Articles Posted in District Courts

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In this patent infringement action, Plaintiff Personalized Media Communications, LLC (“PMC”) filed a motion seeking (1) a court order compelling Defendant Netflix Inc. (“Netflix”) to provide PMC with on-site access to Netflix’s source code after the close of fact discovery or, in the alternative, (2) an extension of the fact discovery deadline to allow review of the source code. Netflix opposed the motion asserting that PMC should have completed review of the source code prior to the close of fact discovery and that there was no good cause to extend the fact discovery deadline.

In support of its positon, PMC did not cite to any case law that supported its argument that a party producing confidential source code through on-site access procedures must allow further review of this source code after the fact discovery deadline. The district court did not find persuasive the cases cited by PMC, which concern inspection of physical sites rather than review of confidential source code. Continue reading

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The defendant, IBG, contended that the plaintiff, Trading Technologies (“TT”) committed patent misuse (rendering its patents unenforceable) when it tied licenses to its U.S. patents to sales of products in foreign jurisdictions where IBG did not hold any patents. TT moved for summary judgment on the patent misuse defense.

As explained by the district court, between 2004 and 2018, TT and various third parties entered into thirty-five license and/or settlement agreements with respect to the four patents-in-suit. At least seven of these agreements include language explaining that the license granted is “worldwide and is based on worldwide usage of [the competitor’s licensed products], as opposed to only usage in countries in which there is patent protection.” The license agreements also included the following or nearly identical language: “WHEREAS, TT is willing to grant the discounted license granted herein for administrative convenience because the license is worldwide and requires payments of royalties for use of Licensed Products . . . anywhere in the world as opposed to royalties based only on the usage of Licensed Products in countries in which there is patent protection.” Continue reading

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In this patent infringement action, defendant Athenahealth, Inc. (“Athenahealth”) moved to exclude the plaintiff CliniComp International Inc.’s damage expert testimony of Dr. Nisha Mody, which included a check on the reasonableness of the damage calculation based on an incremental-value analysis.

As explained by the district court, Dr. “Mody’s damages model is based on a reasonable-royalty-rate analysis, which calculates the royalty the parties would have agreed to during a hypothetical negotiation that would have occurred on the eve of infringement. Her analysis multiplies the number of infringing customers by the cost to design around the claimed invention per customer to determine the amount of damages. Mody also performs a second calculation to check the reasonableness of her damages calculation. She refers to this as an “incremental-value” analysis. For the incremental-value analysis, Mody determines that Athenahealth estimated that the athenaOne suite would increase revenue by 10 percent. She then calculates the damages by multiplying 10 percent by the total revenue Athenahealth earned from the athenaOne suite.”

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SIMO Holdings Inc. (“SIMO”) prevailed on its patent infringement claims against defendant Hong Kong uCloudlink Network Technology Limited (“uCloudlink”) at trial. SIMO asked the district court twice to use confidential uCloudlink documents produced in pretrial discovery in a trade secret misappropriation lawsuit in Shenzhen, China between SIMO subsidiary Skyroam Shenzhen and a uCloudlink subsidiary (the “Chinese lawsuit”).

As explained by the district court, when it made the request to disclose the confidential information in the Chinese lawsuit, SIMO informed the district court for the first time that “[i]n late November 2018” plaintiff’s counsel at K&L Gates LLP “made the . . . uCloudlink Confidential Documents available to the [King & Wood Mallesons] attorneys” who at that time represented Skyroam Shenzhen in a related Chinese patent infringement lawsuit and who now represent Skyroam Shenzhen in the Chinese lawsuit. Defendants not only opposed disclosure but also requested that the district court impose sanctions for the unauthorized disclosure to King & Wood Mallesons.

The district court found it significant that SIMO admitted that it shared the uCloudlink confidential documents with four King & Wood Mallesons attorneys in late November 2018. The district court noted that paragraph 5(c) of the Protective Order prohibits disclosure of confidential discovery material except to court personnel, stenographers, “counsel retained specifically for this action,” and those “retained by a party to serve as an expert witness or otherwise provide specialized advice to counsel in connection with this action.” Continue reading

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After it prevailed on a motion for judgment on the pleadings, ShopperChoice argued that no reasonable patentee in the plaintiff’s position could have believed that Claim 11 of 261 patent covered patent eligible subject matter at the time suit was filed. ShopperChoice based its argument on the prior opinion of a California Federal District Court, which invalidated claims of patents in the ‘261 patent’s family based on the finding that they were directed to “the abstract idea of asking people, based on their location to go place[]s,” and implemented with only “‘generic computer[s]’” that did not transform the claims into patent eligible subject matter. McKinley, 2014 WL 4407592, at *11 (quoting Alice, 573 U.S. at 223, 134 S. Ct. 2347). ShopperChoice also noted that three years later, in True Grit, a sister court in the Central District of California cited McKinley as authority for invalidating Claim 11 of the ‘261 patent – the same patent and claim as that at issue in the instant suit — finding that this claim “suffers from the same type of obvious defect as the asserted claims in McKinley.” Continue reading

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As the district court, explained the “case present[ed] the Court with a disturbing and unfortunate situation. Puneet Chawla, Defendant Workspot, Inc.’s (“Workspot”) co-founder, former Chief Technology Officer (“CTO”), and former member of the Board of Directors, sent harassing and threatening email messages to executives of Plaintiff Citrix Systems Inc. (“Citrix”), and posted additional messages to intend sites. In connection with opposing Citrix’s motion for a preliminary injunction and temporary restraining order (“PI Motion”), Workspot then filed a declaration from Mr. Chawla, which contained knowingly false statements, including denials of Chawla’s harassing conduct. At a December 2018 hearing denying Citrix’s PI Motion, the Court imposed monetary sanctions on Workspot, which ultimately totaled $271,963. The Court also ordered limited, expedited discovery relating to the sanctionable conduct and authorized Citrix to move for additional sanctions after the completion of that discovery.”

Citrix then moved for additional sanctions, including additional monetary sanctions, jury instructions and the striking of Workspot’s equitable defenses. Although the district court denied the additional monetary sanctions and jury instructions, the district court did strike Workspot’s equitable defenses. Continue reading

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In this patent infringement action, DUSA Pharmaceuticals, Inc. (“DUSA”) sought to strike the testimony of Biofrontera’s expert witness, Professor Harry Moseley, for his reliance on a non-infringing alternative, the Paterson lamp. DUSA asserted that the testimony should be stricken because the Paterson lamp had never been available in the United States.

The district court explained that the Paterson lamp was designed and built by the Paterson Institute in the United Kingdom in the early to mid-1990’s and that five articles describing the Paterson lamp were published in the United States, but there was no evidence that the lamp was ever sold, used, or exhibited in the United States. “Based on his personal involvement in the creation of the Paterson lamp, Professor Moseley testified to its composition and functionality. In particular, Professor Moseley identified the lamp’s desired treatment distance as 4 inches, a parameter not explicitly disclosed in the published references.”

DUSA challenges the testimony as impermissible (attempting to back-fill gaps in the Paterson lamp references) and as untimely. Biofrontera responded that Professor Mosleys’ testimony was admissible evidence of prior art and that the parties had agreed to modify the expert discovery schedule to give DUSAs expert witness, Dr. Zamenhof, an opportunity to submit a supplemental declaration. Continue reading

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Plaintiff Midwest Athletics and Sports Alliance LLC (“MASA”) filed a patent infringement action against Ricoh USA, Inc. (“Ricoh”) alleging infringement of certain printing-related patents. Ricoh sought production of certain categories of documents that MASA contended were privileged and, therefore, not subject to disclosure. Ricoh contended that the documents are responsive to its requests, which seek documents related to MASA’s acquisition of the patents from Kodak and various communications with litigation funding companies, for which MASA asserted a common interest privilege.

The district court explained that “the common interest doctrine protects parties, with shared interest in actual or potential litigation against a common adversary, from waiving their right to assert privilege when they share privileged information.” Gelman v. W2 Ltd., No. 14-cv-6548, 2016 WL 8716248, at *3 (E.D. Pa. Feb. 5, 2016) (quotation omitted). Unlike joint representation, the common interest exception “comes into play when clients with separate attorneys share otherwise privileged information in order to coordinate their legal activities.” In re Teleglobe, 493 F.3d at 359. The legal activities may be litigation or transactional matters, but “the privilege only applies when clients are represented by separate counsel.” Id. at 365. Continue reading

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In this long running patent dispute, the district court denied Apple’s motion to amend the judgment based on a five month delay. The district court explained the long running history of the case as follows: “Nearly 10 years ago, VirnetX sued Apple, alleging Apple’s FaceTime and VPN on Demand features infringed VirnetX’s patents. Four trials, three appeals and a litany of parallel proceedings ensued. Almost three years ago, this Court laid to rest a portion of the parties’ quarrel, entering final judgment in the above-captioned matter. Now, under Rule 60, Apple attempts to resurrect this case for a retrial on damages.”

In its motion to set aside the final judgment under Rule 60(b)(6), Apple argued that the relief was necessary to prevent VirnetX from recovering “a massive damages judgment for patent claims that are necessarily unpatentable.” VirnetX responded that Apple’s motion was untimely, that it attempted to relitigate issues raised on direct review and failed to establish the “extraordinary circumstances” necessary for relief under Rule 60(b).

The district court agreed with VirnetX, noting that motions under Rule 60(b)(6) “must be made within a reasonable time.” FED. R. CIV. P. 60(c). “What constitutes [a] ‘reasonable time’ depends on the facts of each case, taking into consideration the interest in finality, the reason for delay, the practical ability of the litigant to learn earlier of the grounds relied upon, and prejudice to other parties.” Travelers Ins. Co. v. Liljeberg Enters., 38 F.3d 1404, 1410 (5th Cir. 1994) (quoting Ashford v. Steuart, 657 F.2d 1053, 1055 (9th Cir. 1981)). “A district court is provided wide discretion in determining whether a Rule 60(b) motion is filed within a reasonable time.” McKay v. Novartis Pharm. Corp., 751 F.3d 694, 701 n.5 (5th Cir. 2014). Continue reading

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In this patent infringement action, the plaintiff’s counsel deposed one of the defendant’s (DJO) Fed.R.Evid. 30(b)(6) witnesses during a deposition that took place remotely.  At the remote deposition, counsel questioned the witness regarding a license agreement and a privileged letter that was apparently appended to the license agreement.  Plaintiff then contended that any objections to the privileged nature of the letter were waived and that the waiver should be not just to the letter but also to the subject matter of the letter.

To analyze the waiver issue, the district court addressed whether DJO took appropriate steps to claw back the privileged letter.  DJO contended that it did promptly take reasonable steps to rectify the error, explaining that, because the deposition was remote and the letter was attached to many other non-privileged documents, DJO’s counsel could not tell from the remote display of the document whether the letter had been intentionally produced.  Although Mr. DJO’s counsel did not assert privilege over the letter during the deposition or after the letter was discussed, DJO identified the letter as inadvertently produced and requested the destruction of the letter and related testimony “within hours” of the deposition’s conclusion. Continue reading