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In Intellectual Ventures I LLC, et al. v. Canon Inc., et al., C.A. No. 11-792-SLR (D. Del. Apr. 10, 2014), Judge Sue L. Robinson first resolved several summary judgment motions regarding the six patents asserted by plaintiffs (“IV”) that remained at issue: U.S. Patent Nos. 5,754,348 (“the ‘348 patent”), 6,121,960 (“the ‘960 patent”), 6,221,686 (“the ‘686 patent”), 6,023,081 (“the ‘081 patent”), 6,979,587 (“the ‘587 patent”), 7,365,298 (“the ‘298 patent”).

With respect to the ‘348 Patent, Judge Robinson found a genuine issue of material fact regarding whether the “zoom features” of the accused products satisfied the limitation of “selecting for magnification a selected region of an original image in the graphical user interface,” and therefore defendant’s (“Canon”) motion for summary of non-infringement. Turning to Cannon’s motion for summary judgment of invalidity of the ‘348 patent, Judge Robinson was first required to determine whether the term “digital image magnification in a graphical user interface” from the preamble of claim 1 was limiting. Both parties cited to Catalina Mktg. Int’l Inc. v. Cool savings.com, Inc., 289 F.3d 801 (Fed. Cir. 2002) as support for their positions, and Judge Robinson ultimately determined that the preamble was limiting. As Judge Robinson explained, the applicant “emphasized both ‘digital image magnification’ and ‘in the graphical user interface’ in distinguishing the invention from the prior art.” Judge Robinson found, however, that the experts’ disagreement with respect to the anticipatory references at issue was sufficient to create a genuine issue of material fact and denied Canon’s motion for summary judgment of invalidity. Id. at 9-13.

Judge Robinson also denied Canon’s motion for summary judgment of non-infringement as to the ‘960 patent, explaining that “[a]ttorney argument and conclusory expert opinions are insufficient to meet Canon’s burden of showing that there is no genuine issue of material fact.” As to invalidity of the ‘960 patent, Judge Robinson explained that in the Court’s prior claim construction order, claims 1 and 26 were found indefinite in view of the limitations “computing device for providing a main image” and “means for computing, the means for computing providing a main image,” respectively. In this regard, Canon’s motion for summary judgment was granted. However, the remainder of Canon’s motion on invalidity was denied in light of conflicting expert testimony. Id. at 16-20.

As to the ‘686 patent, Judge Robinson denied Canon’s motion for summary judgment of invalidity for claims 14 and 16. Judge Robinson further explained that Canon argued only that claims 14 and 16 cannot be infringed because they are invalid in light of the prior art, and did not provide any other opinion as to non-infringement of these claims. Judge Robinson therefore granted IV’s motion for partial summary judgment as to infringement of those claims. As to claim 15 of the ‘686 patent, Judge Robinson granted Canon’s motion for summary judgment of non-infringement under the doctrine of equivalents. Id. at 21-24.

As to the ’081 patent, Judge Robinson denied Canon’s motion for summary judgment of invalidity, and denied Canon’s motion for summary judgment of non-infringement, in part. Turning to the ’587 patent, Judge Robinson granted Canon’s motion for summary judgment of non-infringement, noting that “[a]s explained in the court’s claim construction order, the applicant differentiated the claimed field stop layer from two layers found in the prior art, one of which was formed after the field area.” In this regard, Judge Robinson found the prosecution history to foreclose IV’s infringement argument. Judge Robinson, however, denied Canon’s motion for summary judgment of invalidity for the ’587 patent. Id. at 25-31.

Canon’s motion for summary judgment of non-infringement of the ‘298 patent was granted. Judge Robinson granted this motion in view of the fact that the Court’s claim construction required a “specific relationship to be present,” and IV’s expert could not “point to the two layers meeting” the limitation at issue. Canon’s motion for summary judgment of invalidity of the ‘298 patent, however, was denied. Id. at 31-35.

Lastly, Judge Robinson considered the parties motions to exclude certain testimony and evidence. Canon moved to exclude the testimony of IV’s technical experts “on secondary considerations regarding invalidity, particularly long-felt need and commercial success.” Canon argued that IV’s experts “have no training, education, experience, or specialized knowledge in the areas of economics, IP licensing, or any similar area that would qualify them to opine regarding the commercial aspects of the commercial success inquiry.” IV’s technical experts have PhDs in electrical engineering and/or computer science, and each have over 20 years of experience in their respective fields. While Judge Robinson found these qualifications to meet the “liberal standard for ‘specialized knowledge’ under Federal Rule of Evidence 702,” Judge Robinson also noted that “[a]s to the commercial success testimony, neither expert has a specific background in economics or the like.” Judge Robinson nevertheless denied Canon’s motion to exclude the testimony of IV’s experts, as “[n]either party . . . made clear to the court the specific testimony IV intends to present at trial, or the basis for that testimony.” Judge Robinson noted that IV would be required to make a proffer at trial before such testimony would be permitted. Id. at 35-36.

IV moved to exclude Canon’s experts on obviousness, arguing that the experts “used the asserted claims of the patents-in-suit as guides to find missing elements in the prior art.” Judge Robinson denied Canon’s motion to exclude, finding that “after identifying the prior art, Canon’s experts applied an obviousness analysis to reach their opinions regarding obviousness of the patents-in-suit” and that “IV is free to challenge Canon’s experts on cross-examination as to why a person of ordinary skill in the art would be motivated to combine the selected references.” Id. at 36-37.

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In Andrulis Pharmaceuticals Corp. v. Celgene Corporation, C.A. No. 13-1644-RGA (D. Del. Apr. 10, 2014), Judge Richard G. Andrews considered defendant’s motion to dismiss plaintiff’s direct and induced infringement claims for failure to state a claim. As to direct infringement, plaintiff alleged both “undivided” direct infringement and joint infringement. Id. at 1.

Judge Andrews dismissed plaintiff’s undivided direct infringement claim, which alleged that plaintiff itself directly “administers the patented method.” Id. at 1-2. Plaintiff argued that dismissal was inappropriate because the pleading “complies with Form 18.” Judge Andrews explained, however, that compliance with Form 18 is “not limited to whether the form was simply parroted.” Id. Rather, Judge Andrews found that “notice and facial plausibility,” were required, which were both found to be lacking with respect to the undivided direct infringement claim. Id. Additionally, in response to plaintiff’s argument that “dismissal would require construing the claims, which is inappropriate at the pleadings phase,” Judge Andrews acknowledged in a footnote that “I am always hesitant to engage in claim construction without a Markman hearing.” Id. at 2 n.1. In this case, however, Judge Andrews found occasion to note that “the claim at issue is a method claim that cannot possibly be read to make direct infringers out of anyone other than the medical personnel who treat patients.” Id.

Judge Andrews next considered plaintiff’s joint direct infringement claim, which alleged that “physicians administer the patented method under [defendant’s] direction and control.” Id. at 2. Finding these claims to survive the motion to dismiss, Judge Andrews explained that plaintiff “has pled more than enough factual allegations describing the relationship between prescribing doctors and Celgene” that would plausibly support the inference that defendant “direct or controls” the “doctors’ performance of the claimed method.” Id. at 3.

Judge Andrews also found plaintiff’s induced infringement claim to survive the motion to dismiss. Id. at 3-4. Defendant argued that “disseminating publications about an unapproved use of a product does not serve as evidence of intent that the product be used for that unapproved use because the FDA guidelines allow for dissemination of these materials.” Id. Judge Andrews found, however, that “[j]ust because the FDA labels materials as ‘non-promotional’ does not mean that doctors do not view these materials as promoting off-label uses.” Id. at 4. Accordingly, as Judge Andrews explained, “[t]he fact that [defendant] was aware of the patent and disseminated materials which it knew might be viewed as promoting that use is sufficient at this stage.” Id.

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Judge Leonard P. Stark recently transferred a case to the Northern District of California based in part on the plaintiff’s actions and representations made to the Judicial Panel on Multidistrict Litigation. Genetic Technologies Ltd. v. Natera, Inc., C.A. No. 12-1737-LPS (D. Del. Apr. 15, 2014). Specifically, the Court noted that “[b]efore the [JPML], [the plaintiff] contended the Northern District was preferable to Delaware as a venue for centralizing pre-trial litigation.” Id. at 3. The JPML declined consolidating the cases into an MDL, leaving the plaintiff litigating in Delaware, North Carolina, New Jersey, and the Northern District of California. Although Judge Stark found that the plaintiff had rational reasons for wanting to litigate this action in Delaware, the Court found that the plaintiff’s representation to the JPML, as well as several other Jumara factors (including, notably, the convenience to the parties of litigating in Northern California, where the defendant’s principle place of business is located and which is some 2,500 miles closer to the plaintiff’s Australian headquarters than Delaware), weighed in favor of transferring the case. Id. at 2-4.

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Chief Judge Gregory M. Sleet recently issued a memorandum and order resolving a post-trial dispute regarding the appropriate royalty rate to apply to post-verdict infringement. Telcordia Technologies, Inc. v. Cisco Systems, Inc., C.A. No. 04-876-GMS (D. Del. Apr. 14, 2014). The Court previously had found that a permanent injunction was not warranted, and ordered the parties to negotiate the terms of a reasonable royalty rate for post-verdict infringement. Id. at 1. The parties were unable to reach agreement, however, and ultimately submitted competing proposals that amounted to a difference of roughly $8.9 million. Id. at 4.

Chief Judge Sleet noted that royalty rates applied to post-verdict ongoing infringement frequently exceed royalty rates found at trial because of the parties’ changed legal status following a verdict, but that market circumstances also need to be considered in the analysis. Id. at 7. The Court found that the plaintiff was in a stronger bargaining position after prevailing at trial, and on appeal, but was not in a strong enough position to warrant the 3.5% “market rate” the plaintiff proposed with respect to its ‘763 and ‘633 patents (through the expiration of the ‘763 patent, after which the plaintiff proposed a 2% market rate through the expiration of the ‘633 patent). Id. at 8. The defendant proposed an “effective rate” of 0.64% on the two patents. The Court ultimately found that a 1.25% royalty rate on the ‘763 patent, and a 1% royalty rate on the ‘633 patent, were appropriate under the circumstances. Id. at 9.

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Judge Richard G. Andrews construed the following claim terms of U.S. Patents Nos. 6,335,031 and 6,316,023 at issue in the Novartis Pharmaceuticals Corp., et al. v. Alvogen Pine Brook, Inc., et al., C.A. No. 13-52-RGA (consol.) (D. Del. Apr. 7, 2014) litigation:

“antioxidant”
“about 0.01 to about 0.5 percent by about 0.01 to about 0.5 percent by
weight”
“diluent or carrier”
“a/the composition”
“an amount of antioxidant effective to stabilize Compound A from degradation”
“stabilizing”

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Judge Sue L. Robinson recently sanctioned a plaintiff for its objectively unreasonable claim construction position. Technology Innovations, LLC v. Amazon.com, Inc., Civ. No. 11-690-SLR (D. Del. Mar. 31, 2014). At issue was the plaintiff’s allegation (later withdrawn following a motion to dismiss and for sanctions) that Amazon.com’s Kindle product infringed the plaintiff’s U.S. Patent No. 5,517,407, titled “Device for including enhancing information with printed information and method for electronic searching thereof.” As the Court explained, “[t]he specification is replete with references to providing ‘enhancing information’ to aid the reader of ‘printed information’ and makes it clear that ‘printed information’ refers to pages provided in a conventional book.” Id. at 22. Further, the “background of the invention indicates that the patentee was concerned with problems associated with printed and electronic indices then available to users of printed publications. . . . The patent distinguishes electronic books from the present invention and points out that ‘they do not enhance printed publications. . . . Additionally, figures 1-8 illustrate a book with printed pages.” Id.

The Court therefore explained that the plaintiff’s “definition for ‘printed’ – to encompass ‘any configuration in which information is presented for direct human perception’ – is astonishingly broad.” Id. at 23. The plaintiff’s proposed construction was based on a sentence in the specification referring to a printed work as a “configuration in which information is presented for direct human perception.” Id. at 23-24. But the Court noted that the plaintiff ignored the next sentence in the specification, which provided, “[t]hus, for example, in addition to a cloth- (or other hard-) bound, or soft-bound book, work 11 may be a magazine, or other paper based media . . . .” Id. at 24. Finding that it was not objectively reasonable in this case to allege that a Kindle would infringe the ‘407 patent, the Court sanctioned the plaintiff under Rule 11. Id. at 24.

The Court also granted the defendant’s motion for summary judgment of invalidity of the plaintiff’s remaining asserted U.S. Patent No. 7,429,965, based on indefiniteness.

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In Masimo Corporation v. Philips Electronic North America Corporation, et al., C.A. Nos. 09-80, 11-742-LPS-MPT, Magistrate Judge Mary Pat Thynge previously issued three Reports and Recommendations addressing the parties’ motions for summary judgment and Daubert motions. Having heard oral argument on the parties’ objections, Judge Leonard P. Stark has issued rulings relating to the Reports. Memorandum Opinion (D. Del. Mar. 31, 2014).

The Court first offered “comments about how it views objections to Reports and Recommendations filed by Magistrate Judges.” Id. at 2. While the only issues on appeal to the District Court are those that are specifically addressed in objections, parties do not waive their right to appeal to the Federal Circuit if they do not lodge objections to a Report and Recommendation. Id. at 3-5. The Court then explained that “generalized” objections to a Report and Recommendation are “unhelpful” and insufficient to preserve a party’s right to District Judge review; the Court, therefore, construed any objection raised by the parties here, but not briefed, as waived with regard to review by a District Judge. Id. at 5-7. It was also inappropriate for a party to incorporate underlying briefs by reference in their objection “as a way of avoiding the page limits on objections.” Id. at 8. Parties must also adhere to their original arguments when objecting, and not offer new ones, but may “explain their view of the Magistrate Judge’s determinations and analysis.” Id. at 9. Finally, parties must identify and properly apply the proper standard of review. Id. at 10. “As the District Judge is essentially undertaking appellate review of the work of a Magistrate Judge, it is imperative that the parties accurately articulate and apply the correct standard of review.” Id.

Turning to the parties’ objections, the Court first reviewed Magistrate Judge Thynge’s findings on summary judgment for invalidity and non-infringement de novo, and sustained a number of the parties’ objections. See id. at 10-29. The Court did not adopt the following findings of the Report, concluding that genuine issues of material fact existed: (1) the Report’s grant of Philips’ motion for summary judgment of invalidity of Masimo’s ‘222 patent due to lack of written description, id. at 10-16; (2) the Report’s grant of Philips’ motion for summary judgment of non-infringement of Masimo’s ‘984 patent (because Philips did not oppose Masimo’s objection), id. at 16-17; (3) the grant of Philips’ motion for summary judgment on no literal infringement of Masimo’s ‘535 patent , id. at 22-23. Finally, the Court sustained Philip’s objection to the Report and granted its motion for summary judgment of no infringement of Masimo’s ‘272 patent. Masimo’s arguments for the denial of summary judgment here were based on its expert’s “conclusory opinion and do not provide sufficient bases for a finding of infringement.” Id. at 28-29. As to Magistrate Judge Thynge’s later Report that decided motions for summary judgment on damages issues (willfulness and lost profits) , the Court adopted that Report in full. Id. at 37-39.

The Court also reviewed non-dispositive pre-trial matters, including Daubert motions (previously discussed here), for clear error or abuse of discretion. The Court sustained Masimo’s objection that it could not challenge the status of a certain reference as prior art. Id. at 17-19. It also sustained Masimo’s objection to the finding that its damages expert was “unfamiliar with the supporting documents and other details for his assumptions.” Id. at 33. The Court concluded that the expert, “far from relying on a third party [as had been done in a case cited in the Report] . . . legitimately relied on his staff and dictated the parameters of the analysis.” Id. 33-34.
While the Court overruled Masimo’s objection to the recommendation that its expert could only testify as to the “lack of peer reviewed studies on Nonin PureSat showing that it is an acceptable alternative, but cannot opine or testify that Nonin PureSat is an unacceptable alternative due to the lack of such studies,” id. at 32 (emphasis in original), it did note a concern about whether “it can effectively walk the fine line draw by today’s ruling.” Id. at 33. “It may be appropriate to reevaluate these issues in the context of a motion in limine, if either side chooses to file on in connection with preparation of the final pretrial order.” Id.

In a subsequent Order, Judge Stark supplemented His Honor’s review and overruled an additional objection of Phillips to the denial of its motion for summary judgment of invalidity of Masimo’s ‘984 patent, an objection that had not been covered in the March 31 opinion. Order(D. Del. Apr. 14, 2014). In addition to the fact that Magistrate Judge Thynge had idenfied issues of material fact, Judge Stark had also sustained Masimo’s objection to the finding that it could not challenge a certain reference’s status as prior art to the ‘984 patent. This also created a material issue as to whether the reference was prior art. Id. at 3.

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In Intellectual Ventures I LLC v. Canon Inc., et al., C.A. No. 11-792-SLR (D. Del. Apr. 10, 2014), Judge Sue L. Robinson construed a number of claim terms across six patents:

“Selecting for magnification a selected region of an original image in the graphical user interface”
“Floating plane”
“Logical operators to provide different blending/merging effects”
“Means for displaying a composite image … further wherein individual pixels of the means for displaying can be dedicated simultaneously to both the main image and the representation of at least one input zone”
“layer”
“Enhancement layer having a doping concentration that is less than the first doping concentration”
“image sensor”
“A silicide layer on a portion of the image sensor wherein an area overlying the pinned photodiode is devoid of the silicide layer”
“A field stop layer being formed beneath the field area and being wider than the field area in a direction towards the active area”
“A channel area having a bottle-neck structure connecting to the photodiode area and the floating diffusion area”
“Multi-layer interlayer insulating films … stacked in at least two layers of oxide film having different density and the refractive index so that the density and the refractive index of the upper interlayer insulating film becomes lower than that of the lower interlayer insulating film as the multilayer interlayer insulating films proceed upward”
“A light shield layer and an element protecting film sequentially stacked on the multi-layer interlayer insulating film”
“Wherein the density of the oxide films becomes higher in the order of PE-CVD<HDP-CVD<LP-CVD<thermal oxidations”
In its Order, the Court also held that certain claims of U.S. Patent No. 6,121,960 were invalid under Section 112. As to the claim term “clear space around a blended area to highlight the area of blending,” the Court found its claim was invalid as lacking written description and as indefinite. See id. at 3-4. The “clear space” limitation only appeared in the claim itself; the portion of the specification identified by plaintiffs in support did not indicate the meaning of this term.

The Court also found other claims of this patent invalid due to the indefiniteness of means-plus-function terms “a computing device for providing a main image” and “means for computing, the means for computing providing a main image.” See id. at 4-9.

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In a recent memorandum opinion, Judge Richard G. Andrews denied defendant’s partial summary judgment motion of indefiniteness. Pi-Net International Inc. v. JPMorgan Chase & Co., C.A. No. 12-282-RGA (D. Del. Apr. 7, 2014). Given the potential for judicial efficiency, Judge Andrews had granted defendants leave to file their partial motion for summary judgment, in which it was argued that the following five terms, which appeared in several claims of the three patents-in-suit, were indefinite:

(1) “means for transmitting a transaction request from said transactional application”;
(2) “means for processing said transaction request”;
(3) “a computer system executing the Back-end transactional application for processing the transaction request in real-time”;
(4) “keeping a transaction flow captive”;
(5) “routed transactional data structure.”

Id. at 2. As to the first two terms, defendant argued that the terms were “computer-implemented means-plus-function terms for which no algorithm is disclosed.” Id. Judge Andrews explained that in general, when there exists the “special case where the corresponding structure of a means-plus-function term is a computer, the patent must disclose an algorithm for performing the claimed function.” Id. at 6. Judge Andrews further explained, however, that there is a “narrow” exception to that general rule: the Federal Circuit has held that “it 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. (quoting In re Katz Interactive Call Processing Patent Litig., 639 F.3d 1303, 1316 (Fed. Cir. 2011)).

As Judge Andrews explained, “[a]t this stage, the Court cannot rule out the possibility that a general purpose computer without special programming could perform the claimed function, or that an algorithm is disclosed.” Id. at 8. Specifically, Judge Andrews explained that defendant argues strenuously that the terms are invalid because the functions at issue require more than simply plugging in a general purpose computer.” Id. at 12. Judge Andrews explained, however, that in order to agree with defendant’s position, “an expert opinion comparing the functional capabilities of a general purpose computer during the relevant time frame with the disputed functionalities might have been helpful.” Id. Defendant, however, did not provide any such opinion. Judge Andrews thus concluded that based on the current record, which lacked “the benefit of a claim construction hearing, it [was] difficult to say that no disputed issue of material fact exists regarding whether the claimed functions could have been performed by a general purpose computer without special programming.” Id. at 13. Judge Andrews additionally noted that even if the exception for a “general purpose processor” did not apply, “the flow chart in Figure 8, common to all three patent specifications, might be sufficient to satisfy the algorithm requirement.” Id. at 12.

As to the third term, Judge Andrews noted in a parenthetical that a court will not construe a limitation as a means-plus-function term if it contains a term that “is used in common parlance or by persons of skill in the pertinent art to designate structure.” Id. at 13. As Judge Andrews explained, the claim term at issue included “computer system,” and therefore could not be said to be “devoid of anything that can be construed as structure.”Id. at 15. In other words, “[a] computer system is a physical structure that [was] sufficient to prevent [defendant] from rebutting the presumption” that a term that does not contain the word “means” should not be construed as a means-plus-function term. Id.

As to the last two terms, plaintiff asserted that they were “insolubly ambiguous because the patentee did not define them in the specification or the prosecution history and they do not have a generally accepted meaning to a PHOSITA.” Id. at 2-3. Judge Andrews explained that “[a]lthough it does appear that the link between [plaintiff’s expert’s] cited passages and his proposed definitions is somewhat tenuous in places, there is no competing declaration or affidavit from [a defendant] expert for the Court to rely upon.” Id. at 16. That is, “[w]ithout an opposing expert to identify the deficiencies, if any, in [plaintiff’s expert’s] declaration, it is difficult to say that his opinion regarding a PHOSITA’s understanding of the claim language is incorrect.” Id.

In accordance with the analysis above, Judge Andrews denied defendant’s partial motion for summary judgment.

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Judge Robinson has issued a decision on several pending motions to dismiss for lack of subject matter jurisdiction in cases filed by plaintiff Data Speed Technology LLC. The moving defendants alleged lack of standing to sue because the plaintiff had not demonstrated that it owns all rights in the patent-in-suit. Judge Robinson ultimately denied the motions, but not before indicating that the chain of ownership of the patent-in-suit was “in a muddle.” The chronology of ownership of the patent-in-suit was complicated, even including litigation over title to the application leading to the patent-in-suit, and Judge Robinson explained the chain of title in depth after pulling relevant facts from several different parties’ submissions. Ultimately, although she found the “efforts of [the inventors] to monetize their invention through [assignment to] another individual . . . [could] be charitably characterized as less than sophisticated,” for the purposes of the motions to dismiss, the chain of title had been sufficiently proven. Data Speed Tech. LLC v. EMC Corp., et al., C.A. No. 13-616-SLR, et al., Memo. at 10 (D. Del. Apr. 8, 2014).

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