Even after Jury Trial and Final Judgment in Favor of Patent Owner, Collateral Estoppel of Invalidity from a Subsequent, Other Proceeding Applies

March 2, 2015

The plaintiff, U.S. Ethernet Innovations, LLC ("USEI"), filed a patent infringement action against several defendants in the Eastern District of Texas. The district court then transferred the cases to the Northern District of California. While litigation in the Northern District of California proceeded, USEI filed another patent infringement case against Texas Instruments Incorporated ("TI").

The TI case then proceeded with two jury trials. The first jury returned a verdict finding that the patents-in-suit ("Early Transmit Patents") were not invalid. The second jury found that TI infringed the asserted claims of U.S. Patent No 5,434,872 and awarded USEI $3,000,000.00 in damages. After the district court rejected TI's equitable defense of laches, the district court entered a Final Judgment in the case, but the Final Judgment "specifically noted that the Court was still considering the issues raised in the parties' post-verdict briefing."

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Three Strike and You are Out: District Court Grants Summary Judgment on Lack of Standing, No Infringement and Invalidates the Patent

February 26, 2015

Plaintiff NOV filed a patent infringement action asserting that defendant Omron had infringed NOV's patent (U.S. Patent No. 5,474,142 or the '142 Patent). Specifically, NOV alleged Omron's oil rig automation control system has an automatic driller function that infringes one or more claims of the '142 Patent.

After years of litigation, Omron filed dispositive motions asserting lack of standing, no infringement and invalidity of the '142 Patent. The district court first found that NOV had no standing to assert the patent as the owner of the patent had only "agreed to assign" the patent. "In sum, the prevailing Federal Circuit case law makes clear the "agrees to assign" language in the ACA was not a present assignment. The ACA further indicates Varco, L.P. was to issue a separate assignment document, but there is no such piece of paper. Because NOV is unable to show the ACA was a present assignment of assets, the Court finds, on this ground alone, NOV has failed to satisfy its burden of proving ownership and, consequently, standing to sue."

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District Court Denies Motion in Limine Seeking to Preclude Advice of Counsel Defense Even Though Plaintiff Was not Able to Obtain Information about the Defense During Discovery

February 24, 2015

The Plaintiff filed a motion in limine seeking the district court to preclude the Defendant from offering at trial any testimony regarding the Defendant's opinion of counsel defense that was not disclosed during discovery. As explained by the district court, the Plaintiff also alleged that the Defendant selectively produced certain documents pertaining to the Defendant's opinion of counsel defense and instructed witnesses not to testify on matters concerning the Defendant's investigation into the Plaintiff's allegations of patent infringement and theft of trade secrets.

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District Court Denies Motion to Lift Stay Pending Inter Partes Review Even Where Plaintiff Agreed to Not Pursue Claims That Were Subject to Review

February 19, 2015

Barco filed a patent infringement action in September 2011 against Defendants Eizo Nanao Corporation and Eizo Nanao Technologies, Inc. ("Eizo"), alleging that Eizo infringed various claims in U.S. Patent No. 7,639,849 (the '849 patent). After Barco filed a reissue application with the United States Patent and Trademark Office (the "PTO"), in which it added seventy-eight new claims to the original thirty-seven claims of the '849 patent, the district court stayed the action.

Eizo subsequently filed an inter partes reexamination, seeking to reexamine the original thirty-seven claims of the '849 patent and the district court continued the stay even though the patent was reissued by the PTO as RE43,707 (the '707 patent), because the inter partes reexamination proceedings initiated by Eizo were still pending before the PTO.

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Rosebud v. Adobe: District Court Grants Summary Judgment of No Remedies Where Plaintiff Could Not Prove Actual Notice of Patent Application

February 17, 2015

Rosebud filed a patent infringement action Adobe and Adobe moved for summary judgment arguing that Rosebud had no remedy for its patent against Adobe. Adobe based its summary judgment motion on the argument that the patent-in-suit did not issue until after Adobe's accused product was discontinued.

As set out by the district court, the parties did not dispute that the accused feature of Adobe's product (Collaborate Live) was discontinued and could not have been used after January 2013. As the '280 patent issued on November 5, 2013, Rosebud could not recover post-issuance damages. Instead, Rosebud sought to recover provisional remedies under 35 U.S.C. § 154(d), based on the publication of the '280 patent application on December 29, 2011, which requires the defendant to have actual knowledge of the published patent application.

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Court Denies Motion to Stay Pending New Inter Partes Review ("IPR") Denied Where PTO Had Previously Declined to Institute an IPR on Asserted Claims and Trial Was Rapidly Approaching

February 11, 2015

The defendant, Samsung, had previously filed IPRs on several of plaintiff's patents, which were granted and denied in part. After the plaintiff reduced its asserted claims to those that the PTO had declined to institute review, Samsung filed an additional IPR to challenging the asserted claims and moved to stay pending the new IPR.

In requesting the stay, Samsung argued that "the IPRs will address the validity of all asserted claims of the patents-in-suit" and "[c]onsidering the current status and likely disposition of each USPTO proceeding for the patents in suit, there is strong possibility that nearly all of Rembrandt's infringement allegations will be moot." The district court observed that the "simplification offered by Defendants is not likely based on the recent denials of IPR institutions."

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Court Continues Stay Pending Inter Partes Review Even Though PTO Declined to Institute Review on Patent

February 9, 2015

The district court had previously stayed the patent infringement action between Nidec Motor Corporation and Broad Ocean Motor pending the PTO's decision on whether to institute an inter partes review on three of the patents-in-suit. After the PTO declined to institute review on one of the patents, the plaintiff moved to lift the stay on that patent.

As explained by the district court, "the parties notified the Court that, on January 21, 2015, the United States Patent and Trademark Office ("PTO") instituted Inter Partes Review ("IPR") against the '895 and '349 Patents but it denied institution against the '970 Patent. The parties state that they met and conferred on January 26, 2015, but the parties did not agree as to whether the Court should lift the stay at this time with respect to the '970 Patent."

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District Court Grants Stay Before The PTO Institutes An IPR

February 6, 2015

In MLC Intellectual Property, LLC v. Micron Technology, Inc., Case No. 14-cv-3657 (N.D. Cal.), MLC filed its lawsuit on August 12, 2014, accusing Micron of infringing U.S. Patent No. 5,764,571 ("the '571 patent"). On October 15, 2014, Micron answered the complaint and asserted counterclaims for declaratory judgment of non-infringement and invalidity of the '571 patent. At the initial case management conference on November 21, 2014, the Court set a further case management conference for March 20, 2015, the tutorial hearing for June 10, 2015, and the claim construction hearing for June 17, 2015.

On December 24, 2014, Micron filed a petition for inter partes review ("IPR") at the U.S. Patent and Trademark Office ("PTO"), challenging the patentability of at least each asserted claim of the '571 patent. The PTO accorded the IPR petition a filing date of December 24, 2014, and thus the PTO must issue a decision on whether to institute the IPR no later than June 24, 2015. On December 29, 2014, Micron filed its motion to stay pending the IPR. In its motion, Micron sought a stay through a final written decision of the IPR including any appeals to the Federal Circuit. MCL partially opposed only the portion of the stay beyond the final written decision of the PTO rather than after all appeals have been exhausted. MCL also argued that the case should not be stayed at this time until after the claim construction was completed.

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Intellectual Ventures v. Symantec: Court Bifurcates and Stays Symantec's Patent Misuse Defense

February 4, 2015

Intellectual Ventures ("IV") filed a motion to bifurcate and stay discovery of Symantec's patent misuse defense. The district court agreed with Intellectual Ventures. "While the Court views IV's motion as essentially two motions one to bifurcate for a separate trial, see F.R.C.P. 42(b), and one to stay discovery, to which the general stay factors may be pertinent, see, e.g., Apotex, Inc. v. Senju Pharm. Co., 921 F. Supp. 2d 308, 313-14 (D. Del. 2013) it finds that the circumstances do not warrant departure from the Federal Circuit's general guidance that antitrust and related issues be bifurcated in patent cases, and further finds that judicial economy warrants staying discovery related to these issues. See In re Innotron Diagnostics, 800 F.2d 1077, 1084 (Fed. Cir. 1986)."

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Open Text v. Box: District Court Holds That Box Can Present Damages in the Form of a Fully Paid-Up Lump Sum Payment Even Though Such an Award Might Preclude a Later Injunction

February 2, 2015

As the Open Text v. Box patent case gets closer to trial, Open Text sought to preclude Box from asking the jury to award damages in the form of a fully paid-up lump sum that would cover the life of the patents-in-suit. Open Text argued that such a result would preclude Open Text from seeking an injunction or post-verdict ongoing royalties, which would improperly allow the jury to decide equitable issues.

Although the district court agreed that a lump-sum award might indeed preclude the injunction and/or post-verdict ongoing royalties, the district court stated that "there is no doubt that a fully paid-up lump sum is an allowable form of damages. See, e.g., Lucent Techs., Inc. v. Gateway, Inc., 580 F.3d 1301, 1325-26 (Fed. Cir. 2009) (discussing the licensor and licensee's option of entering into an "upfront, paid-in-full royalty" in the hypothetical negotiation).

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Blue Spike v. Adobe: Court Grants Motion to Strike Infringement Contentions Where Contentions Failed to Crystalize Theory of the Case and Used an Open-Ended Priority Date

January 29, 2015

In this patent infringement action between defendant Adobe Systems, Inc. ("Adobe") and plaintiff Blue Spike, LLC ("Blue Spike"), Adobe filed a motion to strike the infringement contentions ("ICs") filed by Blue Spike. In the motion, Adobe contended that Blue Spike's ICs fail to comply with the Patent Local Rules for the following reasons: (1) the ICs fail to provide a claim chart for each of the accused instrumentalities and instead group together all four products in violation of Patent Local Rule 3-1(c); (2) the claim chart cites to exhibits that discuss Auditude's (a company acquired by Adobe) products generally--both fingerprinting and ad insertion products--without identifying the particular product to which each exhibit refers, rendering the documentary support insufficient under Patent Local Rule 3-2; (3) the ICs chiefly rely on online articles published by third parties that do not specifically identify the accused products and are therefore insufficient under Patent Local Rule 3-2; and (4) the ICs do not properly set forth allegations of infringement under the doctrine of equivalents in violation of Patent Local Rule 3-1(e); and (5) fail to allege indirect infringement, willful infringement, or assert a priority date in accordance with the Patent Local Rules.

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PTAB Will Not Consider An Expert Report Prepared for Litigation And Created After the Filing of the Petition

January 27, 2015

In IPR2014-01510, 01511, and 01513, in connection with its preliminary response the Patent Owner Mag Aerospace Industries, LLC, submitted an expert report by its expert in the related litigation. The expert report addressed issues relevant to the IPR proceedings, including the patentability of the claims in light of the prior art asserted in the IPRs. As explained below, the Board held that the expert report constituted "new" evidence and thus violates 37 C.F.R. § 42.107(c) even though it was created for the related litigation and not expressly for the IPR proceedings.

The Petition was filed on September 16, 2014. The expert report, filed as Exhibit 2002, is dated November 4, 2014, and was filed on January 2, 2015, along with the Patent Owner's Preliminary Response. It also is uncontested that the expert report was created for related litigation according to the schedule for that litigation.

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District Court Denies Motion to Exclude Defendants' Experts from Claim Construction But Orders the Defendants to Supplement Their Disclosures or Face Exclusion

January 26, 2015

In this patent infringement action, the plaintiff filed a motion to exclude the defendants' claim construction experts. The plaintiff's motion was based on the argument that the defendants' disclosures did not comply with local rules in that they did not identify the actual opinions of the experts.

The district court agreed with plaintiff's position. "After consideration of the briefing and of Defendants' expert disclosures, the Court agrees with Plaintiff that Defendants' disclosures do not comply with Local Rule 4.2.d.2. insofar as Defendants simply identify the general subjects on which their experts may testify, but do not identify the actual opinions Defendants expect the experts to offer."

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District Court Holds Plaintiff and Plaintiff's Attorneys Jointly and Severally Liable for Attorney's Fees and Costs After Finding that Attorneys Knew of False Affidavits Filed with the Patent Office

January 22, 2015

After trial, HTC Corporation and HTC America, Inc. ("HTC") filed a motion seeking to recover attorney fees and costs from plaintiff's attorneys as well as from plaintiff Intellect Wireless, Inc. ("IW"). IW withdrew its initial opposition and conceded that the case was exceptional within the meaning of the Patent Act. HTC also contended that a finding should also be made that the attorneys for IW are jointly and personally required to satisfy HTC's attorney fees and costs because, among other things, IW's attorneys unreasonably and vexatiously multiplied the proceedings within the meaning of 28 U.S.C. § 1927.

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Court Orders Production of Work Product Documents under Crime-Fraud Exception to Attorney-Client Privilege Where Defendants Had Falsely Identified Source Code

January 20, 2015

In an earlier filed decision, the district court had previously found that Escort and its defense counsel had knowingly misled the plaintiff, Fleming, which warranted a sanction of attorney fees. As explained by the district court, "they falsely claimed that the source code identified as ESC17363 was the current operating source code for Escort's commercially sold products and that it provided a complete defense to Fleming's patent infringement charges."

After awarding attorney's fees, the district court turned to Fleming's motion to compel the production of certain documents. "Fleming seeks discovery of a wide variety of documents and communications in an effort to determine if Escort fabricated ESC17363 and falsely represented that it was created in the normal course of product development."
In response, Escort argued that all of the material sought by Fleming was protected by the work product doctrine and the attorney client privilege.

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