Articles Posted in Mary Pat Thynge, Chief Magistrate Judge

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Chief Magistrate Judge Thynge recently issued a report and recommendation finding that a defendant’s Rule 12(b)(6) motion to dismiss should be granted. Judge Thynge first found that she need not take judicial notice of certain exhibits supplied by the defendant. The exhibits, copies of 3G cellular specifications, were relied on by the Plaintiff’s complaint, which alleges infringement based on the defendant’s practice of the 3G standard. Thus, the specifications were integral to the complaint and the plaintiff had actual notice of them. Therefore, judicial notice was not required. Network Managing Solutions, LLC v. AT&T Mobility, LLC, C.A. No. 16-295-RGA-MPT, Report and Recommendation at 10-11 (D. Del. Nov. 9, 2017).

Turning to the sufficiency of the pleading, Judge Thynge found that the plaintiff “alleges sufficient facts to state a plausible claim because, by showing what the standards require, the standards may be compared with the patents to determine whether defendant, in following these standards, infringes.” Id. at 12. The 3G standards on which the plaintiff’s complaint relied, however, were out of date, ranging from 2009 to 2010 and post-dated by many newer releases of each standard. Accordingly, Judge Thynge found that because “there have been substantive changes to the specifications,” the plaintiff “should be granted leave to amend the complaint to indicate the specific standards defendant allegedly practices that result in infringement.” Id. at 12-13.

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In the declaratory judgment action Tabletop Media, LLC v. AMI Entertainment Network, LLC, C.A. No. 16-1121-RGA-MPT (D. Del. Oct. 10, 2017), Chief Magistrate Judge Mary Pat Thynge recommended that Defendant’s motion to dismiss for lack of subject matter jurisdiction, due to a lack of case or controversy, be denied.  The Court pointed to the following facts in support of its conclusion that an actual case or controversy existed:

Here, [Defendant] AMI asserted its rights under the ‘091 patent and alleged [Plaintiff] Tabletop’s Ziosk had features that were covered by the patent. In addition, AMI requested a response within 10 days. In its response, Tabletop insisted the patent was not relevant to its Ziosk product, but AMI continued to assert the patent’s relevance and requested that its patent lawyer be included in a meeting between the parties. Just as in [Hewlett-Packard v. Acceleron, LLC , 587 F.3d 1358 (Fed. Cir. 2009)], AMI affirmatively contacted Tabletop asserting its patent rights, Tabletop disagreed, and AMI continued to claim that the patent was relevant to Tabletop’s Ziosk. Thus, there is an actual case and controversy because the two parties have opposing legal interests that are redressable by a court decision.

Id. at 11. The Court further noted that a declaratory plaintiff need not cut of licensing discussions before seeking a declaration of its rights, id. at 12; here, the parties had continued discussions after Tabletop filed this suit and AMI had not threatened any litigation but also had not assured it would not sue for infringement.  Finally, the Court observed that exercising its discretion to dismiss the declaratory judgment suit would be inappropriate here, as “[t]his is the type of situation the Declaratory Judgment Act was designed to address. The parties have an adverse legal interest, and, the adverse legal interest is ‘fairly traceable’ to AMI’s conduct.” Id. at 13.

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In Magnetar Technologies Corp., et al. v. Six Flags Theme Parks Inc., et al., C.A. No. 07-127-LPS-MPT (D. Del. Aug. 2, 2017), Chief Magistrate Judge Mary Pat Thynge recommended the grant of Plaintiffs’ motion to correct inventorship, under Section 256, that was filed after the Court had ruled that the patents-in-suit were invalid, in part due to failure to name all inventors.  The Court had thenentered judgment for Defendants and against Plaintiffs, also due to its findings of noninfringement.  The Court’s rulings had been affirmed by the Federal Circuit.

Defendants presented three arguments in opposition: the motion was futile as Plaintiffs lacked legal title to the interest in the invention held by the inventor they sought to add; Plaintiffs had no procedural vehicle through which to seek relief because final judgment had already been entered; and the motion was moot because the patent at issue had been found invalid for reasons in addition to incorrect inventorship. The Court rejected these arguments.  As to futility, the Court concluded that Section 256 requires no showing of ownership in the patent on those seeking to invoke it. Id. at 7-8.  As to the procedural vehicle for hearing the motion, the Court concluded that Section 256 itself sufficed. Id. at 9.  It also concluded that the motion was proper because final judgment had not been entered “as to plaintiffs’ right to correct inventorship.” Id. Finally, as to mootness, the Court pointed to the fact that the outcome of the motion could impact Defendants’ attorney fee requests and would remove the invalidity of certain claims of the patent-in-suit. Id. at 10.

Having rejected these arguments, the Court then recommended that the motion to correct inventorship be granted. Id. at 11.  In light of its rulings, the Court also recommended denial of Defendant’s request for attorneys’ fees in connection with Plaintiffs’ motion. Id. at 12-13.

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Chief Magistrate Judge Mary Pat Thynge recently issued a Report and Recommendation regarding plaintiff’s motion to dismiss defendant’s counterclaims for sham litigation, violation of the Sherman Act, Robinson-Patman Act, and unfair practices under state law.  Varentec, Inc. v. Gridco, Inc., No. 16-217-RGA-MPT (D. Del. June 6, 2017).  Judge Thynge found that defendant failed to adequately plead these claims, but recommended that plaintiff’s motion be granted without prejudice as Judge Thynge could not determine on the current record whether amendment would be futile.  Id. at 7-25.

Varentec, Inc. v. Gridco, Inc., No. 16-217-RGA-MPT (D. Del. June 6, 2017)

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In a recent Report and Recommendation, Chief Magistrate Judge Mary P. Thynge granted defendants’ renewed motion for attorneys’ fees. Magnetar Technologies, Corp. v. Six Flags Theme Parks, Inc., C.A. No. 07-127-LPS-MPT (D. Del. Mar. 13, 2017). Previously, on July 21, 2015, Judge Thynge issued a Report and Recommendation finding that, in view of the totality of the circumstances, the case was exceptional based on plaintiffs’ objectively unreasonable position on inventorship of U.S. Patent No.  5,277,125 (“the ‘125 patent”) and plaintiffs’ reliance on Mark T. Hanlon’s expert report with respect to infringement of the ‘125 patent. On September 30, 2015, having considered plaintiffs’ objections to that Report and Recommendation and defendants’ subsequent response, Chief Judge Leonard P. Stark returned the issue of attorneys’ fees to Judge Thynge for additional findings.  On November 31, 2015, defendants filed the instant renewed motion for attorneys’ fees. See id. at 6.

In granting the renewed motion, Judge Thynge first reaffirmed the court’s conclusion “that plaintiffs’ position on the issue of inventorship was objectively unreasonable and defendants are entitled to fees incurred following the depositions in late July 2011” that demonstrated incorrect inventorship. Id. at 17-18. Judge Thynge also reaffirmed the court’s conclusion that plaintiffs’ reliance on Hanlon’s expert report was objectively unreasonable. Id. at 19.

Judge Thynge further found that attorneys’ fees in this action were “warranted to deter parties from continuing to maintain claims based on objectively unreasonable positions,” and “to compensate the defendants in this case for the expenses in defending claims that should not have been maintained.” Id. at 29. As Judge Thynge explained, “[p]laintiffs’ continued litigation of the ‘125 patent after the Chung and Staehs depositions revealed the inventorship issue with that patent improperly increased defendants’ litigation expenses by forcing them to continue to defend against the infringement claim and pursuing a ruling that the patent was invalid.” Id. at 29-30.

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In this case, Plaintiff T-Jat systems alleged in its operative complaint that the three Defendants, Expedia, Inc. (Delaware), Expedia, Inc. (Washington), and Orbitz Worldwide Inc. “operate as a single entity” with a high degree of intermingling. T-Jat Systems 2006 Ltd. v. Expedia, Inc., et al., C.A. No. 16-581-RGA-MPT, Report and Recommendation at 1-3 (D. Del. Mar. 7, 2017). In response to this allegation, the Defendants moved to dismiss, arguing that “the first amended complaint fails to satisfy the pleading requirements of FED. R. CIV. P. 8(a) because it does not set forth facts sufficient for a facially plausible claim from which the court can infer the alleged misconduct . . . [particularly because] T-Jat’s allegations that Expedia-DE and Expedia-WA acted as one entity because of the companies’ parent-subsidiary relationship [is] far fetched, and the first amended complaint fails to show ‘facts that justify piercing the corporate veil.’” Id. at 5.

Magistrate Judge Thynge first rejected Plaintiff’s alter-ego theory, finding that “T-Jat has, at best, alleged sufficient facts to establish . . . a failure to observe corporate formalities and subsidiary companies acting as a façade for the parent companies” but not additional factors that would help prove a true alter-ego relationship. Plaintiff alleged sharing of certain officers and directors, sharing of a headquarters and offices, and a collective identify on marketing and promotional materials. “However, T-Jat does not allege the second element of fraud or injustice of use of the corporate form in either case. Recent case law from this court establishes that factual allegations of ‘nothing more than a close relationship and coordination among defendants,’ including operational control of the parent company over subsidiaries, is insufficient under Rule 12(b)(6). As such, the alter-ego theory against all three defendants is inadequate to meet the minimum pleading requirements.” Id. at 9-12.

Judge Thynge refused to dismiss, however, Plaintiff’s agency theory, explaining that “[o]ne can reasonably infer Expedia-DE’s control over Expedia-WA and Expedia’s control over Orbitz from the alleged facts. Further, the court can reasonably deduce Expedia-DE directed Expedia-WA’s actions, and likewise Expedia directed Orbitz’s activities relating to the underlying cause of action, the allegedly infringing mobile and website applications, based on the close connection between the respective companies. Although this corporate closeness may not be sufficient to succeed on agency theory at later stages in litigation, it is sufficient to survive a motion to dismiss, if the parties are properly and individually identified.” Id. at 12-13.

Finally, Judge Thynge agreed with Defendants that the complaint improperly conflated separate entities into a generic “Defendants” rather than pleading sufficient facts against each individual Defendant: “Although T-Jat’s assertions of Orbitz’s individual infringement may be facially plausible, the allegations as to Expedia-DE and Expedia-WA do not clarify that each defendant committed at least one infringing act. Therefore, the first amended complaint fails to provide Defendants with adequate notice of the direct infringement allegations against them and fails to meet the minimum pleadings standard.” Id. at 14-15.

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In a recent report and recommendation, Magistrate Judge Mary Pat Thynge recommended that several affirmative defenses be stricken.  Sonos, Inc. v. D&M Holdings Inc., C.A. No. 14-1330-RGA-MPT (D. Del. Aug. 10, 2016).  Of note, Judge Thynge explained that the defendants’ § 288 defense should be stricken because there was no allegation that any asserted patent “has been found invalid before the commencement of the present action.”  Judge Thynge also recommended that the defendant’s equitable estoppel and unclean hands affirmative defenses be stricken for failure to allege facts supporting those defenses with the particularity required by Rule 9(b).  Next, the Court recommended the striking of the defendant’s patent misuse defense, which was supported by arguments in the defendant’s answering brief, but not in allegations in the affirmative defense, itself.  Judge Thynge explained, “D&M is required to assert a basis showing an anticompetitive effect in its pleadings; delegating this in its answering brief is not sufficient.”  Finally, Judge Thynge explained that the defendant’s prosecution laches defense “is limited to a one sentence conclusory statement, containing no information to support the elements of unreasonable and inexcusable delay,” warranting that it, too, be stricken.  The Court noted, however, that it would allow D&M leave to amend the pleadings to address these deficiencies.

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In a recent Memorandum Order, Chief Magistrate Judge Mary Pat Thynge considered Plaintiff SunPower Corporation’s (“SunPower”) motion, pursuant to Local Rule 7.1.5, seeking (i) clarification of the court’s April 1, 2016 Memorandum and Order with respect to infringement by defendant PanelClaw, Inc. under the doctrine or equivalents; and (2) reconsideration of the court’s construction of the term “disposed as a layer.” SunPower Corporation v. PanelClaw, Inc., C.A. No. 12-1633-MPT (D. Del. Jul. 26, 2016). Judge Thynge first clarified that the court’s “April 1, 2016 Memorandum and Order granting summary judgment of non-infringement was limited to literal infringement and did not grant summary judgment of non-infringement under the doctrine of equivalents.” Id. at 3. Judge Thynge then denied SunPower’s request for reconsideration, noting that its “argument fails to demonstrate an error of apprehension, or the need to correct manifest errors of law or fact, requiring the court to reconsider its construction of the ‘disposed as a layer’ term.” Id. at 5. Judge Thynge explained: “As the court noted in its April 1, 2016 Memorandum, the construction adopted by the PTAB, and subsequently this court, is the construction SunPower proposed during the IPR.” Id. According to Judge Thynge, “[t]he court considered SunPower’s arguments to the PTAB, the reasoning of the PTAB, construction of the term by another district court, and its own review of the figures and specification of the ‘788 patent to reach its construction.” Id.

SunPower Corporation v. PanelClaw, Inc., C.A. No. 12-1633-MPT (D. Del. Jul. 26, 2016).

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 Chief Magistrate Judge Mary Pat Thynge recently considered defendants motion to dismiss Nexeon Limited’s amended complaint alleging direct and indirect infringement of the patents-in-suit. Nexeon Limited v. EaglePicher Technologies, LLC, et al., No. 15-955-RGA-MPT (D. Del. Jul. 26, 2016).  Defendants previously moved to dismiss Nexeon’s original complaint prompting Nexeon to file a first amended complaint.  Id. at 1.  Defendants again moved to dismiss arguing that the amended complaint still fails to adequately state of claim for direct and indirect infringement.  Regarding direct infringement, Judge Thynge noted that the complaint was filed prior to the amendment to the Federal Rules and the court “has discretion whether to apply the post-December 1, 2015 direct infringement pleading standard to the amended complaint.”  Id. at 9.  Judge Thynge decided that, in this case, Form 18 should be used to analyze the sufficiency of Nexeon’s amended complaint; and concluded that the requirements of Form 18 were met.  Id. at 9-11.  Regarding indirect infringement, Judge Thynge determined that Nexeon adequately pled inducement finding facts in the complaint alleging “specific intent for its customers to infringe and knowledge that the acts constituted infringement.”  Id. at 12-14.  Judge Thynge determined, however, that defendants’ motion should be granted with respect to Nexeon’s allegations of contributory infringement because Nexeon failed to plead that there are no substantial non-infringing uses.  Id. at 14-15.

Nexeon Limited v. EaglePicher Technologies, LLC, No. 15-955-RGA-MPT

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Magistrate Judge Thynge has issued a Report and Recommendation addressing whether there is an actual case or controversy within the meaning of the Declaratory Judgment Act over a suit in which the plaintiff seeks judgment of a defendant’s willful infringement based on the defendant’s filing of a New Drug Application with the FDA. Both the plaintiff and the defendant in this case filed NDAs with the FDA and neither party’s NDA has been approved. The parties in the case are also parties to an interference in the PTO in which the defendant is the senior party. Clarus Therapeutics, Inc. v. Lipocine Inc., C.A. No. 15-1004-RGA-MPT, Report and Recommendation at 1-5 (D. Del. June 23, 2016).

Given these facts, Judge Thynge found “significant, concrete steps to conduct infringing activity” as well as ripeness for judicial resolution: “Defendant not only has a working product, but also has an NDA before the FDA for review. Additionally, plaintiff notes defendant’s market research, hiring of new sales and marketing personnel, saving for manufacture of commercial quantities of its product, manufacture of launch supplies, and anticipation of the manufacturing agreements. Defendant contends the prerequisite FDA approval for commercialization and entry into the market is uncertain and, if approval is eventually given, commercial launch will not be immediate. While this may be accurate, defendant’s conduct is still indicative of meaningful preparation for the making, launch, and use of [its drug product] that satisfies the immediacy requirement for declaratory judgment jurisdiction.” Id. at 8-11.

Moreover, “the PTAB’s decision in the upcoming Interference will not determine the issue of infringement central to plaintiff’s complaint. Due to the lack of further factual development needed and the PTAB’s inability to hear plaintiff’s infringement claim in the forthcoming Interference, the issue is fit for judicial decision.” Id. at 11. Judge Thynge therefore recommended that the defendant’s motion to dismiss be denied.

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