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In a much anticipated decision, the United States Supreme Court confirmed that, absent a valid assignment agreement, inventors own their invention — even if federal funding was used to support the research efforts. The decision in Leland Stanford Junior Univeristy v. Roche Molecular Systems, Inc. held that under the Patent Act an inventors owns his or her invention in the first instance and only a valid and binding assignment agreement is effective to transfer ownership from the inventor.

The decision let stand the Federal Circuit’s ruling that Stanford University did not obtain the patent rights from one of its research scientists when it used an assignment agreement stating that the research scientist “agrees to assign” all of his future inventions. Rather, Roche obtained the rights in a subsequent agreement because it used the language “do hereby assign.” The Federal Circuit has now held on a number of occasions that the language “agree to assign” is a mere promise to assign in the future and requires a subsequent act, while the language “do hereby assign” is effective immediately upon the creation of the future invention without any additional act on the part of the assignee.

The Supreme Court held that the Bayh-Dole act for funding did not change this result as it did not contain any language to trump the Patent Act, which makes clear that an inventor owns the invention unless there is a valid assignment to the contrary. The Supreme Court noted that the Federal Circuit’s decision on the distinction between “agree to assign” and “do hereby assign” was not before it as Stanford University did not file its cert petition on that basis. Accordingly, the Supreme Court did not address this issue and let stand the Federal Circuit’s decision, although it did leave open the possibility of addressing this issue in the future.

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The plaintiff filed a patent infringement action against the defendant in the Northern District of Illinois after licensing negotiations fell apart. Defendant, a Delaware corporation, with its principal place of business in Michigan moved to dismiss for lack of personal jurisdiction or, in the alternative, to transfer. The district court granted defendant’s motion to dismiss, finding that it lacked personal jurisdiction over the defendant, but it permitted plaintiff to amend the complaint.

The plaintiff, operating out of Illinois, owned four patents pertaining to laser-etching technology, which is used to etch patterns and effects onto a wide range of materials, including fabrics and leather. Defendant sold leather for use in automotive interiors for distribution throughout the United States, including in the district. The parties had worked together since 2004, with the goal of selling leather etched with plaintiff’s technology to automotive companies. In 2009, the plaintiff sent defendant some samples on a new etching which the plaintiff alleged defendant converted for its own use and sold to an automotive company. Ultimately, the parties began to negotiate a license to resolve these issues, among others. As part of these negotiations, the parties exchanged e-mails and negotiated by telephone as well. When the negotiations ceased, the plaintiff filed suit for patent infringement, breach of a non-disclosure agreement, and trade secret misappropriation, among other claims. The defendant moved to dismiss or transfer venue.
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In a recent case from the United States District Court for the Northern District of California, the district court granted a defendant’s motion to compel an interrogatory response where the infringement contentions were inadequate to put the defendant on notice of the alleged infringement. The infringement contentions relied on a number of screenshot that referred to a specific configuration file. The defendant argued that the screenshots alone failed to explain how the products as depicted allegedly met the limitations of the asserted claims and that the citations to the documents accompanying the infringement contentions also did not supply the missing information.

The defendant served an interrogatory seeking the missing information. The plaintiff refused to respond to any portion of the interrogatory, asserting that its amended infringement contentions contained screenshots that showed the products at each stage of the infringing processes and that the claim charts also contained a detailed narrative and citations to show the infringing processes. The defendant disagreed, arguing that neither the screenshots nor the narrative disclosed the particular configurations of the accused products and were meaningless without an understanding of the custom configuration of the accused products that were used to produce the screenshots.
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Defendant contended that several claims of a patent were indefinite under 35 U.S.C. §112, ¶2. The defendant argued that the term “engine for” should be construed under §112, ¶6 because engine is only discussed in functional terms. The defendant also argued that the term “engine for” did not connote sufficient structure because it does not have a well understood meaning in the art. The district court disagreed with both points and denied the motion for summary judgment.

The patent in the case involved the creation of a web-based database application that used a data dictionary. The patent teaches that the data dictionary eliminates the need for a programmer or web-developer, which reduces the cost and time associated with creating a web-based data application. Certain claims of the patent recited “an engine for” performing various tasks, such as “determining and storing” or “building and/or updating and/or running an application.” The defendant contended that the “engine for” limitations were indefinite and should be construed as means-plus-function claims. It also contended that the “engine for” terms did not recite particular algorithms that performed the functions and were therefore indefinite.
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Recently, a Court in the Central District of California, applying the Patent Rules from the Northern District of California, held that the plaintiff failed to demonstrate the requisite good cause to amend its infringement contentions to add additional accused products. In particular, Plaintiff Kruse Technology Partnership (“Kruse”) sought to add new engines to its infringement contentions based on its recent testing of the engines. In denying Kruse’s motion for leave to amend its infringement contentions, the Court took issue with Kruse for failing to explain why it had not tested the accused engines before it filed its infringement contentions. In doing so, the Court held that “[m]erely stating the tests are expensive is insufficient,” particularly where Kruse was able to later acquire and test the engines at issue. The Court also noted that Kruse never did disclose the cost of the testing. The Court further rejected Kruse’s argument that any disruptions caused by its amended contentions were contemplated by the Patent Rules. The Court found that, while the Patent Rules allow for disruptions caused by timely amending infringement contentions, the disruptions resulting from Kruse’s proposed amendments were not contemplated because Kruse was not diligent in discovering the engines it now seeks to add, and thus its amendments were not justified. The Court found that Kruse’s failure to move to compel discovery on these engines was further evidence of Kruse’s lack of diligence.
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In this case, the defendant asserted a defense of inequitable conduct on the grounds that the inventors of the patent-in-suit were aware of prior art when they prosecuted the patent but failed to disclose that prior art.. On a motion to dismiss the inequitable conduct defense, the United States District Court for the Eastern District of Virginia held that the defendant had plead insufficient factual allegations to support an inequitable conduct defense.

The plaintiff asserted that the defendant had failed to sufficiently plead inequitable conduct because it had not plead that material prior art was withheld, sufficient knowledge of the prior art, and that such prior art was withheld with an intent to deceive the Patent and Trademark Office (“PTO”). The district court started its analysis by noting that inequitable conduct is akin to a claim for fraud and therefore must meet the particularity requirements of Federal Rule of Civil Procedure 9(b) (“In alleging fraud or mistake, a party must sate with particularity the circumstances constituting fraud or mistake.”).
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In a recent decision from the United States District Court for the Southern District of New York, the district court granted defendant’s motion in limine to exclude plaintiff’s damage expert’s testimony based on the entire market value rule. The district court held that the plaintiff’s expert’s testimony ran afoul of the Federal Circuit’s decision in Lucent Technologies v. Gateway, Inc., 580 F.3d 1301, 1336 (Fed. Cir. 2009).

The district court began its analysis by noting in Lucent that “the Federal Circuit announced that its jurisprudence on the entire market value rule–pursuant to which a patentee assesses damages based on the entire market value of the accused product–was quite clear. For the entire market value rule to apply, the patentee must prove that, ‘the patent related feature is the basis for customer demand.'” The district court also noted that in a more recent decision, Uniloc USA, Inc. v. Microsoft, 632 F.3d 1292 (Fed. Cir. 2011), the Federal Circuit “warned against the danger of admitting consideration of the entire market value of the accused product where the patented component does not create the basis for customer demand.”
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A Delaware Court again recently denied transfer from Delaware to the Northern District of California despite that (a) all of the accused infringers were headquartered in the transferee venue, (b) the party witnesses knowledgeable about the accused products and documents related to the accused products were there and (c) the plaintiff also maintained an office there as well. Focusing instead on the fact that the plaintiff and three of the four defendants were incorporated in Delaware, the Court stated that the Plaintiff’s choice of venue was entitled to “significant deference” because Delaware was considered plaintiff’s home turf. Moreover, the Court found that because three of the four defendants were incorporated in Delaware, they could not be heard to complain about defending a lawsuit in Delaware because they had availed themselves of the rights and privileges of the State of Delaware by incorporating there. The Court quoted from another decision from the District of Delaware that “absent some showing of a unique or unexpected burden, a company should not be successful in arguing that litigation in its state of incorporation is inconvenient.”
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In a recent case from the Central District of California, the court ordered the defendant to produce the complete source code for an allegedly infringing product during a deposition. The plaintiff noticed the depositions of certain engineers from the defendant and requested that the defendant provide a complete copy of the source code on a computer during the deposition. The defendant objected on two grounds.

The defendant first argued that such a request and corresponding procedure would violate the protective order entered by the court. The defendant also argued that the proposals offered by the plaintiff were insufficient to maintain the security and integrity of the source code for the allegedly infringing product. The court disagreed with both of defendant’s objections and ordered the production of the source code.
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The plaintiff filed a lawsuit against five companies in the United States District Court for the District of Delaware for patent infringement. All five companies moved to transfer the case to the Northern District of California because none of the defendants had their headquarters in Delaware and they argued it would be more convenient for the witnesses if the case proceeded in the Northern District of California. The district court denied the motion.

The district court began its analysis by noting that the various defendants were incorporated in Delaware and several had their principal place of business in California.. It also noted that the plaintiff was incorporated in Delaware and had its principal place of business in Connecticut.
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