Opinion ID: 4542383
Heading Depth: 3
Heading Rank: 2

Heading: Sham Threats and Litigation

Text: In addition to its Walker Process claims, Inline presents an additional theory of antitrust liability: “claims for sham threats and litigation alleging that Graphic knew the Asserted Patents were invalid when it subsequently asserted the patents in 2014 and 2015.” Appellant’s Br. at 40. Inline argues that the district court erroneously characterized these claims as “‘recycled version[s]’ of its Walker Process claims.” Id. (alteration in original). The Noerr-Pennington[8] doctrine immunizes acts related to the constitutional right to petition the courts for grievance, unless the act is 8 See United Mine Workers of Am. v. Pennington, 381 U.S. 657 (1965); E.R.R. Presidents Conf. v. Noerr Motor Freight, Inc., 365 U.S. 127 (1961). -15- a mere sham. The First Amendment to the United States Constitution provides that Congress shall make no law abridging the right to petition the Government for a redress of grievances. The Noerr-Pennington doctrine, which arose in the context of antitrust claims, provides immunity from claims that are based on the filing of lawsuits. Select Comfort Corp. v. Sleep Better Store, LLC, 838 F. Supp. 2d 889, 896 (D. Minn. 2012) (internal quotation omitted). The sham exception to the Noerr-Pennington doctrine consists of two elements: First, the lawsuit must be objectively baseless in the sense that no reasonable litigant could realistically expect success on the merits. If an objective litigant could conclude that the suit is reasonably calculated to elicit a favorable outcome, the suit is immunized under Noerr, and an antitrust claim premised on the sham exception must fail. Only if challenged litigation is objectively meritless may a court examine the litigant’s subjective motivation. Under this second part of [the] definition of sham, the court should focus on whether the baseless lawsuit conceals an attempt to interfere directly with the business relationships of a competitor through the use of the governmental process—as opposed to the outcome of that process—as an anticompetitive weapon. Prof’l Real Estate Inv’rs, Inc. v. Columbia Pictures Indus., Inc., 508 U.S. 49, 60–61 (1993) (cleaned up). In this instance, Graphic accurately states, “Inline’s attempt to meet these requirements relies exclusively on the same facts that allegedly constitute fraudulent conduct before the [US]PTO.” Appellee’s Br. at 37 (citing Appellant’s Br. at 41 (“Graphic’s assertion of its patents and pursuit of the infringement litigation was ‘objectively baseless’ in light of, inter alia, Graphic’s collaboration with Nestlé; the -16- terms of the JDA; and direct evidence of incorrect inventorship and prior sales.”)). Based on our previous discussion in Part II.B.1, we conclude that Inline cannot meet the objectively baseless element of the sham exception to the Noerr-Pennington doctrine. As we stated above, Inline did not evidence fraud related to Graphic’s procurement of the asserted patents and its prior sales of drawing sample sleeves 50019D/F. It has not established why the same set of facts and evidence would render Graphic’s patent-infringement litigation objectively baseless; consequently, we affirm the district court’s dismissal of Inline’s sham-litigation claim. As a result, we need not address Graphic’s subjective intent under the exception.