Delaware Patent Litigation Report : Delaware Intellectual Property Lawyer & Attorney : Morris James Law Firm : Delaware Patent Litigation Report

The disputed technology concerns advertiser-supported directory assistance.  A jury unanimously found that Defendant did not infringe.  It further found that none of the asserted claims were invalid.  The court finds that expert testimony regarding payment in advance adequately supports the jury finding of noninfringement.  The court further finds that disputed prior art did not create a list of selected businesses but rather selects a single business.  The jury’s verdict was not against the weight of the evidence.  The jury’s verdict of nonobviousness was substantiated.  Defendant was required to present evidence establishing the level of ordinary skill in the art and failed to do so.  The application for attorneys’ fees is denied.  Plaintiff’s conduct did not amount to bad faith or vexatious litigation, and the conduct of neither party was “exceptional” in that regard despite hard fought litigation.

The patent-in-suit relates to refrigerator technology.  Defendant’s motion to dismiss plaintiff’s request for declaratory judgment based on invalidity of one patent-in-suit as barred by collateral estoppel is denied.  While a previous jury considered the issue of infringement, plaintiff’s evidence of its redesign presents new issues which were not previously litigated.  Plaintiffs’ motions to dismiss on the theory of res judicata are granted.  Specifically, a redesigned accused French door refrigerator shares the same configuration in all material respects as refrigerators previously found not to infringe.  Plaintiff demonstrated that the features compelling judgment of non-infringement previously were not changed in the redesign.  The court declines to consider the motion as one for summary judgment because it is permitted to take judicial notice of the record from a previous court proceeding.

Plaintiffs initiated this patent case on April 16, 2010 seeking a declaration of non-infringement and invalidity of four of defendants’ patents related to refrigerator technology.  On December 3, 2010, defendants filed their answer and counterclaims.  Plaintiffs thereafter sought leave under Fed. R. Civ. P. 15(a) to file a first amended complaint to assert the defendants’ infringement of patents owned by the plaintiffs.  The motion was granted.  Defendants will not suffer prejudice by the addition of plaintiffs’ patent directed to related refrigerator technology.

This is a patent infringement case involving patents directed to agricultural equipment.  A jury trial was held January 31 through February 10, 2011.  The jury returned a verdict of non-infringement in favor of defendant Kinze Manufacturing Inc. and found all of plaintiffs CNH America LLC and Blue Leaf I.P., Inc.’s asserted claims invalid as anticipated, and all but two of the asserted claims invalid as obvious.  The jury further found that the claims were not invalid due to indefiniteness, lack of written description or enablement and issued an advisory verdict in favor of no inequitable conduct.  The parties’ post-trial motions were denied. Substantial evidence in the record supported the jury’s findings.

This is a consolidated patent infringement action concerning a generic version of ALIMTA®, which is covered by U.S. Patent No. 5,344,932.  Defendants contend that the ‘932 Patent is invalid under the doctrine of obviousness-type double patenting in view of commonly-owned U.S. Patent Nos. 5,028,608 and 5,248,775.  A bench trial was held November 8 - 15, 2010.  Plaintiff prevailed at trial and its findings of fact and conclusions of law were largely adopted.  “[T]he examples found in the ‘775 patent specification do not support a finding of invalidity for obviousness-type double patenting because this case does not present a situation in which separate patents are sought for a claim to a compound and a claim to using that compound for the disclosed utility of the original compound.”  Further, the evidence presented at trial does as to the certain prior art referenced do not lead to the conclusion that the claimed compound would have been obvious to a person of ordinary skill in the art.

This is a patent infringement case involving refrigerator technology.  On April 28, 2008, plaintiffs initiated the case.  Defendants counterclaimed in their answer with their own patents.  A nine-day jury trial was held March 1 to March 11, 2010.  The parties moved for judgment as a matter of law on a number of grounds, which were denied.  On March 11, the jury returned its verdict and judgment was entered April 9, 2010.  The parties thereafter filed post-trial motions: (1) plaintiff’s renewed motion for JMOL or for a new trial, (2) Defendants’ renewed motion for JMOL or for a new trial, (3) Defendants’ motion for a permanent injunction, (4) Defendants’ motion for an award of prejudgment and postjudgment interest, (5) Defendants’ motion to deny and dismiss plaintiffs’ bench trial issues, and (6) Defendants’ motion for relief from judgment under Fed. R. Civ. P. 60(b).  The parties’ post-trial motions were denied, except defendants’ motions were granted as to its (1) motion for JMOL regarding anticipation of one its patent claims, (2) motion for infringement of one of its patents and for new trial on damages, (3) request for accounting, and (4) motion for prejudgment and postjudgment interest; and except plaintiffs’ motions were granted as to its (1) request for a new trial regarding the sufficiency of the written description of one of defendants’ patents and (2) request for a new trial regarding obviousness of one of defendants’ claims.

This is an ANDA litigation involving Entocort®, which has budesonide as its active ingredient, and involving U.S. Patent No. 5,643,602 (“the ‘602 Patent”).  Plaintiffs, AstraZeneca LP, Aktiebolaget Draco, KBI Inc., and KBI-E Inc., initiated litigation in 2008 and tried the case to the bench in May of 2010.  Defendant, Mylan Pharmaceuticals Inc., is owner of an ANDA seeking approval to sell budesonide enteric coated capsules in three (3) milligram strength prior to the expiration of the ‘602 Patent.  The parties submitted post-trial proposed findings of fact and conclusions of law concerning the validity and enforceability of the ‘602 Patent and whether the defendant’s proposed product infringes the patent.  Defendant was found not to infringe the asserted claims of the ‘602 Patent because the evidence at trial, including expert testimony and manufacturing process evidence, demonstrated, inter alia, “Mylan’s product consists solely of: 1) an active core in which budesonide is homogenously distributed and 2) an enteric coating, and further finds that the lactose particles in the active core are not enclosed on all sides by a glucocorticosteroid/polymer coating.”  The court’s findings of fact and law and order did not address the validity and enforceability of the ‘602 Patent.

This is a patent infringement case involving programmable digital hearing aids.  On February 4, 2008, the jury returned a verdict for plaintiff following nine days of trial.  Judgment was entered on February 8, 2008; and the parties filed their respective post-trial motions shortly thereafter.  Substantial evidence existed in the record to support the jury’s finding that plaintiff’s patents were not invalid and that the defendants infringed all asserted claims of U.S. Patent No. 4,731,850 under the doctrine of equivalents and claim 19 of the’850 patent literally.  The defendants did not infringe any asserted claim of U.S. Patent No. 4,879,749 under the doctrine of equivalents because of prosecution history estoppel.  Plaintiff’s prosecution amendments surrendered claim scope that precluded operation of the doctrine of equivalents; thus the jury’s verdict that claims 1 and 2 of the ‘749 patent are infringed under the doctrine of equivalents cannot stand.  Defendants were required to pay prejudgment interest on the final damages award at the prime rate calculated by spreading out the damages over the twenty-one quarterly royalty payments defendants would have made to plaintiff throughout the period in which defendants would have licensed the patents-in-suit and compounding the interest in each of the royalty payments on a quarterly basis and post-judgment interest on the final damages award pursuant to 28 U.S.C. § 1961.  The remaining post-trial motions, including motions for a new trial, enhanced damages, and a finding of no willful infringement, were denied.

Nokia Corporation initiated this patent infringement action against Apple Inc. on October 22, 2009.  Nokia’s motion to stay is denied.  The court reasoned that the stay pending reexamination would not serve the interests of judicial efficiency because it already held a Markman hearing, fact discovery is nearly complete, a trial date is set, and a stay of only Apple’s claims would not simplify the case because a majority of the case would still proceed.  Apple’s motion to dismiss is denied because, inter alia, the court concluded that Nokia sufficiently pled its counterclaim, which seeks injunctive relief based on a contract theory of repudiation of fair, reasonable, and non-discriminatory term (“FRAND”) licensing rights.  Judicial estoppel based on prior litigation did not apply.  Finally, after construing the facts in the light most favorable to Nokia, the court denied Apple’s motion to strike Nokia’s defense which alleges that Apple is estopped from asserting that Nokia engaged in anticompetitive conduct.

The Court denied defendant’s motion to transfer venue to the Northern District of California for the following reasons.  Although Delaware is not plaintiff’s “home turf,” its choice of forum should prevail.  Several cases are currently pending in this district with common issues of law and fact that are best considered by the same court.  Moreover there are no physical or financial considerations cited by defendant that would make litigating in Delaware particularly burdensome.

The disputed technology relates to smart phone technology.  Plaintiff Delaware corporation with business in California brought suit against Taiwan corporation located in Taiwan, Texas corporation located in Washington, British Virgin Island corporation with its business in the British Virgin islands, and a Texas corporation located in Texas.  The court had previously declined to consolidate this action with other actions filed by this plaintiff because of insufficient overlap.  Nevertheless, the court is persuaded that there is enough overlap to make it more efficient for this case to remain in this district.  The court finds that the balance of convenience does not strongly favor transfer and thus the plaintiff’s choice of forum should prevail. Defendants have failed to identify physical or financial conditions which make it difficult to litigate in Delaware.  Witnesses will need to travel long distances and documents will need to be shipped regardless of the forum.

The type of references which constitute prior art is governed by 35 U.S.C. § 102.  Plaintiff contends that § 102 does not resolve the question of applicable prior art “as of what date?”  The court recognizes the need to specifically distinguish between the obvious and obvious type double patenting (“OTDP”) analyses where necessary, citing Geneva Pharm v. GlaxoSmithKline.  However, the Federal Circuit has never suggested intent to apply a different set of prior art rules to OTDP cases.  This court will not set aside § 102 simply because logical arguments can be made for doing so.  Therefore, the dates provided in § 102 apply.

The court makes the following post-trial proposed findings of fact and conclusions of law concerning the validity and enforceability of the patents-in-suit and whether the defendants' proposed products infringe the patents-in-suit.  The patents-in-suit relate to two hydrophobic antineoplastic agents which demonstrate significant antitumor activity.  Based on the evidence presented at trial, the court concludes that claims 2 and 10 of the '561 patent are invalid due to indefiniteness and the prior art available at the time of filing renders obvious every limitation of each of the asserted claims.  However, the asserted claims are not invalid due to double patenting.  Next the defendants assert that the patents-in-suit are unenforceable due to inequitable conduct on the part of the applicants.  The court concludes that Jean-Louis Fabre (one of the named inventors) engaged in inequitable conduct by failing to disclose two prior art references.  These references are highly material because they are inconsistent with the position that the plaintiffs took in asserting the patentability of the asserted claims and they were sufficient to render the asserted claims of the patents-in-suit obvious.  Moreover, the court concludes that a reasonable examiner would find these references to be key references in determining the patentability and proper scope of the asserted claims.  In addition, the court finds the evidence of deceptive intent to be clear and compelling.  Finally, the court finds that the defendants' proposed products infringe asserted claims 2, 5, and 10 of the '561 patent and claim 33 of the '512 patent.

The Magistrate’s Markman decision issued on May 12, 2010.  No objections were filed within the time allowed pursuant to Fed. R. Civ. P. 72. As a result, the magistrate’s decision is adopted.

After a four-day trial the court finds that the '491 patent is not invalid as obvious in light of the prior art.  There are significant differences between the prior art and the claimed inventions such that a person of ordinary skill in the art would not have been motivated to combine the cited references.  In addition, there are a number of secondary considerations that severely undermine the defendant's claims of obviousness.  Finally, attorneys' fees and costs are not warranted in this case where both sides vigorously, and in apparent good faith defended their respective positions.

The Court finds that the manufacture, use, or sale of Mylan's proposed generic alfuzosin hydrochloride product would infringe and will induce infringement of the asserted claims of the '491 patent.

After the 4th day of a 5-day bench trial, the court in a previous decision found the accused products infringed. In this opinion, the court finds the patents-in-suit to be invalid as obvious.  Published studies using omeprazole/sodium bicarbonate solutions render the patents-in-suit obvious, rejecting plaintiffs’ argument that the art teaches away from the patented invention because of rapid washout of omeprazole.  References in two prior art patents also render the invention obvious.  Furthermore, evidence on secondary considerations does not undermine the court’s determination of obviousness.  Zegerid has not achieved commercial success.  While the sales figures in isolation show growth, they remain dwarfed in comparison to those of others four years after the product launched and the growth appears to have leveled off.  The nexus of the sales is tied to preferential pricing and sales tactics unconnected to the merits of the invention.  Unmet need, if any, was not for advancements on existing prior art, but rather for recognition of what already existed in the prior art.  The court is not persuaded by a statement offered as skepticism because the person who made the statement was not a witness in the litigation.  The statement was read into evidence by an expert and the context was never presented at trial.  Nor did the patented composition produce unexpected results.  Assuming defendant’s reverse-engineering of the patented drug constitutes “copying,” it is not persuasive evidence of non-obviousness.  There is insufficient evidence of industry recognition or acceptance.  As for inequitable conduct, the court finds that while defendant has met its burden with respect to materiality, it did not establish the requisite intent to deceive.

This case involves two consolidated class actions regarding antitrust claims with respect to the drug metoprolol succinate (Toprol-XL) used for the treatment of hypertension, angina, and congestive heart failure.  The Federal Circuit affirmed a determination that the patent is invalid for double patenting and remanding the finding of inequitable conduct.  Plaintiffs accuse defendant of fraudulently obtaining patents through inequitable conduct, invalid Orange Book listings, and sham litigation.  The absence of tentative approval does not resolve the issue of whether the defendant engaged in anti-competitive conduct.  The court also cannot determine at this stage whether an ANDA-filer diverted resources causing delay in obtaining FDA approval.  The motion is denied for the additional reason that failure to disclose information regarding inventorship and ownership to the PTO could constitute inequitable conduct.  The sham litigation claim could succeed if plaintiffs establish the infringement lawsuit was objectively baseless and therefore declines to dismiss that count.

The court concludes that the complaint contains sufficient specificity and declines to dismiss on that ground.  It rejects the contention that the Supreme Court decision Ashcroft v. Iqbal heightened the requirements for pleading direct infringement.  Rule 12(b) does not provide for a dismissal based on violation of a settlement agreement.  In addition, both parties agreed that their actions to comply with the terms of the settlement agreement had been met.  Bad faith motion is denied due to efforts to comply with agreement, dearth of authority provided, and the presumption in favor of good faith.

The defendant subsidiary moved to dismiss for lack of jurisdiction.  The court finds that there is enough competent evidence to demonstrate that there may be personal jurisdiction over this defendant.  In particular, the court permits discovery on the issue of the subsidiary defendant’s role in formation, investment or contribution to certain Delaware entities.

Plaintiff alleges that certain agricultural equipment manufactured by defendants infringes the patent-in-suit. The individual defendant moves to dismiss for lack of personal jurisdiction. The only basis for jurisdiction alleged in the complaint is based on an alter ego theory. However, mere ownership or direction of a corporate entity is not a sufficient basis for jurisdiction. Without more, dismissal is warranted. The remaining corporate defendant has failed to establish that venue is improper. There are no allegations the defendant does not have the resources to litigate here. Witnesses can be deposed in their home state and defendant does not contend that witnesses or other evidence will be unavailable for trial. Therefore, the Court will not disturb plaintiff’s choice of venue.

Plaintiff filed Second Amended Complaint to allege claims under the Lanham Act and Delaware’s Deceptive Trade Practices Act.  Defendant moves to dismiss those claims under 12(b)(6).  Citing Bell Atl. Corp. v. Twombly, the Court finds the allegations supporting the claims to be formulaic and deficient in detail.  The claims are, therefore, dismissed.

The patents-in-suit relate to a high efficiency switching regulator.  A jury trial was held from June 23, 2008 to July 1, 2008.  At no time before the jury verdict did defendant move for JMOL.  The jury found plaintiff proved infringement and defendant failed to prove obviousness.  The court found that the failure to move for JMOL was fatal to its motion for judgment as a matter of law on obviousness.  The court further found that the jury’s verdict of non-obviousness was not remotely against the clear weight of the evidence and declined to order a new trial.  The court further rejects the argument that fraudulent testimony requires a new trial.  The testimony was found to be consistent with the facts, and defendant’s failure to clarify the contested testimony can not now be the basis for a new trial.

This decision follows an eight-day bench trial held from March 9 through March 18, 2009.  The patents-in-suit relate to brimonidine tartrate, an alpha-2-adrenergic agonist drug compound that is used in ophthalmic solutions for the treatment of glaucoma.  Plaintiff markets its brimonidine tartrate products under the ALPHAGAN P® brand name for use in the treatment of glaucoma.  This consolidated patent infringement action arises out of ANDA filings by certain defendants seeking to market generic brimonidine products.  Following an eight-day bench trial, the Court concludes that the defendants' proposed generic products infringe the asserted claims of the patents-in-suit; the patents-in-suit are not invalid nor are they unenforceable.  In addition, because the Court does not find this case to be exceptional by clear and convincing evidence as required by 35 U.S.C. § 285, the court will not award attorneys' fees and costs.  Turning to plaintiff’s Rule 52(c) motion, the Court finds that plaintiff is entitled to judgment as a matter of law regarding prior art references or combinations of references not raised at trial.

After an initial trial, an appeal, a remand, and a 2-day bench trial Defendant prevailed on 8/14/06.  This decision was affirmed on 4/18/08.  Defendant, as the prevailing party, sought costs of $431,200.47, including (1) $10,914.40 for transcripts; (2) $17,549.30 for depositions, $2,410 for witness fees and subsistence, $173,855.77 for exhibits, and $226,471 for bonds.  The Clerk granted the witness fees and denied the other requests.  Denial of transcript costs was because the Court had not requested them and the local rule provides that transcripts for counsel’s own use are not taxable.  Denial of deposition costs was upheld because the use of the transcripts was not substantial.  Defendant is not entitled to costs for exhibits because it was not established that the exhibits were necessarily sustained in connection with admitted exhibits or were requested by the Court; were not merely explanatory or argumentative, and were sustained as a result of presentation and not production of the exhibits.  In Schering Corp. v. Amgen, Inc., 198 F.R.D. 422, 428 (D.Del. 2001), costs for a video were allowed because the judge had specifically invited it.  Because the Federal Circuit stated that “each party shall bear its own costs” the prevailing party was not entitled to costs for the bond posted to stay execution pending appeal notwithstanding Fed. R. App. P. 39.  It was however entitled to the costs for a bond staying execution during post-trial motion practice in the district court.

The dispute arises over legal fees owed for the filing and prosecution of a patent application for a third party.  Following a dispute with the third party, plaintiff filed a notice of equitable claim with the PTO.  A prior lawsuit against an alleged infringer of the patent was filed.  That complaint was withdrawn after a motion to dismiss was filed.  This second lawsuit followed. Defendant claims plaintiff has no standing to sue and that plaintiff is liable for costs from the first action.  The court concludes that plaintiff lacks standing because he does not hold legal title to the patent-in-suit, since he is neither the inventor nor a licensee.  There is no credible dispute that plaintiff is not an assignee.  Further, plaintiff has no equitable interest in the patent since neither the notice of equitable claim nor the engagement letter confers any interest in the patent.  As for costs, the court is persuaded that defendant is entitled to some costs incurred in the first action since the second action is based in large part on the same claim against the same defendant, essentially requiring the defendant to defend the same action twice.  The defendant is permitted to file an itemized application for attorneys’ fees and costs, and the plaintiff will thereafter be permitted to respond.

The dispute arises out of a sales agreement to purchase intellectual property.  Plaintiff claims defendants breached an agreement to disclose IP claims.  The complaint was filed on 9/23/08.  Briefing on defendants’ motion to dismiss was completed on 1/6/09.  A motion to stay was filed, and after a rule 16 conference on 7/6/09, the matter was stayed pending resolution of the outstanding motion.  The finds there is no personal jurisdiction over the defendants, breach of fiduciary duty claims fail to state a claim for which relief can be granted, and the action should be dismiss for forum non conveniens.  The court rules that being a party to a contract with a Delaware entity, and being a parent of a Delaware entity are insufficient to confer jurisdiction under Delaware’s long-arm statute.  As for the forum dispute, France is a viable alternate forum, and it has closer connections to the litigation, including the documents and witnesses.  The contract at issue was finalized and executed in France.  The Court denies jurisdictional discovery because it would not serve any purpose in light of his rulings.

Honda defendants sought reexamination of 8 of the 12 patents-in-suit on November 27, 2006.  A joint motion to stay pending reexam was granted on February 23, 2007.  On October 28, 2008 plaintiff moved to lift the stay.  Briefing was completed on December 1, 2008.  Plaintiff argues that stay is no longer warranted because the PTO has reissued 2 of the patents-in-suit and decided at least 51 of the patent claims.  Defendants note that since thus far all of the asserted claims have been either rejected or amended by the PTO, further reexam will likely continue to narrow the issues.  The court notes that reexam is still underway for 6 of the 8 asserted patents.  Reexam of the remaining claims will likely affect this court’s claim construction and simplify infringement and validity issues, conserve the court’s and the parties’ resources.

This is a consolidated ANDA case relating to adamantine derivatives in the prevention and treatment of cerebral ischemia.  Two defendants seek dismissal on jurisdictional grounds.   Plaintiff established that the case could have been brought in New Jersey.  The Magistrate found that this court had no jurisdiction over these defendants.  However, rather than dismissing them from this lawsuit, he severed these claims from the remaining Delaware litigation and transferred to the District of New Jersey.  The Magistrate correctly found that dismissal was inappropriate because plaintiff acted in good faith in filing in Delaware.  When a party mistakenly but in good faith believes that venue is proper, the interest of justice supports transfer rather than dismissal.  Furthermore, the Magistrate correctly found that dismissal would unfairly prejudice the plaintiff because initiation of a new suit would deprive plaintiff of the automatic thirty-month stay of FDA approval, and would prejudice the other defendants who filed earlier ANDAs.

Following a jury verdict in favor of plaintiff, both parties file a series of post trial motions.  The patents-in-suit relate to computer networks.  Plaintiff’s patents relate to “hostile downloadables” while defendant’s patents relate to “firewalls.”  The Court concludes that the jury’s findings are supported by substantial evidence in the record, and that a new trial is unwarranted.  There is substantial evidence in the record to conclude that plaintiff’s patents-in-suit are not invalid based on anticipation or obviousness.  In addition, there is substantial support for the jury’s finding that defendant’s accused products literally infringe or infringe under the doctrine of equivalents.  Next, the evidence shows that defendant acted despite an objectively high likelihood that its actions constituted infringement supporting the jury’s finding of willfulness.  The Court also gives deference to the jury’s findings that defendant’s ‘364 patent is not invalid based on anticipation and obviousness where there is no legal or factual basis to overturn the jury’s findings .

As for a permanent injunction, plaintiff has suffered irreparable harm as a result of defendant’s infringement since the parties are direct competitors in the network security market.  Next, the Court is unconvinced that the jury’s award of damages is either grossly excessive, unreasonable, or sufficiently shocking so as to warrant a new trial.  Therefore, defendant’s request to amend or alter the award or for a new trial is denied.  On the matter of accounting, plaintiff is entitled to an accounting for those additional infringing sales that occurred up until the date of the entry of the judgment.  Prejudgment interest at the prime rate, compounded quarterlyand postjudgment interest pursuant to 28 U.S.C. § 1961 will apply.  The Court reviews each of the factors set forth in Read Crop. v. Portec, Inc. and finds that the factors weigh in favor of an award of enhanced damages in the amount of 50% of the amended jury damages award.  Postjudgment interest shall not be applied to these damages.  However, defendant’s conduct does not rise to the level of bad faith to warrant an award of fees or costs.
 

Both plaintiff and defendant manufacture and sell, among other things, vents for motor vehicle lamps.  Defendant is a Georgia corporation with its principal place of business located in Georgia and has never operated an office in Delaware.  Defendant is not licensed to conduct business in Delaware and has never had any officers or employees here.  However, defendant sells its product to a Delaware company which provides components and parts and related services directly to a Delaware automobile assembly plant.  Defendant’s actions satisfy §§ 3104(c)(1) and (c)(4) of the Delaware Long Arm Statue as well as due process requirements. Therefore, jurisdiction is proper.  As a result, additional jurisdictional discovery is not necessary and plaintiff’s request is denied as moot.

The Court finds that the parties reached a definite and final settlement agreement that is binding and enforceable under Delaware law.  Statements to the Court and plaintiff undermine defendant’s contention that there is no agreement and the defendant is bound by its attorney’s representations.  Defendant’s arguments that the agreement should be rescinded based on fraud or negligent misrepresentation or unilateral mistake are rejected.  Defendant’s conduct does not rise to the level of bad faith needed to justify plaintiff’s request for attorneys’ fees and costs.

Plaintiff filed this infringement action several months after defendant initiated a declaratory judgment action in the Tennessee District Court.  The Tennessee Court refused to dismiss the action because that action was first-filed, Tennessee had an interest in the litigation and the claims were properly stated under the Declaratory Judgment Act.  The court noted that the first-filed rule applies equally to declaratory judgment actions as it does to lawsuits seeking “coercive relief.”  The Tennessee court had previously denied a motion to dismiss or transfer to Delaware.  Deferring to the Tennessee District Court, this action is dismissed.

This is a declaratory action for non-infringement and invalidity.  Defendants engage in the business of licensing and enforcing patents.  Both defendants are Texas limited liability companies with their principle places of business located in Texas.  Neither company has any assets, employees or facilities in Delaware.  Nor do they conduct any commerce here.  Defendants are separate entities but are related through certain common entities which are not parties to this suit.  Previously, certain patents, including the patents-in-suit, were purchased by one defendant through a bankruptcy auction held in Delaware and were transferred to the other defendant who then sought to enforce the patents by filing suit again plaintiff in Texas.  Plaintiff contends that jurisdiction is proper here since defendants are sister corporations and are related through a common relationship with the entity that assisted with the purchase of the patents-in-suit at the Delaware auction.  Plaintiff fails to establish that either the agency or alter ego theories of jurisdiction apply and can point to no evidence of fraud or inequity between the common entity and the defendants.  Plaintiff’s theories of personal jurisdiction do not support further discovery.  Moreover, plaintiff’s request to amend the complaint to add the related entities fails for the same reasons set forth above. In addition, allegations in the second complaint fail to provide those entities sought to be joined with notice of a claim against them.  Therefore the motion is denied.

The patents-in-suit relate to telecommunications networks.  The ‘306 patent discloses a data transmission technique which provides a flexible migration strategy between present circuit networks and future broadband packet networks.  The ‘633 patent relates to a residual time stamp technique for timing recovery in a broadband network.  The ‘763 patent relates to a survivable or self-healing ring network that can withstand a cut line or failed node.  The Court denies defendant’s challenges to the jury’s verdict of willful infringement on the basis of noninfringment, invalidity, indefiniteness, obviousness and improper inventorship.  In addition, the Court refuses defendant’s request for a new trial on willfulness based on flawed jury instructions in light of the Federal Circuit’s recent holding in In re Seagate Tech., LLC.  Seagate was decided after trial in this case but before the entry of final judgment.  Although the jury instruction was erroneous, the error was harmless in light of the evidence adduced at trial.  Plaintiff’s motion for a permanent injunction is denied.  Plaintiff has been able to license the patents-in-suit which suggests that plaintiff has not been irreparably harmed.  The parties are ordered to negotiate the terms of a reasonable royalty rate and for an accounting going forward but may seek assistance from the Court if their efforts are not successful.  Prejudgment interest is granted at the prime rate, compounded quarterly.  Despite the finding of willfulness, evidence was not strong enough to warrant enhanced damages.  Plaintiff’s request for attorneys’ fees and expenses is declined.

Court denies defendants’ motion to set aside the default order and judgment.  Court had entered the default judgment after defendants failed to retain counsel within 30 days and to respond to outstanding jurisdictional discovery within 60 days following the Court’s order granting defense counsel’s motion to withdraw.  Withdrawal was granted based on defendants’ unwillingness to cooperate with their counsel and the failure to compensate their counsel for services rendered.  The Court had warned defendants that the failure to retain new counsel and to answer discovery would result in a default.

Plaintiff is a drug company that markets ALPHAGAN P for use in the treatment of glaucoma which is covered by its ‘834 patent.  Defendants submitted an ANDA to the FDA seeking approval to market a generic version before the expiration of the ‘834 patent.  Plaintiff argues that the stay against Excela is appropriate since the partnership between certain defendants has ended and there is no effective ANDA to litigate in this case.  The Court concludes that a stay would be unduly prejudicial since it would likely affect Excela’s first filer status.  A stay is unwarranted particularly since discovery is nearing completion and a trial date is firmly set.  Nor does the Court find persuasive plaintiff’s argument that the case should be stayed until defendants provide the FDA with bioequivalence testing information.  The Court finds no dilatory conduct to support tolling the 30-month stay.  The Court finds that plaintiff should not be allowed to use defendants’ confidential information in its citizen’s petition.

Defendant contests plaintiff’s calculations of lost profits arguing that the numbers are inflated due to failure to account for costs associated with increasing production capacity.  It further argues a damages stipulation should not apply.  The court enforces the stipulation since defendant had sought to avoid presentation of evidence on damages at trial by entering into the stipulation.  The stipulation does not address additional production costs.  The court ordered prejudgment interest at the prime rate, compounded quarterly.  The court enters an injunction with respect to certain products.  The court declines to stay the injunction pending appeal, noting that defendant mentions a stay in passing in its brief without evidence of irreparable harm.

Court considers defendant’s renewed motion for judgment as a matter of law.  Citing Pannu v. Iolab Corp., the Court notes that to prevail, defendant must show that the jury’s findings, presumed or express, are not supported by substantial evidence or, if they were, the legal conclusions implied by the jury’s verdict cannot be supported.  Defendant challenges the jury’s findings that it infringed the ‘544 patent which invention is a safety needle shield that is used to prevent accidental needle sticks to health care workers.  The only issue for the jury to decide at trial was whether defendant’s safety needle devices contained the “spring means” element recited in plaintiff’s claims.  Having reviewed the evidence the Court concludes that substantial evidence (including circumstantial evidence) was presented such that it was reasonable for the jury to infer that the defendant’s devices contain a spring mechanism as defined in plaintiff’s claims.  Therefore, the Court denies defendant’s motion for judgment as a matter of law.

Although the action could have been brought in Georgia where defendant has its principal place of business, the fact that Delaware is plaintiff’s home turf is of paramount consideration.  Defendant is a Delaware corporation, and Delaware has a substantial interest in maintaining lawsuits brought by and between its corporate citizens.  Courts have transferred where defendant’s sole tie to Delaware was its place of incorporation where there was already related litigation in the transferee forum.  That is not the case here.  Convenience of witnesses is relevant only to the extent they would be unavailable at trial.  Party witnesses are presumed willing to testify at trial.

A full copy of the opinion is available here.

Plaintiff filed infringement action on ‘178 and ‘258 patents (involving voltage regulators) and for breach of a settlement agreement arising from a prior infringement action brought before the ITC regarding the same patents-in-suit.  Subsequent to entering into the settlement agreement, defendant began marketing a voltage regulator controller product.  Plaintiff contends that defendant’s product infringes the patents-in-suit and violates the terms of the settlement agreement.  Plaintiff and defendant filed cross-motions for summary judgment on the claim for breach of the settlement agreement.  Plaintiff contends that the agreement bars defendant from challenging validity and/or enforceability of the patents-in-suit in any action brought pursuant to the settlement agreement and from practicing any of the asserted claims of the patents-in-suit anywhere in the world.  Defendant argues that nothing in the agreement prevents it from contesting validity and/or enforceability with respect to a product not encompassed by the agreement and that the prohibition on practice only applies to three categories of products which currently have the zx circuitry identified by plaintiff’s counsel during the ITC proceeding.  Applying California law, the Court concludes that the terms are clear and unambiguous precluding consideration of parol evidence. The Court finds that the express words of the settlement agreement bar defendant from challenging the validity of the patents-in-suit but that the agreement is silent on the issue of enforceability.  Thus, defendant may challenge the enforceability of the patents-in-suit.  The Court also agrees with defendant that the express terms of prohibition against practice applies only to the defendant’s products containing zx circuitry and not to all products.  The Court concludes that genuine issues of material fact remain regarding whether defendant’s product at issue contains the zx circuitry preventing summary judgment for either party on the breach of contract claim.

A full copy of the opinion is available here.

 

The patents-in-suit relate generally to infant carriers and bassinets.  After trial, appeal, and remand, the court granted plaintiff’s motion for a new trial on damages and willfulness.  Following a second trial on the merits, the jury found in favor of the plaintiff.  On their contempt motion, plaintiff argues that defendant violated the injunction previously entered by the court on August, 28, 2003 by continuing to sell infringing products and by failing to make all reasonable efforts to retrieve infringing products from major retail customers.  Defendant concedes that certain sales violated the injunction but argues others did not.  The Court enters a contempt order as to the admitted violations but finds insufficient evidence as to the contested sales.  In addition, the Court holds defendant in contempt having found defendants’ efforts to retrieve infringing products lacking. Because the jury award included lost profits, the Court does not order them here but does award attorneys’ fees and costs with regard to the contempt motions.  However, the Court refuses to include enhanced damages or additional sanctions finding such request to be beyond the scope of available remedies for civil contempt.  In addition, the Court denies defendant’s motions for judgment as a matter of law as to damages and willfulness based on the jury’s findings of fact and because the issue of willfulness is moot in light of the Court’s denial of enhanced damages and sanctions.  Moreover, having found that the jury’s damages award was supported by substantial evidence, the Court denies defendant’s motions for new trials.  Finally, the Court enters final judgment in favor of the plaintiff along with prejudgment interest calculated at the prime rate, but finds that this is not a case where enhanced damages or attorneys’ fees are appropriate. Defendant’s request for additional briefing as to willfulness is denied as well based on the above findings.


A full copy of the opinion is available here.






 

Movant is a Danish holding corporation with subsidiaries located throughout the world, including certain defendants who manufacture the allegedly infringing products.  Movant does not manufacture, sell, advertise, trade or import foods or services in the United States or anywhere else in the world.  Jurisdictional discovery was ordered following the initial filing of the motion to dismiss on October 31, 2005.  The court’s analysis included a review of Delaware’s Long-Arm Statute as well as the Due Process Clause.  Referring to 10 Del. C. §3104 (c)(1) and/or (c)(3) for support, plaintiff argued that movant acted in consort with its subsidiaries to manufacture, sell, and distribute the infringing products in the United States and Delaware.  After reviewing the record, the court found sufficient evidence that movant knew that the accused products foreseeably would be sold in the United States and Delaware citing to the website of one of its subsidiaries which directs the customer to three providers of the accused product located in Wilmington Delaware.  Similarly, the court found the existence of minimum contacts concluding that Delaware’s interest in the dispute is significant. 

A copy of the full opinion is available  here.

In November 2004, Orion filed a lawsuit in the Eastern District of Texas against 15 defendants, none of which is a party to this Delaware action.  In February 2005, it amended its complaint to add Sony Corp.  Sony filed its action in Delaware in May 2005.  The same patents are at issue in both litigations, although potentially infringing websites are different.  The Court severed the claims relating to Sony Corp. and transferred them to Texas.  Jumera factors do not weigh in favor of transferring with respect to plaintiffs other than Sony Corp.