Patent Lawyer Blog

GemShares LLC filed a patent infringement action against Arthur Lipton and Secured Worldwide, LLC (SWW) on U.S. Patent No. 8,706,513 B2 (the ‘513 patent). The ‘513 patent is entitled “global investment grade for natural and synthetic gems used in financial investments and commercial trading and method of creating standardized baskets of gems to be used in financial and commercial products.”

According to the district court, Lipton became a one-fifth owner of GemShares in 2013, while the patent application was pending. Lipton executed an operating agreement that included a term requiring him (and other GemShares members) to disclose and present to the company opportunities related to or likely to be competitive with GemShares’ business.

In its complaint, GemShares alleged that in the fall of 2013, Lipton secretly started working on a business that GemShares alleged is a competing business (SWW). Lipton allegedly created SWW to commercialize products and services that infringe GemShares’ patents, including the patent-in-suit.

In this patent infringement case, Plaintiff and Counter-defendant Bal Seal Engineering, Inc. (“Bal Seal”) filed a joint stipulation pursuant to Local 37-2 moving to compel Defendant and Counterclaimant Nelson Products, Inc. (“NPI”) to provide further responses to Bal Seal’s Interrogatories. These included contention interrogatories (the “Contention Interrogatories”) seeking “all facts” supporting allegations in NPI’s Second Amended Answer and Counterclaims (“SACC”).

In the joint stipulation, Bal Seal sought to compel responses to twenty interrogatories asking that NPI “state all facts” supporting allegations in its SACC. (Dkt. 129-1 at 11-22 (quoting Contention Interrogatories Nos. 1-11, 16-19, 24-27, and 30).) Bal Seal served the Contention Interrogatories on October 27, 2016 (Nos. 1-11) and May 3, 2017 (Nos. 16-19, 24­27, and 30), yet had received no substantive response as of the Motion’s December 2017 filing (Dkt. 129-3, ¶¶ 4, 8.).

Rather than respond to the interrogatories, NPI had served objections, which included the following statement: “NPI … objects to this request in that it is premature to answer contention interrogatories at this time and NPI will supplement this response at the close of discovery.” (Dkt. 129-1 at 11-22.)

The plaintiff, Realtime Adaptive Streaming LLC’s (“Realtime”) filed an ex parte application to file its Certification and Notice of Interested Parties under seal (the “Application”) at the beginning of this patent infringement case.  Realtime asserted that it should be permitted to file the Certification under seal in order to keep confidential the identity of the litigation financing company engaged in the case.

Realtime argued that the agreement between Realtime and the litigation funder “explicitly provides that the identity of the parties to the agreement is itself to be treated as confidential information” and “that all terms of the agreement are to be treated as confidential information.”

The district court began its analysis by noting that the courts recognize a “general right to inspect and copy public records and documents, including judicial records and documents.” Nixon v. Warner Commc’ns, Inc., 435 U.S. 589, 597 & n. 7 (1978). They also “have expressly recognized that the federal common law right of access extends to pretrial documents filed in civil cases.” San Jose Mercury News, Inc. V. U.S. Dist. Court–Northern Dist. (San Jose), 187 F.3d 1096, 1102 (9th Cir. 1999). Thus, “unless a particular court record is one ‘traditionally kept secret,’ a ‘strong presumption in favor of access’ is the starting point.” Kamakana v. City and Cnty. of Honolulu, 447 F.3d 1172, 1178 (9th Cir.2006) (quoting Foltz v. State Farm Mut. Auto. Ins. Co., 331 F.3d 1122, 1135 (9th Cir.2003)). For non-dispositive motions, “a ‘particularized showing’ under the ‘good cause’ standard of Rule 26(c) will suffice.” Id. at 1180 (quoting Foltz, 331 F.3d at 1138).

Greatbatch moved in limine to preclude the defendant, AVX, from presenting the testimony of AVX’s expert, Dr. Panlener, by deposition. The district court concluded that permitting the expert to testify would deprive Greatbatch of the opportunity to challenge Dr. Panlener’s “credibility and would be unfairly prejudicial, under the totality of circumstances, including Dr. Panlener’s role as an employee and then consultant to AVX, his numerous instances testifying (including as a corporate representative), and representations made as to the termination of his relationship with AVX (which appears to have been related to conduct that may be probative of issues that are the subject of the forthcoming trial).”

The district court also noted that AVX may have “procured” the absence of Dr. Panlener by terminating its relationship with him after relying on his deposition testimony and depriving Greatbatch of an opportunity to cross-examine him regarding that termination and then attempting to rely on Dr. Panlener’s necessarily incomplete testimony at trial. The district court concluded that regardless of whether AVX may fairly be viewed as having “procured” Dr. Panlener’s absence, “the Court agrees with Greatbatch that it would be unfair to permit AVX to secure Dr. Panlener’s self-serving testimony about, for instance, the purported pin washer changes, and thereafter fire him so that AVX can play his deposition to the jury and avoid the specter of his live testimony.”

The district court also disagreed with the defendant’s argument that it was entitled to present Dr. Panlener’s deposition testimony at trial under Rule 32(a)(4)(B) (“A party may use for any purpose the deposition of a witness . . .”). The district court found that the Rule 32 did not  override the district court’s “discretion to manage the trial in a manner that is fair to both sides and consistent with all other applicable rules.” See generally Garcia-Martinez v. City & Cty. of Denver, 392 F.3d 1187, 1191 (10th Cir. 2004) (“Other cases hold that the mere fact that a party is more than 100 miles from the courthouse does not require the district court to automatically admit a party’s deposition.”) (emphasis added).

After this patent infringement action was filed, the defendant, BigCommerce, filed a motion to dismiss for failure to state a claim for relief pursuant to Fed.R.Civ.P. 12(b)(6). BigCommerce did not file a motion to transfer or to challenge at that time.  After the district court ordered the plaintiff to file an amended complaint and the plaintiff filed the amended complaint, BigCommerce filed a motion for improper venue pursuant to Fed.R.Civ.P. 12(b)(3). The BigCommerce motion was filed shortly after the Supreme Court’s decision in TC Heartland LLC v. Kraft Foods Grp. Brands LLC, No. 16-341, 137 S.Ct. 1514 (May 22, 2017).

BigCommerce argued that although it is incorporated in Texas, it is not incorporated in the Eastern District of Texas and lacks any place of business in the Eastern District of Texas. Therefore, BigCommerce argued it should be dismissed from the case because of improper venue.

The district court concluded that BigCommerce had waived the defense because the defense was not raised in the original Fed.R.Civ.P. 12(b)(6). “A party waives any defense listed in Rule 12(b)(2)–(5) by . . . omitting it from a motion in the circumstances described in Rule 12(g)(2).” Fed. R. Civ. P. 12(h)(1)(A). Under Rule 12(g)(2), “a party that makes a motion under this rule must not make another motion under this rule raising a defense or objection that was available to the party but omitted from its earlier motion.” Certain defenses are exempt from Rule 12(g)(2)’s consolidation requirement, but venue is not one of the exempt defenses. See Rule 12(h)(2)–(3). See Elbit Sys. Land & C41 Ltd. v. Hughes Network Sys., LLC, No. 2:15-cv-37-RWS-RSP, 2017 WL 2651618, at *19 (E.D. Tex. June 20, 2017) (citing Albany Ins. Co. v. Almacenadora Somex, S.A., 5 F.3d 907, 909 (5th Cir. 1993)). “Thus, by filing a motion to dismiss for failure to state a claim under Rule 12(b)(6) and omitting its venue defense, [BigCommerce] waived the defense.” Id. at *20 (citing Fed. R. Civ. P. 12(g)(2) and 12(h)(1)(A)).

In this patent infringement action, T-Mobile sought email discovery from seventeen named inventors of the asserted patents and the licensing executives involved in the parties’ FRAND negotiations. T-Mobile asserted that the discovery could reveal the inventors’ contemporaneous understanding of the invention and whether T-Mobile is an unwilling FRAND licensee. T-Mobile also proposed limiting the email discovery by specific search terms.

Huawei raised two arguments in support of its objections to producing the requested documents. First, Huawei contended that T-Mobile had not shown that the e-mail discovery would be necessary or proportional to the needs of the case. Second, T-Huawei argued that T-Mobile delayed in seeking the discovery warranted denying the requested relief.

In analyzing the arguments, the district court was not persuaded by either of Huawei’s arguments. “As other courts have explained in complex case such as this, Huawei’s proposed limitations on e-discovery or the number of email custodians is not typically warranted. See Knauf Insulation, LLC v. Johns