Source: https://www.ocipla.org/federal-circuit-summaries-march-2019/
Timestamp: 2019-04-24 06:52:06+00:00

Document:
RCT challenged whether Appellants had standing to appeal. The Federal Circuit looked to the plain text of Section 315(c), which provides that the Board may join as a party any person who properly files a petition. Next, the Court looked to Section 319, which provides that “[a]ny party to the inter partes review shall have the right to be a party to the appeal.” Thus, the Board had discretion to join Appellants as parties. Once they were joined as parties, they had a statutory right to appeal under 35 U.S.C. § 319.
SEVEN Networks, LLC sued Google for patent infringement in the Eastern District of Texas. The district court denied Google’s motion to dismiss for improper venue. SEVEN alleged that venue was proper because Google committed acts of infringement in the district, and that Google’s servers, stored in a third-party ISP’s facility, constituted a regular and established place of business. Google petitioned the Federal Circuit for a writ of mandamus directing the district court to dismiss or transfer the case for improper venue. In an unpublished decision, the Federal Circuit found mandamus inappropriate because “it is not known if the district court’s ruling involves the kind of broad and fundamental legal questions relevant to § 1400(b),” and “it would be appropriate to allow the issue to percolate in the district courts so as to more clearly define the importance, scope, and nature of the issue for us to review.” Google unsuccessfully petitioned for a rehearing en banc.
In Momenta Pharmaceuticals, Inc. v. Bristol-Myers Squibb Company, Appeal No. 2017-1694, the Federal Circuit held that an injury-in-fact is required to establish Article III standing for judicial review of agency action, even if a statute permits such review.
Momenta Pharmaceuticals, Inc. (“Momenta”) requested inter partes review (“IPR”) of a patent owned by Bristol-Myers Squibb Company (“BMS”). The patent covers a product that BMS markets under the brand name Orencia®. At the time Momenta petitioned for IPR, it was reportedly attempting to develop a biosimilar counterpart to the Orencia® product. The PTAB sustained patentability of the claims. Momenta appealed to the Federal Circuit.
The Federal Circuit dismissed Momenta’s appeal for lack of standing and mootness. BMS argued that Momenta lacked standing because its proposed product had failed clinical trials and had been withdrawn. Momenta responded that it had not abandoned its intent to produce the biosimilar, and that it was injured by the IPR estoppel statute. However, press releases and SEC filings from Momenta revealed that it had terminated its participation in the development program for the biosimilar. The Federal Circuit held that because of this termination, Momenta had failed to show “an invasion of a legally protected interest” that was “actual or imminent, not conjectural or hypothetical.” Further, IPR estoppel did not create an injury-in-fact because Momenta was no longer engaged in any activity that would give rise to a possible infringement suit. Thus, Momenta lacked standing to appeal. The Federal Circuit also determined that the appeal was moot, because Momenta ceased the potential infringement and thus ended the potential for injury. Therefore, the Federal Circuit dismissed the appeal.
In Continental Circuits LLC v. Intel Corporation, Appeal No. 2018-1076, the Federal Circuit reversed a claim construction which read a process limitation into a product claim where the patentee did not clearly and unmistakably disavow claim scope and also did not make clear that the process was an essential part of the claimed invention.
Continental sued Intel for patent infringement, asserting claims to a dielectric material. The district court read a limitation into the claims to require that the dielectric material be made via a repeated etching process. Based on this construction, the parties stipulated to non-infringement and the court entered judgment accordingly. Continental appealed, challenging only the district court’s claim construction.
On appeal, the Federal Circuit agreed with Continental that the district court erred in limiting the claims to require a repeated etching process. The Federal Circuit noted that the plain language of the claims was not limited to a repeated etching process. The Federal Circuit concluded that the statements in the specification did not rise to the level of a clear and unmistakable disclaimer or disavowal of claim scope. The statements in the specification simply described a preferred method and did not amount to a clear disavowal. Similarly, with respect to the prosecution history, the Federal Circuit found that an expert’s declaration responding to indefiniteness and written description rejections was not a clear disavowal. Statements on a particular claim term to overcome indefiniteness and lack of written description is not the same as a disavowal. The Federal Circuit also noted that because it was not clear that the repeated etching process was “an essential part of the claimed invention,” it was improper to read the process limitation into the product claims. The Federal Circuit vacated the judgment of non-infringement and remanded for further proceedings.
In CenTrak, Inc. v. Sonitor Technologies, Inc., Appeal No. 2017-2510, the Federal Circuit reversed summary judgment of lack of written description where the complexity and predictability of a claimed embodiment were disputed. Additionally, the Federal Circuit explained that a final assembler can be liable for making an infringing product even if it does not make each individual component element.
CenTrak sued Sonitor for infringement of its patent relating to systems for locating and identifying portable devices using ultrasonic base stations, and Sonitor moved for summary judgment of invalidity for lack of written description and non-infringement. The district court granted summary judgment of invalidity for lack of written description, finding that the specification primarily disclosed a system based on infrared (“IR”) technology and merely contemplated the claimed ultrasound-based system. Likewise, the district court granted summary judgment of non-infringement, finding that Sonitor did not “make” an infringing assembly by performing installations. CenTrak appealed.
The Federal Circuit found genuine issues of material fact and thus reversed and remanded the district court’s grant of summary judgment of invalidity and non-infringement. The specification’s relative lack of attention to its ultrasonic embodiment compared to its IR embodiment did not show that the inventors failed to constructively reduce to practice a system with ultrasonic components. Further, the district court erred in failing to credit testimony from CenTrak’s expert and a named inventor that the differences between IR and ultrasound were incidental to carrying out the claimed invention. Regarding infringement by final assembly, the Federal Circuit explained that a final assembler can be liable for making an infringing combination even if it does not make each individual component element. Because the record contained evidence that Sonitor oversaw the installation of the infringing product and configured the final product, the district court erred in ruling that there was no genuine issue of material fact.
In Dr. Falk Pharma GmbH v. Generico, LLC, Appeal No. 2017-2312, the Federal Circuit held that a firm’s representation of an indirect subsidiary of a parent corporation created a disqualifying, concurrent conflict of interest for representation of a party adverse to a different indirect subsidiary of the parent corporation, in view of the Rules of Professional Conduct, and the signed engagement letter between the law firm and the parent corporation.
The Federal Circuit, applying regional circuit law and the Model Rules of Professional Conduct, found that Katten’s representation of Bausch constituted a concurrent conflict of interest, and granted the motion to disqualify. Although representation of a corporation does not necessarily impart a conflict to all its corporate affiliates, the Federal Circuit clarified that an affiliate can be considered a client by either express agreement or when affiliates are so interrelated that representation of one constitutes representation of all. The Federal Circuit found that Katten’s Engagement Letter with Bausch, and the Outside Counsel Guidelines incorporated therein, created an ongoing attorney-client relationship between Katten, Valeant, and its subsidiaries Salix and Bausch. Furthermore, the Federal Circuit adopted the Second Circuit’s factors when considering corporate interrelatedness, and found that Valeant, Bausch and Salix have sufficient operational commonality and sufficient financial dependence to give rise to a corporate affiliate conflict. Finally, the Federal Circuit rejected Katten’s reliance on an ethical wall as doing too little, too late. Thus, the Federal Circuit granted the motion to disqualify Katten.
In Coda Development v. Goodyear Tire & Rubber, Appeal No. 2018-1028, the Federal Circuit held that the district court committed a procedural error that led it to improperly conclude that the Plaintiffs’ claims for correction of inventorship were not plausible.
Coda’s pleading alleged that its CEO, Mr. Hrabel, invented a certain self-inflating tire (“SIT”) technology. Coda entered an NDA with Goodyear, and the parties met twice to discuss the technology. Following the meetings, Goodyear stopped communicating with Coda. Goodyear then filed its own patent application directed to SIT technology, without naming Mr. Hrabel as an inventor. Coda and Hrabel sued to correct inventorship of the SIT patents and for trade secret misappropriation. Goodyear moved to dismiss under Rule 12(b)(6). Goodyear argued that Plaintiffs failed to plead facts supporting Hrabel’s conception of the claimed inventions. Goodyear also argued that Plaintiffs’ trade-secret claim was time-barred because Plaintiffs should have known of Goodyear’s published patent application more than four years before filing suit. And for the first time in its reply brief, Goodyear pointed to a previously published article by Hrabel and argued that the article disclosed everything that Hrabel claimed to have invented. The district court denied Plaintiffs’ motion to strike the article and without explanation denied Plaintiffs’ request to file a sur-reply to address the article. The district court determined Plaintiffs’ correction of inventorship claims were implausible and dismissed them. The district court also dismissed Plaintiffs’ trade secret claim as time-barred. Plaintiffs moved to amend the judgement under FRCP 59(e) and also for leave to file an amended complaint with additional factual allegations, but the district court denied the motions stating that the factual details should have been in the original complaint.
The Federal Circuit vacated the decision and remanded. On correction of inventorship, the Federal Circuit held that the pleaded facts plausibly stated a claim. The Federal Circuit also held that the district court improperly considered the 2008 Hrabel article without either converting Goodyear’s motion into one for summary judgement or giving Plaintiffs an opportunity to respond. While a district court may judicially notice matters outside the pleadings on a Rule 12(b)(6) motion, the facts may not be subject to reasonable dispute. Whether the 2008 Hrabel article actually disclosed novel trade secrets was a reasonably disputed factual issue. The Federal Circuit also held that the district court erred in dismissing the trade-secret-misappropriation claim. The issue of whether Plaintiffs should have discovered their claim earlier was a fact-specific inquiry that could not be resolved at the pleading stage. The Federal Circuit also commented that leave to amend should be freely given, and that denying Plaintiffs an opportunity to amend in this case was troubling and improper.

References: § 319
 § 1400
 v. 
 v. 
 v. 
 v. 
 v.