United States Court of Appeals 

for the Federal Circuit ______________________ 

ANTICANCER, INC.,

Plaintiff-Appellant,

v.

PFIZER, INC.,

Defendant-Appellee,

AND 

CROWN BIOSCIENCE, INC.,

Defendant-Appellee, 

AND 

DOES 1-10,

Defendants.

_____________________ 

2013-1056

______________________ 

Appeal from the United States District Court for the 

Southern District of California in No. 11-CV-0107, Judge 

Janis L. Sammartino.

______________________ 

Decided: October 20, 2014

______________________ 

RICHARD A. CLEGG, Law Office of Richard Clegg, of 

San Diego, California, argued for plaintiff-appellant. 
2 ANTICANCER, INC. v. PFIZER, INC. 

RICHARD DE BODO, Bingham McCutchen LLP, of Santa Monica, California, argued for defendant-appellee 

Pfizer, Inc. With him on the brief was OLGA BERSON. Of 

counsel on the brief was STANLEY J. PANIKOWSKI, DLA 

Piper US LLP, of San Diego, California. 

JING JAMES LI, LiLaw Inc., of Los Altos, California, 

argued for defendant-appellee Crown Bioscience, Inc.

______________________ 

Before NEWMAN, REYNA, and TARANTO, Circuit Judges.

NEWMAN, Circuit Judge. 

This litigation concerns patents owned by AntiCancer, 

Inc. on technology related to the imaging of gene expression using a green fluorescent protein linked to a gene 

promoter. The fluorescent protein is derived from a 

species of green-glowing jellyfish named Aequorea victoria. The patented inventions are described as useful for 

drug discovery and evaluation in cancer control and 

treatment.

Appeal is from the district court’s summary judgment

of noninfringement entered not on the substantive merits

of any issue raised in the complaint, but on a procedural 

aspect at the threshold of the litigation arising from 

application of the Patent Local Rules of the Southern 

District of California. The district court imposed a feeshifting sanction as a condition of permitting AntiCancer 

to supplement the Preliminary Infringement Contentions

that the district court found defective under Patent Local 

Rule 3.1. The court ordered that AntiCancer may supplement its Contentions, provided that it concurrently pay 

the attorney fees and costs incurred by the defendants in 

connection with their motion for summary judgment

related to the Contentions. AntiCancer objected to this 

condition, and the district court entered summary judg-
ANTICANCER, INC. v . PFIZER, INC . 3

ment of noninfringement and duly dismissed the complaint with prejudice. For the reasons we shall discuss, 

we conclude that the fee-shifting condition was improperly imposed; the judgment based thereon is vacated.

BACKGROUND

On January 19, 2011, AntiCancer filed a complaint 

against Pfizer, Inc. in the United States District Court for 

the Southern District of California, with counts for breach 

of license agreement, breach of the duty of good faith and 

fair dealing, and unjust enrichment. The complaint 

recited that AntiCancer, in a contractual arrangement 

initially with Wyeth Pharmaceuticals, later acquired by 

Pfizer, disclosed technology relating to fluorescent proteins and their DNA linkage and imaging in mammals, 

and the technology’s use in cancer drug evaluation and 

treatment. 

After the complaint was filed, AntiCancer came upon 

several publications authored by scientists at Pfizer and 

Crown Bioscience, Inc. AntiCancer stated that these 

publications show the use of AntiCancer’s technology and 

infringement of AntiCancer’s patents, and requested 

permission to amend the complaint by adding counts for 

patent infringement and adding Crown Bioscience as a 

defendant. The district court granted the motion on 

November 8, 2011. 

On September 21, 2011, the district court held a case 

management conference, and on that same date the court

issued a “Case Management Conference Order Regulating 

Discovery and Other Pretrial Proceedings,” AntiCancer, 

Inc. v. Pfizer Inc., No. 11CV107 (S.D. Cal. Sept. 21, 2011), 

ECF No. 13. The Order provided that: “On or before 

November 14, 2011, Plaintiff shall serve on all parties a 

‘Disclosure of Asserted Claims and Preliminary Infringement Contentions,’” in accordance with the Patent Local 

Rules. Id. at 1-2. The Order also set the discovery schedule, with claim construction discovery to be completed by 
4 ANTICANCER, INC. v. PFIZER, INC. 

March 26, 2012, fact discovery to be completed by September 4, 2012, and expert discovery to be completed by 

October 29, 2012. Id. at 8, 11.

On November 9, 2011, AntiCancer filed a First 

Amended Complaint adding Crown Bioscience as a defendant and adding patent infringement counts. AntiCancer filed its “Disclosure of Asserted Claims and 

Preliminary Infringement Contentions” on November 14, 

2011, as required by the Case Management Conference 

Order. This document drew primarily on the scientific 

publications of Pfizer and Crown Bioscience, and consisted of 22 pages, including 18 pages of patent claim charts. 

The Contentions stated that AntiCancer “reserves the 

right to amend or supplement its identification of asserted 

claims, accused instrumentalities, and priority dates, as 

well as its claim charts, based on further investigation 

and discovery.” J.A. 83-84. On January 31, 2012, the 

deadline for completing fact discovery was extended to 

December 4, 2012, and the deadline for expert discovery 

was extended to January 29, 2013. Am. Case Mgmt. 

Conf. Order, AntiCancer (S.D. Cal. Jan. 31, 2012), ECF 

No. 32.

On March 12, 2012, Pfizer filed a motion for summary 

judgment on the patent infringement counts, stating that 

the Preliminary Infringement Contentions were defective 

because the “charts are missing claim limitations for each 

and every claim of each asserted patent, and/or do not

identify specifically how Pfizer allegedly practiced each 

element of the asserted claims.” Pfizer’s Notice of Mot. & 

Mot. Summ. J. at 1, AntiCancer (S.D. Cal. Mar. 12, 2012), 

ECF No. 38. Crown Bioscience joined this motion. AntiCancer responded that its Preliminary Infringement 

Contentions complied with the Patent Local Rules and 

that the presentations in the claim charts associated the

claim elements or steps with a designated portion of the

scientific publications of Pfizer and Crown Bioscience. 

AntiCancer also filed with its opposition brief the declara-
ANTICANCER, INC. v . PFIZER, INC . 5

tion of Dr. Robert M. Hoffman, the founder and President 

of AntiCancer, who explained how a person skilled in this 

field of science would understand the claim terms and 

their relation to the Pfizer and Crown Bioscience publications. 

The district court found the information in the claim 

charts deficient as to three claim elements, and authorized AntiCancer to supplement its Preliminary Infringement Contentions but required that AntiCancer 

concurrently pay the defendants’ attorney fees and costs 

related to the summary judgment motion.1 The district 

court gave the defendants fourteen days in which to 

submit an accounting of their attorney fees and costs and 

gave AntiCancer fourteen days thereafter in which to file 

amended Preliminary Infringement Contentions and 

concurrently pay the defendants’ attorney fees and costs, 

or to “object [to the] conditions for amendment, in which 

event summary judgment will be granted in Defendants’ 

favor.” Dist. Ct. Op. at 15-16. AntiCancer objected to the 

fees/costs condition,2 and the district court entered summary judgment of noninfringement.3

On July 16, 2012, the district court entered a Judgment in a Civil Case, stating “IT IS ORDERED AND 

ADJUDGED that summary judgment is hereby granted 

in favor of Defendant Crown Bioscience, Inc. on the fourth 

1 AntiCancer, Inc. v. Pfizer Inc., No. 11CV107 (S.D. 

Cal. June 1, 2012), ECF No. 63 (“District Court Opinion”) 

(conditional order granting summary judgment of noninfringement).

2 Notice of Objection to Court’s Conditions for 

Amendment, AntiCancer (S.D. Cal. June 29, 2012), ECF 

No. 73.

3 AntiCancer (S.D. Cal. July 2, 2012), ECF No. 74 

(order entering summary judgment on patent infringement claims).

 
6 ANTICANCER, INC. v. PFIZER, INC. 

and fifth claims for relief in AntiCancer’s Second Amended Complaint.” AntiCancer (S.D. Cal. July 16, 2012), ECF 

No. 80.4

The parties then settled the contract claims and filed 

a “Joint Motion and Stipulation of Voluntary Dismissal, 

with Prejudice.” AntiCancer (S.D. Cal. Sept. 26, 2012), 

ECF No. 85. Upon the parties’ joint stipulation, the 

district court dismissed AntiCancer’s Second Amended 

Complaint with prejudice.5 AntiCancer then filed its 

Notice of Appeal, wherein AntiCancer stated it was appealing “from the judgment entered in this action on July 

16, 2012.”6

AntiCancer argues on appeal that the fee-shifting 

condition and its consequences was a sanction, that the 

sanction was unwarranted, and that the summary judgment based on the condition was improper. AntiCancer 

states that it provided all information available to it at 

the time it filed its Contentions, that it complied with the 

Patent Local Rules, that there was no bad faith or other 

sanctionable behavior, and that further details of the 

defendants’ practice of the claimed inventions required 

discovery of the unpublished laboratory procedures of 

Pfizer and Crown Bioscience. AntiCancer also states that 

its pleadings met the requirements of the Federal Rules of 

Civil Procedure and that, even without supplementation, 

4 We note that the fourth claim for relief in AntiCancer’s Second Amended Complaint is against Pfizer 

only, and the fifth claim for relief is against Pfizer and 

Crown Bioscience. Second Am. Compl. 9-10, AntiCancer

(S.D. Cal. June 22, 2012), ECF. No. 72.

5 Order Granting Joint Mot. & Stipulation of Voluntary Dismissal, with Prejudice, AntiCancer (S.D. Cal. 

Sept. 28, 2012), ECF No. 86.

6 Notice of Appeal, AntiCancer (S.D. Cal. Oct. 26, 

2012), ECF No. 87.

 
ANTICANCER, INC. v . PFIZER, INC . 7

its Preliminary Infringement Contentions complied with 

the Patent Local Rules. AntiCancer appeals from the 

requirement for payment of the defendants’ attorney fees 

and costs as a condition for continuing the litigation. 

DISCUSSION

A. Standard of Review 

The grant of summary judgment is reviewed without 

deference. See Flex–Rest, LLC v. Steelcase, Inc., 455 F.3d 

1351, 1357 (Fed. Cir. 2006). Summary judgment is appropriate when there is no genuine issue of material fact 

and the movant is entitled to judgment as a matter of law. 

See Fed. R. Civ. P. 56(c); Anderson v. Liberty Lobby, Inc., 

477 U.S. 242, 250 (1986).

A district court’s application of its local rules is reviewed on the standard of abuse of discretion. See O2 

Micro Int’l Ltd. v. Monolithic Power Sys., Inc., 467 F.3d 

1355, 1366-67 (Fed. Cir. 2006). The district court’s exercise of its disciplinary authority is reviewed on the standard of abuse of discretion. Chambers v. NASCO, Inc., 501 

U.S. 32, 55 (1991); see also In re Keegan Mgmt. Co. Sec. 

Litig., 78 F.3d 431, 436 (9th Cir. 1996). Abuse of discretion may be established when the court commits a clear 

error of judgment in weighing the relevant facts or exercises its discretion based upon an error of law or clearly 

erroneous factual findings. See, e.g., Erico Int’l Corp. v. 

Vutec Corp., 516 F.3d 1350, 1353 (Fed. Cir. 2008); United 

States v. Hinkson, 585 F.3d 1247, 1262 (9th Cir. 2009).

In O2 Micro, this court discussed when and whether 

Federal Circuit law or regional circuit law applies to 

issues arising under patent local rules, and concluded 

that it depends on whether the issue is of substantive 

patent law or of regional procedure. 467 F.3d at 1364 

(“There is an important distinction between local rules of 

general applicability, which by definition are not unique 

to patent law and where we apply regional circuit law,
8 ANTICANCER, INC. v. PFIZER, INC. 

and local rules that only apply to patent cases.” (footnote 

omitted)).

The question of whether a filing under the Patent Local Rules needs supplementation may involve substantive 

patent law, but the question of whether fee-shifting is an 

appropriate condition for such supplementation is primarily a matter of discipline under the court’s inherent authority, not substantive patent law. See Baldwin 

Hardware Corp. v. FrankSu Enter. Corp., 78 F.3d 550, 

560-62 (Fed. Cir. 1996); see also Monsanto Co. v. E.I. Du 

Pont de Nemours & Co., 748 F.3d 1189, 1196 (Fed. Cir. 

2014).

The federal courts have the inherent powers that “‘are 

necessary to the exercise of all others.’” Roadway Express, Inc. v. Piper, 447 U.S. 752, 764 (1980) (quoting 

United States v. Hudson, 7 U.S. 32, 34 (1812)). The

Supreme Court has observed that action “in bad faith, 

vexatiously, wantonly, or for oppressive reasons” may 

incur sanctions in the form of attorney fees under the 

court’s inherent powers. Alyeska Pipeline Serv. Co. v. 

Wilderness Soc’y, 421 U.S. 240, 258-59 (1975) (quotation 

omitted). Invocation of the district court’s inherent powers is a matter of regional circuit law, rather than Federal 

Circuit law. See Monsanto, 748 F.3d at 1196 (“When 

reviewing the imposition of sanctions under a district 

court’s inherent powers, we apply the law of the regional 

circuit in which the district court sits . . . .”).

Under Ninth Circuit precedent, “[b]efore awarding 

sanctions under its inherent powers . . . the court must 

make an explicit finding that counsel’s conduct ‘constituted or was tantamount to bad faith.’” Primus Auto. Fin. 

Servs., Inc. v. Batarse, 115 F.3d 644, 648 (9th Cir. 1997) 

(quoting Roadway Express, 447 U.S. at 767); see also 

Yagman v. Republic Ins., 987 F.2d 622, 628 (9th Cir. 

1993) (“Courts may not invoke these [inherent] powers 
ANTICANCER, INC. v . PFIZER, INC . 9

without a ‘specific finding of bad faith.’” (quoting United 

States v. Stoneberger, 805 F.2d 1391, 1393 (9th Cir. 

1986))). This rigid imposition that district courts make an 

explicit finding of bad faith is justified under Ninth Circuit law because of the “very potency [of] inherent powers.” Yagman, 987 F.2d at 628. 

Here, the district court’s conditional fee-shifting sanction appears to be grounded in the court’s inherent powers 

relating to the “general conduct of the litigation,” rather 

than on any specific infraction such as violation of 28 

U.S.C. §1927 or Rule 11. Primus Auto., 115 F.3d at 648; 

see id. (“Although the district court failed to specify the 

authority for its order, we can deduce the source of its 

power for purposes of our review. . . . [W]e will assume 

that the court relied on its inherent powers.”); see also

Jones v. Williams, 68 Fed. App’x 857, 859 (9th Cir. 2003) 

(“Since the district court did not specify the authority 

under which sanctions were imposed, we assume that the 

court was exercising its inherent powers . . . .”); Irwin v. 

Colletti, No. 98-15019, 1999 WL 109662, at *1 n.3 (9th 

Cir. Feb. 26, 1999) (“The district court did not specify the 

authority for its fee award. . . . [W]e conclude that the 

district court relied upon its inherent powers in awarding 

fees . . . .”).

Of significance to our review is the Ninth Circuit’s requirement of an explicit finding of bad faith before imposing a sanction. We note the Ninth Circuit’s recognition of 

the importance of this requirement, see Primus Auto., 115 

F.3d at 649-50, as well as the Supreme Court’s observance 

of the gravity of district courts invoking their inherent 

authority, see, e.g., Roadway Express, 447 U.S. at 764 

(“Because inherent powers are shielded from direct democratic controls, they must be exercised with restraint and 

discretion.”).
10 ANTICANCER, INC. v. PFIZER, INC. 

We apply this guidance to the “factual and legal prerequisites to the exercise of this [inherent] power,” Zambrano v. City of Tustin, 885 F.2d 1473, 1478 (9th Cir.

1989), surrounding Patent Local Rule 3.1 as here applied, 

including the asserted deficiencies of AntiCancer’s submissions. 

B. Patent Local Rule 3.1

The purpose of preliminary infringement contentions 

as required by Patent Local Rule 3.1 is to assist the court 

and guide the parties in focusing on potentially dispositive issues, providing a framework for discovery and 

generally facilitating the proceedings. See, e.g., Network 

Caching Tech. LLC v. Novell, Inc., No. C-01-2079, 2003 

WL 21699799, at *5 (N.D. Cal. Mar. 21, 2003) (“PICs 

[preliminary infringement contentions] are not meant to 

provide a forum for litigation of the substantive issues; 

they are merely designed to streamline the discovery 

process.”).

It appears undisputed that AntiCancer’s complaint 

complied with the Federal Rules of Civil Procedure. See 

Ashcroft v. Iqbal, 556 U.S. 662, 678 (2009) (complaint 

must contain sufficient facts to plausibly show that complainant may be entitled to relief); Bell Atl. Corp. v. 

Twombly, 550 U.S. 544, 556 (2007) (allegations in complaint must “plausibly suggest[]” the accused conduct to 

“raise a reasonable expectation that discovery will reveal 

evidence” of such accused conduct). The issue on appeal 

relates to the fee-shifting sanction imposed as a condition 

of supplementing AntiCancer’s Preliminary Infringement 

Contentions under Patent Local Rule 3.1. Rule 3.1 states:

Not later than fourteen (14) days after the Initial Case Management Conference, a party claiming patent infringement must serve on all parties 

a “Disclosure of Asserted Claims and Preliminary 

Infringement Contentions.” Separately for each 
ANTICANCER, INC. v . PFIZER, INC. 11

opposing party, the “Disclosure of Asserted Claims 

and Preliminary Infringement Contentions” must 

contain the following information:

a. Each claim of each patent in suit that is allegedly infringed by each opposing party;

b. Separately for each asserted claim, each accused apparatus, product, device, process, method, 

act, or other instrumentality (“Accused Instrumentality”) of each opposing party of which the 

party is aware. This identification must be as 

specific as possible. Each product, device and apparatus must be identified by name or model 

number, if known. Each method or process must 

be identified by name, if known, or by any product, device, or apparatus which, when used, allegedly results in the practice of the claimed method 

or process;

c. A chart identifying specifically where each element of each asserted claim is found within each 

Accused Instrumentality, including for each element that such party contends is governed by 35 

U.S.C. § 112(6), the identity of the structure(s), 

act(s), or material(s) in the Accused Instrumentality that performs the claimed function;

d. Whether each element of each asserted claim is 

claimed to be literally present and/or present under the doctrine of equivalents in the Accused Instrumentality;

e. For any patent that claims priority to an earlier application, the priority date to which each asserted claim allegedly is entitled; and

f. If a party claiming patent infringement asserts 

that its own apparatus, product, device, process, 

method, act, or other instrumentality practices 

the claimed invention, the party must identify, 
12 ANTICANCER, INC. v. PFIZER, INC. 

separately for each asserted claim, each such apparatus, product, device, process, method, act, or 

other instrumentality that incorporates or reflects 

that particular claim.

The Southern District of California adopted Patent 

Local Rules similar to those of the Northern District of 

California and refers to decisions of the Northern District 

as authority for their interpretation.7 See NessCap Co., 

Ltd. v. Maxwell Techs., Inc., No. 07cv0704, 2008 WL 

152147, at *1 (S.D. Cal. Jan. 16, 2008) (“[B]ecause the 

Southern District’s Patent Local Rule 3.4(a) is similar in 

all material respects to the corresponding patent local 

rules promulgated by the Northern District of California . . . this Court relies on published and unpublished 

precedent from that court[] as persuasive authority.”); see 

also Zest IP Holdings, LLC v. Implant Direct Mfg., LLC, 

No. 10cv0541, 2013 WL 1626111, at *5 (S.D. Cal. Apr. 15, 

2013) (looking to Northern District case law with respect

to Patent Local Rule 3.1); Ameranth, Inc. v. Pizza Hut, 

Inc., No. 12cv1659, 2013 WL 3894880, at *5 (S.D. Cal. 

July 26, 2013) (same); accord Dist. Ct. Op. at 5 n.4 (“This 

Order cites to out-of-district case law interpreting patent 

local rules promulgated by other districts that are substantively similar to our own as persuasive authority.” 

(citing NessCap, 2008 WL 152147, at *1)); id. at 6. We 

observed in O2 Micro that the Northern District’s rules 

were designed to “‘require parties to crystallize their 

theories of the case early in the litigation’ so as to ‘prevent 

the shifting sands approach to claim construction.’” 467 

F.3d at 1364 (quoting Atmel Corp. v. Info. Storage Devices, 

7 The Southern District of California adopted 

amended patent local rules on February 8, 2013. This 

decision is directed to the rules in effect at the time of 

these proceedings.

 
ANTICANCER, INC. v . PFIZER, INC. 13

Inc., No. C 95-1987, 1998 WL 775115, at *2 (N.D. Cal. 

Nov. 5, 1998)).

The district court cited the explanation by the Northern District of California that “‘infringement contentions 

need not prove infringement’ but must ‘outline a plaintiff’s theories of infringement.’” Dist. Ct. Op. at 6 (quoting 

Data Retrieval Tech., LLC v. Sybase, No. C 08-5481, 2009 

U.S. Dist. LEXIS 129454, at *8 (N.D. Cal. Sept. 11, 

2009)). In Shared Memory Graphics LLC v. Apple, Inc., 

the Northern District explained that “Rule 3-1 does not 

necessarily require the patent holder to produce evidence 

of infringement.” 812 F. Supp. 2d 1022, 1025 (N.D. Cal. 

2010). In Genentech, Inc. v. Trustees of University of 

Pennsylvania, the Northern District summarized:

The purpose of the disclosure rules is to further the goal of full, timely discovery and provide 

all parties with adequate notice of and information with which to litigate their cases. In analyzing disclosures in the parallel context of 

infringement contentions pursuant to Patent L.R. 

3–1, courts have distinguished between the required identification of the precise element of any 

accused product alleged to practice a particular 

claim limitation, and every evidentiary item of 

proof showing that the accused element did in fact 

practice the limitation.

No. C 10–2037, 2012 WL 424985, at *1 (N.D. Cal. Feb. 9, 

2012) (citations and quotations omitted).

We apply this guidance to determine whether the

sanction here imposed as a condition of supplementing 

the Rule 3.1 Preliminary Infringement Contentions was 

an abuse of discretion.

C. The Preliminary Infringement Contentions

AntiCancer states that its Contentions showed its 

theories of infringement, provided notice of the infor-
14 ANTICANCER, INC. v. PFIZER, INC. 

mation to be obtained by discovery, and complied with the 

letter and purpose of Patent Local Rule 3.1. AntiCancer’s 

Rule 3.1 filing stated that “[t]he attached Asserted Claims 

and Preliminary Contentions Charts . . . identify to the 

extent possible based on information currently in AntiCancer’s possession where each element of each asserted 

claim is found within each accused instrumentality of 

which AntiCancer is aware.” J.A. 85. AntiCancer states 

that its “infringement theories were as crystallized as 

they could be” before AntiCancer could “possibly have 

taken any discovery to support its infringement claims 

and to learn the actual details of the defendants’ internal 

research activities.” Appellant Br. at 8-9, 13.

The patents are United States Patent No. 6,649,159 

(the ’159 patent) and Reissue Patent No. RE 39,337 (the 

’337 patent). The ’159 patent is for a method of monitoring gene expression using fluorescence imaging. Claim 1 

recites:

1. A method to monitor the ability of a promoter to promote expression in an animal of an 

endogenous gene that is controlled by said promoter, which method comprises:

a) delivering, to an animal, cells containing a 

nucleic acid encoding a fluorophore operatively 

linked to the promoter of said endogenous gene 

whose ability to promote expression is to be analyzed; and

b) observing the presence, absence or intensity 

of the fluorescence generated by said fluorophore 

at various locations in said animal by whole-body 

external fluorescent optical imaging,

whereby the ability of said promoter to promote expression is monitored, and

wherein said fluorophore is a protein that is 

autofluorescent such that no substrates or cofactors are needed for it to fluoresce.
ANTICANCER, INC. v . PFIZER, INC. 15

With its Contentions for the ’159 patent, AntiCancer 

incorporated the Pfizer publication entitled “Defects in 

Embryonic Development of EGLN1/PHD2 Knockdown 

Transgenic Mice are Associated with Induction of Igfbp in 

the Placenta,” published at 390 Biochemical and Biophysical Research Communications 370 (2009). This article

describes experiments using green fluorescent protein 

imaging of gene expression in mouse embryos. In its 

claim charts, AntiCancer included Figure 2 from that 

publication, captioned “Embryoplacenta l effects of the 

localization of intense (+++) GFP fluorescence in EGNLI 

RNAi hairpin treated embryos,” showing mouse embryos 

with these effects.

The ’337 patent is directed to a mouse model in a process called “surgical orthotopic implantation,” in which 

fragments of human tumors are implanted into the corresponding organ of a living mouse. Claim 1 of the ’337 

patent as reissued recites:

1. A nude mouse model for progression of 

human neoplastic disease, the progression of said 

disease being characterized by growth of a primary tumor site and metastasis to secondary tumor 

sites,

wherein said mouse has histologically intact 

human neoplastic tissue of at least 1 mm in size 

transplanted onto an organ of said mouse which 

corresponds to the human organ from which said 

tissue is originally obtained;

and has sufficient immuno-deficiency to allow 

said transplanted neoplastic tissue to grow at said 

primary site and metastasize to said secondary 

tumor sites, so as to mimic the progression of the 

neoplastic disease including the metastatic behavior of said neoplastic disease in humans.

With its Contentions for the ’337 patent, AntiCancer 

included a Pfizer-Crown Bioscience poster presentation

ANTICANCER, INC. v . PFIZER, INC. 17

Pfizer’s Mem. P. & A. Supp. Mot. Summ. J. Noninfringement Based on Defective Infringement Contentions 11, 

AntiCancer (S.D. Cal. Mar. 12, 2012), ECF No. 38-1.

The district court held that AntiCancer’s claim charts

did not provide all of the information the Patent Local 

Rules require. The district court held that the claim 

charts were deficient as to three elements: the “promoter 

monitoring” and “delivering cells” elements of the ’159 

patent, and the “metastasis to a second site” element of 

the ’337 patent. 

AntiCancer argues that the Contentions and claim 

charts adequately showed the connection between these

claim elements and the information in the Pfizer and 

Crown Bioscience publications, and showed, prima facie, 

the presence of these elements in the accused activities. 

AntiCancer states that the degree of specificity in its 

Contentions and claim charts was in accordance with the

Patent Local Rules, and further specificity and detail will 

require discovery of the defendants’ non-public, internal 

activities. AntiCancer stresses that the Patent Local 

Rules contemplate that discovery will follow from the 

Preliminary Infringement Contentions, and that it is not 

expected or intended that the Contentions must provide

complete proof of infringement before the patentee has a 

meaningful opportunity to conduct discovery.

On the role of discovery in the specificity of the Preliminary Infringement Contentions, it cannot be ignored 

that AntiCancer’s Preliminary Contentions were required 

to be filed within two months of the district court’s Case 

Management Conference Order and just five days after 

AntiCancer filed its First Amended Complaint adding the 

infringement counts and party-defendant Crown Bioscience, with nearly ten months remaining until the close of 

fact discovery pursuant to the original Case Management 

Conference Order. The commentary on preliminary 

infringement contentions in those district courts that 
18 ANTICANCER, INC. v. PFIZER, INC. 

have adopted similar local rules is that the contentions 

precede discovery and are intended to facilitate discovery. 

This court, in O2 Micro, mentioned “the broad discovery 

regime under the Federal Rules of Civil Procedure, especially given the particular importance of discovery in 

complex patent cases.” 467 F.3d at 1365. 

We note the limiting language of Patent Local Rule 

3.1, requiring the plaintiff to identify the accused products, instrumentalities, or acts “of which the party is 

aware”; and to be “as specific as possible,” with the name 

or model number of the accused product, device, or apparatus “if known.” These requirements harmonize the 

Local Rule with the discovery provided by the Federal 

Rules and warrant consideration when reviewing the 

district court’s fee-shifting sanction. 

Turning to the three claim elements for which the district court found AntiCancer’s Preliminary Infringement 

Contentions deficient, we review compliance with Patent 

Local Rule 3.1 in the context of the condition the district 

court imposed on AntiCancer’s ability to supplement the 

Contentions. In the end, considering the language and 

purposes of the Local Rule, and the record of what AntiCancer disclosed in its Contentions and the limited, 

specific criticisms of the Contentions’ sufficiency, we 

conclude that there is no reasonable basis for making the 

finding of bad faith that would be required to sustain the 

fees sanction, without which summary judgment here is 

improper. Indeed, we do not see how revised Contentions 

could be insufficient if AntiCancer added to them the brief 

explanations it provided in its opposition to summary 

judgment.

1. promoter monitoring

Each asserted ’159 patent claim includes the clause 

“whereby the ability of said promoter to promote expression is monitored.” See ’159 patent col. 24 l. 44 - col. 26 l. 

12. The district court observed that “in support of its 
ANTICANCER, INC. v . PFIZER, INC. 19

allegation of infringement” of the promoter monitoring 

element, AntiCancer’s Contentions identified Figure 2 

and the Pfizer publication’s statement that “[t]he localization and intensity of GFP fluorescence in conceptuses 

from both treatment groups was varied.” The district 

court concluded that “[o]n its face, the text from the paper 

says nothing about ‘promoters’ or ‘monitoring.’” Dist. Ct. 

Op. at 8. The court found that the citations to portions of 

the Pfizer publication, or the incorporation of its full text, 

did not “suppl[y] sufficient information for how Pfizer 

allegedly practiced the Promoter Monitoring element,” 

Dist. Ct. Op. at 8, and stated that “AntiCancer needs to 

connect the dots for how Pfizer’s research . . . reads on the 

asserted claim language,” id. at 9. 

AntiCancer states that further specificity would be 

obtained with discovery and faults the district court for 

granting summary judgment before there was claim 

construction “or a comparison of the properly construed 

claims to the accused methods.” Appellant Br. at 19. See, 

e.g., Ameranth, Inc. v. Papa John’s USA, Inc., 946 F. 

Supp. 2d 1049, 1057-61 (S.D. Cal. 2013) (denying motion 

for summary judgment and holding that defendant’s 

allegation that preliminary infringement contentions 

lacked sufficient specificity “turns the issue into one of 

claim construction rather than sufficiency of the PICs 

[preliminary infringement contentions],” and was thus 

premature); Network Caching, 2003 WL 21699799, at *4 

(“Patent LR 3–1 does not require [the plaintiff] to produce

evidence of infringement . . . .”).

AntiCancer continues to stress that its Preliminary 

Infringement Contentions stated that the disclosures and 

claim charts “identify to the extent possible based on

information currently in AntiCancer’s possession where 

each element of each asserted claim is found within each 

accused instrumentality of which AntiCancer is aware.” 

Appellant Br. at 24-25. AntiCancer had argued in its 

brief opposing the motion for summary judgment that “it 
20 ANTICANCER, INC. v. PFIZER, INC. 

would be clear to any competent scientist or even a layman, that measuring the ‘intensity’ of any process is 

another way of saying that the process is being ‘monitored,’” and provided the declaration of its founder and 

President, Dr. Robert M. Hoffman, explaining this science. The Hoffman declaration states that “it is impossible to measure the intensity of a process without 

monitoring it, since intensity refers to a degree of measurement which is monitored over time.” Decl. Robert M. 

Hoffman at 3, AntiCancer (S.D. Cal. Apr. 2, 2012), ECF 

No. 40-1. Dr. Hoffman explained that the Pfizer publication 

clearly indicates that the promoter was monitored 

in this experiment. Fluorescence intensity was 

graded as either “0, +, ++, or +++.” Therefore, expression of GFP varied from “0” at the lowest end 

to “+++” at the highest end, which means the activity (intensity) of the promoter linked to GFP 

was varied. The scientist conducting this experiment could only have rated the varying intensity 

of the GFP promoter by monitoring it.

Id.

The district court apparently gave weight to the inclusion of additional explanation in AntiCancer’s opposition 

brief and the Hoffman declaration, and remarked that 

AntiCancer was “capable” of making the “connection” 

between the Pfizer publication and the claim elements. 

Dist. Ct. Op. at 9. The court observed that AntiCancer’s 

brief contained more details than its Contentions, and 

stated:

Indeed, in its opposition brief [AntiCancer] makes 

this connection: “[I]t is the signal of GFP fluorescence which indicates the activity of the promoter, 

and the ‘localization and intensity’ of such fluorescence, and thereby of the promoter, is determined 
ANTICANCER, INC. v . PFIZER, INC. 21

by viewing or imagining the subject over time – in 

other words, by monitoring it.”

Id. (quoting AntiCancer’s brief in opposition to motion for 

summary judgment of noninfringement). The district 

court thus suggested that this information should have 

been included in the Preliminary Infringement Contentions. AntiCancer does not object to such inclusion, but 

objects to the fee-shifting condition placed on this inclusion.

As we review the nature of the deficiencies that were 

found by the district court, and the condition imposed on 

AntiCancer’s supplementation of the Contentions, AntiCancer reasonably argues that its “infringement theories 

were as crystallized as they could be under the circumstances, five (5) days after it had filed its First Amended 

Complaint with its infringement claims.” Appellant Br. 

at 13. AntiCancer argues that there was no uncertainty 

as to the subject matter that was charged with infringement, and that the supplemental information sought by 

the district court would be obtained by discovery, as 

contemplated by the Patent Local Rules, as well as the 

broad discovery regime provided for by the Federal Rules 

of Civil Procedure. The district court referred to the 

requirement that “the degree of specificity under Local 

Rule 3–1 must be sufficient to provide reasonable notice 

to the defendant why the plaintiff believes it has a ‘reasonable chance of proving infringement.’” Shared Memory 

Graphics, 812 F. Supp. 2d at 1025 (quoting View Eng’g, 

Inc. v. Robotic Vision Sys., Inc., 208 F.3d 981, 986 (Fed. 

Cir. 2000)). However, the question on appeal is not 

whether the district court properly required additional 

specificity in these Contentions, but whether a feeshifting sanction was appropriately attached to the court’s 

authorization to supplement the Contentions.

Ninth Circuit precedent negates the imposition of a 

fee-shifting sanction absent an explicit finding of bad 
22 ANTICANCER, INC. v. PFIZER, INC. 

faith. Although the district court described the Contentions as “woefully insufficient” and “vague,” and described 

AntiCancer as “act[ing] unreasonably” and “disingenuous” 

in submitting the Contentions, Dist. Ct. Op. at 14, there is

no explicit finding of bad faith. Indeed, the district court’s 

observation that AntiCancer’s brief in opposition to the 

motion for summary judgment and the Hoffman declaration might meet the court’s concerns weighs against any 

inference of bad faith. We thus conclude that a feeshifting sanction conditioned on AntiCancer’s supplementation for the “promoter monitoring” element cannot be 

sustained.

2. delivering cells

The “delivering cells” element appears in each of the 

asserted ’159 patent claims, as “delivering, to an animal, 

cells containing a nucleic acid encoding a fluorophore 

operatively linked to the promoter.” See ’159 patent col. 

24 l. 44 - col. 26 l. 12. AntiCancer’s claim charts refer to 

the Pfizer publication and the publication’s statement 

that “we generated transgenic mice expressing EGLN1 

shRNA.”

EGLN1 shRNA denotes the mouse expression of a 

known genetic trait. The district court observed AntiCancer’s argument to be that

it is a basic scientific concept that in order to have 

a transgenic mouse, cells must have been delivered. In other words, inherent within the statement ‘we generated transgenic mice expressing 

EGLN1 shRNA’ is the concept that cells containing a nucleic acid encoding a fluorophore were delivered to an animal. 

Dist. Ct. Op. at 11 n.8.

The defendants argued that the Pfizer publication did 

not show the “delivering cells” element, but merely described the fluorescent mice used by Pfizer. AntiCancer 
ANTICANCER, INC. v . PFIZER, INC. 23

responded that “[a]lthough the Pfizer Article does not 

explicitly state that GFP [green fluorescent protein]-

labeled cells were delivered, such delivery is so implicit 

that it needs no statement . . . [because] it could not be 

done any other way than by ‘delivering cells,’ a basic 

scientific concept that should be well understood by a 

company with Pfizer’s expertise.” AntiCancer Opp’n Mot. 

Summ. J. at 5, AntiCancer (S.D. Cal. Apr. 2, 2012), ECF 

No. 41. AntiCancer argued that identification of the 

information in the Pfizer publication by the AntiCancer 

Preliminary Infringement Contentions and claim charts 

satisfied the requirements of the Patent Local Rules, for 

the step of “delivering cells” would be “apparent to a 

competent scientist, or even a layman.” Id.

The district court compared the claim language “delivering, to an animal, cells containing a nucleic acid 

encoding a fluorophore,” with the language of the Pfizer 

publication “we generated transgenic mice expressing 

EGLN1 shRNA,” and stated:

As Pfizer correctly notes, the cited sentence does 

not mention cells. It does not mention delivering 

cells, fluorophores, or nucleic acids encoding fluorophores to animals. The quoted sentence only refers to animals (i.e., ‘transgenic mice’) with a 

particular genetic trait (i.e., ‘expressing’ a particular gene—‘EGLN1 shRNA’).

Dist. Ct. Op. at 10 (internal quotations and citation 

omitted). The district court concluded that “AntiCancer 

in no way attempts to make a connection between the 

sentence provided and the claim language, and the PICs 

additionally draw no connection between Figure 2 and the 

relevant claim language.” Id. However, the district court 

observed that AntiCancer had elaborated on this element 

in its opposition brief, the court stating: “Essentially, 

Anticancer argues that because its [sic] common 

knowledge that GFP comes from jellyfish—not mice—‘the 
24 ANTICANCER, INC. v. PFIZER, INC. 

GFP gene had to have been delivered.’” Dist. Ct. Op. at 

11 (quoting AntiCancer Opp’n Mot. Summ. J. at 5).

The district court ruled that the Contentions for the 

“delivering cells” element did not “suppl[y] sufficient 

information for how Pfizer allegedly practiced this element. . . . cit[ing] to a single sentence from the Pfizer 

paper as evidence that Pfizer infringed this element.” 

Dist. Ct. Op. at 10. The court stated that “the connections 

between the claim language and the ‘evidence of the 

accused instrumentality’ that AntiCancer makes in its 

opposition brief need to be set forth in the PICs, even if 

they are ‘basic scientific concepts’ that are generally 

known or publicly available.” Dist. Ct. Op. at 11 (citing 

Linex Techs., Inc. v. Belkin Int’l, Inc., 628 F. Supp. 2d 703, 

709 (E.D. Tex. 2008)).

The district court faulted the Preliminary Infringement Contentions for failing to provide sufficient “evidence” of the accused instrumentalities and “information” 

about how Pfizer practiced the “delivering cells” element. 

Dist. Ct. Op. at 10-11. AntiCancer argues that, as precedent has established, the purpose of the Contentions is to 

outline the theories of infringement and streamline 

discovery, not to provide proof of infringement. See O2 

Micro, 467 F.3d at 1364 (the Contentions are intended to 

“crystallize [the infringement] theories . . . so as to prevent the shifting sands approach to claim construction”

(internal quotation marks omitted)).

We conclude that, in view of AntiCancer’s presentation of the “delivering cells” element at this stage, and 

applying the law of the Ninth Circuit concerning the 

standards for fee-shifting, the district court exceeded its 

discretionary authority in imposing a fee-shifting sanction 

as a condition of proceeding with the litigation.
ANTICANCER, INC. v . PFIZER, INC. 25

3. metastasis to a second site

The third element for which the district court held the 

Preliminary Infringement Contentions to be deficient is 

“metastasis to a second site” in the ’337 patent claims. 

The claims are directed to “a nude mouse model for progression of human neoplastic disease, the progression of 

said disease being characterized by growth of a primary 

tumor site and metastasis to secondary tumor sites, 

wherein said mouse has . . . sufficient immuno-deficiency 

to allow said transplanted neoplastic tissue to grow at 

said primary site and metastasizing to said secondary 

tumor sites.” ’337 patent col. 11 ll. 13-67. AntiCancer’s 

Contentions recited the following text from the defendants’ poster presentation as corresponding to this element:

“Tumor fragments derived from patient tumor tissues were surgically implanted into the left lobe of 

nude mouse liver”; “Sutent treatment significantly 

inhibited orthotopic HCC tumor growth; Plasma 

samples were collected at different time points for 

alpha-feto-protein (AFP) measurement. At termination, tumors were excised from liver and their 

weights and sizes were recorded”; “In addition, 

histological analysis confirmed that orthotopically 

implanted primary human tumors maintained 

their histopathological characteristics.” 

Disclosure of Asserted Claims and Preliminary Infringement Contentions at 95-96, AntiCancer (S.D. Cal. Mar. 

12, 2012), ECF 38-4.

The defendants argued that the passages quoted from 

their poster presentation were insufficient to establish a 

connection between this claim element and the defendants’ activities, because the poster does not specifically 

describe the implanted tumor as metastasizing to a 

second location. AntiCancer responded that the ’337 

patent claims require sufficient mouse immuno-deficiency 
26 ANTICANCER, INC. v. PFIZER, INC. 

to “allow said transplanted neoplastic tissue to grow at 

said primary site and metastasize to said secondary 

tumor sites,” and that the defendants’ publications showing growth of the tumor at the site of implantation “is

direct evidence that the mice used were sufficiently immuno-deficient to allow for growth at the primary site and 

for metastasis at secondary sites.” AntiCancer Opp’n 

Mot. Summ. J. at 4-6. The district court stated: 

AntiCancer has left out the essential connection 

between the claim language and the allegedly infringing acts. How does the growth of the tumor 

at the primary site provide ‘direct evidence’ that 

the mice were sufficiently immuno-deficient to allow for metastasis to secondary sites? By skipping this essential connection, AntiCancer leaves 

Defendants—and the Court—guessing at how the 

patent was allegedly infringed, hindering Defendants’ ability to prepare an effective defense. 

Dist. Ct. Op. at 13.

AntiCancer states that its Contentions were not deficient, and that the district court’s question of “how” tumor 

growth relates to immuno-deficiency transcends the 

requirement of Local Rule 3.1, to simply provide “a chart 

identifying specifically where each element of each asserted claim is found within each Accused Instrumentality.” 

AntiCancer also states that it identified the activities 

meeting the “metastasis to a second site” element, and 

that persons of skill in this science would readily understand that the tumor control described in the defendants’ 

publication also related to metastasis.

In Network Caching, the Northern District court explained that the Preliminary Infringement Contentions 

“are not meant to provide a forum for litigation of the 

substantive issues; they are merely designed to streamline the discovery process.” 2003 WL 21699799, at *5. 

The Preliminary Infringement Contentions do not need to 
ANTICANCER, INC. v . PFIZER, INC. 27

include proof or direct evidence of infringement, as the 

various decisions on the Patent Local Rules have explained.

We again conclude that the district court’s fee-shifting 

condition for supplementing the Contentions was unwarranted, applying the Ninth Circuit’s requirement of bad 

faith for imposition of sanctions as discussed, e.g., in 

Primus Automotive, 115 F.3d at 648. 

CONCLUSION

Summary judgment is appropriate when there is no 

reasonable possibility that the non-movant could prevail 

upon proper pleadings and a full and fair trial. See Fed. 

R. Civ. P. 56; Anderson v. Liberty Lobby, Inc., 477 U.S. 

242, 250 (1986). Here, the district court granted summary judgment based on its finding that AntiCancer’s 

Preliminary Infringement Contentions were deficient and 

because AntiCancer objected to the fee-shifting sanction 

imposed as a condition of supplementing the Contentions.

When a complaint meets the standards of the Federal 

Rules, and there has been no reasonable opportunity for 

discovery and evidentiary development of the issues, it is 

rarely appropriate to summarily decide the merits against 

the complainant. We need not intrude upon the district 

court’s authority to require supplementation of the Preliminary Infringement Contentions when such supplementation may assist the procedures of trial. However, 

exercise of a court’s inherent authority to levy a sanction 

as a condition of supplementing the Contentions requires 

conduct that “constituted or was tantamount to bad 

faith.” Roadway Express, 447 U.S. at 767. There is no 

finding, and there is no basis for a finding, of such impropriety here.

We conclude that the district court exceeded its discretion in imposing the condition of payment of the defendants’ attorney fees and costs in order to permit 
28 ANTICANCER, INC. v. PFIZER, INC. 

AntiCancer to supplement its Preliminary Infringement 

Contentions. We vacate the condition, and the summary 

judgment based thereon. The case is remanded for further proceedings.

VACATE AND REMANDED