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One of the district courts in the Eastern District of Texas has issued several orders in multi-defendant patent infringement cases addressing whether changes to the court’s normal scheduling orders were necessary. The district court has previously expressed concern in several cases that defendants may be faced with a Hobson’s choice of spending more than the settlement range on discovery “or settling for less than their cost of defending the case, regardless of the merits of the case.” The district court has expressed concern that the Patent Rules may not provide the most efficient case management schedule in those situations because of the quick discovery deadlines in the Eastern District of Texas.

In addressing a plaintiff that has sued 95 defendants across seven cases, the district court began by noting that it had previously expressed concern in cases where a plaintiff may assert questionable patent claims to extract cost of defense settlements. “The Court has previously expressed concern about cases where a plaintiff asserts questionable patent claims against a large number of Defendants to extract cost of defense settlements.”
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In pursuing patents for their inventions, inventors need to make sure that earlier filed provisional patent applications filed by other inventors do not preclude the inventor’s patent application. The Federal Circuit’s decision in In re Giacomini, (Fed. Cir. July 7, 2010) affirmed a USPTO Board of Patent Appeal’s decision that found the patent examiner properly rejected certain claims of a pending application. The decision in Giacomini occurred because an earlier filed provisional application by another inventor disclosed the same invention. Because the inventor failed to challenge the written description of the earlier filed provisional application, the inventor waived his right to do so on appeal and lost his patent as a result.

The Federal Circuit began by noting that “an applicant is not entitled to a patent if another’s patent discloses the same invention, which was carried forward from an earlier U.S. provisional application or U.S. non-provisional application. Here, the inventor did not dispute that the earlier provisional application described the invention claimed in Giacomini’s application. As result, the Federal Circuit found that the provisional, which pre-dated Giacomini’s filing date, was the first U.S. application to describe the invention.
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In a recent decision from New Jersey, the district court granted a motion to dismiss for failure to state a claim. The district court granted the motion because the plaintiff’s patents did not qualify as patentable subject matter under the machine-or-transformation, which the United States Supreme Court has recently determine remains a useful test in determining patentable subject matter. In re Bilski, 130 S. Ct. 3218 (2010).

The patents at issue claim processes directed to a system for processing information from a template file to an application using “content instructions” and “customizable transmission format instructions” on a programmed computer. The plaintiff alleged that the defendant’s website infringed the patents because the website allowed customers to input information into a template as part of the purchase process. The defendant argued that the patents were invalid because they claim unpatentable abstract ideas.
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In a case involving application of the “first-filed action” doctrine and transfer, the district court in the Eastern District of Texas transferred a case as to one defendant but severed and kept the case as to two other defendants. One of the defendants in Texas, Interwoven, began the litigation, not in Texas, but in the Northern District of California by filing suit against Vertical Computer Systems, Inc. seeking a declaration that the Vertical patents were invalid and were not infringed by Interwoven. Vertical subsequently filed a patent infringement action on the same patents against Interwoven and two additional defendants, Samsung and LG, in the Eastern District of Texas. Samsung then filed a declaratory judgment action in the Northern District of California.

In analyzing the first-filed action doctrine on a motion to transfer, the district court agreed that the Interwoven action was filed first and that therefore the case against Interwoven should be transferred to the Northern District of California. The district court disagreed with Samsung, however, and found that the action against Samsung should remain in Texas as Samsung was not a party to the first filed case.
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The written description requirement is of heightened importance in determining the priority date for continuation patent applications. Without a sufficient written description that supports and details the claims of the patent, the priority date of the parent patent may be lost for the continuation application. This issue was recently addressed by the Federal Circuit in the Anascape, LTD. v. Nintendo of America, Inc., 601 F.3d 1333 (Fed. Cir. 2010) decision and the decision is useful to review to understand the consequences of failing to have sufficient support in the written description for claims in a continuation patent.

Click here for a more detailed discussion: Anascape, LTD. v. Nintendo of America, Inc.

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The district court determined that plaintiff had waived the attorney-client privilege because the plaintiff’s in-house counsel revealed too much information in answering questions during a deposition. The defendants raised the waiver issue in the context of a motion to compel by contending that the plaintiff’s in-house counsel’s answers during a deposition revealed attorney-client communications and therefore waived the privilege regarding the plaintiff’s motivation in seeking the reissuance of its patent.

The district court found that the in-house counsel “expanded on the statements to the PTO, revealing that because of the issue of the different effective filing dates, there was a specific concern that the mixed subject matter claims were technically anticipated by” another published application. The in-house counsel also explained that there were additional communications between himself and other in-house and outside counsel that led to this concern. The district court found that these types of statements were sufficient to waive the attorney-client privilege.
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In another decision involving sanctions for defendants failure to provide discovery, the district court for the Western District of Michigan granted plaintiff’s motion for default judgment. The default was granted because the defendant had not participated in discovery. As the district court stated, “Defendants have not participated in discovery, but rather have refused to provide depositions or responses to [plaintiff’s] written discovery requests.”

The district court went on to note that defendants’ conduct was willful in that the defendants had ignored discovery deadlines and previous orders from the district court. “Defendants have ignored discovery deadlines and other obligations imposed both by the Rules of Civil Procedure and explicit orders of the Court.”
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In a recent case in the Eastern District of Texas, the district court addressed the admissibility of a consumer survey to show demand for the patented features in accused products. The district court rejected plaintiff’s consumer surveys and granted the defendants’ motion to exclude plaintiff’s survey experts because the surveys did not measure the purported advantages of plaintiff’s technology.

The surveys measured whether consumers valued incorporating internal antennas in cell phones in place of external antennas. The problem with these surveys, however, was that plaintiff did not invent–and the patents did not claim–internal antennas for cell phones. Instead, the patents were directed only to one type of internal antenna that had increase advantages over other internal antennas and external antennas because of multiband functionality and reduced size. Thus, the surveys did not measure the value of plaintiff’s technology. “While Plaintiff claims that its experts contend that the patents-in-suit are ‘fundamental’ to internal antennas, the surveys are not tied to the alleged advantageous technical characteristics of the patents-in-suit. Put another way, the surveys do not measure how consumers value the purported advantages provided by Plaintiff’s technology.”
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It is well settled law that all inventors who contribute to an invention must be named on the patent application. Nonetheless, where there are many inventors who contribute to the conceptions and reduction to practice of an invention, it can be difficult to determine who should be listed as the inventors on the patent application. But taking the time to do this right is also critical. Because the failure to name all co-inventors can render the patent unenforceable, particularly if one or more of the named inventors intended to deceive the patent office, it is very important to thoroughly analyze who should be named on the patent application. In addition, listing people who are not inventors as inventors can have the same dire consequences–the inability to enforce the patent. The recent case of Advanced Magnetic Closures, Inc. v. Rome Fasteners Corp., 607 F.3d 817 (Fed. Cir. 2010) illustrates what can happen when an inventor misleads the patent office on the issue of who invented the invention covered by the patent.

Click here for a more detailed discussion of Advanced Magnetic Closures, Inc. v. Rome Fasteners Corp.

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After a serious delay by the defendant in providing discovery, the district court granted plaintiff’s motion to strike the defendant’s answer and enter a default judgment. The district court found that the defendant continually mislead the plaintiff and the court regarding its discovery obligations and caused the case to be delayed for several years by doing so. “This Court gave [defendant] numerous opportunities to provide the requested documents, yet it chose to produce incomplete responses. . . . [Defendant] and [its counsel] affirmatively misled Plaintiffs — and more importantly, this Court — as to the production of documents and compliance with Court orders. . . . By failing to provide the discovery as ordered, [defendant] has prevented Plaintiffs from pursuing their claims and delayed this litigation for nearly seven years.”
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