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In Atlantic Marine Const. Co., Inc. v. U.S. Dist. Court for Western Dist. of Texas, 571 U. S. _ (2013), 2013 WL 6231157 (December 3, 2013), the Supreme Court not only reiterated that a valid forum selection clause must be given controlling weight, with rare exception – when considering a transfer motion under a 1404 analysis – but unamimously held that the analysis in those rare exceptions may give no weight to plaintiff’s choice of forum and may only consider counterveiling public-interest factors. “When parties agree to a forum-selection clause, they waive the right to challenge the preselected forum as inconvenient or less convenient for themselves or their witnesses, or for their pursuit of the litigation. A court accordingly must deem the private-interest factors to weigh entirely in favor of the preselected forum.”

Recognizing the applicability of Atlantic Marine to a forum selection clause in a patent license, yesterday the Supreme Court vacated and remanded a Federal Circuit decision refusing to enforce a forum-selection clause in an EDTX patent suit that, by the agreement, should have been filed in New York. See Broadcom Corporation v. USDC ED TX, et al., case number 12-1475.

Atlantic Marine settles a circuit split in authority. In the Third Circuit, guidelines for the applicability of a forum selection clause were established by Jumara v. State Farm Ins. Co., 55 F.3d 873, 883 (3d Cir.1995). Atlantic Marine, revises Jumara‘s guidance. It appears now that a forum selection clause is entitled to more than the “substantial consideration” – called for by Jumara – in a 1404 transfer analysis. It further appears that one may no longer rely on Jumara’s reasoning that a forum selection clause is but “one facet of the convenience-of-the-parties consideration.” Private-interest factors, as noted above, must now “weigh entirely in favor of the preselected forum.”

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Special Master Lukoff recently considered the latest of several motions regarding expert discovery in Robocast, Inc. v. Apple, Inc., C.A. No. 11-235-RGA (D. Del. Dec. 4, 2013) (previous decisions discussed here and here). Apple moved to strike the supplemental expert report of Robocast’s damages expert, Mr. Hoffman. The expert’s original report was based in part on the opinions of another expert who had analyzed user surveys. Id. at 1. Subsequently, plaintiff withdrew this expert’s opinions, leaving Hoffman’s report “with a gap in the foundation of his own opinions.” Id. Robocast, however, did not seek the Court’s permission to issue a supplemental expert report that was untimely.

Special Master Lukoff noted that “[i]n an assessment of a relatively grey area, plaintiffs having Mr. Hoffman generate a supplemental report could be generously classified as an effort to comply with its FRCP 26(e) obligation to supplement discovery under appropriate circumstances.” Id. at 2. In this case, however, Special Master Lukoff determined that after plaintiff notified Apple that it was voluntarily withdrawing the opinions upon which Mr. Hoffman predicated a portion of his damages projection, there was no obligation to supplement the Hoffman report under Rule 26(e) “since it was crystal clear to Apple what had happened and what the loss of the [other expert’s] opinions would mean.” Id. at 3. Instead, Special Master Lukoff found that Robocast used the opportunity to add a new theory to Mr. Hoffman’s opinions that could have been contained in his original report. Id. As such, Apple’s motion was granted and Robocast’s supplemental Hoffman report was stricken.

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Special Master David White recently issued a ruling granting in part and denying in part a motion to compel. Frontier Communications Corp. v. Google Inc., C.A. No. 10-545-GMS (D. Del. Dec. 6, 2013).

Special Master White first found the defendant’s identification of only two individuals who have “participated in the design, development, testing, implementation, marketing, sales, or distribution of the Accused Systems/Services” to be a deficient response to an interrogatory seeking the identification of “all persons … who have participated in ….” The Special Master agreed with the defendant that the interrogatory seeking the identifies of “all” such individuals was overbroad, but found that “the interests of both parties may be respected by requiring Google to identify those individuals who are most knowledgeable about or primarily responsible for each of the activities set forth in the Interrogatory ….” The defendant had referred the plaintiff to the defendant’s document production as a source from which the plaintiff could identify the identities of the individuals sought by the interrogatory, but the Special Master rejected that approach, since the plaintiff could not, simply by reference to the document production, “locate and identify [the relevant individuals] as readily as” the defendant could.

The parties also disputed what the appropriate number of record custodians should be searched by the defendant, with the plaintiff identifying 60 such individuals, and the defendant willing to search only 7. The Special Master found that the Default Standard was triggered by the parties’ disagreement, meaning that the defendant was required to search 10 custodians. He added, though, that “[i]n the event that Frontier is able to provide particularized information which demonstrates the need for an expanded search, the Court will consider such supplemental application, and Google’s response thereto, consistent with the standards set forth in the Federal Rules.”
Next, the Special Master endorsed the defendant’s preference for Boolean searches, but found that its proposed searches were too narrow. He ordered, as a result, that the defendant broaden its searches. Further, the plaintiff was permitted, consistent with the Default Standard, to provide the defendant with 10 additional search terms beyond the broadened Boolean searches proposed by the defendant.

The Special Master then considered a dispute over the production of the defendant’s source code. The plaintiff moved to compel the production of all of the source code of the Accused System, while the defendant’s position was that it should only be required to produce the source code related to the alleged infringement. Special Master White found that the parties had negotiated sufficient safeguards for access to source code in their protective order such that the defendant’s interest in safeguarding its source code would be protected. Accordingly, he ordered that the defendant make its source code available for review consistent with the protective order.

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In a recent memorandum opinion, Judge Sue L. Robinson granted a defendant’s motion for summary judgment of non-infringement under the doctrine of equivalents. Auxilium Pharmaceuticals, Inc. v. Upsher-Smith Laboratories, Inc., Civ. No. 13-148-SLR (D. Del. Dec. 4, 2013). The parties had stipulated previously that the defendant’s pharmaceutical formulation did not literally infringe the plaintiff’s patented methods for treating hypogonadism using a specific formulation of testosterone gel. The claims in the patents in suit focused on cyclic Hsieh enhancers, whereas the defendant’s formulation used Dudley enhancers, which the patentee gave up during prosecution. As the Court explained, “a large number of enhancers were known in the art, many of which the patentees referenced in their specification. The patentees specifically discussed the straight chain Dudley enhancers in the specification and, thereafter, differentiated the cyclic Hsieh enhancers.” Id. at 13. Further, the patentees “argued during prosecution that their invention was not obvious in light of Dudley enhancers . . . .” Id. The Court therefore found that the plaintiff could not recover through the doctrine of equivalents what it surrendered during prosecution. Id. at 13-14.

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Judge Sue L. Robinson denied defendant’s request to claw back certain documents that defendant initially produced “without claiming protection from disclosure under either the attorney-client privilege or the work product doctrine.” Pfizer Inc., et al. v. Lupin Pharm., Inc., et al., C.A. No. 12-808-SLR, slip. op. at 1 (D. Del. Dec. 2, 2013). Defendant produced “100 documents related to experiments conducted by scientists in [defendant’s] Intellectual Property Management Group,” and defendant sought to claw back those documents as protected under the attorney-client privilege or the work product doctrine. Id. at 2. Judge Robinson found it clear that these documents were not protected under the attorney-client privilege, as “they were neither created with the knowledge of . . . counsel, nor were they shared with . . . counsel contemporaneously.” Id.

The “harder question,” as Judge Robinson explained, was whether these documents were protected under the work product doctrine, which does not require attorney involvement for document protection. Id. at 3. Judge Robinson recognized that “the documents at issue were generated under the complex administrative paradigm created under the Hatch-Waxman Act,” and that “litigating the validity of patents is contemplated under the statute.” Id. at 3-4. However, Judge Robinson “decline[d] to equate the ordinary course of business of a generic manufacturer (testing compounds in order to develop bioequivalent drugs) with the more specific conduct associated with anticipation of litigation (e.g., testing the compounds of the prior art in order to invalidate a patent), especially where, as here, there [was] no indication that the [defendant] scientists were doing anything other than pursuing general scientific research on [defendant’s] prospective drug(s).” Id. at 4. Judge Robinson therefore found that defendant failed to meet its burden to demonstrate the documents at issue were protected from disclosure and denied defendant’s requested claw back. Id.

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In a recent Letter Order, Magistrate Judge Joel Schneider resolved the parties’ dispute over the effective date of the Community of Interest (“COI”) doctrine. Evonik Degussa GmbH v. Materia Inc., C.A. No. 09-636-NHL-JS; Evonik Degussa GmbH v. Elevance Renewable Sciences, C.A. No. 10-200-NLH-JS, Letter Order (D. Del. Nov. 21, 2013). Plaintiff (“Evonik”) argued that the COI doctrine did not apply as between defendant (“Materia”) and UNO until May 3, 2007, the date Materia and UNO executed their “Second Amended and Restated Patent License Agreement” (“PLA”). Id. at 1. Materia, on the other hand, argued that the COI doctrine was applicable as early as January 12, 2007, when Materia and UNO signed a term sheet (“Term Sheet”) related to an amended and restated license agreement, or January 1, 2007, the Term Sheet’s effective date. Id.

Judge Schneider found that the COI doctrine’s effective date was not until May 3, 2007, the date that Materia and UNO signed the PLA. Id. at 2. As Judge Schneider explained, the “COI doctrine applies when two or more clients have a ‘common legal interest.’” Id. Judge Schneider highlighted that the Term Sheet specified that Materia and UNO did “not intend to be legally bound, unless and until a definitive License Agreement [had] been executed by both Parties.” Id. Judge Schneider therefore found that during the “negotiation period” between January 12, 2007 and May 3, 2007, Materia and UNO “were acting in their own and not the common best interest.” Id.

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Earlier this week, Chief Judge Gregory M. Sleet granted defendants’ motion to stay litigation pending the outcome of inter partes review of the patents-in-suit. HumanEyes Technologies Ltd. v. Sony Corp., C.A. No. 12-398-GMS (D. Del. Dec. 2, 2013). The defendants filed the inter partes petitions five months after termination of a parallel ITC action, and the motion to stay three weeks after the petitions. Id. at 2 n.4. As such, Judge Sleet found no evidence that defendants were seeking an unfair tactical advantage. Moreover, because the parties are not direct competitors and HumanEyes can be adequately compensated for any delay by money damages, Judge Sleet found that plaintiff was unlikely to suffer prejudice due to the stay. Id. Also, because the case was in its early stages and because the Patent Trial and Appeal Board granted defendants’ petitions, the inter partes review proceedings will likely simplify issues in the case and “advance the interests of judicial economy.” Id. at 2 & n.5.

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Judge Stark has issued orders staying two related cases brought by General Electric against Kontera Technologies and Vibrant Media. In May 2013, Judge Stark denied a previous request by Vibrant to stay pending resolution of the inter partes review, which was filed by Vibrant. Since that time, however, the PTAB has instituted an inter partes review of the patents-in-suit based on its preliminary findings that all asserted claims are invalid. General Electric Co. v. Vibrant Media, Inc., C.A. No. 12-526-LPS, Memo. Order at 1 (D. Del. Dec. 4, 2013). As Judge Stark explained, “Regardless of their outcome, the IPR proceedings will simplify this case, as Vibrant will be estopped from contending that certain prior art invalidates the asserted claims and/or some or all of the asserted claims will be invalidated.” Id. Additionally, “[t]he PTAB has scheduled oral argument in the IPR for February 2014, so the delay caused by a stay will likely not be especially lengthy and, therefore, is unlikely to cause GE (which does not practice the patents-in-suit) undue prejudice. While the parties and the Court have invested resources in the litigation, and the litigation has advanced significantly since May, this action is far further away from conclusion than is the IPR.” Id. at 2. On these bases, Judge Stark ordered that the Vibrant action be stayed with the exception of “permit[ing] fact discovery to be completed—reducing any risk of evidentiary staleness that might otherwise be present during the pendency of the stay—but . . . allow[ing] the parties to avoid the expense of expert discovery until after the results of the IPR are known.” Id.

Additionally, Judge Stark seemed to find it persuasive that “in the related action, defendant Kontera Technologies, Inc. has agreed, if these actions are stayed, to be estopped to the same extent as Vibrant is estopped . . . [even though] [t]his was not Kontera’s position when the Court considered Vibrant’s earlier motion.” Id. at 1-2. Accordingly, Judge Stark ordered that the Kontera case as well.

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Chief Judge Sleet recently issued his constructions of disputed claim terms in a patent related to “jousting toy” spinning tops. The patent is being asserted against Lego.
Judge Sleet construed the following terms:
– “stable footing on said playing surface to maintain said body section in an upright position without the use of centrifugal force”
– “[first playing component configured to] kinetically engage and form a scoring connection with a second playing component”
– “hooked arm connecting to said wire frame hoop”
– “means for rotating said body section”
– “means for carrying said body section above a playing surface”
– “means for providing a stable footing on said playing surface to maintain said body section in an upright position without the use of centrifugal force”
– “means for kinetically engaging said first playing component with a second jousting element to form a scoring connection”
Battle Toys, LLC v. Lego Systems, Inc., C.A. No. 12-928-GMS, Order at 1-10 (D. Del. Dec. 2, 2013).

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The District of Delaware has announced the creation of a Patent Study Group focused on exploring “issues relating to the practice of patent litigation, with a particular emphasis on the handling of such cases in the District of Delaware.” The Court’s announcement was posted on its website and reads as follows:

Court Announces Patent Study Group

The United States District Court for the District of Delaware is pleased to announce the creation of a Patent Study Group. The goal of the Patent Study Group is to explore issues relating to the practice of patent litigation, with a particular emphasis on the handling of such cases in the District of Delaware. In recent years, more patent cases have been filed in the District of Delaware than in almost all of the other federal trial courts across the country. The size of Delaware’s patent docket, and the experience of the District’s bench and bar, create a unique opportunity for identifying potential “best practices” for the management of these complex cases. Over the coming months, the Patent Study Group will solicit input from practitioners who regularly appear in the District of Delaware (in-state and out-of-state counsel), in-house counsel, and others with an interest in understanding and improving the practice of patent litigation.

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