Articles Posted in District Courts

Plaintiff Biomet, Inc. (“Biomet”) filed a complaint for Declaratory Judgment against Bonutti Skeletal Innovations, LLC (“Bonutti”) seeking a declaration that the manufacture, use, or sale of Biomet’s products does not infringe on Bonutti’s patents. Bonutti filed a motion to dismiss for lack of subject matter jurisdiction pursuant to Fed. R. Civ.P. 12(b)(1), arguing that, at the time the complaint was filed, there was no case or controversy as defined by the Declaratory Judgment Act, 28 U.S.C. § 2201(a).

The district court explained the facts as follows. In June 2012, Acacia Research Group (ARG), Bonutti’s parent company, contacted Biomet about a new licensing agreement. Shortly afterwards, Plaintiff and ARG began negotiating the terms of the licensing agreement. The bargaining process included the signing of a Non-Disclosure Agreement (“NDA”). The NDA’s purpose was to facilitate the licensing of patents to avoid litigation. There was nothing in the NDA that prevented the parties from filing a lawsuit against each other at any point, for any reason.
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Plaintiff The Procter & Gamble Company (“Plaintiff”) filed a patent infringement action against Clio USA, Inc. (“Clio”). Plaintiff moved to compel certain opinions of counsel and other documents concerning the subject matter of those opinions. In the litigation, Clio had produced to Plaintiff copies of two abridged opinions, which were marked on their face as containing privileged communications.

Clio intentionally disclosed the abridged opinions to various third parties, including Clio’s co-Defendants, the co-Defendants’ customers, and Plaintiff. Clio claimed that it disclosed one of the abridged opinions to co-Defendants under a common interest privilege. But Plaintiff identified documents from co-Defendant Team Technologies, Inc. (“Team Tech”) showing further dissemination of counsel’s opinions to retailers. For example, CVS demanded documentation of a “legal nature” to “show there is no patent infringement,” and Clio responded that it would provide such documentation. Meijer requested a similar legal opinion, and a legal opinion letter was furnished to CVS.

Plaintiff asserted that these productions waived the attorney client privilege.
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KFx Medical Corp. (“KFx”) alleged that Arthrex, Inc. (“Arthrex”) infringed three of its patents: United States Patent Number 7,585,311 (“311 Patent”), United States Patent Number 8,100,942 (“942 Patent”) and United States Patent Number 8,109,969 (“969 Patent”). All three patents share the same name: “System and Method for Attaching Soft Tissue to Bone.” KFx’s moved for summary judgment of no inequitable conduct in connection with the ‘942 Patent and the ‘969 Patent.

As explained by the district court, Arthrex’s claim of inequitable conduct was directed to the conduct of Ryan Melnick, the attorney who prosecuted the patents. Arthrex alleged that Mr. Melnick intentionally diverted the Examiner of the ‘942 and ‘969 Patents away from a statement by KFx’s President and CEO, Tate Scott (“the Scott Statement”), and instead directed the Examiner to less relevant prior art references. Arthrex contended the Scott Statement explained that the work performed in a 2004 article by Peter J. Millett, M.D., et al., entitled “Mattress Double Anchor Footprint Repair: A Novel, Arthroscopic Rotator Cuff Repair Technique” (“the Millett article”) was prior art to all of the patents. Arthrex claimed that Mr. Melnick’s diversionary tactic caused the Examiner not to apply the Millett article, and that if the Examiner had applied that article, he would have rejected the claims. Arthrex also asserted that “Mr. Melnick failed to disclose to the Examiner the correct priority date for the ‘969 patent and, in fact, took steps to mislead the Examiner into believing the ‘969 patent was entitled to the same priority date as the ‘942 patent, when he knew it was not.”
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Ball Metal Beverage Container Corp. “(Ball Metal”) filed a declaratory judgment action against CMI&J LLC (“CML&J”) for non-infringement and invalidity. CML&J moved to dismiss the action for lack of personal jurisdiction, contending that it lacked sufficient minimum contacts with Colorado.

The declaratory judgment action centered on U.S. Patent No. 8,245,866 (the “‘866 Patent”), which is directed to a type of beverage container. Three friends created the product embodied in the ‘866 Patent, Daniel Gibson, Joseph Snecinski, and Todd Epstein. The three friends incorporated CML&J to license the beverage container described in the ‘866 Patent. Gibson and Snecinski reside in Connecticut, and Epstein resides in Massachusetts. CML&J’s place of business is in Connecticut.
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Graco Childrens Products Inc. (“Graco”) filed a patent infringement action against Kids II, Inc. (“Kids II”). During discovery, Graco and Kids II agreed to discuss terms to settle the dispute. As part of that process, Graco’s in-house counsel sent an email to Kids II’s in-house counsel, with a settlement proposal calling for a two-year mutual non-solicitation provision and a purchase by Kids II of the family of patents-in-suit with a non-exclusive license back to Graco for $1,150,000 or, in place of an outright purchase of the patents, a full settlement of the pending claims for $750,000. The offer was contingent on the execution of a mutually agreeable settlement agreement and was to expire on March 15, 2013.

On March, 19, 2013, Kids II’s in house counsel set forth a counterproposal, offering $750,000 for, among other things, the purchase of the patents previously identified by Graco and a mutual two-year moratorium on employee solicitation. Graco responded by seeking clarification on whether Graco would be granted a right to practice the patents and the parties then attempted to reach an agreement on the amount for the settlement.
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H-W Technology, L.C. (“H-W”) filed a patent infringement action against Apple and several other defendants including Amazon and Buy.com. H-W alleged that it had ownership of U.S. Patent No. 7,525,955, entitled “Internet Protocol (IP) Phone with Search and Advertising Capability” (the ‘955 patent). The 955 patent is directed to systems and methods of using a multi-convergence device, including phones commonly referred to as smartphones, which are able to converge voice and data within a single terminal, and which allow users of such devices via domain specific applications to receive information and offers from merchants and to complete a transaction with one of said merchants without having to generate a phone call.

The Defendants argued that claims 1 and 17 of the patent were indefinite and invalid under 35 U.S.C. § 112, paragraph 2, for combining two statutory classes of invention within a single claim. The defendants also asserted that claim construction was not necessary to rule on the motion to dismiss because H-W had not included any argument in its claim construction briefs regarding the subject-matter class covered by the claim language at issue. H-W asserted that the validity of its patent claims had to be considered on summary judgment context, with the benefit of claim construction and expert discovery, and not on a motion to dismiss.
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After the plaintiff, Peerless Industries, Inc. (“Peerless”) produced an arguably privileged document to the defendant, Crimson AV LLC (“Crimson”), Peerless asserted that the document was inadvertently disclosed and was privileged. Crimson filed a motion to compel production of the document, particularly asserting that it should be produced under an exception to the attorney-client privilege.

As explained by the district court, “Defendants have filed a motion for an in-camera inspection of a particular document inadvertently produced by plaintiff [dkts. 230, 231]. Defendants seek a ruling that this document is discoverable, and not to be returned to plaintiff based on the inadvertent disclosure provision of the parties’ protective order, because of the crime-fraud exception. We deny that request and find plaintiff’s inadvertent disclosure did not waive the attorney-client privilege.”
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James R. Taylor (“Taylor”) filed a patent infringement action against Taylor Made Inc. (“Taylor Made”). Taylor Made filed a motion to dismiss the action on the ground that Taylor did not have standing to maintain the patent infringement action because Taylor’s ex-wife had not been made a party to the lawsuit and she had an ownership interest in the asserted patent.

As explained by the district court, “[t]he Plaintiff and Ms. Taylor were married on February 14, 1987. Dkt. 24-1. The Plaintiff subsequently obtained the Patent on September 15, 1998 for a storm drainage conduit plug and sealing band. Dkt. 1. The Plaintiff and Ms. Taylor obtained a Final Judgment of Dissolution of Marriage (A “Divorce Settlement”) from a Florida state court on March 7, 2011. Dkt. 24-1; see also In re the Marriage of James R. Taylor and Mary Louisa Taylor, Case No. 2006-Dr-10057-NC. The Divorce settlement subjects the Taylors’ marital assets to equitable distribution, in so doing notes that the primary assets of the marriage are three United States patents, specifically: (1) ‘5,224,514/July 6, 1993;” (2) “5,316,045/May 31, 1994;” and (3)[5], 806566/September 15, 1998.”
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Plaintiff Unwired Planet (“UP”) filed a patent infringement action against Apple asserting over 247 claims in ten different patents. Apple filed a motion to limit the number of claims. In the motion, Apple asserted that UP had included approximately 80% of the total number of claims in the patents. Apple asserted that if the claims were not narrowed, then the case would be unmanageable and would unfairly burden Apple.

As justification for its motion, Apple also pointed to the parties’ prior litigation history in 2011 at the International Trade Commission. As explained by Apple, UP accused the same products in this case, the iPhone, the iPad and the iPod Touch, in the ITC action. Therefore, Apple assert, UP should know how the products work, what they do, and should have an adequate understanding of the case to narrow the claims. Apple argued that the asserted claims should be reduced to fifty or sixty claims.
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Potter Voice filed a patent infringement action against Apple, Google, HTC, Sony, LG, Motorola, ZTE, Kyocera, Sharp, Huawei, Pantech, Research in Motion, Microsoft and Nokia. Many of the defendants filed several motions to dismiss pursuant to Fed.R.Civ.P. 12(b)(6).

After addressing the pleading standard for determining a Rule 12(b)(6) motion and denying certain motions without prejudice based on severance and transfer issues, the district court turned to the allegations of induced infringement. As explained by the district court, “[e]ach of the defendants who filed a motion to dismiss argues that the allegations in the plaintiff’s complaint are not sufficient to state a claim for inducement of infringement. To allege induced infringement, the plaintiff must allege direct infringement by another, knowing inducement of that infringement by the defendant, and the defendant’s specific intent to encourage another’s infringement. Toshiba Corp. v. Imation Corp., 681 F.3d 1358, 1363 (Fed. Cir. 2012). In addition, the plaintiff must allege that the defendant had knowledge of the plaintiff’s patent. Global-Tech Appliances, Inc. v. SEB S.A., ___ U.S. ___, ___, 131 S. Ct. 2060, 2068-69 (2011). “The requirement that the alleged infringer knew or should have known his actions would induce actual infringement necessarily includes the requirement that he or she knew of the patent.” DSU Med. Corp. v. JMS Co., Ltd., 471 F.3d 1293, 1304 (Fed. Cir. 2006).”
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