May 2012 Archives

Complainant OSRAM AG Loses Summary Determination Motion to Establish Satisfaction of Domestic Industry Requirement at the ITC Because It Could Not Establish Economic Prong

May 31, 2012

Complainant OSRAM AG ("OSRAM") moved for a summary determination that it had satisfied the economic prong of the domestic industry requirement. Respondent LG Electronics, Inc. and other LG entities (collectively, LG) opposed the motion.

OSRAM moved for summary determination on the ground that it has devoted substantial resources in the United States, including engineering and research of products that incorporate LEDs. As stated by the Administrative Law Judge, "OSRAM contends that it satisfies the economic prong of the domestic industry requirement as set forth in 19 U.S.C. § 1337(a)(3)(C) for U.S. Patent Nos. 7,151,283 ("the '283 patent") and 7,271,425 ("the '425 patent"). OSRAM states that it has devoted substantial resources in the United States, including investments in domestic engineering and research and development ("R&D") of products incorporating LEDs, at its two domestic subsidiaries, OSRAM Opto Semiconductors, Inc. and OSRAM Sylvania Inc. Mem. at 1. OSRAM further states that these investments relate to work on OSRAM LEDs with chip level conversion technology ("OSRAM LEDs with CLC"), which OSRAM asserts are covered by claims of the '283 patent, and OSRAM's Advanced Power TOPLEDs ("OSRAM APT LEDs"), which OSRAM asserts are covered by claims of the '425 patent Id OSRAM summarizes its investments in domestic engineering and R&D from October 2009 through September 2011."

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Claims for Inducing Infringement and Willful Infringement Dismissed Based on Failure to Plead Sufficient Facts

May 28, 2012

Defendant TIBCO Software Inc. ("TIBCO") moved to dismiss plaintiff's claims for inducing infringement and willful infringement. Plaintiff's complaint alleged that "TIBCO is 'inducing its customers to directly infringe the '864 Patent by providing its customers and others with detailed explanations, instructions, and information as to arrangements, applications, and use of its TIBCO Spotfire Platform products that promote and demonstrate how to use those products in an infringing manner. VSi avers it "demonstrated its patented software MIDaS to Spotfire in 2005 and notified Spotfire MIDaS was covered by U.S. Patent No. 6,877,006 ('the '006 Patent').'"

The complaint also alleged that "[i]n 'early 2006,' according to the FAC, VSi made a 'similar presentation' of its MIDaS software to TIBCO. Id. During that presentation, VSi allegedly notified TIBCO that MIDaS was covered by the '006 patent and another pending continuation patent application that later issued as that '864 patent. Id. Finally, VSi pleads that TIBCO had actual knowledge of the '864 patent at least by December 23, 2011, the date this suit was filed."

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Damage Expert Opinion Allowed Where Expert Properly Apportioned the Value Between the Patented Feature and the Unpatented Features of the Accused Products

May 25, 2012

Plaintiff retained an expert to opine on damages arising from the defendants' alleged infringement of the asserted patents. The defendants moved to exclude the expert report on two grounds: (1) the expert failed to properly apportion the value of the patented features; and (2) the expert misapplied the market value rule. The expert had attributed 30% of the value of the accused products to the asserted bus interface department.

The district court began its analysis by stating the applicable law: "An expert witness may provide opinion testimony if '(a) the expert's scientific, technical, or other specialized knowledge will help the trier of fact to understand the evidence or to determine a fact in issues; (b) the testimony is based on sufficient fact or data; (c) the testimony is the product of reliable principles and methods; and (d) the expert has reliably applied the principles and methods to the facts of the case." Fed. R. Evid. 702. A trial court is "charged with a 'gatekeeping role,' the objective of which is to ensure that expert testimony admitted into evidence is both reliable and relevant.' Sundance, Inc. v. DeMonte Fabricating Ltd., 550 f.3D 1356, 1360 (Fed. Cir. 2008)."

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Expert on Dispute over Inventorship Permitted to Rely on Section 102(f) to Establish Purported Inventor Did Not Make Significant Contribution to the Invention

May 23, 2012

In this dispute over inventorship of a patent, Affymetrix ("Affymetrix") and Gregory Kirk ("Mr. Kirk") sought to correct U.S. Patent Nos. 7,510,481 and 7,612,020 to add Mr. Kirk as one of the inventors on the patents. The patents are directed to a method and an apparatus for conducting genetic testing using microarrays and are assigned to the defendant, Illumina, Inc. ("Illumina"). The plaintiffs contended that Mr. Kirk is a joint inventor because of certain information he disclosed in an email to one of the named inventors several months before the first patent application was filed.

The plaintiffs filed a motion in limine to preclude Illumina's expert from testifying at trial on the ground that his opinions were neither relevant nor helpful. In its motion, the plaintiffs divided Illumina's expert report into three parts: (1) an opinion that Mr. Kirk did not contribute a "complete and operative invention"; (2) an opinion on Mr. Kirk's contribution to "decoding"; and (3) an opinion on the "organization and structure" of Mr. Kirk's emails.

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3,000 Page Attachment with Limitation by Limitation Invalidity Analysis Violates ITC Ground Rule and Is Rejected

May 21, 2012

In this matter pending before the International Trade Commission ("ITC"), the ITC (Administrative Law Judge James Gildea) rejected the respondent's pre-hearing statement for failing to follow ITC Ground Rule 7.1. As noted by Judge Gildea, the parties filed their respective prehearing statements on May 3, 2012. "Ground Rule 7.1 requires complainants and respondents to provide party-specific additional submissions correlating the asserted claims to the accused products or prior art, respectively." Judge Gildea also noted that the rule sets forth sample charts to avoid any confusion as to what data is required.

Judge Gildea then noted that "[o]ther parties in other investigations have not had any trouble understanding the requirements. Indeed, complainants in this Investigation submitted a one page chart providing the information requested."

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Apple v. Motorola: Motorola Loses Bid to Exclude Apple's Damage Expert

May 18, 2012

In the ongoing battle between Apple and Motorola, Motorola moved to strike portions of Apple's supplemental expert report on damages. The district court had previously granted Apple's request to supplement its damages expert report to address information that was disclosed between the filing of Apple's initial damage report and the close of discovery. The royalty estimate disclosed in the expert report was based on the costs of designing around the patent-in-suit.

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Multi-District Panel Rules That America Invents Act Does Not Bar Centralization of Multiple Defendants in Single District

May 16, 2012

Bear Creek Technologies, Inc. ("Bear Creek") is the patent holder in fourteen patent infringement actions pending in three different district courts. Bear Creek moved for centralization in the District of Delaware or, alternatively, the Eastern District of Virginia. In each of the cases, Bear Creek alleged that various telecommunications companies infringed the Bear Creek patent and the various telecommunications companies raised questions surrounding the validity or enforceability of the patent.

Certain of the defendants did not oppose centralization but suggested that the district should be either Delaware or the Eastern District of Pennsylvania. Other defendants opposed centralization and the Vonage defendants asserted that the America Invents Act ("AIA") limits centralization under 28 U.S.C. § 1407.

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Apple Wins Motion for Issue Preclusion Sanctions Against Samsung for Samsung's Failure to Produce Source Code

May 14, 2012

The court had previously granted Apple's motion to compel Samsung to produce the source code for Samsung's accused products. Apple moved to compel a second time and sought issue preclusion sanctions for Samsung's failure to produce source code. The court decided to focus on Samsung's failure to produce code for its "design-around" products. The court focused on design-arounds because by "their very nature design-arounds impact key questions of liability, damages, and injunctive relief."

The court noted that its previous order had required Samsung to produce all source code for all accused products by December 31, 2011. Samsung did not produce the source code for the design-around products until March, 12, 2012: "Samsung did not produce source code for its '891 and '163 design-around until March 10 and 12, 2012 - after the close of fact discovery - knowing full well that the court would not grant the parties any exceptions. Samsung offers no explanation why it could not produce code in commercial release months before the deadline, or produce other code in commercial release until months after the deadline. Samsung also offers no explanation why it failed to bring any source code production problems to the court's attention as soon as practicable and instead put the onus on Apple to seek relief."

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Court Denied Motion to Exclude Expert Testimony That Relied on Consumer Survey to Establish Evidence of Infringement

May 11, 2012

Pact XPP Technologies ("Pact") filed a patent infringement action against Xilinx, Inc. ("Xilinx") and other defendants. Xilinx filed a motion to exclude Pact's expert's testimony on inducement. Pact claimed that the defendants induced Xilinx customers to infringe the asserted patents and presented expert witness to offer an opinion that Xilinx actively induces infringement, which in part relied on consumer survey evidence.

The court began it analysis by noting that "[a]n expert witness may provide opinion testimony if '(a) the expert's scientific, technical, or other specialized knowledge will help the trier of fact to understand the evidence or to determine a fact in issues; (b) the testimony is based on sufficient facts or data; (c) the testimony is the product of reliable principles and methods; and (d) the expert has reliably applied the principles and methods to the facts of the case.' Fed. R. Evid. 702. A trial court is 'charged with a 'gatekeeping role,' the objective of which is to ensure that the expert testimony admitted into evidence is both reliable and relevant.' Sundance, Inc., v. DeMonte Fabricating Ltd., 550 F.3d 1356, 1360 (Fed. Cir. 2008).

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Apple v. Motorola: Apple Provides Counsel Free of Charge to Inventor to "Prepare" for Deposition and Judge Posner Rules That No Bona Fide Attorney-Client Privilege Was Created

May 9, 2012

In one of several patent battles that Apple is waging across the country against Google's Android operating system, Motorola moved to exclude the testimony of one of the inventors of the patent-in-suit. As part of determining this motion, the district court, Judge Posner, requested that Apple answer several questions in camera, including why the inventor retained certain counsel and under what circumstances the inventor retained the additional counsel provided by Apple.

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Apple v. Samsung: Rule 37 Sanctions Ordered Against Samsung for Failure to Timely Produce Documents Despite Two Court Orders

May 7, 2012

Apple sought sanctions against Samsung pursuant to Fed.R.Civ.P. 37(b)(2) in two separate motions pertaining to alleged violations of discovery orders, including an order regarding discovery on damages. The court had initially ordered Samsung to produce two categories of documents: (1) documents from the custodial files of Samsung designers of the Samsung products at issue during the preliminary injunction motion referencing the Apple products alleged by Apple to embody one or more of the ornamental or utility features claimed in the patents; and (2) all survey documents from central or custodial files that reference the Apple products-in-issue. After this order, Apple contended that the Samsung production was still woefully inadequate and the court issued a further order directing Samsung to comply by December 31, 2011 and stating that failure to comply would subject Samsung to sanctions.

The court ultimately agreed that Samsung had failed to comply with the court's orders, even though there was significant burden on Samsung due to the compressed case schedule. "The scale of Samsung's production and the burden placed on it by the compressed case schedule and the numerous claims at issues . . . That burden, however, does not negate Samsung's obligation to comply with no fewer than two court orders specifying the production of documents that reference Apple's products claimed to embody the features and designs at issue. As this court has stated under similar circumstances, '[o]nce the order compelling production issues, the focus of this court's appropriate inquiry necessarily shifts to compliance.' Notwithstanding Samsung's efforts, the court agrees with Apple that Samsung's production as of October 7 and December 31, 2011 failed to comply with the Court's orders."

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Inequitable Conduct Defense Dismissed Where Defendants Did Not Even Purport to Identify an Allegedly Fraudulent Document Submitted to the PTO

May 4, 2012

Zep Solar Inc. ("Zep") filed a patent infringement action against several defendants. Two of the defendants, Lightway Green new Energy Company, LTD ("Lightway") and Brightway Global LLC ("Brightway") answered and counterclaimed with an allegation of inequitable conduct. Zep moved to strike or dismiss the counterclaim and affirmative defense.

As the district court stated, "[i]n the fourth affirmative defense, Brightway and Lightway allege that '[t]he Complaint and the purported claim for relief therein is barred because the '537 Patent, and each claim thereof, is unenforceable due to inequitable conduct.' (Docket No. 49, Answer and Counterclaims for Relief at 7:26-27.) In their second counterclaim for relief, Lightway and Brightway alleged hat the '537 Patent is 'invalid and/or unenforceable for failing to meet the conditions of patentability including but not limited to hose specified in 36 U.S. C. Sections 1 et seq., including 35 U.S.C. sections 102, 103, 112, 199, 256 and 37 C.F.R. section 1.56.'"

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