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In a recent Order, Judge Gregory M. Sleet granted defendants’ motion to stay pending inter partes review and the resolution of defendants’ motion to dismiss in part. Amkor Technology, Inc. v. Synaptics, Inc., et al., C.A. No. 15-910-GMS (D. Del. Oct. 25, 2016). Plaintiff’s complaint pleads thirteen counts, but only Count I asserts patent infringement, specifically, infringement of U.S. Patent No. 7,358,174 (“the ’714 patent”). Judge Sleet stayed Count I of the matter pending resolution of the inter partes review of the ’714 patent, but otherwise denied the motion to stay. Judge Sleet observed that “[i]t does not appear that a PTAB decision will impact any other claims in the Complaint besides the claim of patent infringement.” Id. at 3 n.5

Considering the traditional stay factors, Judge Sleet first concluded that defendants “would not gain a tactical advantage as a result of a stay of the ’174 patent infringement claim, and Plaintiff is unlikely to suffer undue prejudice.” Id. at 2. Judge Sleet found no evidence that defendants were attempting to gain an unfair tactical advantage, noting that “defendants filed the inter partes petitions for U.S. Patent No. 7,358,174 on April 8, 2016—six months earlier than the statutory deadline.” Id. at 2. n.2 Moreover, “Defendants moved to stay the case less than three weeks after filing the petitions for inter partes review.” Id. As to any undue prejudice, Judge Sleet noted that the “Patent Trial and Appeal Board (“PTAB”) has . . . decided to institute inter partes review” and that “the parties do not appear to be direct competitors.” Id. Plaintiff argued “that [it] face[d] the risk of losing market share and goodwill because Defendants fed confidential information and trade secrets to Plaintiff’s primary competitor,” but Judge Sleet found plaintiff’s argument to present “a separate issue from Defendants’ alleged infringement of the ’174 patent.” Id.

Judge Sleet also determined that “the issues before the court—with regard to Count I—will be simplified by the recently instituted inter partes review proceedings of all currently asserted claims.” Id. at 2-3. Finally, Judge Sleet noted that “[a]lthough a trial date has been set, the fact that this case remains in an early stage reinforces the prospect that a stay of Count I pending review will advance the interests of judicial economy.” Id. at 3.

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In a recent Memorandum, Judge Gregory M. Sleet denied defendant’s (“HTC”) motion to dismiss plaintiffs’ (“Philips”) direct infringement claims, but granted defendant’s motion to dismiss plaintiffs’ contributory infringement claims. Koninklijke Philips N.V., et al., v. ASUSTek Computer, Inc., et al., C.A. No. 15-1125-GMS (D. Del. Oct. 25, 2016). As to the direct infringement claims, HTC contended that Philips’ “use of exemplary—rather than exhaustive—lists of products and claims renders the [first amended complaint] deficient.” Id. at 7. Judge Sleet found, however, that Philips’ direct infringement claims passed muster under Twombly/Iqbal, observing that “[h]ere, Philips provides specific details of at least one of the method and device claims allegedly infringed under each patent-in-suit, specific examples of at least one product HTC manufactures or sells that contains mechanisms or processes performing the identified functions, and specific examples of the class of products which also contain these Accused Functionalities.” Id. at 8. Judge Sleet further explained that Philips’ “allegations are far more detailed than those dismissed in the cases HTC cites. Those cases featured general categories of products such as ‘computer chips, motherboards, and computers.’” Id.

Despite finding Philips’ claims of direct infringement sufficient, Judge Sleet ultimately dismissed Philips’ claims for contributory infringement. Judge Sleet explained as follows: “Here, Philips has specified the categories of products alleged to contributorily infringe as well as the Accused Functionalities they possess. Philips, however, provides no facts supporting the inference that the Accused Functionalities have no substantial non-infringing use beyond the assertion that ‘upon information and belief . . . the only use for the [ ] Accused Functionality is infringing the patent’ and that the ‘Defendants know’ this. This is insufficient, and the court will grant HTC’s Motion to Dismiss.” Id. at 9. Judge Sleet, however, granted Philips leave to amend its complaint to properly allege a claim for contributory infringement. Id. at 10.

Koninklijke Philips N.V., et al., v. ASUSTek Computer, Inc., et al., C.A. No. 15-1125-GMS (D. Del. Oct. 25, 2016).

 

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Chief Judge Leonard P. Stark recently issued the pretrial order resolving motions in limine and setting time allocations for trial.  Andover Healthcare, Inc. v. 3M Company, No. 13-843-LPS (D. Del. Oct. 27, 2016).  Regarding time for trial, the parties requested 41 hours to be split equally between the parties.  Judge Stark rejected this request:

Considering that this is a one patent case, with two asserted claims, four accused products, a single plaintiff and single defendant, at most five invalidity defenses .(written description, enablement, indefiniteness, anticipation, obviousness), damages, and willfulness, and given the number of witnesses the parties intend to call, the Court has determined that the parties will be allocated a maximum of 14 to 16 hours per side for their trial presentations, with the final amount to be determined after further discussion at the pretrial conference.

Id. at ¶ 2.

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In Vehicle IP v. AT&T Mobility LLC, et al., C.A. No. 09-1007-LPS (D. Del. Oct. 20, 2016) (unsealed Oct. 27, 2016), Chief Judge Leonard P. Stark granted-in-part the Defendants’ motion to sever their cases, concluding that joinder under Rule 20 was impermissible as to infringement and damages, and denying the motion with respect to invalidity.

Plaintiff had accused the two groups of defendants, who were competitors of each other, of infringement by different products, but Plaintiff argued that joinder was proper under Rule 20 because the Defendants “advance largely identical arguments on all the key issues in the case . . . ; the allegedly infringing acts occurred during the same time period . . . ; Defendants used identically-sourced components in their respective products . . . ; and Defendants used similar development and manufacturing methods[.]” Id. at 3.

As to infringement, the Court observed that the infringement analysis would differ between the two defendant groups, and that they had engaged different infringement experts. Id. at 4. Severance was proper even if the accused products were the same in relevant respects: Plaintiff “has not argued that there was any relationship between the [defendant groups]; in fact, they are direct competitors, which weighs heavily against joinder. Other factors weighing against joinder include that there is no assertion [Plaintiff] of licensing or technology agreements between the [defendant groups], and that there is no claim for lost profits. Although there is some similarity in the development and manufacturing of the accused products and some components (such as cell phones) come from the same sources, those overlaps are due to the fact that the accused products are cell phone applications, and these components are not part of the infringement dispute. While both groups of Defendants are accused of infringing during the same time period, this factor does not outweigh the other considerations weighing in favor of severance.” Id. Furthermore, in light of Defendants’ argument that consolidation under Rule 42 would be prejudicial due to the high likelihood of jury confusion, the Court granted the motion to sever with respect to infringement and damages. Id. at 5.

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In this multidistrict litigation, a protective order was originally entered in a case between Plaintiff Bear Creek Technologies and Defendant Verizon while the Verizon case was pending in the Eastern District of Virginia. The Verizon case was then transferred to the MDL in the District of Delaware after entry of the protective order. The protective order in question bars the Plaintiff’s litigation counsel from participating in prosecution activities except that the “prosecution bar does not apply to any reexamination proceedings before the [USPTO] that is initiated by any Verizon defendant in this action.” The Plaintiff therefore sought a modification of the protective order because it “exempted reexamination proceeding initiated by Verizon, but did not extend the exemption to proceedings initiated by other parties” and the Plaintiff sought to have the protective order recognize “that the case now involves multiple defendants.” In re: Bear Creek Technologies Inc., MDL No. 12-2344-GMS, Amended Or. at 1-2 (D. Del. Oct. 20, 2016). Judge Sleet, however, declined to modify the protective order, agreeing with Verizon that because “the Protective Order has already been decided by another court, Bear Creek must show, on a counsel-by-counsel basis, that an exemption for a particular attorney or a particular purpose is warranted and Bear Creek has not made this showing.” Id. at 2-3 (citing In re Deutsche Bank Trust Co. Ams., 605 F.3d 1373 (Fed. Cir. 2010)).

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Judge Gregory M. Sleet recently denied a motion to stay pending ex parte reexamination in Polar Electro OY v. Suunto OY, et al., C.A. No. 11-1100-GMS (D. Del. Oct. 31, 2016).  Judge Sleet explained that a review of Public Pair indicated that the PTO withdrew previous rejections of the claims subject to the ex parte reexamination and allowed newly presented claims.  As a result, prosecution on the merits was now closed, and the Court therefore exercised its discretion to deny the motion to stay. Continue reading

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In Sony Corporation v. Pace PLC, et al., C.A. No. 15-288-SLR (D. Del. Oct. 24, 2016), Judge Sue L. Robinson issued a claim construction order in which Her Honor concluded that one preamble of an asserted claim was limiting.   The preamble recited: “[a]n information reproducing device for reproducing an information recording medium in which audio data of plural channels are multiplexedly recorded, the information reproducing device comprising:”.

This preamble explained the purpose of the claimed device, and the “recording medium” was not discussed in the body of the claim. Thus, its presence in the preamble gave was necessary to give meaning to the claim. Id. at 3. The preamble also provided an antecedent basis for terms in the body of the claim. Id. Finally, the Court observed that the parties already agreed that the preamble of another claim in this patent that was similar to the disputed preamble was limiting. Id.

Sony Corporation v. Pace PLC, et al., C.A. No. 15-288-SLR (D. Del. Oct. 24, 2016)

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In a recently unsealed memorandum opinion, Chief Judge Leonard P. Stark issued rulings on several pre-trial motions.  Andover Healthcare, Inc. v. 3M Co., C.A. No. 13-843-LPS (D. Del. Oct. 18, 2016).  Most notably, Chief Judge Stark denied a motion to preclude the plaintiff’s CEO from testifying as an expert based on his purported “blatant and direct financial interest in the outcome of this case.”  Id. at 14.  The Court explained that 3M’s argument that the CEO should be precluded because of his financial interest in the litigation “only holds if the Court disregards Andover’s corporate existence.  Any recovery in this case will initially go to Andover, not Murphy. . . .  [T]he Court concludes that Dr. Murphy’s indirect financial interest in the outcome of the litigation [redacted] can be handled appropriately on cross-examination.”  Id. at 15-16 (emphasis in original).

Chief Judge Stark also denied cross-motions for summary judgment relating to a laches defense, on the basis that there existed factual disputes regarding the factual underpinnings of the defense, and also in view of the U.S. Supreme Court’s pending consideration in the SCA Hygiene Products v. First Quality Baby Products case of whether and to what extent laches is an available defense to patent infringement.  Id. at 10 n.2.

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The Defendants in this case requested a stay pending the Federal Circuit’s decision on a patent-in-suit from a related case, and Judge Andrews denied the motion. In considering the motion to stay, Judge Andrews recognized that the Federal Circuit’s decision “may make this case moot, or otherwise simplify whatever issues would remain on this patent. Depending on what the decision is, it might also cause a scramble over whether a preliminary injunction should issue, which would involve issues in addition to the trial issues. Thus, on the whole, this factor favors granting the stay, but it does not heavily weigh in favor of granting the stay.” Sanofi, et al. v. Lupin Atlantis Holdings SA, et al., C.A. No. 15-415-RGA, Order at 1 (D. Del. Oct. 14, 2016). Judge Andrews also pointed out that the “case is ready for expert discovery, which is due to begin next week, and trial is set for April 24, 2017 . . . [which] argues against granting the stay.” Id. Finally, Judge Andrews found that a stay may cause some undue prejudice to Plaintiffs, the non-moving party, because “[i]f a stay is granted, Plaintiffs have to prepare for the possibility of a preliminary injunction, which would be an extra expense. In all likelihood, Defendants too would prepare for the possibility of a preliminary injunction. The prejudice to Plaintiffs may be that I would not grant a preliminary injunction, whereas if Plaintiffs win on a trial on the merits, they will get their injunction by virtue of the trial. Thus, it may be that a trial is an easier route for Plaintiffs to get the relief they are seeking. I think consideration of this factor suggests some possibility of tactical advantage to Defendants if a stay is granted.” Id. at 1-2.

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The Defendant sought leave to file an amended answer and counterclaims adding a claim of inequitable conduct based on an allegedly undisclosed inventor. The motion for leave was filed several months after the December 15, 2015 scheduling order deadline for amendment of pleadings, meaning that the Defendant needed to show “good cause” for the amendment. Although the allegedly undisclosed inventor, Dr. Chu, had initial been disclosed as a person who may have knowledge of products embodying the asserted patent in early 2015, Dr. Chu was not issued a subpoena or deposed until over a year later in May and June of 2016. Judge Andrews found it “fair to say that the [February 2015] ‘initial disclosures’ do not suggest Dr. Chu as a person who as involved in the invention.” E.I. DuPont de Nemours & Co. v. Unifrax I LLC, C.A. No. 14-1250-RGA, Memo. Or. at 1-2 (D. Del. Oct. 7, 2016).

The Plaintiff pointed to several documents that were produced in June 2015 and would have allegedly shown the Defendant at that time that Dr. Chu was involved in product development. But Judge Andrews reviewed the documents and found “they did not show anything that would suggest Dr. Chu was an inventor” but rather only “Dr. Chu being involved in testing and experimentation at Plaintiff’s direction and request.” Id. at 2-3. Therefore, Judge Andrews concluded:

I would tend to agree with Plaintiff that the cited documents do not support the proposed counterclaim. Perhaps this will be a problem for Defendant down the road, but, at this juncture, it does support Defendant’s argument that Defendant has good cause not to have asserted the counterclaim until Dr. Chu was deposed, and provided the basis upon which Defendant now relies. I do not think the cited documents put Defendant on notice that Dr. Chu was an important witness. Defendant’s motion for leave to amend followed without undue delay after Dr. Chu’s deposition was concluded. Therefore, I find good cause and will grant Defendant’s motion.

Id. at 3.

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