Source: http://docketreport.blogspot.com/2015_03_01_archive.html
Timestamp: 2018-02-22 06:48:19
Document Index: 423850134

Matched Legal Cases: ['§ 325', '§ 325', '§ 314', '§ 285', '§ 285', '§ 285', '§ 285', '§ 285', '§ 285', '§ 285', '§ 285', '§ 285', '§ 285', '§ 285', '§ 285', '§ 315', '§ 315', '§ 315', '§ 315']

Use of Trade Show to Identify Potential Infringers Justifies Exercise of Personal Jurisdiction Over Patentee
Following jurisdictional discovery, the court denied defendant's motion to dismiss plaintiff's declaratory relief action for lack of personal jurisdiction. "[Defendant's] receipt of service of the amended complaint while he was attending the SHOT Show in Las Vegas establishes personal jurisdiction. [Defendant] was physically present in Nevada and he was personally served. Due process in this case requires nothing more. . . . [E]ven if [defendant] had not been personally served with the amended complaint in Las Vegas, the record developed through discovery supports a finding of personal jurisdiction here. . . . [Defendant] routinely used the SHOT Show as a venue to identify potential infringers and that he, through counsel, made efforts to discourage potential infringers from displaying their products at the SHOT Show by sending cease-and-desist letters only days before the event. . . . In such a situation, it should come as little surprise to the patentee that he is required to defend himself against a declaratory judgment action for noninfringement in the forum he repeatedly utilized to identify products potentially infringing his patent."
“Shotgun” Infringement Pleading May Support Exceptional Case Finding
The court denied defendant's motion to dismiss plaintiff's "shotgun" direct infringement claim but warned of a potential exceptional case finding later. "[Plaintiff's] asserted patents are clearly complex. Among the six patents, there are over 900 claims, many of which [plaintiff's] counsel admits are inapplicable to [defendant's] products and services. A pleading that alleges 'one or more' of the over 900 claims in the patents-in-suit are infringed gives [defendant] and this court scant notice of what is truly alleged to be at issue in this case. Although adhering to the minimum requirements of Form 18, [plaintiff's] direct-infringement pleading is a classic example of a 'shotgun' approach to pleading, where the sheer volume of potential asserted claims and complexity of the patents are overwhelming to the parties and to the court. . . . Still, because the requirements of Form 18 have been met, the court will not at this time instruct [plaintiff] to redraft its direct-infringement allegations. . . . However, the court does remind [plaintiff] that a sprawling resource-depleting approach to this case, which ultimately proves to be unduly wasteful, may factor into a finding that this case is an 'exceptional' case that justifies fee shifting."
In response to the parties' joint claim construction statement addressing twenty-three disputed terms, the court ordered the parties to "identify the ten terms the construction of which will be the most significant in the resolution of this dispute." "It is not apparent to the court why many of the terms, such as 'file,' are in dispute, let alone case or claim dispositive. . . . The purpose of requesting construction of a term is not to lard the record with potential error or to impose costs on an opponent. Given the number of terms in dispute, the court orders that the parties meet and confer in good faith, in an attempt to reduce the number of terms in need of construction and to determine those terms on which agreement can be reached. . . . The traditional primer on the general principles of Markman v. Westview Instruments, Inc., 517 U.S. 370, 116 S. Ct. 1384 (1996) and Phillips v. AWH Corp., 415 F.3d 1303 (Fed. Cir. 2005) (en banc) is not likely to be necessary or helpful."
Failure to Include Known Prior Art and Arguments in IPR Petition Justifies Denial of Subsequent Petition
"[The petitioner] does not show that we misapplied § 325(d) in assessing whether 'the same or substantially the same prior art or arguments' were raised in the first and second petitions. . . . Our authority is grounded not only in § 325(d), but also in the broader discretion to deny a petition under § 314(a). . . . [The petitioner] argues that the Board should not have considered whether any new prior art or arguments raised in the second petition were known or available to [the petitioner] at the time of filing the first petition. . . . [The petitioner] advances a bright-line approach that would allow petitioners to file 'follow-on' second petitions in order to 'correct deficiencies noted' by the Board in decisions that deny a first petition. That bright-line approach would allow petitioners to unveil strategically their best prior art and arguments in serial petitions, using our decisions on institution as a roadmap, until a ground is advanced that results in review—a practice that would tax Board resources, and force patent owners to defend multiple attacks. We did not err by adopting a more flexible approach that assesses each case on its particular facts to achieve a result that promotes the efficient and economical use of Board and party resources, and reduces the opportunity for abuse of the administrative process."
Petition for Inter Partes Review by Conopco, Inc., IPR2014-00628 (PTAB March 20, 2015, Order) (Obermann, APJ)
Presumption of Validity Weighs Against § 285 Fee Award
The court denied counterclaim defendants' motion for attorneys' fees under 35 U.S.C. § 285 following summary judgment of invalidity because the case was not exceptional. "Ironically, this Motion may be more exceptional than what it attacks. Counterclaim Defendants primarily argue that '[counterclaim plaintiff] should have known that the [patent] is invalid,' and thus presumably should not have defended the validity of his patent or asserted counterclaims. . . . [Counterclaim plaintiff's] manner of litigating this case was not exceptionally unreasonable. It was [counterclaim defendants], not [counterclaim plaintiff], that initiated this case. . . . While true that the disputed patent claims were weak, that is, unfortunately, not exceptional. Absent a showing that something was withheld from the USPTO, a patentee should be able to rely to some degree on the USPTO’s expert views and the resulting presumption of validity."
Plaintiff’s “Fallacious” Post-License Infringement Claim Warrants Attorney Fee Award
The court overruled plaintiff's objection to the magistrate judge's recommendation to award defendant attorneys' fees under 35 U.S.C. § 285 because plaintiff's claims were unsupported. "[Plaintiff] first objects to the Report and Recommendation on the grounds that 'only by exaggeration of an otherwise benign record could this case be deemed exceptional.' The Court flatly rejects [plaintiff's] nonpenitent view. . . . [Plaintiff's] argument that it retained the patents and therefore was justified in pursuing its case against [defendant] is a fallacious one. There was not one piece of evidence to support [plaintiff's] position that even if it retained the patents, [its licensee] could not make use of them in its commercialization efforts. The business deal made no sense otherwise. . . . Had [plaintiff] done any due diligence, it would have learned that no witness supported [plaintiff's] construction of the Agreement and this case [should] never have been filed."
Lack of Standard for Measuring “Substantial” Interference Renders Wireless Transmission Claims Indefinite
The court granted defendant's motion for summary judgment that plaintiff's wireless data transmission patent was invalid as indefinite because of the term, "substantially prevent communication interference between the first and second pairs." "It is clear that the use of the word "substantially" does not necessarily make a claim term indefinite. . . . But when a word of degree is used in a patent, the court must determine whether the patent’s specification provides a standard for measuring that degree. It is not enough to identify some standard for measuring the scope of a phrase. . . . [Defendant] correctly notes that the intrinsic evidence does not offer any objective boundaries for the term 'substantial.' The fact that the specification and prosecution history lack evidence that would inform a person skilled in the art as to how much interference prevention the patent contemplates sets it apart from patents that have overcome indefiniteness challenges to terms of degree."
$5.3 Million Fee Award Not Excessive In Light of Plaintiff’s Financial Condition
The court awarded defendant more than $5.3 million in attorneys' fees under 35 U.S.C. § 285 and rejected plaintiff's argument that an award could bankrupt plaintiff. "[Plaintiff], which instituted this action with an eye toward 'tak[ing] [defendant] out,' now argues, without even a wisp of irony, that the risk of bankruptcy entitles it to a reduced fee liability. . . . [Plaintiff's CEO] contends only that a fee award in excess of $4 million 'may lead customers to terminate contracts with [plaintiff].' He does not contend that it would, or even could, result in bankruptcy as [plaintiff's] opposition brief asserts. Taken together, these facts are too speculative to merit a diminution in fees. Furthermore, capping a litigant's § 285 liability at the value that it can comfortably pay comes close to effacing the statute's distinct purpose as a deterrent to frivolous litigation."
Plaintiff’s Desire for “Payback” and Litigation Abuse Warrant Fee Award Under § 285
The court granted defendant's motion for attorneys' fees under 35 U.S.C. § 285 following jury and bench trials because of the lack of strength of plaintiff's case and its litigation tactics. "[E]vidence at trial showed that this litigation was at least in part motivated by Plaintiff’s desire for 'payback' for Defendant’s successful competition in the marketplace. . . . [I]nformation regarding Plaintiff’s marking policies, procedures, and practices was uniquely in Plaintiff’s possession, but Plaintiff either did not adequately review this material before filing suit, or filed suit knowing that it had not complied with the marking requirement. Plaintiff compounded this by engaging in gamesmanship that made it hard to discover and prove the marking failure. . . . The substantive and procedural problems concerning the [patent-in-suit] are particularly troublesome in this case because, due to the patent’s expiration, there was no case at all on the [patent] absent compliance with the marking requirement."
Inventor’s Change of Testimony at Trial Warrants Attorney Fee Award Under § 285
The court granted in part defendant's motion for attorney fees under 35 U.S.C. § 285 following a jury trial because of plaintiff's litigation misconduct after the inventor changed his testimony regarding conception at trial. "During his deposition, [the inventor] testified that he did not recognize or have any knowledge of a document and stated that he would not change his testimony at trial. However, at trial he identified the document as his conception document and stated that he was the author. [The inventor] explained that he had requested a copy of the document to look over after the deposition, at which point he recalled what it was. . . .While a change of testimony is not itself necessarily unethical or unprofessional, the failure of [plaintiff] to alert [defendant] to the change in testimony at any point in the year prior to trial is. [Plaintiff] knowingly introduced testimony that violated a witness's sworn commitment not to change his testimony at trial, understanding that [defendant] would have prepared based on misleading information. [Plaintiff] took no steps to rectify the situation despite ample time to do so. Accordingly, the testimony of [the inventor] warrants a determination of exceptional conduct."
The court granted defendant's motion to dismiss plaintiff's patent misuse claim for failure to state a claim. "[C]ourts disagree on whether patent misuse can constitute a claim, not just a defense. . . . Some courts view [B. Braun Med., Inc. v. Abbott Labs., 124 F.3d 1419 (Fed. Cir. 1997)] as allowing an affirmative claim of patent misuse so long as the plaintiff does not seek damages. . . . Others read B. Braun as rejecting patent misuse as an affirmative claim regardless of whether it seeks a declaratory, injunctive, or compensatory relief. . . . [T]here is no disagreement among the courts that patent misuse doctrine cannot be asserted for monetary relief . . . as [plaintiff] seeks to do here. . . . Moreover . . . this Court concludes that patent misuse cannot be brought as a stand-alone cause of action. . . . [T]he Federal Circuit has repeatedly defined patent misuse as a defense, rather than a cause of action in its own right."
Since the Supreme Court decided Highmark and Octane on April 29, 2014, U.S. district courts have ruled on seven motions to reconsider earlier rulings on motions for attorney fees under 35 U.S.C. § 285. Five were denied or recommended for denial, one was granted and one was partially granted. To view these orders, click here. To view summaries of the rulings, click “Show Annotations” at the bottom of the page.
The court granted defendant's motion to dismiss plaintiff's claims for infringement of its proposal preparation patents because the asserted patents lacked patentable subject matter. "[T]he asserted claims are directed to the abstract idea of creating a customized sales proposal for a customer. . . . [T]he Court does not hold that all claims in software-based patents are directed to an abstract idea. Indeed, the contours are often unclear between those inventions that are directed to an abstract idea and those that are not. . . . Although verbose, the claims as a whole broadly recite a simple process which, in this case, does not require the type of complex programming that confers patent eligibility. Importantly, the claims in no way 'purport to improve the functioning of the computer itself.' Likewise, the claimed invention is not 'necessarily rooted in computer technology in order to overcome a problem specifically arising in the realm of computer networks.'. . . The claims identify no inventive algorithms or otherwise creative means for generating a customized sales proposal other than an instruction that the basic process be performed using generic computer components."
Since 2008, U.S. district courts have ruled on 924 motions for attorney fees under 35 USC § 285. About 60% were denied each year, with the exception of 2013 when the denial rate increased to 67%. It appears Octane Fitness and Highmark may be changing that. Last year only 57.6% were denied and the denial rate in 2015 to date is only 48%.
Click here to view a Motion Success Report showing all outcomes of motions for attorney fees since 2008. Using the filters on the left side of the page, you can modify the report to focus on a specific court or judge. You can also print the report in PDF format by clicking the printer icon.
The court granted defendants' motion for attorney fees under 35 U.S.C. § 285 following summary judgment of noninfringement because plaintiff should have known its claims were meritless. "The infringement claims against [defendants] depended on a claim construction that the court clearly rejected in prior litigation on closely related patents. . . . [Plaintiff] justifies the arguments it advanced here on the wording differences, asserting that the prior construction in [the earlier case] was not 'controlling.' The prior construction was not preclusive, but it certainly was clear. . . . [Plaintiff's] arguments for a different construction in the present cases were wholly unsubstantial and without merit. . . . It was merely a vehicle to relitigate prior, clearly rejected, positions."
Google’s Size, Wealth, and Market Power Relevant to Hypothetical Negotiation
The court partially denied Google's motion in limine to preclude references to its size, wealth, and alleged market power. "Google’s size and wealth, on their own, are not relevant to the issues to be tried. [Plaintiff] may not make general statements about Google’s financials that are unrelated to damages in this case. Google’s market power, however, is relevant to the bargaining position that the two parties would take in a hypothetical negotiation. Testimony and argument on Google’s market power is permissible to the extent that it relates to that negotiation, but is not permissible to the extent that it suggests that Google behaves as a monopoly or engages in unlawful or anticompetitive practices. Evidence and arguments about Google’s non-location-related revenues and profits, as well as the value of 'location' to Google, are similarly relevant to damages and are permissible for that purpose. With these principles in mind, the parties may raise objections to specific mentions of these issues as appropriate at trial."
Since the creation of new post-grant proceedings before the Patent Trial and Appeal Board, U.S. district courts have ruled on 617 motions to stay pending inter partes review (IPR), covered business method review (CBM), and post-grant review (PGR). Most of those rulings either granted or denied a stay. However, in 27 rulings, courts granted the stay upon certain conditions, the most common of which was defendants’ agreement to 35 USC § 315(e) estoppel. In some cases, the stipulated estoppel was weaker than estoppel under § 315(e). In other cases, stay was conditioned on the PTAB reaching certain determinations that might impact the litigation. To view all orders granting stays upon certain conditions, click here.
Stay Pending IPR Conditioned on Defendants’ Stipulation to § 315(e) Estoppel Even in the Event of Withdrawal
The court conditioned a stay pending inter partes review on defendants' stipulation to be bound by estoppel even if petitioners withdrew but the PTAB still issued a final written decision. "The purpose of the stipulation is to provide defendants with a stay if they would, in substance, be treated as if they were subject to the estoppel pursuant to 35 U.S.C. § 315(e). That is, as if they were a petitioner, or 'the real party in interest or privy of the petitioner.' . . . An IPR petitioner who withdrew before decision – perhaps because it perceived that it was not likely to receive a favorable PTAB decision – would not escape the estoppel consequences. . . . I will not permit the defendants to avoid estoppel if the IPR petitioners decide to withdraw and the PTAB thereafter issues a 'final written decision.'"
CTP Innovations LLC v. EBSCO Industries Inc., 1-14-cv-03884 (MDD February 25, 2015, Order) (Garbis, J.)