Posts Tagged ‘patent lawsuit’

Judge Gilstrap’s Four-Factor Test

July 10th, 2017 Alexander No comments

U.S. District Judge, Rodney Gilstrap, the country’s busiest patent judge, took a broad stance on what constitutes a company’s place of business in terms of venue. This is a promising signal for patent owners who want to keep their cases in the Eastern District of Texas after the Supreme Court’s decision in TC Heartland.

Judge Rodney Gilstrap created a four-factor test leading his decisions regarding whether cases will remain in the district. This test takes into consideration whether a business has a retail store in the district in addition to the sales revenue the business has generated in the district. However, no single factor carries more weight than another. The test takes into account all of the circumstances of the case.

Since the Supreme Court’s decision in TC Heartland LLC v. Kraft Foods Group Brands LLC, there has been a new emphasis on the “place of business” requirement of the patent venue statute. In this case, the Supreme Court stated that patent suits can only be filed where the accused patent infringer has an established place of business or where it is incorporated. During the weeks after the TCH Heartland decision, the majority of the district court decisions regarding venue were directed towards whether a defendant waived its arguments by not bringing them up sooner. Judge Gilstrap is the first to create a place-of-business test after the TC Heartland decision.

In developing this test, Judge Gilstrap stated that he gathered factors from other court decisions and modernized them, one of them being a 1985 Federal Circuit case- In re: Cordis Corp. Judge Gilstrap wrote: “Regardless of the area of law, a consistent theme among courts is that the technological advances that foster growth and advancement in today’s business world cannot be ignored.”

The first factor of the test takes into consideration whether a business has a physical presence in the district, such as warehouses and retail stores. If the business has employees or independent contractors there, it will also weigh in favor of the business. The second factor determines the extent to which a business demonstrates that it has a presence in the district. The third factor takes into account the benefits the business receives from its presence in the district, including sales revenue. The fourth and last factor examines a business’s targeted interactions with consumers there, such as localized customer support and marketing techniques.

This test is not binding on other district courts or judges within the district. It has yet to be determined whether other courts will chose to use this test or create a test of their own.

For more information, See Law360.

Courts Restrict Where Patent Suits Can Be Filed

May 29th, 2017 Alexander No comments

Last week, the Supreme Court placed even more limitations on where patent owners can file infringement lawsuits. This decision will drastically change almost 30 years of settled practice, probably pushing numerous lawsuits out of the Eastern District of Texas.

The Supreme Court reversed a ruling that basically permitted patent holders to file suit anywhere a defendant makes sales. Critics stated that this encouraged forum shopping and an aggregation of suits in a few courts.

Justice Clarence Thomas stated in an opinion “We therefore hold that a domestic corporation ‘resides’ only in its state of incorporation for purposes of the patent venue state.”

In Fourco Glass Co. v. Transmirra Products Corp., the Supreme Court ruled that “resides” meant the place of incorporation. However, in 1990, the Federal Circuit implemented a broader rule, permitting patent lawsuits to be filed anywhere that a defendant does business.

After Kraft Foods Group Brands LLC sued TC Heartland for infringement, TC Heartland challenged the statute, encouraging the Supreme Court to overturn the Federal Circuit’s broad interpretation of the law.

A majority of people believed that if the Supreme Court ruled for TC Heartland, a bulk of patent suits would move to Delaware, where a lot of businesses are incorporated, and the Northern District of California, where there are many technology companies.

For more information, see Law360.

Unwired Planet LLC v. Apple Inc.

April 9th, 2017 Alexander No comments

This case, involving two huge tech companies, takes place in the U.S. District Court for the Northern District of California. Unwired Planet is seeking $33 million in damages from Apple for infringement of its wireless, location and voice recognition patents. Unwired Planet asserts that the $33 million is equitable in light of the fact that Apple is seeking $400 from Samsung in a similar proceeding. On the other hand, Apple contends that the damages it was seeking in the Samsung case is irrelevant to the case at bar. Judge Chhabria granted Apple’s motion in limine, agreeing with Apple.

Judge Chhabria ordered Unwired Planet to reveal documents in its infringement case with Samsung and Huawei Technologies Co. Ltd. Upon discovering this, Tracey B. Davies of Gibson Dunn, attorney for Apple, asserted that Unwired Planet’s witnesses were presenting figures “directly contrary” to information they offered during the case. In addition, Davies contended that Apple was not able to depose those involved in the case, thereby substantially prejudicing Apple. Although Judge Chhabria has not seen Apple’s sanction bid, his “preliminary reaction” is to reject it.

Furthermore, Judge Chhabria mentioned that he will not excuse jurors during jury selection just because they are Apple consumers.

For more information, see Law360.

Biosig Heart Monitor Patent Not Indefinite

May 2nd, 2015 Alexander No comments

The Federal Circuit recently ruled that a Biosig Instruments Inc. heart rate monitor patent asserted against Nautilus Inc. is not indefinite.

The long-running case began in 2004, when Biosig sued Nautilus over the patent, which covers a device that can give a reading on a person’s heart rate while on a stationary bike, treadmill or other cardio machine.

The justices held the Federal Circuit’s old test that a patent is only invalid if it is “insolubly ambiguous” did not ensure that patents are definite and instead held a patent is indefinite if it fails to inform a person skilled in the art about the scope of the invention “with reasonable certainty.”

The case hinged on the meaning of the phrase “spaced relationship” between two electrodes in Biosig’s patent. The circuit court ruled that the phrase passed under the new test.

“The term ‘spaced relationship’ does not run afoul of the innovation-discouraging ‘zone of uncertainty’ against which [the Supreme Court] has warned, and to the contrary, informs a skilled artisan with reasonable certainty of the scope of the claim,” the court said.

Mark Harris of Proskauer Rose LLP, an attorney for Biosig, said the company was very pleased with the decision. “The Federal Circuit confirmed what we argued, which is that the patent is valid and definite and there is no problem with lack of clarity,” he said.

In addition, Harris said the justices recognized that the phrase “insolubly ambiguous” could be confusing to lower courts and the patent bar.

The Federal Circuit had always used “insolubly ambiguous” as a kind of shorthand for the type of analysis the Supreme Court called for to determine whether a person skilled in the art would understand the claims, Harris said. “This decision today confirms that all they were doing is getting rid of a confusing phrase and didn’t radically change course.”

John Vandenberg of Klarquist Sparkman LLP, an attorney for Nautilus, said that the company was evaluating the decision, but noted that there has only been a decision on indefiniteness, not on infringement or any other invalidity theory.

He said it was “unfortunate” that the Federal Circuit based its decision that the patent was reasonably clear in part on evidence presented during a re-examination of the patent 13 years after it was issued. The Supreme Court ruling made clear that the correct analysis is whether the patent would be clear to a skilled artisan at the time it was issued, he said.

After several re-examination proceedings the case resumed in 2010, and the district court judge granted summary judgment to Nautilus in 2012 that the patent was indefinite because it was not clear what was meant by a “spaced relationship” between the electrodes. The Federal Circuit reversed in 2013, holding that the patent was not insolubly ambiguous.

That led Nautilus to appeal to the Supreme Court, which held that the insolubly ambiguous test was unclear and “can leave courts and the patent bar at sea without a reliable compass.”

The Federal Circuit said that as a result of the high court’s ruling “we may now steer by the bright star of ‘reasonable certainty,’ rather than the unreliable compass of ‘insoluble ambiguity,’” but still concluded that Biosig’s patent was reasonably clear.

For more information, see Law360.

Categories: Uncategorized

Google Says Alice Kills Priceline Founder’s Photo Tag Patent

April 10th, 2015 Alexander No comments

Google Inc. recently invoked the Supreme Court’s Alice decision in its bid to throw out a suit brought by the founder of over a patent for photo tagging technology, saying the patent does nothing more than identify a person in a photograph.

Google asserts that Inventor Holdings LLC is trying to claim an abstract idea that doesn’t disclose any new technology. Instead, the patent merely attempts to monopolize the high-level steps for taking two images, comparing them, determining the name of the person in the photo and asking the user if that name is correct.

“This method has been applied by any person who has ever put together a scrapbook,” Google said. “The patent does not claim or even disclose any new technology or algorithm for recognizing or comparing faces.”

Google argued in that the U.S. Supreme Court’s June 2014 ruling in Alice v. CLS Bank International should translate into a win for the tech giant.

The claims in the patent add “no inventive concept” to the abstract idea of identifying and labeling photographs based on the name of the person in the photo and should therefore be invalidated, Google argued.

Inventor Holdings, which owns the patents developed by inventor Jay Walker’s Walker Digital LLC, accused Google in a February 2014 lawsuit of infringing its patent, which covers technology that suggests and stores metadata of photos online.

Walker Digital assigned its patents to Inventor Holdings as part of a corporate restructuring in September 2013. In the restructuring, Inventor Holdings became a wholly owned subsidiary of Patent Properties Inc., a public company controlled by Walker and Walker Digital.

For more information, see Law360.

Categories: Intellectual Property

BlackBerry Wins $860K Sanction For Sales Of Keyboard

February 10th, 2015 Alexander No comments

U.S. District Judge William H. Orrick found Typo Products LLC in contempt of a preliminary injunction enjoining the company from selling a wraparound iPhone keyboard accused of infringing BlackBerry Ltd.’s patented keyboard and imposed a hefty sanction of $860,600 plus attorneys’ fees and costs.

Judge Orrick found that Typo had sold more than 18,000 products in violation of the injunction, but nevertheless imposed a sanction that fell well short of the $2.6 million requested by BlackBerry. The judge agreed with Typo that the damage BlackBerry suffered as a result of the sales was uncertain but said the award was nonetheless just and appropriate.

“Typo’s not-so-clever attempts to evade the court’s preliminary injunction is quite certain, and it is my obligation and intent to vindicate respect for and compliance with the court’s orders,” the order said. “The amount of sanctions awarded is only a third of what BlackBerry sought and is directly tied to additional revenue that Typo could have expected from its illegal conduct.”

Typo sold 1,908 enjoined keyboards to Chris Yergensen, a good friend of Typo’s CEO Laurence Hallier, in Las Vegas, as well as 16,829 enjoined keyboards to customers outside of the United States and 365 warranty replacements of enjoined keyboards, and referred six customers to third parties to buy the enjoined keyboard after the preliminary injunction went into effect in April 2014.

Judge Orrick also scolded Typo for shipping 6,804 enjoined keyboards to Canada on the same day as the contempt hearing, saying the company couldn’t evade the preliminary injunction by transferring enjoined products out of the country for sale.

Typo has 45 days to pay BlackBerry the $860,600.

BlackBerry, which has been struggling in the smartphone market as the iPhone and Android-based devices have become more popular, filed a lawsuit against Typo last January over its keyboard cases for later models of the iPhone.

For more information, see Law360.

Malpractice Suit in Nike Air Jordan Patent Case

January 22nd, 2015 Alexander No comments

A total of eight attorneys face a $8.1 million legal malpractice suit for allegedly mishandling a patent infringement suit against Nike Inc. over its Air Jordan shoes.

Inventor Lyons claims the expert chosen by the team of lawyers on the case ultimately doomed his suit against Nike and if it weren’t for that poor choice, he would have prevailed in his allegations that Nike infringed his 1996 patent for an “athletic shoe with compression indicators and replaceable spring cassette.”

The thrust of the patent holder’s displeasure with the representation stems from the decision to appoint Dr. Duane Priddy as an expert to testify on the alleged infringement. That testimony ultimately led to a dismissal of the case by U.S. Magistrate Judge Acosta, the complaint said.

“Dr. Priddy is not qualified nor skilled in the art with respect to athletic shoes,” counsel for Lyons said. “The court’s final analysis was that the expert was not qualified … so there wasn’t sufficient expert support for Mr. Lyons.”

Another of Lyon’s experts evaluated the damages of the alleged infringement at $8.1 million, hence the dollar figure in the legal malpractice litigation.

Judge Acosta ruled against Lyons in June 2012, granting Nike’s motion for summary judgment as to noninfringement, but denied the motion as to invalidity.

That ruling was reaffirmed in January 2013 when Judge Acosta denied Lyons’ request for reconsideration of the original ruling.

Categories: Intellectual Property

Gore Must Pay $1B In Patent Saga

January 16th, 2015 Alexander No comments

The Federal Circuit affirmed a lower court’s ruling that W. L. Gore & Associates Inc. willfully infringed C.R. Bard Inc.’s blood vessel graft patent, adding $205 million to the $854 million in damages Gore has already been ordered to pay Bard in the long-running case.

The Federal Circuit heard the case once before and used it to set a new standard for proving willfulness. U.S. District Judge Murguia held that Gore’s infringement was willful under the new standard the Federal Circuit agreed.

The court had held since a 2007 en banc decision that there is a two-prong test for establishing willfulness. First, a patentee must show that an accused infringer acted despite an objectively high likelihood that it was infringing and second, the patentee must show that this risk was known to the infringer.

Gore maintained that its infringement was not willful because it had a reasonable argument that one of its employees was a joint inventor of Bard’s patent and that the patent was invalid for failing to name him as a co-inventor.

The Federal Circuit rejected that argument, noting that prior litigation over the patent had “definitively held” that the inventor of Bard’s patent, Goldfarb, had developed the invention on his own, without assistance from Gore’s employee.

“Within the backdrop of the extensive proceedings prior to this litigation, therefore, we agree with the district court that Gore’s position was not susceptible to a reasonable conclusion that the patent was invalid on inventorship grounds,” the appeals court said.

In addition to affirming that Gore’s infringement was willful, the Federal Circuit on Tuesday rejected the argument the company raised at oral arguments in August that Bard did not have standing to bring the suit in the first place.

For more information, see Law360.

Categories: Uncategorized

The “Abstract Idea” Under Alice

December 22nd, 2014 Alexander No comments

A federal judge recently invalidated a pair of digital file identification patents used to sue Amazon and Barnes & Noble, ruling they described nothing more than an abstract idea under the U.S. Supreme Court’s Alice Corp. decision.

U.S. District Judge Robinson granted Amazon and Barnes & Noble’s joint motion for invalidity in Cloud Satchel’s suits against the retailers. The patents described a way to transfer location information for documents, allowing mobile users to access a host of files without being limited by the memory on their device.

Judge Robinson held the patents essentially described the abstract idea of cataloging documents to aid retrieval efforts, a concept the defendants had called “as old as libraries themselves,” dating back two millennia.

Cloud Satchel launched its suits and said that while the patented ideas do facilitate the identification and retrieval of documents from storage, they do so in a specific way, with portable devices that have less memory than centralized databases.

But those limitations were not an “inventive concept” sufficient to transform that idea into patent-eligible subject matter. It was an inherent limitation to cataloging that the mobile devices would have less memory than the larger database, Judge Robinson said. Other restrictions, including using computers with processors and receivers, were also generic because they applied to virtually every portable computer.

Cloud Satchel commented, “We are hopeful the Federal Circuit will correct this overreaction, which if allowed to stand has the potential to significantly diminish the value of many existing patents – including Amazon’s own ‘One-Click’ technology — and dissuade the research and development efforts of companies both large and small.”

Futhermore, another federal judge also invalidated two content-on-demand technology patents asserted by OpenTV against Netflix saying they claimed nothing more than abstract ideas under the Alice Corp. decision, but refused to nix a third patent.

Judge Seeborg refused to strike down the third OpenTV patent because the patentability of the subject matter described in that patent was still in doubt. The patent describes a system for allowing advertisers to direct customized ads to individuals based on data gathered as to those individual’s specific interests and possible needs. Judge Seeborg found that it was unclear prior to claim construction if the patent describes abstract ideas or if it relates to a technological solution to a problem pertaining to interactive television.

“[T]he mere fact that generic computer processors and internet technology can now be used to implement the basic idea, with certain perceived greater advantages, does not give rise to a patentable method.”

“At least at this juncture in the case, the patent appears to be directed at providing a technological solution to a problem that arises in the computer and interactive television context,” Judge Seeborg said.

For more information, see Law360.

Categories: Litigation

High Court To Reconsider Ban On Expired-Patent Royalties

December 18th, 2014 Alexander No comments

The U.S. Supreme Court agreed to review a 50-year-old rule barring royalty agreements that extend beyond the expiration of a patent, a standard the inventor of a Spider-Man toy argues is outdated and anti-competitive.

In 1990 Kimble invented a Spider-Man wristband toy that could shoot foam string and got Marvel to agree to compensate him if it used his idea. The company later created the Web Blaster toy, but Kimble never received any payments, and he filed a 1997 patent infringement and breach of contract suit.

Marvel and Kimble settled the suit in 2001 when the company agreed to purchase the patent for about $500,000 and pay Kimble a 3 percent royalty on product sales.

But in 2006, Marvel licensed the right to produce the Web Blaster to Hasbro Inc. A number of disagreements then arose between Marvel and Kimble concerning the royalty payments, resulting in the current breach of contract suit, filed in 2008.

The justices granted a petition for certiorari by inventor Stephen Kimble and the high court will review its own 1964 decision in Brulotte v. Thys, which held that licenses requiring royalty payments for the use of a patent after it expires are per se unlawful. The justices agreed to hear the case even though U.S. Solicitor General Donald Verrilli Jr. told the court in October that Brulotte remains good law and should not be reviewed.

Kimble’s attorney said that he and his client are gratified that the justices took the case and are looking forward to arguing that the Brulotte rule “should be resigned to the dust heap of history.”

“Brulotte’s per se rule has, for 50 years, damaged the American economy by forbidding licensing practices that would provide unique pro-competitive benefits,” Kimble’s attorney said.

The rule has suppressed innovation by hindering the commercialization of life-saving medical treatments by universities and research hospitals, he said.

“And it has been a trap for the unwary and an instrument of injustice when wielded by large, sophisticated licensees to deny small inventors their contractually guaranteed royalties under circumstances where those inventors had no actual market power, and had applied no coercion during contract negotiations,” he said.

According to Marvel, the “core bargain” of the patent system is that inventors must publicly disclose their invention in return for a limited period of exclusivity.

“Brulotte’s conclusion that permitting post-expiration royalties would upset this bargain is justified and is independent of antitrust principles,” Marvel said.

Likewise, Verrilli told the court in October that the Brulotte rule “fits comfortably within a line of precedents establishing that the federal patent laws are not indifferent to what happens when a patent’s prescribed term expires.”

“Rather, those laws reflect an affirmative congressional policy judgment that the patented invention should thereafter be freely available for exploitation by others and for enjoyment by the general public,” he said.

For more information, see Law360.

Categories: Intellectual Property