July 2016 Archives

Jury's Finding of Willfulness Sufficient Under Halo to Support Judgment of Willful Infringement

July 28, 2016

Sociedad Espanola de Electromedicina Y Calidad, S.A. (Sedecal) filed a patent infringement action against Blue Ridge X-Ray Company, Inc. (Blue Ridge X-Ray), DRGEM USA, Inc. (DRGEM USA), and DRGEM Corporation (DRGEM Corp.), alleging infringement of Sedecal's U.S. Patent No. 6,642,829 ("the '829 Patent"). After a jury returned a verdict finding that the Defendants had infringed the '829 Patent, the same jury awarded the Plaintiff $852,000 in damages against all three Defendants in a second trial and found that DRGEM USA, Inc. and DRGEM Corporation's infringement was willful.

The district court then ordered supplemental briefing on the objective prong of the Seagate case since the jury verdict was rendered before the Supreme Court's decision in Halo. While the matter was still under advisement, the Supreme Court issued its decision in Halo Electronics, Inc. v. Pulse Electronics, Inc., 136 S. Ct. 1923 (2016). In Halo, the Supreme Court overruled Seagate, concluding that the Federal Circuit's two-part inquiry was "unduly rigid, and it impermissibly encumbered the discretion of district courts." Halo, 136 S. Ct. at 1932.

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District Court Denies Motion to Lift Stay Even after Federal Circuit Affirms PTAB's Decision Upholding Claims of Patent-in-Suit Because Petition for Certiorari Was Pending before Supreme Court

July 26, 2016

The district court had previously granted a stay pending an inter partes reexamination by the United States Patent and Trademark Office ("PTO") of U.S. Patent No. 6,797,454 (the "'454 patent"). After the PTO affirmed the validity of claims 2-6, 15, and 16 of the '454 patent, the Federal Circuit unanimously affirmed the PTO's decision.

Although a reexamination certificate had not yet been issued, the plaintiff argued that the stay should be lifted and further argued that the certificate had not yet been issued only because the defendant had filed a petition for certiorari with the United States Supreme Court. The plaintiff argued that given the extreme unlikelihood that the United States Supreme Court would grant certiorari in this matter, particularly in light of the Federal Circuit's summary affirmance of the PTO's decision, the stay be lifted now.

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After Defendant Seeks to Claw Back Attorney-Client Privileged Documents, District Court Determines Privileged Waived (Including Work Product) Because Witness Gave Testimony Regarding Privileged Documents at Deposition

July 21, 2016

The defendants produced documents in response to plaintiffs' first set of requests for production and included in the production were five documents that the defendants were later claim were subject to attorney-client privilege. Before the defendants made that claim, however, the plaintiffs deposed a corporate designee of Defendants Musion Events Ltd. and Musion 3D Ltd. During that deposition the five documents in questions were marked as exhibits. For some of the documents, the deponent testified regarding the contents of the documents and even read portions of the documents into the record--all without objection as to privilege or work product.

Shortly after that deposition, the defendants' counsel to plaintiffs' counsel and requested a claw-back of the five documents pursuant to the parties' protective order.

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District Court Orders Production of Bills from Expert Witnesses But Permits Redaction of Narrative Statements in Bills

July 19, 2016

In this patent infringement action, the defendant, Ericsson moved to compel the plaintiff, TCL, to produce bills and invoices for worked performed by TCL's expert witnesses. TCL sought to redact the bills and invoices to eliminate statements and narratives from the bills that do not reflect compensation.

Fed.R.Civ.P. 26(b)(4)(C) provides that "Rule 26(b)(3)(A) and (B) protect communications between the party's attorney and any witness required to provide a report under Rule 26(a)(2)(B), regardless of the form of the communications, except to the extent that the communications . . . relate to compensation for the expert's study or testimony." Fed. R. Civ. P. 26(b)(4)(C).

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Subsequent Employment Agreement Assigning Inventor's Intellectual Property Rights Does not Defeat Standing for Inventions Created Prior to Employment Agreement

July 14, 2016

The plaintiff, Odyssey Wireless ("Odyssey") filed four separate actions for patent infringement against Defendants Apple, Samsung, LG, and Motorola, alleging infringement of U.S. Patent Nos. 7,881,393; 8,199,837; 8,576,940; 8,660,169; 8,855,230; and 8,879,606. Each of the patents-in-suit lists on its face Peter D. Karabinis as the inventor and EICES Research, Inc. as the assignee of the patent. Dr. Karabinis is the Founder and Chief Technology Officer of EICES, and EICES is the predecessor of Odyssey Wireless.

In April 2001, Mobile Satellite Ventures ("MSV") hired Dr. Karabinis to be its Vice President and Chief Technical Officer and he entered into an intellectual property and confidential information agreement with MSV, which granted MSV ownership rights in Dr. Karabinis' work for MSV. Based on the agreement with MSV, the Defendants moved to dismiss the patent infringement action based on lack of standing.

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Recent Decision in Halo Requires Reconsideration of Summary Judgment Motion on Willfulness

July 12, 2016

In a multi-district litigation, the district court had previously granted summary judgment in favor of the defendants on the issue of willful infringement. After the Supreme Court's decision in Halo Electronics, Inc. v. Pulse Electronics, Inc., the plaintiff moved to reconsider the ruling on the ground that the substantive legal standard required for a finding of enhanced damages due to willful infringement had changed.

In response, the defendants argued that the plaintiff's motion was futile because the plaintiff had failed to identify any facts that would suggest egregious conduct subject to enhanced damages. The defendants also argued that if the motion was granted, then they should be permitted time to take discovery on the issue of willfulness and file appropriate motions after the discovery was completed.

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District Court Permits Survey Evidence to Support Lost Profits Damage Theory

July 7, 2016

The defendants', Roland DGA Corporation and Roland DG Corporation (collectively "Roland"), filed a motion for summary judgment against plaintiff, Gerber Scientific International, Inc. ("Gerber") regarding Gerber's claims for lost profits and enhanced damages. Gerber's claim for lost profits was based, in part, on survey evidence.

The district court explained that "[t]o recover lost profits a patentee must show that „but for' infringement it reasonably would have made the additional profits enjoyed by the infringer." Micro Chemical, Inc. v. Lextron, Inc., 316 F.3d 1119, 1122 (Fed. Cir. 2003). "A patentee may resort to any method showing, with reasonable probability, entitlement to lost profits „but for' the infringement." Id.

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District Court Denies Leave to Amend to Add Implied License Affirmative Defense Where Motion for Leave Was Filed Just Two Months Prior to Fact Discovery Cut-Off

July 5, 2016

Google, Inc. and YouTube, LLC (collectively "Google") filed a motion for leave to amend their answer to include an implied license affirmative defense. Because Google filed the motion to amend its answer more than two months after the district court's scheduling order's deadline to amend the pleadings, Google had to show good cause for the district court to grant its motion.

The district court noted that Google did not file its present motion to amend until December 22, 2015, near the end of the fact discovery deadline of February 26, 2016. The district court also noted that "[t]he basis of Google's implied license defense is VideoShare's June 21, 2013 covenant not to sue for infringement of U.S. Patent No. 7,987,492. Nonetheless, Google failed to include the implied license defense in its pleadings for a year and a half after VideoShare entered the covenant not to sue. Google has made no attempt to explain its delay in presenting this defense. Google does not contend that it lacked sufficient information to meet the amendment deadline, or that it discovered new information that could not be timely pled. Therefore, Google has not demonstrated why its amended defense could not have been sought in a timely manner."

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