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Last month, Judge Robinson issued an opinion considering the standing required to file a patent infringement suit. In MobileMedia Ideas, LLC v. Apple Inc., C.A. No. 10-258-SLR (D. Del. Aug. 16, 2012), the plaintiff, MobileMedia Ideas (“MMI”), filed suit against Apple for infringement of sixteen patents. Apples filed a motion to dismiss on the ground that MMI lacked subject matter standing. Judge Robinson ultimately denied Apple’s motion to dismiss, finding that MMI had sufficient standing.

At issue was whether MMI could sue on its own or whether it needed to also joint its three licensees. The licensees were former owners of the patents-in-suit who had entered into an assignment and license-back agreement with MMI. Each licensee also partially owned MMI. “Typically,” Judge Robinson noted, “courts are presented with the situation where an exclusive licensee sues an alleged infringer, and it must be determined whether the licensee has standing. [Here] the court is presented with the rather unique, converse scenario ‘in which the patent owner seeks to bring suit, requiring [the court] to determine whether the patent owner transferred away sufficient rights to divest it of any right to sue.’” Id. at 12 (citations omitted).

“[T]o have constitutional standing, a party’s interests in the patents must ‘include sufficient exclusionary rights such that [it] suffers an injury in fact from infringing activities. If [it] holds all substantial rights, it can sue in its name alone. If [it] holds less than all substantial rights but sufficient exclusionary rights that it suffers injury in fact, it can sue as a co-party.’” Id. at 10. Proceeding to examine the transfer of patent rights between MMI and its licensees, Judge Robinson found that one licensee “was delegated the ‘responsibility’ to bring suit, [but] the ‘right’ to sue lies with MMI, [and] [t]he right to sue is of paramount importance in the ‘substantial rights’ analysis.” Id. at 13. She noted that the licensees had assigned MMI “‘the entire right, title and interest in the patents-in-suit,’ . . . [a] transfer of [which] is well known to mean a full assignment of the patent.” Id. at 14. MMI also had other rights “for which the associated enforcement ‘responsibilities’ have been delegated to [a licensee]. MMI has the right to receive patent royalties, for example . . . irrespective of the fact that MMI later allocates its profits to the owners.” Id. Furthermore, “‘the fact that a patent owner has retained a right to a portion of the proceeds of the commercial exploitation of [a] patent . . . does not necessarily defeat what would otherwise be a transfer of all substantial rights in the patent.’” Id. (citations omitted). Finally, “‘[t]he right to dispose of an asset is an important incident of ownership, and such a restriction on that right is a strong indicator’ that not all substantial rights under the patent have been transferred.” Because unanimous approval of all three licensees/owners was required for MMI to sell a patent, this indicated that MMI, not any individual licensee, owned the substantial rights of the patent. Id. (citations omitted).

“In conclusion,” Judge Robinson explained that while the licensees “have retained (or have been granted back) certain rights in the patents-in-suit, the court does not deem such rights ‘substantial’ vis a vis those held by MMI. There is no indication that . . . nonexclusive licensees of MMI holding no legal title to the patents-in-suit, have constitutional standing to sue.” Id. at 15. Accordingly, she found that MMI had standing to sue and denied the motion to dismiss.

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Judge Gregory M. Sleet recently considered defendant’s motion to dismiss, or alternatively to transfer, the pending patent infringement action to Texas where defendant had first-filed a declaratory judgment action involving the same parties and same five patents. Mitek Systems Inc. v. United Services Automobile Association, C.A. No. 12-462 (D. Del. Aug. 30, 2012). Both actions involved various state law claims, such as, breach of contract. Id. at 2. Judge Sleet first determined that the first-filed rule applied, finding that the same patents were at issue in both actions and that the cases involved the same parties. Id. at 3. Even though both cases involve separate state law claims, “it [wa]s clear that the focus of each case [wa]s the intellectual property rights” related to the agreement between the parties. Id. at 4 (internal quotations omitted). Judge Sleet next determined that no exception to the first-filed doctrine applied, such as the forum selection clause of the license agreement at issue in the later-filed action. Id. Judge Sleet held that enforcing the forum selection clause “would violate Delaware’s public policies promoting judicial efficiency and comity served by the first-filed rule.” Id. at 5 (internal quotations omitted). Last, Judge Sleet determined that transfer was appropriate, finding that all but one Jumara factor was either neutral or favored transfer. Id. at 8-15.

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Judge Sue L. Robinson recently issued an order denying defendants’ pending motions to transfer and amend its answer and staying the case pending “an early valuation of the case[.]” Acronis Int’l GmbH v. Symantec Corp., C.A. No. 12-372-SLR (D. Del. Aug. 20, 2012). Id. at 1. After briefing and oral argument on the pending motions, Judge Robinson noted that the “parties have as much a business dispute as a legal dispute[,]” and that an early valuation of the case “may encourage the resolution of the parties’ dispute without incurring the costs and other burdens associated with a more traditional approach to patent litigation[.]” Id. Therefore, Judge Robinson ordered that by the end of October the parties must complete “focused damages discovery,” and she referred the case to Magistrate Judge Thynge “for purposes of managing damages discovery and conducting ADR during this preliminary stage of the proceedings.” Id. at 2.

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Judge Stark recently construed a dozen claim terms relating to patented formulations and methods for making liquid acetaminophen. Cadence Pharmaceuticals, Inc. v. Paddock Laboratories Inc., et al., C.A. No. 11-733-LPS (D. Del. Aug. 22, 2012). The following claim terms were construed:

“stable”
“liquid formulation consisting essentially of acetaminophen dispersed in an aqueous medium”
“buffering agent”
“free radical scavenger”
“an isotonizing agent”
“diluted to a concentration of 2 to 50 mg/ml”
“an aqueous solution”
“an injectable aqueous solution”
“while preserving for a prolonged period”
“deoxygenation of the solution by bubbling with at least one inert gas and/or placing under vacuum, until the oxygen content is below 2 ppm”
“optionally the deoxygenation of the solution is completed by addition of an antioxidant”
“and optionally the aforementioned aqueous solution with an active principal is topped with an inert gas atmosphere heavier than air and placed in a closed container in which the prevailing pressure is 65,000 Pa maximum, and the oxygen content of the aqueous solution is below 2 ppm”
With regard to the claim term “stable”, the Court rejected the defendants’ argument that the term is indefinite under 35 U.S.C. § 112, and therefore not amenable to construction. The Court explained, assuming arguendo that it should even consider indefiniteness in claim construction, that “proof of indefiniteness is an ‘exacting standard’ that requires a determination that the claim term is ‘insolubly ambiguous[]’.” Id. at 5 (quoting Halliburton Energy Servs., Inc. v. M-I LLC, 514 F.3d 1244, 1249-50 (Fed. Cir. 2008)). Here, the Court found that the defendants fell short of showing that the term “stable” was so ambiguous as to be incapable fo construction. Id. at 6.

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Judge Robinson has considered motions for judgment as a matter of law and the question of inequitable conduct in a patent infringement case involving technology for applying thin film coatings to glass. See Asahi Glass Co., Ltd. v. Guardian Indus. Corp., C.A. No. 09-515-SLR (D. Del. Aug. 20, 2012). After partial grants of summary judgment, a denial of defendant’s motion to amend to assert claims of inequitable conduct, and a jury trial on validity, the defendant renewed its motion for judgment as a matter of law and moved for a new trial. Although the jury found that the patents-in-suit were valid, the defendant contended that JMOL or a new trial was appropriate because certain claims were invalid due to obviousness and both patents-in-suit were invalid for failure to list the proper inventorship.

On obviousness, Judge Robinson found that defendant had not “identified clear and convincing evidence of obviousness of the asserted claims of the patents-in-suit. Plaintiffs’ evidence of secondary considerations of nonobviousness . . . provides further rationale for upholding the jury verdict of nonobviousness based on the additional references and combinations of references asserted by defendant. Outside of [one prior art reference], the majority of defendant’s additional obviousness theories were founded primarily on attorney argument.” The court therefore found that “the jury’s verdict of nonobviousness was reasonable and supported by the record.” Id. at 40. Judge Robinson also found that defendants had not proven false inventorship through the improper inclusion of inventors, the improper exclusion of inventors, or a challenge to the jury instructions on inventorship. Id. at 15-22.

Finally, Judge Robinson considered the issue of inequitable conduct. The Court had previously considered defendant’s motion to amend the pleadings to add claims of inequitable conduct. But the defendant’s request to amend came six months after the deadline to amend the pleadings and after the close of fact discovery, so the Court denied it on the basis of unexplained delay. After the jury trial, the defendant again argued that plaintiffs had engaged in inequitable conduct by failing to disclose two of their own patents during prosecution. Judge Robinson found, however, that “defendant’s inequitable conduct argument is based primarily on attorney argument without relevant references in the trial record. The evidence at bar is insufficient to demonstrate either the materiality of [the two patents] or [the inventor’s] intent to deceive the PTO by clear and convincing evidence.” Id. at 44. She awarded plaintiffs their reasonable costs in responding to defendant’s additional inequitable conduct theories raised post-trial: “Insofar as the court agrees with plaintiffs that these theories were procedurally barred, and given that defendant’s inequitable conduct theory with respect to [two other patents] are devoid of merit, the court will order defendant to pay plaintiffs’ reasonable costs associated with preparation of their responsive brief.” Id. at 46.

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In a recent memorandum opinion, Judge Robinson denied a plaintiff’s post-trial motion for judgment as a matter of law and for a new trial. Solvay, S.A. v. Honeywell Int’l Inc., Civ. No. 06-557-SLR (D. Del. Aug. 20, 2012). The patent-at-issue claimed “processes for making 1,1,1,3,3-pentaflouropropane (‘HFC-245fa’).” Id. at 2. At trial, the jury found that the patent was both anticipated and obvious. Id. at 1. The Court found ample evidence to support the jury’s findings, and denied the plaintiff’s motion for judgment as a matter of law of no anticipation or obviousness. Id. at 9, 12, 17.

The Court also denied the plaintiff’s motion for a new trial, which was based, in part, on the argument that the Court’s jury instructions were inconsistent with the manner in which the Court and the parties originally construed claim 1 of the patent-at-issue. Id. at 17. The Court noted that in its Markman order, it construed a reaction in claim 1 as occurring “at a temperature and under a pressure whereby HFC-245fa and HCl are produced in gaseous form and separated from the reaction mixture in a gas stream[.]” Id. at 17. The Court acknowledged that in the final jury instructions, the same portion of claim 1 was construed slightly differently, to read: “at a temperature and under a pressure whereby HFC-245fa and HCl are produced in gaseous form and continuously separated or drawn off from the reaction mixture in a gas stream”. Id. (emphasis in original). The Court noted, though, that “[t]he threshold issue is whether [the plaintiff] properly objected to the change in instructions, thereby preserving its right to raise the instruction as grounds for a new trial.” Id. at 18. Here, the plaintiff “did not object to the [inclusion of ‘continuously’ or ‘or drawn off’] to the claim construction in its notice of objections to the final jury instruction …, and it did not raise any objection before the instructions were read to the jury.” Id. Further, the plaintiff “conceded that the version of the claim construction including the words ‘continuously’ and ‘or drawn off’ was consistent with the court’s previous construction.” Id. at 18-19 (citing trial transcript). Under the circumstances, the Court explained that a new trial based upon the purported improper jury instruction would not be warranted because there was no “grievous unfairness” resulting from the instruction. Id. at 19.

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Judge Sue L. Robinson recently denied defendants’ joint motion to transfer to the Northern District of California where the patents-in-suit were previously litigated. Mosaid Technologies, Inc. v. Sony Ericsson Mobile Communications (USA) Inc., C.A. No. 11-598-SLR (D. Del. Aug. 16, 2012). Judge Ware of the Northern District of California presided over the two previous cases and was, according to defendants, “extensively familiar with the patents.” Id. at 3. Plaintiff was a Canadian corporation with it’s principal place of business in Texas Id. at. 2. Defendant HTC was a Washington corporation with its principal place of business in Washington, and defendant Sony was a Delaware Corporation with its principal place of business in Georgia. Id. Defendants had argued that several of the Jumara public interest factors favored transfer because of Judge Ware’s “‘substantial investments of both time and resources with respect to the subject matter in this case.” Id. at 7. Judge Robinson found those factors neutral, however, noting that Judge Ware recently announced his retirement planned for this month. Id. Judge Robinson found all other factors neutral as well. For example, she determined that this court was “equally well-suited” to construe an agreement at issue under California law, and the named inventors indicated their willingness to travel to Delaware, as needed. Id. at 7-8. “Insofar as no factors favor[ed] transfer in these circumstances[,]” defendants motion was denied. Id. at 9.

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Judge Robinson has granted early summary judgment of invalidity on one patent in several of the Cyberfone patent infringement cases. See Cyberfone Systems, LLC v. Cellco Partnerhsip, et al., C.A. No. 11-827-SLR through 11-835-SLR (D. Del. Aug. 16, 2012). Judge Robinson first determined that under Bancorp Services, L.L.C. v. Sun Life Assurance Co. of Canada, 2012 WL 3037176 (Fed. Cir. July 27, 2012), the Court need not conduct claim construction prior to proceeding with a § 101 analysis. Rather, an early summary judgment even without the benefit of claim construction was appropriate. Cyberfone at 8-9. She then considered the patentability of the claimed invention and found that the patent-in-suit did not meet the “machine-or-transformation test” for patentability of a process claim under In re Bilski, 545 F.3d 943 (Fed. Cir. 2008). The claimed process neither “transformed” the credit card data collected nor was meaningfully limited in scope by the machine on which it operated. Judge Robinson found that “the use of a telephone to capture data does not make the abstract concepts of sorting and storing data somehow patent-eligible, [and to] the extent that a machine is also involved in the sorting or organizing step . . . [t]he machine is just a general purpose computing device being asked to do some unspecified sorting function.” Cyberfone at 11-15. Finally, Judge Robinson found that even aside from the non-dispositive machine-or-transformation test, the patent was too abstract: “[T]he abstract nature of plaintiff’s patent is plainly apparent. The patent, broken down into its component parts, recites steps by which data is obtained, sorted and stored. These steps represent nothing more than a disembodied concept of data sorting and storage and, therefore, the court finds the abstract nature of this patented process to be manifestly apparent.” Id. at 15-16.

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In St. Clair Intellectual Property Consultants, Inc. v. Apple, Inc., C.A. 10-982-LPS (D. Del.), Judge Stark recently issued a claim construction opinion construing disputed claim terms for six patents-in-suit relating to ways in which a computer system can utilize various techniques to achieve improved power conservation. Id. at 1. In the memorandum opinion, the Court construed the following claim terms and phrases:

– “accumulating”
– “accumulating a count indicating the time duration said CPU has allocated to performing . . . [said] idle class activities within a predetermined time period”
– “accumulating a count related to said idle class code thread occurrence detection”
– “execution of a predefined code thread”
– “single common system bus which directly connects the CPU device with the input/output devices”
– “system bus which directly connects the CPU device with said input/output circuit”
– “system bus which connects the CPU device with the input/output device”
– “generating [or generates] a first inactivity indicator after a first predetermined period of inactivity and a second inactivity indicator a second predetermined period of inactivity after generating the first inactivity indicator”
– “[couples device operating power/coupling said circuit operating power] . . . when the [state controller/computer system] is in said [first/second/third] state”
– “polarity control bit”
– “polarity circuit”
– “idle thread execution completion detection means”
– “processor clock speed control means”
– “selectable connector”
– “selection device”
– “controller”
– “bus processing means”
– “power director means which in response to the mode of operation of the mode controller selectively couples each of the plurality of power control lines to said memory cell associated with that power control line such that a signal is generated on the power control line that is dependent upon the state of the memory cell to which it is coupled”

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In a recent memorandum opinion, Judge Robinson granted a defendant’s motion to stay a second-filed action pending the first-filed court’s determination of where the litigation should proceed in light of the first-filed rule. Cellectis S.A. v. Precision Biosciences, Inc., C.A. Nos. 11-890-SLR, 12-204-SLR (D. Del. Aug. 6, 2012). The declaratory judgment plaintiff, Cellectis, (who was the defendant in a mirror image infringement suit filed first in North Carolina), argued that “the first-filed rule should not apply in the first instance because the North Carolina court lacks jurisdiction over [Cellectis].” Id. at 5. The Court noted, though, that Cellectis had previously sued Precision Biosciences in North Carolina, and therefore “should not oppose litigating in a court in which it previously litigated without complaint.” Id. The Court ultimately held that because it was not “evident that the North Carolina court lacks personal jurisdiction . . . the North Carolina court should make that determination in the first place as the first-filed court.” Id. at 6. The Court stayed the case to allow the North Carolina court time to apply the first-filed rule and determine where the parties’ litigation should proceed. Id.

On a separate issue, Judge Robinson clarified that where a complaint is amended “to add patents that issued after the original complaint was filed,” the determination of whether to permit the amendment is controlled by Federal Rule of Civil Procedure 15(d), as opposed to Rule 15(a). Here, the Court permitted Cellectis to amend its complaint to add newly issued patents under Rule 15(d), explaining that (as with the inquiry under Rule 15(a)) leave should be freely given absent evidence of undue delay, bad faith, or dilatory motive, none of which were present in this case. Id. at 8-9. The Court acknowledged that it appeared Cellectis chose to amend its complaint, rather than file a new action for infringement of the newly issued patents, to avoid “first-to-file complications.” Id. at 8.

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