Nespresso USA file a declaratory judgment complaint against Ethical Coffee Company requesting judgment that Nespresso does not infringement ECC’s patent. Nespresso USA, Inc. v. Ethical Coffee Company SA, No. 16-194-GMS (D. Del. July 13, 2017). In response, ECC filed a counterclaim against Nespresso, as well as three additional defendants which are Switzerland corporations. The Swiss Defendants moved to dismiss for lack of personal jurisdiction. Judge Sleet granted the motion. In doing so, Judge Sleet found that general jurisdiction was not present because “there [were] no ties between the companies and Delaware that render them essentially at home in this state[.]” Id. at 5. Regarding specific jurisdiction, Judge Sleet found that the Swiss Defendants were not subject to personal jurisdiction under the stream of commerce theory because they did not “did not introduce the Nespresso machines into the stream of commerce,” therefore ECC could not demonstrate that they “placed–or otherwise influenced the placement of–the Nespresso machines into either the United States market generally or the Delaware market specifically.” Id. at 6-7. Nor could the Swiss Defendants be held responsible for the actions of their subsidiary, Nespresso, because the mere ownership of a subsidiary or a patent, without more, does not justify the assertion of personal jurisdiction on the parent/foreign patentee. Id.at 7. Judge Sleet also found a lack of evidence to support personal jurisdiction under an agency theory. Id.at 8-9. Because of the “bare assertions” in this case, Judge Sleet denied ECC’s request for jurisdictional discovery. Id. at 14.
Senior District Judge Sleet recently considered a motion to dismiss on Section 101 grounds that challenged a patent claiming “a computer implemented method of displaying search results.” As an initial matter, Judge Sleet found that it was appropriate to consider Section 101 arguments at the pleadings stage because the plaintiff “failed to identify any specific claim construction issues that could impact the analysis.” Blackbird Tech LLC v. Advanced Discovery Inc., et al., C.A. No. 16-413-GMS, Memo. at 7-8 (D. Del. June 26, 2017).
Judge Sleet went on to find that “the claims of the asserted patent are drawn to the steps of 1) conducting a search based on a search query, 2) determining a concept associated with a search query, 3) and then ranking the search results based on which documents are most relevant to that concept [which are] merely ‘generalized steps to be performed on a computer using conventional computer activity’ and therefore an abstract idea.” Id. at 8. Moreover, there was no inventive concept to transform the abstract idea into patentable subject matter: “The court is unable to discern the inventive contribution to the art made by claims that merely provide for conducting a search, determining a concept associated with the search, ranking the search results, and then displaying the results. Rather, the claims recite generic computer components . . . to perform the very same sorting and rankings steps that humans can perform using pen and paper.” Id. at 10-11.
Judge Sleet did not invalidate every asserted claim, however. The plaintiff argued that “the validity of claims 2-9, 11-15, 17-24, and 26-30 should be upheld because defendants failed to carry their burden of establishing a representative claim. Although [the defendant] conducted a thorough analysis of each of the ‘specifically asserted claims of the ’717 patent, it undisputedly failed to identify a representative claim. Because [the plaintiff] has properly raised the representative claim issue, the court concludes that [the defendant] cannot meet is burden of establishing the § 101 defense with respect to each of the twenty-six dependent claims that were not addressed in the briefing.” Id. at 8 n.1.
Judge Gregory M. Sleet recently transferred a case to the Central District of California, finding that all but two Jumara factors weighed in favor of transfer. Blackbird Tech LLC v. TuffStuff Fitness, International, Inc., C.A. No. 16-733-GMS (D. Del. Apr. 27, 2017). Judge Sleet explained that the plaintiff’s forum choice weighed in favor of maintaining the litigation in Delaware, but it did not warrant maximum deference because “Delaware is not its ‘home turf’ or principal place of business.” The Court found that the convenience of witnesses weighed against transfer, but only slightly. However, “several factors counsel transfer: the defendant’s choice of forum, convenience of the parties, location where the claim arose, the location of relevant books and records, and court congestion.” With respect to court congestion, the Court noted that the time to trial in the Central District of California was roughly five months shorter than that in Delaware, and the overall disposition time in the Central District of California was roughly four months shorter than in Delaware.
The United States District Court for the District of Delaware announced today that the Honorable Gregory M. Sleet will become a Senior United States District Court Judge as of May 1, 2017, and intends to render substantial judicial service in that role going forward.
The Court’s official announcement regarding Judge Sleet can be viewed HERE.
Judge Sleet recently ruled on a motion to dismiss direct and indirect infringement claims in a case involving VoIP technology. IP Communication Solutions, LLC v. Viber Media (USA) Inc., C.A. No. 16-134-GMS (D. Del. Apr. 5, 2017). The defendant argued that the allegations of direct infringement failed to adequately put it on notice of what it was to defend, and cited as support cases in which allegations relating to unidentified products were dismissed. Judge Sleet disagreed with the defendant’s reliance on those cases, and explained that in those cases the alleged infringers marketed a number of products that could possibly infringe product claims. On the contrary, here, the defendant marketed a single mobile VoIP client application supported by a server that together were alleged to perform a number of steps that would infringe method claims, so the defendant could not persuasively argue that it was not on notice of what the claims targeted simply because the claims did not specifically identify the accused instrumentality. With respect to indirect infringement, however, Judge Sleet agreed with the defendant that the evidence relied upon (webpages showing how customers use the VoIP application to make calls) did not rise to the level of showing that the defendant “specifically instructed or directed customers to use the Viber application and corresponding server system in a manner that would infringe.”
Judge Gregory M. Sleet recently considered defendants’ motion to stay pending inter partes review of six of the eleven patents-in-suit. Koninklijke Philips N.V., et al. v. ASUSTek Computer Inc., et al., Nos. 15-1125-GMS, 15-1126-GMS, 15-1127-GMS, 15-1128-GMS, 15-1130-GMS, 15-1131-GMS, 15-1170-GMS (D. Del. Mar. 30, 2017). Judge Sleet denied the motion without prejudice to renew upon institution of the petitions by the U.S. Patent and Trademark Office. Id. at 1 n.1.
Judge Gregory M. Sleet recently considered defendants’ motion to stay pending inter partes review of one patent in suit. f’Real Foods, LLC v. Hamilton Beach Brands, Inc., No. 16-41-GMS (D. Del. Mar. 9, 2017). Judge Sleet denied the motion, finding that the plaintiff would suffer undue prejudice and because the litigation at issue “will be minimally simplified.” Id. at 2. Judge Sleet importantly noted that the parties are direct competitors and that the Patent Trial and Appeal Board instituted inter partes review on only one claim of one of the patents in suit. Id. at 2, n.3. Further, there were many issues in the litigation that would not be impacted by the inter partes review, namely “the litigation of the two patents-in-suit for which Defendants have not sought IPR, trademark infringement issues, and Defendants inequitable conduct and antitrust counterclaims.” Id. at 3, n.4 (internal quotations omitted).
Judge Gregory M. Sleet, recently granted defendants’ motion for summary judgment of non-infringement based on upon the Court’s construction of the limitation “changing [price] information.” Quest Licensing Corporation v. Bloomberg L.P., No. 14-561-GMS (D. Del. Jan. 19, 2017). Defendants argued that summary judgment was appropriate because “defendants’ accused systems do not receive or supply ‘only data that has changed’ as required by all of the asserted claims of the patent-in-suit.” Id. at 3. Judge Sleet agreed. The Court previously construed the term “changing information” to mean “only [price] data that has changed,” and it was undisputed that the accused systems receive and supply information that “always includes non-changing information such as the stock symbol.” Id. at 5-6. Judge Sleet was not persuaded that the Court should revisit its claim construction ruling. Id. at 6.
In IOENGINE, LLC v. Interactive Media Corp. d/b/a/ Kanguru Solutions, C.A. No. 14-1571-GMS, Judge Gregory M. Sleet denied Defendant’s motion for summary judgment of invalidity and non-infringement of the independent claims of the patent-in-suit (U.S. Patent No. 8,539,047), based on the contention that the patent was directed to patent-ineligible subject matter. Defendant argued the claims were directed to the abstract idea of “providing communication with computing devices.” The Court disagreed, finding the claims analogous to those held to not be abstract ideas in McRO, Inc. v. Bandai Namco Games Am. Inc., 837 F.3d 1299 (Fed. Cir. 2016), as they recited “a specific arrangement of components and a very specific implementation and structure of the executable program code.” Id. at 2 n.2 (citing McRo). The claims were also distinguishable from those in Ultramercial, Inc. v. Hulu, LLC, 772 F.3d 709 (Fed. Cir. 2014) as they defined “a tangible portable device with an unconventional hardware configuration that is able to run specific program code to provide the claimed functionality.” Id. “More important, the court agrees, as [Plaintiff] maintains, that the Independent Claims of the ‘047 patent are directed to a “specific asserted improvement in computer capabilities,” not to an abstract idea “for which computers are invoked merely as a tool,” citing the specification as support. Id. Having concluded the claims were not directed the abstract ideas, the Court did not reach step two of the Alice test.
In a recent Memorandum, Judge Gregory M. Sleet denied defendant Imation Corp.’s (“Imation”) motion to dismiss plaintiff IOENGINE, LLC’s (“IOENGINE”) complaint for lack of standing pursuant to Federal Rules of Civil Procedure 12(c) and 12(b)(1). The inventor of the patent-in-suit, United States Patent No. 8,539,047 (“the ’047 patent”), purported to assign the ’047 patent to IOENGINE LLC on October 7, 2014, but IOENGINE LLC’s Certificate of Formation was not filed with the office of the Secretary of State of Delaware until October 8, 2014. Id. at 2. Imation argued that IOENGINE LLC “did not exist at the time of the proferred assignment and therefore could not have received any rights” in the ’047 patent.” Id. at 5. The court agreed that “IOENGINE did not formally exist and could not, as a de jure entity, have obtained ownership of the ’047 patent on October 7, 2014.” Id. at 7.
The court ultimately recognized, however, that IOENGINE was a de facto LLC at the time of the patent assignment on October 7, 2015, and therefore concluded that IOENGINE has standing to bring suit. Id. at 10. Specifically, the court looked to the Delaware “common law-doctrine of de facto incorporation.” Id. at 8. The court could not find “any principled reason to conclude that a limited liability company would or should be treated differently from a corporation when considering the de facto formation of one or the other.” Id. When considering de facto formation, the court focused on facts demonstrating “a good faith, bona fide attempt to comply with the statutory requirements of formation of a limited liability company.” Id. at 10. For example, on October 7, 2014, the formation documents for IOENGINE were finalized, executed, and notarized, and its Delaware registered agent was designated. Id. at 9. The court therefore found that IOENGINE was a de facto LLC on October 7, 2014, and denied Imation’s motion to dismiss. Id. at 10.