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Posts Tagged ‘Intellectual Property’

Fed. Circ. Refuses To Restrict Venue In Patent Cases

May 8th, 2016 Alexander No comments

The Federal Circuit recently denied liquid sweetener company TC Heartland LLC’s request for new restrictions on where patent suits can be filed. TC Heartland was sued by Kraft Foods Group Brands LLC in the District of Delaware and was seeking to have the case moved to the Southern District of Indiana, where it is based.

TC Heartland’s petition for a writ of mandamus, which urged the court to cast aside a 1990 ruling that patent suits can be filed in any district where the defendant makes sales, was denied.

TC Heartland argued that the 1990 decision known as VE Holding was overruled by a 2011 federal law, and that under that statute, patent suits can be filed only in places where the defendant is incorporated or has an established place of business and has allegedly infringed. The Federal Circuit rejected that argument, calling it “utterly without merit or logic.”

“The 2011 amendments to the general venue statute relevant to this appeal were minor,” the court wrote, adding that the statute was in fact “a broadening of the applicability of the definition of corporate residence, not a narrowing. This change in no manner supports Heartland’s arguments.”

“Boy, doesn’t this feel like something a legislature should do rather than something we should be asked to do?” U.S. Circuit Judge Kimberly A. Moore said at oral arguments.

Although the case did not actually involve the Eastern District of Texas, where the most patent suits are filed, it has been closely watched because a decision restricting venue in the way TC Heartland requested would have kept most suits out of the district, since few patent defendants are based there.

According to statistics compiled by Law360, there were 2,523 new patent complaints filed in the Eastern District of Texas last year, accounting for 45.5 percent of all cases nationwide. The collection of small cities 100 miles east of Dallas saw nearly 2,000 more new suits than the next-busiest court, the District of Delaware.

For more information, see Law360.



Jury Hits Tata With $940M Trade Secrets Verdict

April 28th, 2016 Alexander No comments

A Wisconsin jury slapped Tata with a $940 million trade secrets verdict, including $700 million in punitive damages, for stealing information related to Epic Systems Corp.’s health care software.

After Tata reviewed Epic’s intellectual property under the pretense of doing consulting work for an Epic client, Epic accused Tata of stealing documents and other confidential information tied to the software it builds for health care companies to manage billing, insurance benefits management and referral services.

Epic’s software is used in a wide variety of health care contexts, and the company boasts that 190 million people have an electronic record in Epic. For example, Kaiser Permanente, the largest managed health care organization in the U.S., hired Epic in the past to handle its patient records.

A few years later, people working for Tata sent requests for access to the company’s sensitive internal web under the guise of being Kaiser Permanente employees in need of training, Epic said.

Kaiser assured Epic that the consultants were working for the health care organization, so Epic had the workers sign a privacy contract to keep the inner workings of its software secret.

But behind Epic’s back, the Tata workers had been accessing Epic’s internal network to gather information about the software, which they used to benefit Tata’s competing product.

Tata  argued that Epic was unfairly accusing the company of fraud without supporting its claims with facts, but their motion to dismiss was rejected by the judge.

For more information, see Law360.



Fox Rothschild Sanctioned $25K For Altering Docs In IP Suit

April 12th, 2016 Alexander No comments

A California federal judge ordered Fox Rothschild LLP to pay $25,000 in sanctions to two California-based clothing companies that lost a copyright infringement suit they filed against the firm’s clients.

U.S. District Judge Dolly M. Gee determined that Fox Rothschild attorneys, representing China-based clothing wholesalers Saza Jeans Inc. and Rich Cowboy USA Inc. in a trademark and copyright infringement dispute lodged by Sweet People Apparel Inc. and RCRV Inc., altered financial information on invoices in order to reflect only the amounts related to the relevant product, but didn’t inform the plaintiffs of the changes or why they did so.

“Defendants’ counsel altered at least some of the documents produced in a manner that obfuscated the true meaning of the information provided,” the judge wrote. “At the very least, defendants’ counsel knew or should have known that they had altered the documents and were aware of the risk that plaintiff was being misled by the alterations.”

In July, a jury ruled that Saza and Rich Cowboy’s denim apparel did not infringe any of the at-issue copyrighted designs belonging to Sweet People, which sells Miss Me brand jeans, and RCRV, which makes Rock Revival brand jeans.

RCRV and Sweet People claimed that at trial, they were able to identify several documents produced by the Fox Rothschild attorneys during discovery that had been altered to change information on invoices that made their clients’ businesses seem smaller by a factor of 15.

“When plaintiffs attempted to ask defendants’ witnesses why they had altered the documents, defendants’ attorneys objected, arguing that defendants themselves did not change the invoices. Instead, at first, defendants’ attorneys blamed plaintiffs without the slightest basis,” the companies said. “Eventually they conceded that defendants’ attorneys had changed the documents.”

For more information, see Law360.

Categories: Intellectual Property


Appeal of $400M Award In Apple-Samsung Patent War

March 28th, 2016 Alexander No comments

The U.S. Supreme Court recently decided to hear Samsung’s appeal of a $400 million judgment that Apple won in a smartphone patent suit.  The Supreme Court agreed to consider Samsung’s argument that the damages test for design patents results in “unjustified windfalls” for patent owners.

The Supreme Court granted Samsung’s petition for a writ of certiorari, which challenged a lower court’s decision that the tech giant must pay Apple its entire profits from smartphones found to infringe Apple’s design patents on the look of the iPhone.

Samsung told the justices that the Federal Circuit misread the law and argued that requiring companies to pay their entire profits when they are found to infringe design patents results in exorbitant awards and gives design patents too much power.

“The decision below is thus an open invitation to litigation abuse, and has already prompted grave concern across a range of U.S. companies about a new flood of extortionate patent litigation, especially in the field of high technology,” Samsung said.

In 2012, a jury found that Samsung infringed Apple’s patents and awarded more than $1 billion in damages, but a damages retrial reduced the award to $548 million. Samsung elected not to appeal the portion of that award dealing with utility patents, and focused its Supreme Court petition on the $399 million in damages related to the jury’s finding of design patent infringement.

Samsung noted that the justices had not heard a case dealing with design patents in more than 120 years. The rule that companies must pay their “total profit” from expensive products like smartphones found to have infringed design patents makes no sense in the modern world, the company argued.

“With the recent explosion of design patents in complex products like smartphones, the time is ripe for this court to again take up the issue,” it said.

Apple told the Supreme Court that the law “could not be clearer” that infringers must pay their total profits for design patent infringement, so there was no need to hear the case.

“Samsung had its day in court — many days, in fact — and the properly instructed jury was well-justified in finding that Samsung copied Apple’s designs and should pay the damages that the statute expressly authorizes,” Apple said.

“We welcome the court’s decision to hear our case. We thank the many large technology companies, 37 intellectual property professors, and several groups representing small business, which have supported our position,” Samsung said. “The court’s review of this case can lead to a fair interpretation of patent law that will support creativity and reward innovation.”

For more information, see Law360.



Fed. Circ. Recognizes Non-Lawyer Patent Agent Privilege

March 13th, 2016 Alexander No comments

In a case over smartphones, a split Federal Circuit ruled that communications between U.S. patent applicants and their non-attorney patent agents should be afforded some degree of privilege.

For the first time, the appeals court recognized a patent agent privilege, affording the same type of protections in attorney-client privilege to communications between registered patent agents and their clients.

Patent agents are not licensed attorneys, but they are certified to prepare and prosecute patent applications before the U.S. Patent and Trademark Office.

“We find that the unique roles of patent agents, the congressional recognition of their authority to act, the Supreme Court’s characterization of their activities as the practice of law, and the current realities of patent litigation counsel in favor of recognizing an independent patent-agent privilege,” Circuit Judge Kathleen McDonald O’Malley wrote on behalf of the majority panel.

The scope of this privilege is limited to exclude communications that are not “reasonably necessary and incident to the prosecution of patents before the Patent Office.” For example, an opinion about the validity of someone else’s patent is something that would not be protected.

The ruling comes from a case between Queen’s University at Kingston, a research university in Ontario, Canada, and Samsung Electronics Co. Ltd.

Queen’s University sued Samsung, claiming Samsung’s Galaxy S4 and Galaxy Note 3 smartphones infringe its patents for technology that allows humans to communicate with computers with their eyes. Samsung the year before had unveiled its SmartPause feature, which enabled users to pause a video simply by looking away from the screen.

During the course of discovery, Queen’s University refused to hand over certain documents, including communications between university employees and registered patent agents talking about the prosecution of the disputed patents.

After Samsung protested, the district court ordered Queen’s University to produce the communications, finding they were not protected by attorney-client privilege and that a separate patent agent privilege did not exist. The ruling was stayed until the Federal Circuit could hear the university’s mandamus petition.

The Federal Circuit said an applicant has a reasonable expectation that all communications relating to “obtaining legal advice on patentability and legal services in preparing a patent application” will be privileged.

“Whether those communications are directed to an attorney or his or her legally equivalent patent agent should be of no moment,” the judge wrote. “Indeed, if we hold otherwise, we frustrate the very purpose of Congress’s design: namely, to afford clients the freedom to choose between an attorney and a patent agent for representation before the Patent Office.”

For more information, see Law360.

Categories: Intellectual Property


Fed. Circ.’s Lexmark Ruling Good Sign for Patent Owners

February 23rd, 2016 Alexander No comments

The Federal Circuit’s recently decided to retain limits on patent exhaustion, which is good news for patent owners like Lexmark, allowing them to exert control over products after they’re sold.

The Federal Circuit’s Lexmark opinion sends a mixed message for patent owners.

In the 10-2 en banc decision, the Federal Circuit decided not to disturb two of its longstanding rules: that overseas sales of a product don’t exhaust a patent owner’s right to sue in the U.S. and that patent owners can impose restrictions on the use of patented items after they are sold in order to keep the sale from exhausting their rights.

The court decided to take the case en banc to determine whether those rules remained good law following recent U.S. Supreme Court decisions that printer cartridge reseller Impression Products Inc., which Lexmark International Inc. accused of infringement, cast doubt on the prior holdings. The court found that the rulings don’t require it to change its precedent.

“On its face, this is a win for patent owners because it allows them to maximize their protection through contractual restrictions or where they sell their products geographically,” said Derek Dahlgren of Rothwell Figg Ernst & Manbeck PC.

A decision that either foreign sales or post-sale restrictions exhausted the rights of patent owners would have diminished their ability to use patents to protect their market, he said.

While the Lexmark case involves printer cartridges, the issue of patent exhaustion has broad ramifications across a wide range of industries, including technology, pharmaceuticals and medical devices. Patent owners have relied on the limitations on patent exhaustion to restrict post-sale uses of patented products, a strategy that would have been disrupted had the Federal Circuit overruled its precedent.

“It’s a pro-patent owner decision that reaffirms Federal Circuit precedent,” said Jeffrey Fisher of Farella Braun & Martel LLP. “It’s a less welcome decision for consumers and those who may potentially be accused of infringement down the road.”

The en banc Federal Circuit also gave its blessing to the practice of imposing post-sale restrictions on patented products. It held that as long as those restrictions, such as a requirement that a product can only be used once, are lawful and clearly communicated to buyers, they do not exhaust patent rights.

The issue of post-sale restrictions is particularly important to medical device makers as they use them as a way to protect patient safety, said Joseph Re of Knobbe Martens Olson & Bear LLP, whose firm filed an amicus brief in the case on behalf of the Medical Device Manufacturers Association.

Since reusing medical devices like syringes can lead to the transmission of infection diseases, “single patient use restrictions are critical in a hospital setting,” Re said.

Such restrictions can protect patients, as well as the reputation and sales of device makers. If a product is reused and leads to complications, the original manufacturer will likely be blamed, and “you want people to think highly of your products, and you don’t want them to be the cause of a medical disaster.”

For more information, see Law360.



Dow Can’t Shake $456M Plant Patent Arbitration Loss

January 31st, 2016 Alexander No comments

U.S. District Judge Raymond A. Jackson confirmed that Dow broke a license agreement over four patents for genetically modified cotton and soybean crop products, awarding Bayer Cropscience AG $455.5 million plus interest.

Bayer initially sued Dow in January 2012, contending that Dow violated its intellectual property by selling vectors used to make plants and seeds containing a genetic modification that inhibits the effects of the herbicide Bialaphos.

Dow claimed it never breached the agreement and that because the deal was not terminated correctly, it remained in effect.  Dow also claimed that because the four patents at issue were either invalid or not infringed, it did not require a license for them.

Dow had argued the arbitration was “fundamentally flawed,” saying it wrongly determined Bayer’s patents were valid, that Bayer properly closed out its agreement with Dow, that Dow infringed the patents and that Bayer should receive the award as compensation.

Bayer shot back in November that Dow was merely trying to use the district court venue as a way to take a second bite at the apple, fighting out the issues again.

Judge Jackson found no evidence to sustain Dow’s “very heavy burden” to vacate the award, and that Dow’s contention that it should be vacated on public policy grounds was also unpersuasive.

Judge Jackson said, “a motion to vacate an arbitration award is not an appropriate avenue to relitigate the entire case,” Judge Jackson wrote. “After reviewing the voluminous submissions of the parties and the extensive record in this case … the court finds absolutely zero basis to vacate the award.”

“Ultimately, the most pressing public policy concern at this point in this matter is the public policy in favor of the arbitration process,” Judge Jackson wrote. “The policy supporting fair, competent and judicially respected arbitration proceedings is about as strong and compelling a public policy that our federal courts embrace.”

“To vacate the award on this record would be fundamentally inapposite to our nation’s public policy,” he added.

For more information, see Law360.

Categories: Uncategorized


5 Secrets Of Successful Patent Litigators

December 15th, 2015 Alexander No comments

Here, the pros share five secrets about what it really takes to become patent litigators performing at the top of their game.

Have a Hunger for Learning

Whether the case is about devices that help a smartphone run or active ingredients that make a drug effective, patent litigators have to want to learn as much as they can about the scientific subject matter of the case.

“In many situations, you won’t be able to anticipate until very late in a case what facts will become important, and your ability and willingness to become deeply immersed in the technology are critically important to running a flexible and agile case,” according to Jason Sheasby, a partner at Irell & Manella LLP.

“The judge and jury can sense when someone has a great facility of the technology, and it can give you confidence and credibility,” he said. “Becoming an expert in the technology also allows you to see arguments that you might miss if you have an understanding at a more facile level and adds depth to your litigation strategy.”

Put Yourself in Others’ Shoes

Attorneys are only going to get so far in their case if they only see the dispute from their client’s point of view. A key feature of any successful patent litigator is to have empathy for those around them.

“It’s the ability to figure out what the jury wants to know; it’s the ability to figure out what motivates the opponent, whether that’s the attorney or otherwise; and it’s the ability to write briefs for the judge, not for yourself,” said John Dragseth, a principal at Fish & Richardson PC. “It must be a secret because very few attorneys do it well.”

Lawyers sometimes struggle with stepping outside their own perspective of the case to ask themselves what the judge or jurors care about and how to get them to root for their client. One way to try to resonate with jurors is by drawing an emotional story out of a patent case. While a patent dispute may look like a fight over money between two corporations at first glance, a deeper review may reveal that a more relatable story can be told.

Think Big and Small

If the goal is to win case after case, attorneys must be flexible with their argument style. But being able to shift their arguments from the big-picture level down to the tiniest-of-details level can only be done if lawyers know the facts of their case down cold.

“A lot of good lawyers in our field try to win just at the 30,000-foot level, and it tends to be a winning strategy,” said Gerald Flattmann Jr., a Paul Hastings LLP partner. “But sometimes you need to develop a more complex case of noninfringement or invalidity. And when you need to move to specifics, you need to know the facts.”

“Attorneys need to understand how to adjust so that if a judge initially rules against them at a general stage, they can take a deeper dive and argue at a more specific level,” he said. “This may not be a secret, but it’s something lawyers don’t do.”

Don’t Be Afraid to Go for the Kill Early

Attorneys may think they should hold back from laying into the opposing side’s witnesses until cross-examination, but successful litigators don’t wait for trial. Instead, they try to wring the most of witnesses at the deposition stage.

“I believe cases are won or lost at the expert deposition phase,” Flattmann said. “If you secure enough admissions at deposition, you’ve essentially wired the witness for trial. The cross-exam against the witness’s positions will be concise and effective, and your trial will be a breeze.

However, many attorneys waste precious time at depositions by asking about an expert’s background, rather than drawing out answers on the key issues at stake.

“Attorneys ask about what schools the expert went to and what he did his dissertation on,” Flattmann said. “Who cares? None of that matters. Of course you should know that background, but that’s not where the gold is. Attorneys should be asking the ultimate questions early.”

Adapt

Even when patent lawyers know the facts of a case inside out, they can’t always avoid surprises. Litigators who are able to pivot as new issues come to light are the ones who win cases.

“You never know what witnesses will say, and you may find out during discovery or depositions that the theory you were building your case on turns out not to be true,” Freeman said. “Attorneys have to adjust quickly as new information becomes available. If they get stuck on one theory or are unable to adjust, they could miss out on getting valuable testimony.”

For more information, see Law360.



Patent Cases Spike Ahead Of End To Bare-Bones Complaints

December 4th, 2015 Alexander No comments

The number of federal patent lawsuits filed across the U.S. has spiked dramatically recently, in order to overcome federal rules that raises the pleading standards for patent cases.

In the past two weeks, more than 570 new patent cases were filed in district courts. That is more than three times the number filed in the same period last year.

Just over 210 of those cases were filed the day before the elimination of a rule that allowed plaintiffs to rely on a bare-bones model complaint for patent suits.

Form 18 has long been criticized by patent defendants and judges because it permits vague, bare-bones complaints by nonpracticing entities and others, while requiring alleged infringers to incur discovery costs just to find out what they have been accused of.

With the new rules, complaints alleging direct patent infringement will be subject to the pleading standards established by the U.S. Supreme Court’s landmark decisions in Bell Atlantic Corp. v. Twombly and Ashcroft v. Iqbal, which require plaintiffs to demonstrate that their claims are plausible.

The revision to the pleading standards are part of a broader set of changes approved last year by the Judicial Conference of the U.S. Hoping to modernize the Federal Rules of Civil Procedure, the policymaking body for the federal court system also streamlined the discovery process, among other things.

But attorneys said it might be several months before litigants have a firm grasp on how much detail must be included in complaints after the elimination of Form 18, as there is no specific checklist for what is required under the new rules.

For more information, see Law360.



Boston IP Firm Wants GPNE’s $100M Malpractice Suit Dismissed

November 11th, 2015 Alexander No comments

Occhiuti & Rohlicek LLP urged a Massachusetts federal court to dismiss a $100 million malpractice suit brought by GPNE Corp. over a lapsed Japanese data communications patent, arguing the complaint fails to make specific claims or include an English translation of the patent.

The firm said the suit fails by including a copy of GPNE’s allegedly abandoned and infringed high-speed data transmission patent only in Japanese, which leaves Occhiuti unable to even answer the complaint properly; and by failing to make any allegations that are subject to relief.

GPNE’s complaint includes no specific claims of what has been infringed due to the firm’s alleged failure to ensure the payment of Japanese patent fees and of how GPNE has been specifically damaged, Occhiuti explained.

“In a legal malpractice case, a plaintiff must prove a breach of duty, causation and damages, [and] because GPNE is claiming that it lost the right to bring infringement litigation, it must establish the causation and damage elements through a ‘trial within a trial’ in a malpractice case,” Occhiuti said in its dismissal motion. “This requires it to prove actual infringement and damages resulting from the infringement, and it allows O&R to defend on the grounds of lack of infringement and invalidity of the claims.”

GPNE alleges that Occhiuti is to blame for allowing the company’s data transmission patent to go abandoned by telling GPNE to not pay the renewal fee to the Japanese Patent Office. As a result, the company has lost out on 200 claimed inventions and 5 percent royalty fees from Japanese sales of Apple Inc.’s iPhone and iPad, which purportedly infringe the patent.

Occhiuti said that GPNE’s claim of negligence, malpractice and $100 million in damages “is not plausible on its face,” because there is no indication that the company took any steps to enforce its patent when iPhone, iPads and LTE technology “generally were developed.”

“It stretches credulity for GPNE to contend that now the patent has lapsed, every iPhone and iPad in Japan infringe[s] its claims,” Occhiuti said. “Here there is no factual support for these allegations.”

For more information, see Law360.