Source: s3://data.kl3m.ai/documents/govinfo/USCOURTS/USCOURTS-cand-3_07-cv-00058/USCOURTS-cand-3_07-cv-00058-8/pdf.json

Nature of Suit Code: 830
Nature of Suit: Patent
Cause of Action: 15:1125 Trademark Infringement (Lanham Act)

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United States District Court

For the Northern District of California

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IN THE UNITED STATES DISTRICT COURT

FOR THE NORTHERN DISTRICT OF CALIFORNIA

CONNECTIVE TISSUE IMAGINEERING,

LLC, a California limited liability company

Plaintiff,

 v.

THOMAS F. MITTS, M.D., an individual,

HUMAN MATRIX SCIENCES, LLC, a

California limited liability company,

CLARITY SKINCARE, INC., a California

corporation, and THOMAS F. MITTS, M.D.,

INC., a California corporation,

Defendants. /

No. C 07-00058 WHA

ORDER GRANTING

DEFENDANTS’ MOTION FOR

LEAVE TO AMEND JOINT

CLAIM CONSTRUCTION

STATEMENT AND VACATING

HEARING

INTRODUCTION

In this patent-infringement action, defendants move for leave to amend the joint claim

construction statement. Defendants have shown that their proposed amendment would not be

futile and that their proposed amendment should at least be considered during claim

construction. Furthermore, defendants have demonstrated that they were diligent in pursuing

this amendment, and plaintiff has not shown that it would be substantially prejudiced by the

amendment. Accordingly, defendants’ motion for leave to file an amended joint claim

construction statement is GRANTED. Seeing that no further argument is necessary, the hearing

on this motion is hereby VACATED. 

Case 3:07-cv-00058-WHA Document 52 Filed 08/14/07 Page 1 of 6
United States District Court

For the Northern District of California

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STATEMENT

Plaintiff Connective Tissue Imagineering, Inc., was formed by defendant Thomas F.

Mitts and two business partners in 1998. The partners assigned several patent applications to

CTI, including the three patents in suit (Hamm Decl. Exhs. A–C). The patents claim peptides

found in elastin — a protein that allows mammalian tissue, including skin, to retain its shape

after being stretched or pulled. Plaintiff asserts that the earliest priority date for any of the

patents is March 13, 1998 (id. at Exh. D). 

Defendant Clarity Skincare, Inc., sells a line of skin-care products under the name

Forticelle (Maddox Decl. ¶ 2). Plaintiff alleges that four of Forticelle’s products infringe the

three patents in suit (Hamm Decl. Exh. D). The products include an ingredient called E91

which Clarity Skincare purchases from Protein Preparations, Inc. (Maddox Decl. ¶ 2). E91 is

the only source of peptides and elastin in the Forticelle products (ibid.). 

This action was filed on January 4, 2007. Mitts sent an email to Lucy Miller at Protein

Preparations on February 27, 2007, asking for information about when Protein Preparations

first sold E91 (id. at Exh. A). Protein Preparations refused to answer (ibid.). 

Pursuant to the case management order issued on April 12, 2007, parties exchanged

terms and phrases to be construed on June 18, 2007 (Schwartz Decl. Exh. A). Parties were to

exchange proposed constructions of those terms on June 29, however, plaintiff stipulated to

extend the deadline to July 10, because defendants substituted counsel on July 5, 2007. The

joint claim construction statement was filed on July 17, 2007.

On July 23, 2007, defendants sent a letter to Protein Preparations asking for

information about when E91 was first sold for cosmetics and demanding indemnification and

assistance in defending this action (Hamm Decl. Exh. E). Two days later defendants followed

up by sending a document subpoena (Hamm Decl. Exh. F). On July 26, 2007, Protein

Preparations sent defendants documentation showing that it sold E91 to a company in Utah as

early as 1992 for use in skin care products (id. at Exh. G). Defendants produced the documents

to plaintiff the same day.

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United States District Court

For the Northern District of California

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Negotiations to file an amended claim-construction statement quickly broke down. 

Defendants filed this motion on August 2, 2007. A claim-construction tutorial is currently

scheduled for September 12, 2007, with the hearing to occur on September 26, 2007. 

ANALYSIS

A party seeking to amend a pleading after a scheduling order issues must first show

good cause for the amendment. See Rule 16(b); Johnson v. Mammoth Recreations, Inc., 975

F.2d 604, 608 (9th Cir. 1992). After the court enters a scheduling order, the liberal policy

favoring amendments no long applies. Subsequent amendments are not allowed without a

request to first modify the scheduling order. At that point, any modification must be based on

a showing of good cause. Coleman v. Quaker Oats Co., 232 F.3d 1271, 1294 (9th Cir. 2000). 

1. ASSIGNOR ESTOPPEL.

Defendants seek to add the limitation “The claim does not cover the prior art, such as

Protein Preparation’s E91 or any substance containing Protein Preparation’s E91” to the

construction of each of the asserted claims (Proposed Order at 1). The upshot of their motion

is that defendant Mitts is an assignor of the patents in suit, so he is estopped from challenging

their validity. With that mode of attack closed to them, defendants wish to either use the prior

art to narrow the claims themselves or later use the prior art to argue that the practiced method

does not infringe. Looking at the substance of the amendment, defendants are seeking it so

that the Court can consider whether to consider the issue of prior art at claim construction or

during non-infringement. Plaintiff contends that this proposed amendment would be futile

because it does not actually present an issue of claim construction. 

“Assignor estoppel is an equitable doctrine that prevents one who has assigned the

rights to a patent (or patent application) from later contending that what was assigned is a

nullity.” Diamond Scientific Co. v. Ambico, Inc., 848 F.2d 1220, 1224 (Fed. Cir. 1988). 

Assignor estoppel thus prevents one who assigned a patent, and those in privity with him, from

later arguing that what he assigned was invalid. Pandrol USA, LP v. Airboss Ry. Products,

Inc., 424 F.3d 1161, 1167 (Fed. Cir. 2005). 

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For the Northern District of California

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A unique situation arises where the assignor is practicing the prior art. Where any

other defendant could argue that the prior art invalidates the patent, an assignor cannot do so. 

Even though he or she cannot challenge validity, an assignor still has two avenues open —

arguing for a narrow claim construction that excludes the prior art or later arguing noninfringement. Mentor Graphics Corp. v. Quickturn Design Sys., 150 F.3d 1374, 1380 (Fed.

Cir. 1998). In Westinghouse Electric & Mfg. Co. v. Formica Insulation Co., 266 U.S. 324,

350–51 (1924), the Supreme Court held that where an assignor was estopped from challenging

the validity of a patent, the prior art could be used to narrow the scope of the patent claims. It

explained that “the state of the art may be used to construe and narrow the claims of the patent,

conceding their validity.” Id. at 351. Similarly, in Scott Paper Co. v. Marcalus Mfg. Co., 326

U.S. 249, 252 (1945), an assignor was permitted to argue that the scope of the prior art

narrowed the claims past their scope as described on the face of the patent even though the

assignor was estopped from challenging validity. Thus, it appears that at least under some

circumstances, it may be permissible to consider prior art in construing the claims as against an

assignor estopped from challenging validity.

Plaintiffs argue that defendants’ proposed amendment does not actually present an

issue of claim construction. They point out that importing a limitation from the prior art flouts

several canons of claim construction. See, e.g. SciMed Life Sys., Inc. v. Advanced

Cardiovascular Sys., Inc., 242 F.3d 1337, 1340 (Fed. Cir. 2001) (criticizing the importation of

a limitation from the written description into the claims). Here, however, this order is not

deciding the question of whether the proposed limitation should be adopted, it is only deciding

that defendants can have an opportunity to brief the issue at this time. It may well be that

consideration of the prior art should be a non-infringement argument at summary judgment or

trial, but that issue is not before the Court.

Plaintiff also argues that allowing such an amendment would have the perverse effect

of putting an assignor in a better position than the rest of the world because the assignor would

have the opportunity to argue non-infringement at the claim construction stage. This argument

goes to the wisdom of adopting defendants’ proposed construction, so it is premature. 

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Additionally, plaintiff forgets that even if defendants’ construction were adopted, defendants

would not yet be in the clear. The methods defendants actually practiced would still have to be

determined on summary judgment. 

2. DILIGENCE.

The inquiry under Rule 16(b)’s good cause standard first focuses on the diligence of the

party seeking the amendment. “The district court may modify the pretrial schedule ‘if it cannot

reasonably be met despite the diligence of the party seeking the extension.’” Johnson, 975

F.2d at 609 (quoting FRCP 15 advisory committee notes). If the party seeking modification

was not diligent, then the inquiry should end. 

As to diligence, defendants present evidence that as soon as they knew of the prior

sales of E91 by Protein Preparations, they quickly produced the supporting documents to

defendants and then sought to stipulate to amend the claim construction statement. When that

failed, defendants filed this motion. Only a few days passed between defendants’ learning of

Protein Preparations sales of E91 and their filing this motion. Plaintiff argues that defendants

were not diligent because they first inquired about sales of E91 in late February of this year. 

Protein Preparations said that it could not provide such information, and defendants did not

follow up until nearly five months later. Defendants declare, however, that Protein

Preparations did not give them the information until they threatened to demand indemnification

and assistance in defending the action. It is possible that defendants could have made this

threat sooner, however, given that Protein Preparations is defendants’ critical supplier, failure

to do so does not constitute an absence of diligence. 

Prejudice to the non-moving party, though not required under Rule 16(b), can supply

additional reasons to deny a motion. Coleman, 232 F.3d at 1295. “A need to reopen discovery

and therefore delay proceedings supports the district court’s finding of prejudice from a

delayed motion to amend the complaint.” Lockheed Martin Corp. v. Network Solutions, Inc.,

194 F.3d 980, 986 (9th Cir. 1999). 

Plaintiff first argues that it would be prejudiced by having to defend against a clearly

improper and frivolous claim construction. As described in the previous section, defendants’

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request to amend the claim construction statement is legitimate, at least on its face. The

question of whether not the construction should be accepted must be left to a later time.

Plaintiff also contends that it would be prejudiced by the amendment because the claim

construction proceedings are rapidly approaching. It argues that the deadline for disclosure of

extrinsic evidence has already passed, and that defendants have not disclosed the identity of the

declarants or the contents of their declarations. In response, defendants point out that such

information would be quite obvious; the names of declarants are the people listed on the

documents turned over to plaintiff, and the contents of those declarations would authenticate

the documents and corroborate that the events described therein occurred. Moreover,

plaintiff’s argument is undercut because it has not yet asked for any discovery on the prior art

issue. Defendants have expressed their willingness to change or extend the schedule for the

claim-construction hearing. This would result in some delay to the claim-construction

proceedings, however, trial is still nearly nine months in the future. Plaintiff has not shown

that it would be prejudiced by this amendment. Accordingly, defendants’ motion to amend the

joint claim construction statement is GRANTED.

CONCLUSION

For all of the above-stated reasons, defendants’ motion for leave to amend the joint

claim construction statement is GRANTED. Seeing that no further oral argument is necessary

on this motion, the hearing is hereby VACATED.

IT IS SO ORDERED.

Dated: August 14, 2007. WILLIAM ALSUP

UNITED STATES DISTRICT JUDGE

Case 3:07-cv-00058-WHA Document 52 Filed 08/14/07 Page 6 of 6