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In a case from the Eastern District of Texas, the district court granted an emergency motion to compel pertaining to source code contained on a stand-alone computer. In the case, Hyundai had loaded its source code on a stand-alone computer and provided a standard text-editor (Notepad), a source code editor (Notepad ++) and a comparison tool (Beyond Compare) to facilitate plaintiff’s review of the source code. The plaintiff found that this was insufficient and requested that Hyundai provide integrated development environments to facilitate the review, arguing that the integrated development environment was required to mimic the operation of the source code. Hyundai refused and the emergency motion was filed.

In filing its emergency motion to compel, the plaintiff argued that because of the modular nature of the source code, the integrated development environments would allow its experts to follow various jumps between modules contained in separate files, which would replicate the behavior of the source code during execution. The plaintiff noted that the tools it wanted installed are free and the installation is “virtually effortless.”
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In a recent case from the United States District Court for the District of Delaware, the district court held that the defendant was not liable for patent infringement based on the doctrine of divided infringement. The district court based its ruling on the Federal Circuit’s decision in Centillion Data Sys., LLC v. Qwest Communications Int’l, Inc., 631 F.3d 1279 (Fed. Cir. 2011).

In Centillion, the Federal Circuit analyzed a patent that disclosed a system for collecting, processing, and delivering information from a service provider, such as a telephone company, to a customer. The Federal Circuit focused its decision on the word “use” — agreeing that “direct infringement by ‘use’ of a system claim ‘requires a party … to use each and every … element of a claimed [system.]” Id. at 1285. The Federal Circuit also stated that “to use’ a system for the purposes of infringement, a party must put the invention into service, i.e., control the system as a whole and obtain benefit from it.”
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Section 292 of the Patent Statute (Title 35) provides a civil penalty for falsely marking goods as being covered by a patent and imposes a fine of no more than $500 “for every such offense.” A Section 292 claim, moreover, can be brought by anyone on behalf of the United States government. Yet, it was not until the Federal Circuit’s decision in Forest Group, Inc. v. Bon Tool Co., 590 F.3d 1295 (Fed. Cir. December 28, 2009), that the floodgates of Section 292 claims were opened. In Forest Group, the Federal Circuit held that Section 292 provided for a penalty based on a per article basis rather than on each decision to mark. In other words, the Federal Circuit held that a penalty can be assessed against each product falsely marked rather than a single fine of no more than $500 imposed for falsely marking an entire line of products.

False marking claims typically involve one of two scenarios: (1) an article continues to be marked with a U.S. patent number (or marked with statements to that effect) even though the patent has expired or (2) the article is not covered by any patent and so any marking is false. According to Docket Navigator®, approximately 830 false marking suits have been filed since January 1, 2010 and March 15, 2011. Of those, most of them (i.e., some 60 percent of the cases) were filed in the Eastern District of Texas. As a result of the deluge of Section 292 lawsuits, manufacturers are faced with a dilemma about whether to (1) spend time and money to ascertain whether any patents listed on products actually cover their product or have expired and, if necessary; remove the patent number; (2) remove any patent numbers from all of its products going forward and risk limiting damages in a subsequent infringement lawsuit to the time when an infringer has actual notice of the patent per Section 287 of the Patent Statute; or (3) do nothing and risk a Section 292 claim.

Recently published data regarding settlements of Section 292 claims have shed some light on the actual cost of settling such claims. According one source, there have been approximately 191 settlements from May 10, 2010 through March 4, 2011. The lowest settlement reported was $500 while the largest settlement reported was $350,000 with the average settlement at about $55,635. The total sum for all 191 settlements is $10.6 million. Approximately 80 percent of the claims settle for $75,000 or less. The largest number of claims settled at between $0 and $25,000 with 70 settlements while the next largest group is between $25,001-$50,000 with 52 settlements, and the next largest group being those settlements between $50,001-$75,000 with 30.

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The United States Supreme Court affirmed the use of the clear and convincing evidence standard for challenges to the validity of patents last week in a closely watched and eagerly anticipated case, i4i v. Microsoft. The Supreme Court’s opinion re-affirmed decades of case law that the standard to challenge the validity of a patent is clear and convincing evidence rather than the preponderance of the evidence standard urged by Microsoft.

The patent held by i4i claimed an improved method for editing computer documents. The patent was asserted against Microsoft Word and Microsoft countered that the patents were invalid and challenged the standard for determining the validity of a patent, arguing that it should be by a preponderance of the evidence rather than the existing clear and convincing standard currently used in patent cases.
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In a recent decision from the United States District Court for the District of Delaware, the district court considered defendant’s motion for summary judgment of invalidity. The plaintiff’s patent is directed to a computer program for developing a component based software for the insurance industry. The patent contained both method and system claims.

Defendant’s moved for summary judgment on the grounds that the patent was invalid under Bilski v. Kappos, 130 S. Ct. 3218 (2010), contending “that the claims of the [patents] contain abstract ideas and fail the machine or transformation test.” Defendant contended that the plaintiff’s patents failed the “machine” prong of the Bilski test because the claims only require aspects of a general purpose computer. In addition, the defendant contended that the transformation test also could not be met because the transfer of data regarding insurance cases from one electronic file to another does not transform physical objects to another state or thing. According to the defendant, all of the claims reflect field of use restrictions or insignificant post-solution activity and, therefore, constitute unpatentable abstract ideas under § 101.
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To have a valid patent, an inventor must disclose sufficient detail in the specification to enable the patent, often referred to as the enablement requirement. To fulfill the enablement requirement, an inventor must disclose enough detail in the patent to teach a person of ordinary skill in the art to make the invention without undue experimentation. But an inventor cannot rely on the argument that one of ordinary skill in the art can fill in missing details from the specification. Indeed, recent case law demonstrates that inventors cannot rely on the person of ordinary skill in the art to serve as a substitute for missing information in the specification of the patent.

The case of Alza Corp v. Andrx Pharamaceuticals LLC, 603 F.3d 935 (Fed Cir. 2010), addressed this exact issue. For more information, please see a discussion of Alza.

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In a patent case pending against Intel in the District of New Mexico, the plaintiff sought to compel the production of Intel’s future products that were under development. The litigation involved plaintiff’s claim that Intel infringed its patent for a process called “double patterning,” which is a process that allows for the manufacture of smaller, more powerful computer processor chips.

Plaintiff sought production from Intel of a certain size of Intel chips that were not yet sold to the public and that would not be marketed until after September 2012, a date which is after the plaintiff’s patent expires. Intel argue that the information was not relevant to a reasonable royalty calculation and production of the information would be overly burdensome because the processes were likely to change multiple times before the launch of the product.

The plaintiff argued that it was entitled to production of the information under the theory of “accelerated market entry” and that production of research and development documents would not be overly burdensome.
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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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