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In Cornerstone Therapeutics Inc., et al. v. Exela Pharma Sciences, LLC, et al., C.A. No. 13-1275-GMS (June 16, 2014), Chief Judge Gregory M. Sleet denied the defendants’ motion to transfer to the Western District of North Carolina.

Examining the Jumara factors, the Court explained that plaintiff’s forum choice was “not entitled to the usual paramount deference because none of the plaintiffs are physically located in Delaware,” although their forum choice was still entitled to greater weight than that of defendants.  Id. at 2.  As this is an ANDA case, where the claim arose was governed by “where the ANDA submission was submitted;” here that was North Carolina so this factor weighed in favor of transfer.  Id. at 2-3 However, given that most of the defendants were incorporated in Delaware, convenience of the parties weighed against transfer, as did the location of books and records and the convenience of witnesses where defendants did not show why the evidence and witnesses could not come to Delaware.  Id. at 3.

As to the public interest factors, the Court was not persuaded by defendants’ arguments regarding “the convenience of undisclosed witnesses” and “the congestion of the docket in Delaware.  Although the number of cases per judge and time to trial are greater in Delaware, it is undisputed that Delaware judges have much greater familiarity with patent cases by virtue of their patent-heavy dockets,” which would allow for administrative efficiencies.  Id. at 4.

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In a recent order, Judge Sue L. Robinson denied defendants’ motion for leave to file a second amended answer that would include inequitable conduct counterclaims and affirmative defenses.  Carrier Corp. v. Goodman Global, Inc. et al., C.A. No. 12-930-SLR (D. Del. June 19, 2014). With respect to its inequitable conduct allegation, defendants claimed that the Aquasmart HVAC system (“Aquasmart”) constituted prior art to the patent-in-suit, and the inventors “misrepresented and omitted information regarding Aquasmart to the USPTO during the prosecution” of the patent-in-suit.  Id. at 2.

Judge Robinson noted that defendants filed their second amended answers “ten months after the deadline to amend the pleadings and two months after the close of fact discovery,” and that a “certain prejudice to plaintiff is inherent on [such a] timeline.” Id. at 4 (quoting Asahi Glass Co., Ltd. v. Guardian Indus. Corp., 276 F.R.D. 417, 420 (D. Del. 2011)). Accordingly, under Fed. R. Civ. P. 16(b)(4),  defendants were required to show “good cause” for the Court to grant  leave to amend. Id.

Finding that defendants failed to show good cause, Judge Robinson denied defendants’ motion. Specifically, Judge Robinson explained that defendants’ inequitable conduct allegation “rests on a document produced nearly seven months prior to the filing of the motion for leave to file second amended answers, as well as upon publicly available documents [defendants] discovered independently.”  Id. Further, defendants “did not ask the inventors about Aquasmart during their depositions.”  Id.  Taken together, Judge Robinson concluded that “[t]he timing of [defendants’] motion, coupled with previously produced discovery and publicly available documents relating to Aquasmart, negate the argument for good cause.” Id.

Judge Robinson also dismissed defendants’ motion to file supplemental briefing related to inequitable conduct as moot, as that motion related only to a patent that was dismissed from the suit by stipulation. Id. at 5 n.4; 1-2 n.1.
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In SecureBuy, LLC v. CardinalCommerce Corporation, C.A. No. 13-1792-LPS (D. Del.  June 16, 2014), Judge Leonard P. Stark construed the following disputed claim terms of U.S. Patent Nos. 8,140,429; 7,051,002; and 7,693,783:

-“authentication program”

-“authentication protocol”

-“authentication determination”

-“connection layer”

-“distribution layer”

-“plug-in layer”

-“means for determining from the payment information received at the universal platform server, for each commercial transaction, which of the different authentication protocols is prescribed by the payment network for the type of payment instrument identified in the payment information”

-“means for determining from the payment information received at the server which of the
different authentication protocols is prescribed for the type of payment option identified in the payment information”

-“means for selecting, in accordance with the determination of step (b), a particular authentication protocol from the plurality of different authentication protocols supported by the universal platform server”

-“means for selecting, in accordance with the determination made by the means for determining, a particular authentication protocol from the plurality of different authentication protocols supported by the server”

-“Universal platform server”

-“payment option,” “payment instrument,” and “payment information”

-“first party,” “second party,” “third party,” and “fourth party”

-“Obtaining an authentication determination for the transaction in accordance with the selected protocol,” “obtaining an authentication determination from a fourth party in accordance with the authentication protocol,” and “obtain an authentication determination in accordance with its associated authentication protocol.”

-“means for obtaining an authentication determination for the commercial transaction in accordance with the selected authentication protocol, including formatting messages and routing the formatted
messages over the communications network in accordance with one or more mandates of the selected authentication protocol.”

-“means for obtaining an authentication determination for the commercial transaction in accordance with the selected authentication protocol, including formatting messages and routing the formatted messages”

-“means for returning the obtained authentication determination to the first party’s server”

– “means for returning the obtained authentication over the communications network to a designated entity”

– “Plug-in/Plug-in component”

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In a recent memorandum order, Judge Leonard P. Stark entered a preliminary injunction in a suit involving GPS modules supplied to the Ford Motor Company.  M/A-COM Technology Solutions Holdings, Inc. v. Laird Techs., Inc., C.A. No. 14-181-LPS (June 13, 2014) (public version June 16, 2014).  The plaintiff had, for several years, been Ford’s sole supplier of GPS modules for installation in its automobiles, but the defendant won a contract with Ford to supply GPS modules beginning with a shipment in mid-July 2014.  The plaintiff responded by filing suit and alleging that the defendant’s GPS modules infringed the plaintiff’s patent.

The Court allowed limited discovery, following by full briefing, oral argument, witness testimony, and supplemental briefing, and ultimately found that a preliminary injunction was justified.  The Court found that the plaintiff would likely prevail at proving infringement, and specifically rejected the defendant’s proposed constructions of certain terms that would limit their scope and exclude a disclosed embodiment in order to avoid infringement.  The Court also found that the plaintiff would likely prevail at showing that the defendant was not given rights to infringe through a license agreement between the plaintiff and Ford, and that the defendant failed to raise a substantial question concerning invalidity based on anticipation or obviousness.

The Court next considered whether the plaintiff demonstrated that it would be irreparably harmed absent a preliminary injunction.  The Court found that the plaintiff’s relationship with Ford was threatened with damage that could not be fully remedied through money damages in the form of price erosion and damage to its relationship with Ford.  And although the Court found that a preliminary injunction would significantly harm the defendant, that harm was outweighed by the harm the plaintiff would experience absent an injunction.

Lastly, the Court found that the balance of competing public interests weighed in favor of an injunction.  In this analysis the Court considered the interest in protecting patent rights, and also the interest in encouraging patent litigation to proceed at a reasonable pace—with parties not rushing to Court when a concrete dispute may never ripen (the defendant accused the plaintiff of unduly delaying the litigation), outweighed the “disruptive effect” the injunction would have no Ford, especially since Ford “has not appeared and nothing in the record would support a finding that Ford (and, through Ford, the public) will be harmed as a result of” an injunction.
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Judge Andrews has issued his memorandum opinion construing disputed terms of four patents related to logic and memory circuits for integration into high density integrated circuit chips. In 2011, the plaintiffs, HSM Portfolio and Technology Properties Limited, filed an infringement suit against eighteen defendants, of which eight remain in the case. After oral argument on June 5, Judge Andrews issued his construction of the following terms on June 17:
– “the N-channel field effect transistor in each inverter stage having a channel width which is less than a [predetermined factor] times the width of the N-channel of the immediately preceding inverter stage”
– “wherein the N-channel field effect transistor in the first inverter stage has a channel width which is less than said [predetermined factor] times the width of the at least one N-channel field effect transistor in the logic gate”
– “[the P-channel field effect transistor in each inverter stage having a channel which is wider than the channel of the corresponding N-channel field effect transistor of each inverter stage by ƞ], the ratio of electron mobility in the N-channel field effect transistors to hole mobility in the P-channel field effect transistors”
– “[A Field Effect Transistor (PET) Differential Latching Inverter (DLI) circuit] for sensing signals on first and second bit lines of a memory”
– “first and second bit lines of a memory”
– “first bit line” / “second bit line”
– “an inverter transfer function … which is identical when said first and second inverters turn on and turn off”
– “the outputs of said first and second complementary FET inverters producing output signals for said DLI circuit”
– “for receiving [a logic input signal/a clock input signal]”
– “A field effect transistor (FET) logic circuit comprising”
– “the product of the carrier mobility and the ratio of channel width to length of the inverter FET of said first conductivity type being [substantially greater than] the product of the carrier mobility and the ratio of channel width to length of the inverter FET of said second conductivity type”
– “for receiving [logic input signals]”
HSM Portfolio LLC, et al. v. Fujitsu Limited, et al., C.A. No. 11-770-RGA, Memo. Op. at 1-15 (D. Del. June 17, 2014).

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On Wednesday, June 18, Judge Leonard P. Stark published a new form scheduling order on the District of Delaware web site for non-ANDA patent cases, as well as a new form pre-trial order for patent cases, a new set of “Procedures for Managing Patent Cases,” and a “Case Management Checklist” for use in patent Rule 16 conferences. These changes are in response to feedback from the Patent Study Group (discussed here). Unless otherwise ordered, these Revised Procedures will govern all non-ANDA patent
cases filed on or after July 1, 2014 that are assigned to Judge Stark.

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Judge Richard G. Andrews recently granted plaintiff St. Jude’s motion to dismiss defendant Volcano Corp.’s inequitable conduct counterclaim and affirmative defense. St. Jude Medical v. Volcano Corp., C.A. No. 12-441-RGA (D. Del. June 11, 2014). Volcano alleged that the named inventors on the patent-in-suit, as well as the prosecuting attorney, committed inequitable conduct by “providing an incomplete and misleading representation to the PTO regarding the capabilities of Volcano’s prior art WaveMap system.” Id. at 2. Specifically, Volcano asserted that the inventors knew, based on their familarity with certain documents, that the prior art system possessed a capability embodied in the patent-in-suit. Id. at 2-3. Volcano alleged that the inventors did not disclose these documents, which included owner’s manuals and brochures. Id. at 3. Volcano alleged that the prosecuting attorney was also aware of these documents and even submitted some of the documents during proseuction of a separate patent. Id.

As to the prosecuting attorney, Judge Andrews found that Volcano failed to plead adequate facts to allow the Court to “reasonably infer” that the attorney withheld documents with the specific intent to deceive the PTO. Id. As to the inventors, Judge Andrews found that Volcano failed to “sort out the specific facts and attribute them to a particular individual.” Id. at 4. Volcano was granted leave to amend, as to the inventors, and instructed to: (1) “individually identify whose actions constitute affirmative misconduct or were contrary to the duty of candor, and material to the issuance of the [patent in suit], on particular dates, with the intent to deceive the PTO”; and (2) “plead facts explaining why the omitted references are not cumulative of other prior art reviewed during prosecution[.]” Id.

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In a recent memorandum order, Judge Richard G. Andrews denied a motion for reconsideration of a summary judgment of non-infringement ruling.  Robocast, Inc. v. Apple Inc., C.A. No. 11-235-RGA (D. Del. June 11, 2014).  The plaintiff argued that the Court made a “factual oversight” in rendering its decision, but Judge Andrews disagreed, explaining, “[t]he entirety of the argument is one sentence buried in a footnote. . . . I do not agree that a conclusory statement buried in a footnote is sufficient to constitute an ‘overlooked argument.’”  Regardless, the Court found that summary judgment would have been appropriate even had the argument been properly raised, so the motion for reconsideration was denied.

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In Pragmatus Telecom LLC v. Aspect Software Inc., C.A. No. 14-359-RGA (D. Del. June 13, 2014), Judge Richard G. Andrews granted-in-part defendant’s motion to dismiss the complaint.  The Court dismissed all claims of indirect and willful infringement without prejudice, and also denied the plaintiff’s request for leave to amend “without prejudice to consideration of any subsequently filed motion.”  Id. at 2.

The Court noted that “[t]o describe the complaint as 98% boilerplate would not be unfair,” given that each count used the exact same language except for the different patents asserted in each.  Id. at 1.  The Court further observed that the plaintiff “could have been more specific” in its identification of accused products, given that there was additional public information available about them.  Id.  However, the Court found plaintiff’s description “adequate” enough to survive dismissal of the direct infringement claims.  Id.

However, because the allegations of indirect infringement provided no detail as to when or what kind of written notice of infringement the defendant received, the Court dismissed these claims.  Id. at 1-2.  As the willfulness allegations were “similarly deficient,” the Court dismissed them as well.  Id. at 2.
While plaintiff had requested leave to amend, the Court did not “know what facts Plaintiff could allege.  As Defendant points out, Plaintiff has not asserted any additional facts that it could plead.”  Id.  While recognizing that Rule 15 allows amendment “when justice so requires,” this was a situation where the Court could not conclude that “justice requires anything in the absence of a proposed amended complaint,” particularly where “Plaintiff could have amended as a matter of course . . . after Defendant’s motion was filed” but did not.  Therefore, the Court denied the request for leave to amend, but noted that it would “consider” allowing amendment if plaintiff filed a motion to amend.  Id.
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In the long-running and complex case of Honeywell International Inc., et al. v. Nokia Corp., et al. Judge Stark was recently tasked with reviewing the Clerk of Court’s determinations regarding taxation of costs of two prevailing defendants. Defendants FujiFilm and Samsung succeeding in invalidating the plaintiff’s patent-in-suit then filed Bills of Costs seeking $452,419.77 and $347,495.63 respectively. The Clerk granted only $85.80 of photocopy costs requested by Samsung and denied the balance of Bills of Costs. The defendants moved for a review of the Clerk’s orders, and Judge Stark considered the costs de novo, addressing both whether the costs where adequately supported and allowable and whether Local Rule 54.1 conflicts with Federal Rule 54 and 28 U.S.C. § 1920. Honeywell International Inc., et al. v. Nokia Corp., et al., C.A. No. 04-1337-LPS, Memo. Or. at 1-9 (D. Del. May 30, 2014).

The defendants argued “essentially that D. Del. LR 54.1 imposes requirements for taxation of costs that are not present in Section 1920, rendering the Local Rule impermissibly narrower than the statute.” For example, defendants pointed out that § 1920 makes transcript and copy costs taxable if they are “necessarily obtained for use in the case,” but the local rule requires transcripts to be “requested by the Court or prepared pursuant to stipulation” and copies to be “attached to a document required to be filed and served” or “admitted into evidence.” Id. at 10. As Judge Stark explained, however, LR 54.1 is a “proper exercise of the Court’s discretion, discretion which is recognized in Section 1920.” Because § 1920 states that “the Court ‘may’ tax costs to the losing party,” the local rule “provides guidance to counsel and litigants as to how this Court has chosen, as a general matter, to exercise its discretion with respect to taxation of costs.” Id. Further, the local rule limits on the items which the Clerk “shall” tax, without limiting the items that the Court might tax, and the Court has greater discretion in taxing costs than the Clerk. Id. at 10-11. Judge Stark therefore found that LR 54.1 was not in conflict with § 1920.

Turning to the specific taxation requests at issue, Judge Stark first found that the defendants had provided “adequately detailed and clear support for the costs,” including “four declarations, attaching in excess of 600 pages of invoices, bills, and summaries of work.” Although Honeywell sought to impose a high standard on the bill of costs to clearly describe each item, Judge Stark noted that “[i]n the context of complex patent litigation, it would be unreasonable to require a party to track and articulate the relevance of each specific document produced in discovery, each deposition noticed, and each exhibit designated for use at trial.” Id. at 12-13. His Honor then considered each category of costs individually, in some cases affirming and in other cases reversing the Clerk’s determinations.

Interestingly, Judge Stark also noted the Supreme Court’s recent decisions in Octane Fitness and Highmark when he mentioned in passing the defendants’ previously-denied motions for an exceptional case finding. Judge Stark indicated that he would order the parties to submit a joint status report regarding whether the Court “can and/or should reevaluate its prior ruling with respect to attorneys fees in light of the recent Supreme Court rulings.” Id. at 4 n.6.

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