September 12, 2012

Judge Robinson Dismisses Declaratory Judgment Action for Noninfringement and Invalidity Under the First-Filed Rule

In Elpida Memory, Inc., et al. v. Intellectual Ventures I, LLC, et al., C.A. No. 11-623-SLR (D. Del.), Judge Robinson granted defendants’ motion to dismiss plaintiffs’ declaratory judgment action under the first-filed rule. Id. at 5. On July 11, 2011, defendants originally filed suit for patent infringement against plaintiffs and several other Dynamic Random Access Memory (DRAM) circuit manufacturers and their customers in the Western District of Washington. Id. at 1-2. On July 12, 2012, defendants also filed a complaint with the ITC alleging that certain of plaintiffs’ products infringed the same three patents-in-suit asserted against plaintiffs in the Western District of Washington action. Id. at 2. Two days later, on July 14, 2011, plaintiffs filed the instant declaratory judgment action against defendants in the District of Delaware for noninfringement and invalidity of the same three patents asserted against plaintiffs in the District of Washington and the ITC. Id. at 2. In response, defendants moved to dismiss or, in the alternative, transfer the Delaware declaratory judgment action based upon the first-filed Washington action. Id. at 2. The Court granted defendants’ motion. Id. at 5. In its reasoning, the Court noted that there is no dispute that “the Washington action encompasses all of the patents and parties at issue in this case, and is the first-filed action as between it and the instant case.” Id. at 4. The Court also noted that the “record does not demonstrate, nor does [plaintiff] contend, that any exceptions to the first-filed rule apply” and that to find otherwise would “eviscerate the first-filed rule as it is currently understood.” Id. at 4.

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September 10, 2012

Judge Robinson dismisses defendant's counterclaim for failure to adequate plead invalidity

Judge Sue L. Robinson recently granted plaintiff's motion to dismiss defendant's invalidity counterclaim but denied plaintiff's motion to strike the corresponding affirmative defense. Internet Media Corporation v. Hearst Newspapers, LLC, C.A. No. 10-690-SLR (D. Del. Sept. 6, 2012). Defendant pled that the patent-in-suit was invalid "for failing to comply with one or more of the requirements for patentability set forth in Title 35 of the U.S. Code, including, but not limited to, §§ 101, 102, 103 and 112." Id. at 2. Noting that, since Twombly and Iqbal, it is clear that a "counterclaim must set forth sufficient facts to give rise to a plausible claim for relief[,]" Judge Robinson held that defendant's counterclaim did not contain "such requisite facts" and granted plaintiff's motion to dismiss, with leave to amend. Id. at 3-4. However, because an affirmative defense "must merely provide fair notice of the issue involved[,]" Judge Robinson denied plaintiff's motion as to defendant's affirmative defense of invalidity. Id. at 5.

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September 7, 2012

Judge Robinson Grants Summary Judgment of Invalidity

Judge Robinson recently considered cross motions for summary judgment of invalidity, infringement, and non-infringement in ongoing litigation over patents covering methods for analyzing cellular, biological samples. Focusing on the lighting system required by the patents-in-suit, Judge Robinson first engaged in the claim construction necessary to decide the dispute. She then denied all of the pending motions except for the defendant’s motion for summary judgment of invalidity based on inadequate written description. See Helicos Biosciences Corp. v. Illumina, Inc., C.A. No. 10-735-SLR, at 27 (D. Del. Aug. 28, 2012).

The defendant, Illumina contended that the asserted claims were invalid for lack of an adequate written description, lack of enablement, and anticipated and/or rendered obvious in view of the prior art. The parties also disputed whether any accused product infringed any of the asserted claims. In order to resolve summary judgment motion on these issues, however, Judge Robinson needed to engage in claim construction. In the parties’ briefing, Illumina proffered constructions for two terms, while the plaintiff, Helicos, did not propose any constructions, arguing that the plain meaning should apply to both terms at issue. While Judge Robinson considered Illumina’s constructions unduly narrow, she also disagreed with Helicos that no construction was required, stating that “a lay jury requires context for such unfamiliar technical language.” Id. at 13. She therefore crafted her own constructions for the two disputed terms and proceeded to consider the summary judgment motions based on these constructions.

With respect to lack of written description and lack of enablement, Judge Robinson concluded that summary judgment of invalidity should be granted: “Illumina has demonstrated, by clear and convincing evidence, that the written description requirement has not been met. Although the parties seem to agree on the ordinary meaning of the word “focus” (to wit, “to make an image sharper”), the complete limitation is in dispute . . . . The court has been unable to reconcile the language chosen by the inventor to describe his invention and the science at issue. Given this hobson’s choice, the court finds the ‘109 patent invalid for lack of written description and enters judgment in favor of Illumina.” Id. at 22-23.

Judge Robinson did not rule on several remaining issues of invalidity because they “hinge[d] on a central issue” that had not been addressed in the parties’ briefing. Id. at 23-24. Similarly, Judge Robinson found that “the record does not sufficiently address infringement under the court’s nowadopted construction. . . . Because the court takes up claim construction and summary judgment simultaneously, and neither party advocated for the construction ultimately adopted by the court, the parties’ summary judgment arguments are not framed in [the proper terms].” Id. at 25-26. Accordingly, Judge Robinson ordered further briefing on infringement and claim construction and denied the balance of the pending motions.

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September 6, 2012

Judge Robinson Denies Motion to Dismiss for Lack of Standing

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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August 27, 2012

Judge Robinson sua sponte issues stay pending early valuation of the case through ADR

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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August 22, 2012

Judge Robinson Finds Evidence of Obviousness and Inequitable Conduct Insufficient, Awards Costs

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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August 22, 2012

Judge Robinson: no new trial based on purportedly improper jury instruction to which no objection was raised.

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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August 21, 2012

Judge Robinson denies transfer after finding no Jumara factors favored transfer

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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August 17, 2012

Judge Robinson Grants Early Summary Judgment of Invalidity

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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August 14, 2012

Judge Robinson stays second-filed action, defers to first-filed court to determine where litigation should proceed.

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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