showing that [defendant] destroyed, or was willfully blind to the destruction of, the . . . source code, in order to prevent its use by [plaintiff].” Id. The Special Master, however, had found only that defendant’s failure to preserve evidence was “negligent rather than willful or grossly negligent.” Id.

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In anticipation for the trial in this case that is set to begin this week in Personalized User Model, L.L.P. v. Google, Inc., C.A. No. 09-525-LPS, on March 6 Judge Leonard P. Stark ruled on various pre-trial issues.

First, the Court adopted defendant’s proposed order of proof, which permitted “each party to reply to the other side’s rebuttal on any issue for which a party bears the burden of proof.” Id. at 1. The trial will proceed in four phases. See id. at 1-2. As a result, the Court also denied plaintiff’s request for one of its witnesses to provide the full scope of his testimony in a single phase. Id. at 2.

Second, the Court granted plaintiff’s motion to preclude defendant from referring to recent changes in the accused technology. Defendant intended to use this information as evidence that the patents-in-suit lacked commercial success, but it appeared to the Court that plaintiff had not had the opportunity to determine whether these changes impacted infringement in discovery, plus plaintiff “could have reasonably believed that evidence of such changes [that occurred after the close of fact discovery] would not be admissible.” Id. at 2-3. Because this ruling “may put certain witnesses in an awkward position, in which potentially they may have to testify in a manner that is not fully truthful in order not to reveal to the jury recent changes in the Accused Technologies,” the Court also required counsel to ask precise questions and it would also provide a specific jury instruction about this issue. Id. at 3.

Finally, the Court denied plaintiff’s motion regarding the statute of limitations applicable to defendant’s breach of contract defense and counterclaim. The Court found that the motion was “in essence, an untimely motion for summary judgment, and not merely a motion seeking clarification of the governing law.” Id. at 4.

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On February 28, the jury in Inventio AG v. Thyssenkrupp Elevator Corporation, C.A. No. 08-874-RGA returned a verdict. The jury found that defendant had infringed the asserted claims of U.S. Patent No. 6,835,465 and calculated damages to be $40,320. However, the jury also found that the asserted claims were invalid as obvious. The jury found that defendant had not met its burden to show that these claims were incalid for failing to meet the best mode requirement.

As to U.S. Patent No. 6,892,861, the jury found that defendant did not infringe the asserted claims, and that the asserted claims were also invalid as obvious. The jury also found this patent invalid for failing to meet the best mode requirement.

Finally, the jury found that both patents-in-suit had not named the correct inventors.

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Magistrate Judge Christopher J. Burke recently recommended the dismissal of a plaintiff’s induced infringement claims. Trans Video Electronics, Ltd. v. Netflix, Inc., C.A. No. 12-1743-LPS (D. Del. Mar. 4, 2014). Judge Burke first found that the plaintiff failed to adequately allege pre-suit knowledge of the asserted patent. Specifically, the plaintiff’s allegation that the defendant “has had knowledge of the ‘936 patent as of July 1, 2011[,]” without factual support, was found to be conclusory and was therefore disregarded in the context of the motion to dismiss. Judge Burke also found that the complaint failed to adequately allege direct infringement by the defendant’s customers. Judge Burke explained that “the Complaint is silent even as to what it is that the customers are alleged to have actually done that is asserted to amount to the ‘use’ of” an infringing method. Instead, the complaint alleged only that the customers “use a method for distributing information to various locations in a digital network,” which simply “parrots [a portion] of the preamble of claim 9 of the ‘936 patent . . . it does not give any hint as to how the customers’ actions are said to relate to the content of the method-at-issue.” Finally, and relatedly, Judge Burke explained that the plaintiff’s allegation that the defendant specifically encouraged its customers to infringe through “instructions” on the defendant’s website (which were not recited in or attached to the complaint) was insufficient: “[i]n light of the lack of facts pled linking up any ‘instructions’ with conduct plausibly asserted to amount to direct infringement, the allegations as to this element, then, are insufficient as well.”

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Judge Richard G. Andrews recently denied a defendant’s motion to dismiss the plaintiff’s amended complaint for failure to give fair notice of which of the defendant’s products or services allegedly infringe the plaintiff’s patent. Online News Link LLC v. Wayfair LLC, C.A. No. 13-1440-RGA (D. Del. Feb. 21, 2014). The amended complaint alleged infringement by the defendant’s email system, and attached as exhibits screenshots of emails that were sent by the defendant’s system. Judge Andrews found “not persuasive” the defendant’s argument that it was not fairly put on notice of which products or services the plaintiff was alleging infringe, and explained “[Defendant] is in a position to know which system sends the emails exemplified by the exhibits. Without discovery, Plaintiff could not pursue its claims because Defendant’s use of the accused system is private.” The defendant’s motion to dismiss was therefore denied.

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Judge Leonard Stark recently denied a motion to stay pending PTO reexamination of the patents-in-suit in a case where discovery is closed, the Court has issued a claim construction order, and a trial is set for May 12, 2014. Intellectual Ventures I LLC v. Xilinx, Inc., C.A. No. 10-1065-LPS, Memo. Or. at 1 (D. Del. Mar. 5, 2014). The defendants in the case first filed a motion to stay in August 2011, which was denied in February 2012. In denying the second motion to stay, Judge Stark explained: “Many of the factors that weighed against a stay in August 2011 continue to weigh against a stay now. The Court and the parties have expended substantial resources in bringing the case to this late stage of the litigation. Although it is true that the reexaminations at the PTO are further along than they were in August 2011, it will likely take another two to three years before a final decision on validity makes its way through the Federal Circuit.” Id. at 3. Furthermore, Judge Stark explained that “the marginal simplification that may result from staying this case does not outweigh the stage of litigation and undue prejudice factors,” particularly because “Plaintiffs have . . . agreed not to amend any of [the asserted] claims in the ongoing reexaminations proceedings. The possibility that these claims will eventually be invalidated as a result of the reexamations is too speculative to be accorded great weight under the circumstances.” Id. at 4.

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Judge Richard G. Andrews recently construed eight terms from computer-implemented means-plus-function claims of U.S. Patent No. 5,663,757, titled “Software controlled multi-mode interactive TV systems.” Eon Corp. IP Holdings LLC v. Flo TV Inc., et al., C.A. Nos. 10-812-RGA, 13-910-RGA (D. Del. Mar. 4, 2014). In order to construe a means-plus-function limitation, the court must first determine the claimed function, then “‘identify the corresponding structure in the written description that performs the function.'” Id. at 6 (quoting Applied Med. Res. Corp. v. U.S. Surgical Corp., 448 F.3d 1324, 1332 (Fed. Cir. 2006)). Where the corresponding structure is a computer, however, the patent must do more than simply disclose a general purpose computer as the structure; the patent must disclose an algorithm for performing the claimed function. Id.

The Federal Circuit recognizes a narrow exception to this general rule: “[I]t is ‘not necessary to disclose more structure than the general purpose processor’ when the claimed functions ‘can be achieved by any general purpose computer without special programming.’ Id. at 7 (quoting In re Katz Interactive Call Processing Patent Litig., 639 F.3d 1303, 1316 (Fed. Cir. 2011)). “Examples of functions that can be carried out by a general purpose computer without special programming include: processing, receiving, and storing. By contrast, any function that involves more than merely plugging in a general-purpose computer requires special programming.” Id. (internal citations and quotations omitted).

In light of this law, Judge Andrews construed the following disputed means-plus-function claim terms, finding all of the terms indefinite for failing to disclose a sufficient corresponding structure:

“Means under control of said replaceable software means for indicating acknowledging of shipment of an order from a remote station”
“Means controlled by replaceable software means operable with said operation control
system for reconfiguring the operating modes by adding or changing features and introducing
new menus”
“Means responsive to said self contained software for establishing a mode of
operation for selection of one of a plurality of authorized television program channels”
“Means establishing a first menu directed to different interactively selectable program
theme subsets available from said authorized television program channels”
“Means for causing selected themes to automatically display a second menu”
“Means controlled by replaceable software means operable with said operation control
system for establishing and controlling a mode of operation that records historical operating data of the local subscriber’s data processing station”
“Means controlled by replaceable software means operable with said operation control
system for establishing and controlling fiscal transactions with a further local station”
“Means for establishing an accounting mode of operation for maintaining and reporting fiscal transactions incurred in the operation ofthe local subscriber’s data processing station”

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There is still time to register for Managing IP’s third annual US Patent Forum on March 25 at the Willard InterContinental, Washington D.C.

** Free for in-house patent counsel, academics and R&D professionals **

Supported by AIPLA and Delaware IP Law Blog, the forum will provide you with:

• a guide to improving your company’s patent application process post-AIA;
• an evaluation of post-grant proceedings;
• an update on litigation planning and forum shopping in Europe; and
• the analysis of the recent standard essential patent (SEP) litigation between Apple and Samsung
Speakers include Judge Sharon Prost of the U.S. Court of Appeals for the Federal Circuit and Lead Judge Michael Tierney of the USPTO Patent Trial and Appeal Board.

See the agenda below for a full list of presenters. Click HERE to register online, or by emailing alicia.sprott@legalmediagroup.com.

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In anticipation of a trial to begin next week between Personalized User Model LLP (PUM) and Google, Judge Stark has issued an order addressing several pending pretrial motions. Judge Stark first granted a motion to exclude Google’s non-infringement expert because he failed to apply one of the Court’ claim constructions, instead making arguments that the Court had rejected during claim construction. By contrast, however, some of the expert’s opinions did not expressly contradict the Court’s constructions but rather went to “fact dispute[s] that will be a proper subject of the infringement trial.” Thus, the motion to exclude was granted in part and denied in part. Personalized User Model, L.L.P. v. Google Inc., C.A. No. 09-525-LPS, Memo. Or. at 2-3 (D. Del. Feb. 27, 2014). Judge Stark then turned to Google’s motion to exclude PUM’s expert, holding: “the Court agrees with Google that Dr. Pazzani shall not provide testimony on legal issues, including his experience at Rutgers with assignment and transfer of patent rights. Dr. Pazzani will be permitted to provide technical evidence, including opinion, from the perspective of one of skill in the art of the patents-in-suit, including whether Dr. Konig’s work ‘related’ to SRI’s work and ‘resulted’ in the patented technology.” Id. at 4.

Judge Stark also considered PUM’s request to preclude Google from trying its claims for conversion before the jury in the upcoming trial. Judge Stark first recognized that Google was correct to assert that it has a Seventh Amendment right to a jury trial for its conversion claim. Nevertheless, Judge Stark did “not believe that Google is entitled to have conversion tried now, to the same jury that is deciding infringement and validity of the patents as well as breach of contract,” and found that such a combined trial ran a risk of confusion and unfair prejudice that would outweigh probative value under F.R.E. 403. “Adding conversion to the forthcoming trial would increase the risk of confusing the jury and unfairly prejudicing PUM, for reasons including that the inclusion of this claim would expressly confront the jury with the reality that if Google prevails, it (Google) will own the patents-in-suit. Under the circumstances, including that damages and willfulness have been bifurcated, this is inappropriate and unnecessary.” Id. at 5-6.

Among other issues considered, Judge Stark granted PUM’s request to preclude any mention of pending reexaminations of the patents-in-suit. “Given the nonfinality of the reexamination proceedings (appeal rights have not been exhausted) and the different standards applicable to reexaminations and litigation, the probative value of the reexamination evidence is substantially outweighed by the risk of unfair prejudice and the risk of confusing the jury.” Id. at 6. Similarly, Judge Stark granted PUM’s request to preclude use of the term “patent troll” but explained that both parties would be permitted to present evidence as to the background and development history of the patent as well as evidence to establish or rebut commercial success of the inventions of the patents-in-suit. Id. at 6-7.

Finally, Judge Stark addressed Google’s motions in limine. His Honor granted Google’s request to preclude evidence of copying or pre-suit knowledge because inducement and willfulness were not part of the upcoming jury trial. Accordingly, “the minimal probative value [of such evidence] is substantially outweighed by the risk of unfair prejudice to Google.” Id. at 8. Judge Stark next denied Google’s request to preclude evidence of Google’s acquisition of another personalization company. “Allowing the jury to learn, through financial information, that Google is a very successful company is not unduly prejudicial to Google. Google may effectively challenge the weight the jury should give this evidence through cross-examination. Similarly, the value Google placed on its acquisition of Kaltix is at least probative of commercial success.” Id. at 8-9.

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