Saturday, September 23, 2017

Inequitable conduct case in ND Ill

The outcome in Felt v. Beacon, 2017 U.S. Dist. LEXIS 154714 (DJ SHARON JOHNSON COLEMAN) :

Based on the foregoing, this Court again finds that Feit fails to meet its burden to show that Nilssen made a materially false misrepresentation to the U.S. Patent Office with the intent to deceive. Feit's motion for summary judgment is denied.

A law review with an interesting title is cited:

Moreover, it appears in the '887 application's "Description of Prior Art" that Nilssen identified the '107 application as the "original-in-part progenitor," filed on August 14, 1980, of the invention described [*16] in the '887 application. Dkt. 7903 at FEIT_012774. "'Progenitor applications' are applications unrelated to any previously filed U.S. patent application." Michael Carley, Deepak Hedge, & Alan Marco, What is the Probability of Receiving a U.S. Patent?, 17 Yale J. L. & Tech 203 (2015). Thus, it seems that Nilssen may have disclaimed any filing date earlier than August 14, 1980, on the face of the '887 application. Accordingly, there is insufficient evidence from which to conclude as the only reasonable inference that Nilssen intended to deceive the U.S. Patent Office by claiming an earlier effective filing date to which the '140 patent was not entitled.

ED Wisc discusses "a sandbox for gratuitous sniping" in case about lithium-ion batteries used in power tools

Of the case, MILWAUKEE ELECTRIC TOOL v. Snap-on, 2017 U.S. Dist. LEXIS 155132 :

Plaintiffs [ MILWAUKEE ELECTRIC TOOL et al] assert infringement of the following claims against Snap-on:

claims 1 and 8-10 of U.S. Patent No. 7,554,290 (the "'290 Patent"), claims 1, 4, 5, 7-13, and 16-19 of U.S. Patent No. 7,999,510 (the "'510 Patent"), and claims 1, 8-10, 12, and 13 of U.S. Patent No. 7,944,173 (the "'173 Patent"). Independent claim 1 of the '290 Patent, which is representative of its counterparts, recites
a battery [*2] pack for power a hand held power tool, the battery pack comprising:
a housing connectable to and supportable by the hand held power tool; and
a plurality of battery cells supported by the housing, the battery cells being capable of producing an average discharge current greater than or equal to approximately 20 amps, the battery cells having a lithium-based chemistry.

(Docket #187-1 at 77). Further, later claims provide, in relevant part, that the pack's battery cells each have "a nominal voltage of 4.2 volts" and that they have "a capacity of approximately 3.0 ampere-hours [("Ah")]." Id.

Because of the vast factual record presented, the Court will provide here a broad overview of the relevant background and timeline. Facts pertinent only to one narrow argument or another will be discussed at the appropriate juncture. This may lead to some repetition, but the Court has found no better way to fully and fairly treat each matter for decision.1

1 The Court pauses here to note that the parties often treated their factual briefing as a sandbox for gratuitous sniping at each other. Even when the core, material fact at issue could not be disputed, they rarely overlooked a chance to disagree over minutiae. Additionally, in stating the facts, they often included their own interpretive gloss on the document or testimony in question, which invited

Of claim constructiuon:

Tethering construction to a person of ordinary skill in the art is critical, teaches the Federal Circuit, because such a person reads the words of the claims against the context of their meaning in the relevant field of study, including any special meanings or usages, and in light of closely related documents such as the specification and the prosecution history. Id. at 1313. Because of the sometimes specialized meanings attributed to terms based on the field in question, general-purpose dictionaries are not always useful. See id. Before resorting to such a resource, courts should begin with the materials that a person of skill in the art would use: "the words of the claims themselves, the remainder of the specification, the prosecution history, and extrinsic evidence concerning relevant scientific principles, the [*19] meaning of technical terms, and the state of the art." Id.
After evaluating the claim language itself, the Federal Circuit instructs that the specification "is the single best guide to the meaning of a disputed term." Vitronics, 90 F.3d at 1582. Although the patent specification may not be used to rewrite the claim language, SuperGuide Corp. v. DirecTV Enters., Inc., 358 F.3d 870, 875 (Fed. Cir. 2004), the specification may be used to interpret what the patent holder meant by a word or phrase in the claim,
E.I. du Pont de Nemours & Co. v. Phillips Petroleum Co., 849 F.2d 1430, 1433 (Fed. Cir. 1988).
After considering the claim language and the specification, a court may consult the final piece of intrinsic evidence: the patent's prosecution history. Vitronics, 90 F.3d at 1582. "[S]tatements made during the prosecution of a patent may affect the scope of the invention." Rexnord Corp. v. Laitram Corp., 274 F.3d 1336, 1343 (Fed. Cir. 2001). This is especially true if a particular interpretation of the claim was considered and specifically disclaimed during the prosecution of the patent. Warner-Jenkinson Co., Inc.
v. Hilton Davis Chem. Co., 520 U.S. 17, 30 (1997); Vitronics, 90 F.3d at 1582- 83.
Generally, the body of intrinsic evidence will eliminate any ambiguity in the claim terms, rendering unnecessary any reference to extrinsic evidence. Vitronics, 90 F.3d at 1583. Yet, if needed, a court may consider extrinsic evidence, which "consists of all evidence external to the patent and prosecution history, including expert and inventor testimony, dictionaries, and learned treatises." [*20] Phillips, 415 F.3d at 1317-19. Extrinsic evidence may assist the court in understanding the underlying technology, the meaning of terms to one skilled in the art, and how the invention works, but it may not be used in derogation of the intrinsic evidence. Id.

Of the argument by Snap-on:

Snap-On asks the Court to engraft an additional limitation onto the 20 Amp Limitation out of practicality-that is, because tools in the field are not routinely turned on and their batteries run down completely without pause. See (Docket #201 ¶¶ 5, 12-13). Snap-On reasons that "the word 'average' in the 20 Amp Limitation implies that the discharge current may drop well below 20 amps so long as the average current remains above 20 amps." (Docket #207 ¶ 127). According to Snap-On, it is unlikely that any power too would have to deliver a constant current discharge reasonably close to 20 amps for its entire rated capacity in any real-life application. (Docket #201 ¶ 12).

But the standard of review is not what a person of skill in the art would find realistic; it is instead what a person of skill in the art would understand. There is no question that, [*26] putting aside matters of practicality, a person of ordinary skill in the art would comprehend the meaning of the 20 Amp Limitation, including the requirement that 20 amps be continuously delivered during the entire rated capacity of the battery pack. Such a person would understand that the limitation describes the capability, not the potential real-world use, of the invention. See Hitachi, 2012 WL 10161527, at *4 ("[T]he fact remains that the capacity of a battery is normally measured by discharging at a constant current until the battery has reached its terminal voltage, consistent with Metco's construction."). This is true notwithstanding the fact that even Plaintiffs concede that tool simulations are an important part of assessing the real-world functionality of the ultimate product.5

5Snap-On claims that Plaintiffs' construction reads the word "average" out of the claim language, (Docket #205 at 13), but the Court does not agree. Plaintiffs' construction incorporates the concept of "average" as meaning "reasonably close to" the required discharge current. Snap-On rightly notes that there are other senses of the word "average," including averaging a discharge current over a specified interval, but Snap-On's belief that its interpretation of the word is the only reasonable one does not make it so. Moreover, the deposition testimony of the named inventors on this point cannot undermine the clarity of the intrinsic [*28] record, which supports Plaintiffs' interpretation. See Kara Tech. Inc. v. Inc., 582 F.3d 1341, 1348 (Fed. Cir. 2009) (finding that "extrinsic sources like expert testimony cannot overcome more persuasive intrinsic evidence").

Finally, the Court rejects Snap-On's suggestion that the 20 Amp Limitation is indefinite and therefore invalid. A patent must "conclude with one or more claims particularly pointing out and distinctly [*27] claiming the subject matter which the applicant regards as [the] invention" 35 U.S.C. § 112, ¶ 2 (emphasis added).6If, when "read in light of the specification delineating the patent, and the prosecution history, [a patent claim] fail[s] to inform, with reasonable certainty, those skilled in the art about the scope of the invention," the claim is invalid as indefinite under Section 112. Nautilus, Inc. v. Biosig Instrums., Inc., 134 S. Ct. 2120, 2124 (2014). A claim "must be precise enough to afford clear notice of what is claimed, thereby appris[ing] the public of what is still open to them." Id. at 2129; see also Interval Licensing LLC v. AOL, Inc., 766 F.3d 1364, 1370 (Fed. Cir. 2014). Moreover, a reviewing court must remember that "[i]t cannot be sufficient that a court can ascribe some meaning to a patent's claim; the definiteness inquiry trains on the understanding of a skilled artisan at the time of the patent application, not that of a court viewing matters post hoc." Nautilus, 134 S. Ct. at 2130.

Of indefiniteness:

A claim is indefinite where it can be measured in several ways and the claim language, considered against the specification and prosecution history, do not provide adequate guidance on which method to use. See Teva Pharms. USA, Inc. v. Sandoz, Inc., 789 F.3d 1335, 1344-45 (Fed. Cir. 2015); Eli Lilly, 845 F.3d at 1370. Put differently, "the patent and prosecution history must disclose a single known approach or establish that, where multiple known approaches exist, a person having ordinary skill in the art would know which approach to select." Dow Chem. Co. v. Nova Chems. Corp., 803 F.3d 620, 634-35 (Fed. Cir. 2015).
However, "a patentee need not define his invention with mathematical precision." Invitrogen Corp. v. Biocrest Mfg., L.P., 424 F.3d 1374, 1384 (Fed. Cir. 2005). Instead, "[t]he definiteness requirement mandates clarity, while recognizing that absolute precision is unattainable." Apple Inc. v. Samsung Elecs., Co., 786 F.3d 983, 1002-03 (Fed. Cir. 2015) (quotations and alterations omitted), rev'd on other grounds in 137 S. Ct. 429 (2016); Nautilus, 134 S. Ct. at 2128 (recognizing that "[s]ome modicum of [*29] uncertainty" may be tolerated). Indefiniteness is a question of law and must, like any other invalidity defense, be proven by clear and convincing evidence. Sonix Tech. Co., Ltd. v. Publ'ns Int'l, Ltd., 844 F.3d 1370, 1377 (Fed. Cir. 2017); Teva, 789 F.3d at 1345.
Snap-On's indefiniteness objection has two aspects. First, it says that Plaintiffs conveniently used functional language-the requirement for a 20-amp discharge current-just at the point of novelty from prior art, which is not permitted under General Electric Co. v. Wabash Co., 304 U.S. 364, 371 (1938). However, the Federal Circuit has explained that functional language, standing alone, is not sufficient to render a claim indefinite.
Application of Swinehart, 439 F.2d 210, 213 (C.C.P.A. 1971); Cox Commc'ns,
Inc. v. Sprint Commc'n Co. LP, 838 F.3d 1224, 1232 (Fed. Cir. 2016). Although neither expressly considered the matter, is it worth noting that neither Magistrate Callahan nor the PTAB had difficulty in construing the 20 Amp Limitation, much less such insurmountable difficulty as to render the limitation indefinite. Rather, the relevant materials provide a skilled artisan with sufficient information to describe the claimed subject matter and distinguish it from prior art, which is all that is required. See Microprocessor Enhancement Corp. v. Tex. Instruments Inc., 520 F.3d 1367, 1375 (Fed. Cir. 2008). Snap-On devotes little space to this argument and does no more than point out the functional language, expecting that effort to carry the day, and so the Court need not address the point further. See Hardrick v. City of Bolingbrook, 522 F.3d 758, 762 (7th Cir. 2008); United States v. Berkowitz, 927 F.2d 1376, 1384 (7th Cir. 1991) [*30] .
The second aspect of the indefiniteness challenge is more involved. According to Snap-On, the 20 Amp Limitation is fraught with uncertainty as to how to test the "average discharge current" of the battery pack which a person of ordinary skill in the art could not unravel, including in relation to "how long the battery is used, the application or task for which the tool is used, the acceptable voltage performance, and even the ambient temperature." (Docket #182 at 7). Put simply, Snap-On claims that a pack might not be able to produce a constant 20-amp discharge current over its entire rated capacity but could do so on average if used intermittently. (Docket #187-5 ¶ 32). In light of this, one of its experts, Yet-Ming Chiang ("Chiang"), opines that a pack must be tested in various ways that simulate real-world applications. Id. ¶ 34. This makes Meyer's 2001 cutting test and pulse test at least as relevant-indeed more so-that the constant-current test he performed. Id. ¶ 39; see also (Docket #187-13 163:6-23) (Reimers
testifying that average discharge current denotes averaging the discharge produced during pulse or profile tests). On this point, Snap-On asserts that Magistrate Callahan failed to [*31] consider the issue of indefiniteness as reinvented by the Supreme Court in Nautilus, rendering his opinion less persuasive. See Dow, 803 F.3d at 630 ("[T]here can be no serious question that Nautilus changed the law of indefiniteness.").

The district court referenced the Teva/copaxone case

Plaintiffs admit that tool simulation profiles are among the tests used to assess the performance of Li-ion battery packs. (Docket #201 ¶¶ 14-15). Moreover, other witnesses, include two of the named inventors, testified that a battery pack could be run both intermittently and constantly to ascertain an average discharge current. See id. ¶¶ 24-26. Because of the diversity of potential testing conditions and applications, Chiang concludes that skilled artisans could reasonably differ in how they assess whether the 20 Amp Limitation is met and that the patents-in-suit, even when considered alongside the specification and prosecution history, do not provide adequate instruction on which test should be used. (Docket #187-5 ¶¶ 45-47); see also (Docket #187-10 47:19-48:18) (testimony of Plaintiffs' expert during IPR, opining that continuously running a power tool until its battery runs out is not a "typical" way such tools are operated).

The Court does not agree. The Federal Circuit [*32] has found indefinite patent claims that do not teach how they are to be measured. For instance, in Teva, a patent claim prescribed a particular "molecular weight" of a product but did not specify which of three methods should be used to measure it. Teva, 789 F.3d at 1345. Neither the claims nor the specification provided guidance, and the prosecution history contained inconsistent statements by the patentee about which measure was correct. Id. at 1344- 45.

After lengthy discussion, the outcome:

For the reasons stated above, the Court adopts Plaintiffs' proposed
construction of the disputed claim terms. The Court further finds that Snap-On's motion for summary judgment should be denied in its entirety, and
that Plaintiffs' motion should be denied as to assignor estoppel, granted in part as to IPR estoppel, and granted in full as to Snap-On's anticipation, derivation, invalidity, and inequitable conduct defenses.
IT IS ORDERED that Plaintiffs' motion for summary judgment (Docket #185) be and the same is hereby GRANTED IN PART and DENIED IN PART as stated herein;
IT IS FURTHER ORDERED that Defendant's motion for summary judgment (Docket #183) be and the same is hereby DENIED;
IT IS FURTHER ORDERED that Plaintiffs' motion for leave to file its opening claim construction [*115] brief (Docket #177) be and the same is hereby

Friday, September 22, 2017

CAFC discusses venue issues in In re Cray

This petition arises from a patent infringement action
filed by Raytheon against Cray in the Eastern District of
Texas. Cray sells advanced supercomputers that Raytheon
accuses of infringement. Cray is a Washington corporation
with its principal place of business located there.
It also maintains facilities in Bloomington, Minnesota;
Chippewa Falls, Wisconsin; Pleasanton and San Jose,
California; and Austin and Houston, Texas.
Although Cray does not rent or own an office or any
property in the Eastern District of Texas, it allowed Mr.
Douglas Harless and Mr. Troy Testa to work remotely
from their respective homes in that district. Transfer
Order, 2017 WL 2813896, at *1–2 & n.1. Mr. Testa
worked for Cray as a senior territory manager while
residing in the district from 2010 to 2011 before the
underlying suit was filed. Id. at *1 n.1

Mr. Harless worked as a “sales executive” for approximately
seven years with associated sales of Cray systems
in excess of $345 million. Id. at *1. Mr. Harless’s responsibilities
also included “new sales and new account development
in [the] Central U.S.” and “management of key
accounts within the Financial, Biomedical and Petroleum
Industries.” Id. (alteration in original) (quotation marks
omitted). Cray’s “Americas Sales Territories” map, an
internal document, identified Mr. Harless as a “Named
Account Manager” and his location at his Eastern District
of Texas personal home. Id. Mr. Harless received reimbursement
for his cell phone usage for business purposes,
internet fees, and mileage or “other costs” for business
travel. Id. Cray provided Mr. Harless with “administrative
support” from its Minnesota office. Id.


Cray moved to transfer this suit under 28 U.S.C.
§ 1406(a), which provides that “[t]he district court of a
district in which is filed a case laying venue in the wrong
division or district shall dismiss, or if it be in the interest
of justice, transfer such case to any district or division in
which it could have been brought.” Cray argued that it
does not “reside” in the Eastern District of Texas in light
of the Supreme Court’s decision in TC Heartland LLC v.
Kraft Foods Group Brands LLC, 137 S. Ct. 1514 (2017).
The district court agreed that Cray does not reside in the
district. Transfer Order, 2017 WL 2813896, at *4.

Cray further argued that venue was improper in the
Eastern District of Texas because Cray had neither
committed acts of infringement, nor maintained a regular
and established place of business within that district.
The district court, however, rejected that argument. The
court found that Mr. Harless’s activities were factually
similar to the activities performed by the representatives
in In re Cordis Corp., 769 F.2d 733 (Fed. Cir. 1985), in
which this court rejected a mandamus request to reverse
an order denying transfer for improper venue. See Transfer
Order, 2017 WL 2813896, at *8–10. The court did not
rely on Mr. Testa’s activities in determining that venue
was proper.

The CAFC noted:

We recognize that the world has changed since 1985
when the Cordis decision issued. In this new era, not all
corporations operate under a brick-and-mortar model.
Business can be conducted virtually. Employees increasingly
telecommute. Products may not as a rule be warehoused
by retailers, and the just-in-time delivery
paradigm has eliminated the need for storing some inventory.
But, notwithstanding these changes, in the wake of
the Supreme Court’s holding in TC Heartland, effectively
reviving Section 1400(b) as the focus of venue in patent
cases, we must focus on the full and unchanged language
of the statute, as Cordis did not consider itself obliged to
Moreover, district courts, including the trial court in
this case, have noted the uncertainty surrounding and the
need for greater uniformity on this issue, see, e.g., Transfer
Order, 2017 WL 2813896, at *10 (explaining there is
“uncertainty among the litigants regarding the scope of
the phrase ‘regular and established place of business’”
and “the appropriate scope of such venue discovery”);
Regenlab, 2017 WL 3601304, at *2 (S.D.N.Y. Aug. 17,
2017) (“Substantial confusion exists regarding the circumstances
in which an entity will be found to have a
‘regular and established place of business’ in the dis-

trict.”); Johnston v. IVAC Corp., 681 F. Supp. 959, 962–63
(D. Mass. 1987) (collecting cases with a more “restrictive
reading” of the statute and those with a more “‘liberal’
construction” (citation omitted)); Brunswick Corp. v.
Suzuki Motor Co., 575 F. Supp. 1412, 1424 n.5 (E.D. Wis.
1983) (noting that § 1400(b) “demonstrates . . . a need for
nationwide uniformity” offered by the Federal Circuit),
and this court “has a mandate to achieve uniformity in
patent matters,” Panduit Corp. v. All States Plastic Mfg.
Co., 744 F.2d 1564, 1574 (Fed. Cir. 1984). We conclude
that mandamus here will further “supervisory or instructional
goals” on an “unsettled and important” issue, an
appropriate basis upon which to grant the mandamus
petition. In re Queen’s Univ. at Kingston, 820 F.3d 1287,
1291 (Fed. Cir. 2016) (quoting In re Nintendo Co., Ltd.,
544 F. App’x 934, 936 (Fed. Cir. 2013)); see also BP Lubricants,
637 F.3d at 1313. Although the law was unclear
and the error understandable, the district court abused its
discretion by applying an incorrect legal standard, which
we now clarify in this opinion.


As discussed in greater detail below, our analysis of
the case law and statute reveal three general requirements
relevant to the inquiry: (1) there must be a physical
place in the district; (2) it must be a regular and
established place of business; and (3) it must be the place
of the defendant. If any statutory requirement is not
satisfied, venue is improper under § 1400(b).

The issue in this case:

The parties’ primary dispute concerns
whether Mr. Harless’s home, located in the Eastern
District of Texas, constitutes “a regular and established
place of business” of Cray.

Wednesday, September 20, 2017

CAFC discusses inurement in NFC case

The CAFC noted in NFC v. Matal, 2017 U.S. App. LEXIS 18164

We note that the foregoing analysis assumes that conception is relevant under the present circumstances. Our cases that the Board read as establishing that proof of conception is relevant to inurement involved third-party recognition during testing that the invention would work for its intended purpose. See Cooper II, 240 F.3d at 1380-86; Genentech, 220 F.3d 1352-54; Cooper I, 154 F.3d at 1331-33. Here, there is no evidence that CE did anything other than fabricate the prototype. Although NFC appears to recognize this distinction, see NFC Br. 40-42, NFC only uses it to argue that interference law should not be applied to this case. As NFC has not challenged whether and to what extent conception must be shown to establish inurement under interference law in the present circumstances, we leave that question for another day.

The determination that fabrication of the prototype inures to Charrat's benefit does not resolve this case. As explained previously, the Board assumed, but did not decide, that the prototype embodied the claimed invention. That issue must be decided in order to determine whether Sears can be antedated. Thus, we remand the case for that determination in the first instance. Fortunately, whether the prototype embodied the claimed invention was a disputed issue between HTC and NFC during the initial IPR. See J.A. 455-66. Accordingly, the Board may decide the case on the briefing previously submitted.

Monday, September 18, 2017

PhishMe loses to Wombat in D. Del. on discovery issue

The court noted:

In assessing whether a proposed modification of a Protective Order would present an
unacceptable risk of inadvertent disclosure or competitive misuse of confidential information, it
would be error to deny access solely because of an in-house counsel's "general position"; instead,
"the factual circumstances surrounding each individual counsel's activities, association, and
relationship with a party ... must govern any concern for inadvertent or accidental disclosure."
US. Steel Corp. v. United States, 730 F.2d 1465, 1467-68 (Fed. Cir. 1984);see also Boehringer
Ingelheim Pharm., Inc. v. Hereon Labs. Corp., Civ.A.No. 89-484-CMW, 1990 WL 160666, at
*1 (D. Del. Oct. 12, 1990). This decision will tum, then, on a fact-intensive inquiry into whether
affected counsel (here, Mr. McGee) participates in "competitive decisionmaking" at PhishMe.
US. Steel Corp., 730 F.2d at 1467-68;In re Deutsche Bank, 605 F.3d at 1378. The Federal
Circuit has defined "competitive decisionmaking" as "counsel's activities, [*9] association, and
relationship with a client that are such as to involve counsel's advice and participation in any or
all of the client's decisions (pricing, product design, etc.) made in light of similar or
corresponding information about a competitor." US. Steel Corp., 730 F.2d at 1468 n.3; see also
In re Deutsche Bank, 605 F.3d at 1378-79.


courts have assessed the extent to which counsel--even if he or she does not
make competitive decisions-nevertheless directly advises other high level executives at the
company, who are themselves competitive decisionmakers in the subject matter areas relating to
the suit in question. See Intel Corp. v. VIA Techs., Inc., 198 F.R.D. 525, 530-31 (N.D. Cal. 2000)
(finding that concerns about the risk of harm from competitive decisionmaking were exacerbated
where a Senior Counsel for plaintiff regularly advised the general managers of the plaintiffs
business unit that were most affected by potential licensing agreements, and advised a Vice-
President involved in competitive decisionmaking who had been denied access to confidential
information by other courts in similar cases, and finding that it would be difficult for the Senior
7 See Blackbird Tech LLC, 2016 WL 2904592, at *4


Here, it is clear that while Mr. McGee may not be the "final decisionmaker" as to issues
regarding pricing, product design or those otherwise made in light of similar information about a
competitor (like Wombat), he plays a very important role in the process that leads to those
decisions. He provides legal advice to the final decisionmakers (including the company's CEO
and its Board) on these issues. (Tr. at 8-9) Moreover, Mr. McGee is not only the sole in-house
attorney who provides that kind of advice, but in most instances, he is really the only attorney
who ever does so (since outside counsel has not traditionally played any role in that process).
This all militates in favor of denial of the Motion. 9
A third factor, one particular to the patent context,

Press releases can come back to haunt people:

The Court also notes the apparent disconnect between the way PhishMe described
Mr. McGee's role in the November 2016 press release that was issued just after he was hired, and the way it has described Mr. McGee's role since this legal issue arose. In the press release, Mr. McGee is referred to as a "strategic business partner[,]" (D.I. 99, ex. 1 at 1), but now, PhishMe seems to shy away from that kind of description, (Tr. at 10). In the press release, PhishMe also describes Mr. McGee'.s prior work at Mandiant as including "negotiat[ion] and finali[zation]" of Mandiant's sale, (D.I. 99, ex. 1 at 1); but now, PhishMe states that this description is incorrect (or perhaps, at least a bit misleading), (D.I. 103, [*19] ex. 1 at~ 5 (Mr. McGee averring that "I did not negotiate the business terms in connection with the sale ofMandiant")). At a minimum, it seems like PhishMe wanted the reader of that press release to conclude that Mr. McGee had real experience with the kinds of issues and decisions that play an important role in setting a company's future "strategic" course.

Citation: 2017 U.S. Dist. LEXIS 150862

The EZEKIEL ELLIOTT case in ED Texas

The decision observes that a PATENT trial held back the district court from a rapid response:

Because the Court was presiding over a patent trial, the Court was unable to reach the NFL's Emergency Motion within the NFL's requested time constraints which, the Court notes, was less than twenty-four hours after the briefing on the Emergency Motion was complete.

Because the Court did not issue an order on the NFL's Emergency Motion within the NFL's requested period of time, the NFL did, in fact, file an "Emergency Motion for Stay Pending Appeal" with the Fifth Circuit on September 15, 2017. In its Emergency Motion in front of the Court, the NFL is complaining that the Court essentially issued a premature order by failing to wait for the arbitrator to issue his ruling and therefore, lacked subject matter jurisdiction. Oddly, the NFL is now seeking expedited relief from the Fifth Circuit without first waiting for the Court to rule on the identical issue. The irony is not lost on the Court.

Of interest in the case:

Briefly summarized, Kia Roberts ("Roberts"), Director of Investigations, and Lisa Friel ("Friel"), Senior Vice President and Special Counsel for Investigations, investigated allegations of domestic violence made by Thompson against Elliott. After investigating the allegations and interviewing Thompson, Roberts found insufficient evidence existed to proceed with punishment. On the other hand, Friel, determined, without having interviewed Thompson, sufficient evidence existed to proceed with punishment. Roberts's views were kept from the NFLPA, Elliott, Commissioner Goodell's team of outside advisors, and possibly Commissioner Goodell himself. Conversely, Friel's views were shared with Commissioner Goodell and the outside advisors. In light of the background, the Court found that the denial of Commissioner Goodell and Thompson's testimony were gross evidentiary errors that so affected the rights of the NFLPA and Elliott, such that they were deprived of a fair hearing and it constituted misconduct by Henderson.
The Court also agrees with the NFLPA that the balance of the equitable factors weigh against granting a stay. When determining whether to grant a stay, a court must also weigh equitable factors such as the following: (1) whether the movant will suffer irreparable harm absent a stay; (2) whether the non-movant will suffer injury if the stay is granted; and (3) whether a stay serves the public interest. See In re First S. Sav. Ass'n, 820 F.2d at 704.

The outcome: It is therefore ORDERED that Respondents' Emergency Motion to Stay Injunction
Pending Appeal (Dkt. #30) is hereby DENIED

Note 3: The NFL changed the language of the standard from presenting a substantial case on the merits to "serious and substantial questions on the merits." The Court does not automatically [*12] penalize the NFL for the use of substantial questions rather than substantial case, and continues to analyze whether the NFL presented a substantial case on the merits, which is the standard imposed by the Fifth Circuit. The serious question standard applies to the legal questions presented; however if a serious legal question is presented the NFL must show a substantial case on the merits with respect to those serious legal questions. Ruiz, 650 F.2d at 565.

Note 5: The Court additionally notes that the petition to vacate will not be able to be resolved before November 5, 2017 (this would be the sixth game of Elliott's suspension if it started Week 3 of the NFL season). If the Court were to find in the NFLPA's favor and grant the petition to vacate, Elliott would have already served the entirety of the six-game suspension. The Preliminary Injunction Order preserves the status quo while the Court resolves the NFLPA's Petition.

Citation: 2017 U.S. Dist. LEXIS 150758

Saturday, September 16, 2017

US Court of Claims on "epiphany"

The suggestion that defendant's epiphany occurred only after "obtaining" discovery is less than ingenuous. The government was not obtaining discovery, it was responding to plaintiff's requests with its own information. The assertion that the government's investigation of its own records in response to plaintiff's interrogatory constitutes due diligence makes no sense; it certainly does not constitute good cause, particularly when the court has made substantive rulings which, if revisited, would penalize plaintiff, cf. RCFC 24(b)(3), or if not revisited, could potentially prejudice the third party.

from MORPHOTRUST USA, LLC et al., Plaintiffs, v. Patent infringement ice to THE UNITED STATES, 2017 U.S. Claims LEXIS 1112

Sausage war in ED Wisc gets into inequitable conduct

Defendant Klement Sausage argued that when Johnsonville Sausage withheld information about its utility patent application from Sipos, it breached its duty of candor and good faith in dealing with the PTO.

ED Wisc noted:

Klement fails to prove materiality. For the most part, it applies the wrong materiality standard, arguing that Johnsonville withheld information "material to patentability" as the PTO defines it. The PTO's definition of materiality does not apply in patent cases where inequitable conduct is raised, as it is "overly broad," "encompass[ing] anything that could be considered marginally relevant to patentability."

Id. [Therasense] at 1293-95. "[S]uch a low bar for materiality" does not reflect the seriousness and

"far-reaching consequences" of a finding of inequitable conduct. See id. at 1289, 1294. Rather, "the materiality required to establish inequitable conduct is but-for materiality," meaning that the accused infringer must show that "the PTO would not have allowed a claim" but for some nondisclosure by the applicant. Id. at 1291.
To the limited extent that Klement applies the right materiality standard, its arguments still fail. It first argues that Johnsonville's utility patent application is material because it would have shown Sipos that the curved walls of Johnsonville's tray are functional, not ornamental. This argument assumes that ornamentality [*4] and functionality are mutually exclusive. To the contrary, "[a]rticles of manufacture may possess both."

U.S. Patent & Trademark Office, Manual of Patent Examining Procedure § 1502.01 (9th ed. rev. Nov. 2015). In fact, "the design embodied in or applied to an article of manufacture (or portion thereof)" is distinct from "the article itself" and "cannot be assumed to lack ornamentality merely because the article of manufacture would seem to be primarily functional." Id. §§ 1502, 1504.01(c)(I).

Klement also argues that Gehman's rejection of Johnsonville's utility claims as anticipated and obvious and the prior art he cited are material because they would have shown Sipos that the curved walls of Johnsonville's sausage tray lack novelty and nonobviousness. But, Gehman only assessed the functional novelty and nonobviousness of Johnsonville's tray, not the ornamental novelty and nonobviousness of the design embodied in it. A design does not lack novelty or nonobviousness merely because the article in which it is embodied does. See generally id. § 1504. Further, Klement does not explain how the prior art that Gehman cited adds to the prior art that Johnsonville disclosed to Sipos. Compare U.S. Patent No. 5,820,904, and European Patent Application [*5] No. EP1997618, with '249 Patent, and '539 Patent. Prior art that

"teaches no more than . . . the prior art already before" the examiner is cumulative.

Regents of the Univ. of California v. Eli Lilly & Co., 119 F.3d 1559, 1575 (Fed. Cir. 1997)

Case cite: 2017 U.S. Dist. LEXIS 150011

WD Wisc discusses meaning of "ambiguity"

From 2017 U.S. Dist. LEXIS 149885 :

An ambiguity is "something that makes it possible to interpret a document reasonably in more than one way." Rossetto, 217 F.3d at 542. The Seventh Circuit has recognized two types of ambiguities: (1) a "patent ambiguity" is "apparent just from reading the contract without knowing anything about how it interacts with the world"; and (2) a "latent ambiguity" is "recognized as such only when a contract clear on its face -- clear that is, to the uninformed reader -- is applied to a particular dispute." Id. at 542-43.

Third, in determining whether an ambiguity exists, this court is to look at the entire contract to see if either type of ambiguity can be "disambiguated." Rossetto, 217 F.3d at 545. This search goes beyond the CBAs to include accompanying plan documents. See Barnett, 436 F.3d at 832 ("The second portion of relevant contractual language was contained in a CIPS medical plan."); Murphy, 61 F.3d at 564

Friday, September 15, 2017

CAFC affirms PTAB in IDEMITSU KOSAN CO., LTD. case: no obligation to rebut attorney argument with expert witness testimony

The technology relates to organic LEDs [ “Organic
Electroluminescence Device and Organic Light
Emitting Medium.” ]

The issue:

On appeal, Idemitsu does not appear to challenge the
Board’s factual findings with respect to the correspondence
between the ’648 patent’s components and some of
the compounds disclosed by Arakane. Rather, Idemitsu
argues that the Board erred in finding that Arakane
taught combining those particular compounds for the
purpose of creating a light emitting layer in an electroluminescent

The CAFC referenced PTAB:

(“This teaching regarding the energy gap relationship, however,
does not diminish Arakane’s disclosure of the fundamental
concept of forming a light emitting layer containing a
mixture of at least two components, (A) a hole transporting
compound and (B) an electron transporting compound.”).
In other words, the Board found that Arakane
teaches that combining any of the listed HT compounds
with any of the ET compounds would produce a light
emitting layer, and that—if the combination additionally
satisfies the energy gap relationship—then it will feature
improved durability and efficiency as well. Id. at *27-29.

The CAFC noted

This back-and-forth shows that what Idemitsu characterizes
as an argument raised “too late” is simply the
by-product of one party necessarily getting the last word.
If anything, Idemitsu is the party that first raised this
issue, by arguing—at least implicitly—that Arakane
teaches away from non-energy-gap combinations. SFC
simply countered, as it was entitled to do. To the extent
Idemitsu suggests that the Board could not reach a counterargument
because it was not preemptively addressed
by the petition or institution decision, Idemitsu is plainly
mistaken. See Genzyme Therapeutic Prod. Ltd. P’ship v.
Biomarin Pharm. Inc., 825 F.3d 1360, 1366 (Fed. Cir.
2016) (“There is no requirement, either in the Board’s
regulations, in the APA, or as a matter of due process, for
the institution decision to anticipate and set forth every
legal or factual issue that might arise in the course of the
Idemitsu’s only substantive argument on appeal appears
to be that the Board should not have engaged in
fact-finding on this issue without the benefit of additional
extrinsic evidence, such as expert testimony. See, e.g.,
Appellant Br. 43–44. In some cases, that method of factfinding
could indeed be problematic. See, e.g., Perfect Web
Techs., Inc. v. InfoUSA, Inc., 587 F.3d 1324, 1330 (Fed.
Cir. 2009) (“If the relevant technology were complex, the
court might require expert opinions.”); Proveris Sci. Corp.
v. Innovasystems, Inc., 536 F.3d 1256, 1267 (Fed. Cir.
2008) (affirming the district court’s requirement of expert
testimony to prove invalidity where “th[e] subject matter
[wa]s sufficiently complex to fall beyond the grasp of an
ordinary layperson”); Brand v. Miller, 487 F.3d 862, 869-
70 (Fed. Cir. 2007) (reversing the Board’s decision to
“reject[] as unconvincing the only relevant testimony” and
independently reach the opposite conclusion).
But here, Idemitsu provided no such supporting evidence
for its own position—that Arakane teaches away
from any non-energy-gap HT/ET combinations. SFC, of
course, bears the ultimate burden of establishing unpatentability,
but it is not required as a matter of law to
rebut mere attorney argument with expert testimony in
order to satisfy that burden. The Board weighed the
parties’ competing arguments—each relying solely on the
text of Arakane itself—and found SFC’s reading to be the
more plausible one. That is precisely what the Board is
supposed to do.

Comment: in the text

First, SFC argued in its petition that "Arakane teaches (i) that the [HT] compound can be an arylamine compound corresponding to Formula (V) of claims 1 and 13, (ii) that the [ET] compound can be anthracene derivatives corresponding to Formulas (I) and (II) of claims 1 and 13, and (iii) that the [HT] compound and [ET] compound are mixed in the organic light emit-ting medium." J.A. 15-16; see also J.A. 189-91. Second, Idemitsu argued in its response that SFC failed to "explain why a skilled artisan would have been led to use" that combination, given that "[t]he energy gap relation-ship limits the combinations of the compounds . . . encompassed by Arakane to combinations satisfying the relationship." J.A. 328. Third, SFC countered in its reply that Arakane does not teach away from "the claimed combination," despite "the absence of demonstrating that the combination would possess the preferred energy gap relationship," distinguishing certain comparative exam-ples. J.A. 382-83; see also Idemitsu, 2016 Pat. App. LEXIS 13340, at *24 -25.

we seem to have a generic disclosure within Arakane rendering obvious a claimed sub-genus. An issue would be "why" one of ordinary skill would have been motivated to select the sub-genus.

Citation to case on LEXIS: 2017 U.S. App. LEXIS 17856

No jurisdiction when claim under patent law is secondary to resolving assignment issue

The outcome

First Data Corporation (“First Data”) and Frank Bisignano
(“Bisignano”) appeal from the district court’s dismissal
of their counterclaims and their declaratory
judgment action under Federal Rule of Civil Procedure
12(b)(1). See Bisignano v. Inselberg, Nos. 15-8301 (KM)
(JBC), 16-317 (KM) (JBC), 2016 U.S. Dist. LEXIS 113563
(D.N.J. Aug. 25, 2016) (District Court Opinion). They also
object to the district court’s order remanding their state
law claims to state court. Because the district court
correctly dismissed the federal claims for lack of subject
matter jurisdiction and we cannot review the remand
order, we affirm.

Of the jurisdiction issue

This court reviews de novo a district court’s order
dismissing claims for lack of subject matter jurisdiction.
Powertech Tech. Inc. v. Tessera, Inc., 660 F.3d 1301, 1306
(Fed. Cir. 2011). The party claiming declaratory judgment
jurisdiction has the burden to establish that jurisdiction
existed at the time the claim was filed. Id.

Citing Bell v. Hood, the CAFC noted:

There, the Court explained
that the failure to state a proper cause of action requires a
judgment on the merits rather than a dismissal for jurisdiction,
but that “previously carved out exceptions are
that a suit may sometimes be dismissed for want of
jurisdiction where the alleged claim under the Constitution
or federal statutes clearly appears to be immaterial
and made solely for the purpose of obtaining jurisdiction
or where such a claim is wholly insubstantial and frivolous.”
Id. at 682–83; see also The Fair v. Kohler Die &
Specialty Co., 228 U.S. 22, 25 (1913) (“No doubt if it
should appear that the plaintiff was not really relying
upon the patent law for his alleged rights, or if the claim
of right were frivolous, the case might be dismissed.”).

The CAFC discussed Jim Arnold:

First Data’s and Bisignano’s argument ignores the actual
context we addressed in Jim Arnold. The assignor in
Jim Arnold stated in its complaint that the assignment
was “null and void” and that the assignee was infringing
the patent. But we did not include this allegation as an
example by which an assignment would be declared null
and void “by operation of law.” See id. at 1576–77. To the
contrary, we explained that the gravamen of the complaint
was founded in state contract law. Similarly, here,
the claims focus on state law contract remedies, and
Inselberg and Interactive admit that they cannot pursue a
patent claim unless a state court grants rescission of the
assignment agreement. See, e.g., Appellees’ Br. 2 (“Eric
Inselberg and Inselberg Interactive, LLC do not own any
patents. They used to own 21 patents, and they have filed
state-law claims to try to get those patents back. But at
the time the cases below were filed, they owned zero (0)
patents.”); id. at 3 (“Inselberg and his company lack title
to the patents, and thus lack standing to bring a patent
claim.”); Oral Arg. at 13:59–14:05, http://oralarguments. (explaining
that there is no threat of an infringement claim by
Inselberg against First Data because Inselberg has “no
present ownership of any patents”).

First Data case, D. N.J. 2016-2677, 2016-2696

Thursday, September 14, 2017

Pro se plaintiff fails to establish personal jurisdiction in otherwise interesting case

Of interest is text in the decision [ 2017 U.S. Dist. LEXIS 148859 (ED Ky]:

Mike Ellig was a former owner of Montana Black Gold Inc. and is the current owner of Sight Inc. Ellig responded to Afshari's lawsuit by sending Afshari a letter via e-mail on May 11, 2016. It is that letter that is the root of this action. (DE 1-1, Ellig Letter.) Afshari asserts that, with the letter, Ellig committed various wrongs against him, including defamation, extortion, and blackmail.
In the letter, Ellig asserted that Afshari's fiber-optic bow sight patent was invalid because Afshari's design was actually nothing new; other bow sights employing the same design had been patented before Afshari's. Ellig then went on to address what he believed to be inconsistencies between Afshari's lawsuit against Bear Archery for infringement and Afshari's previous representations to the bankruptcy court that his patents had no value.
"We are also aware that you were currently suing Bear Archery for infringement of your '321 patent at the time your bankruptcy case was filed. However, you disclosed to the bankruptcy trustee that the '321 patent did not have any value." Ellig continued by explaining what he believed to be the significance of the inconsistencies. "Because you were currently suing Bear Archery for infringement, and you were planning on suing Montana Black and/or other archery equipment companies for infringement of the '321 patent, it is clear that you did not believe the '321 patent did not have any value." In Ellig's view, Afshari's actions in the bankruptcy court constituted "misrepresentation and withholding of information" and "could constitute fraud."

He then warned Afshari:
If we were to notify the [bankruptcy] trustee and she agreed to re-open the [bankruptcy] proceedings, she would most likely take control of your infringement claim and the '321 patent as well as all of your other patents. Ben, I really don't want to have to do this but you will force me to re-open your bankruptcy if you disregard all of the above evidence.

The outcome:

As to Black Gold Archery LLC, Afshari does not make any allegations explaining why Ellig's actions should be attributed to it. Afshari does not allege any relationship between Black Gold Archery LLC and Ellig at all. Ellig is a Montana resident. Afshari has submitted evidence that Black Gold Archery LLC is located in Oregon. (DE 15-4, Oregon Sec. of State Filings.) Nor does Afshari allege that any other Black Gold Archery LLC representative took any actions on its behalf. Accordingly, Afshari has not alleged any activity on behalf of Black Gold Archery LLC and the Court cannot find that it has personal jurisdiction over the company. Its motion to dismiss must, therefore, also be granted.
Because the Court has found that it cannot exercise personal jurisdiction over any of the four defendants, Afshari's claims will be dismissed without prejudice. This ruling does not address the merits of any of Afshari's claims. It simply finds that Afshari cannot bring his claims against these defendants in Kentucky

No case/controversy in US for threats of infringement made outside US on non-US patents

In Allied Mineral, 2017 U.S. App. LEXIS 17667, the CAFC addressed DJs in view of a threat of litigation from a foreign patent,

From the decision:

All of Stellar's conduct has been directed towards Allied's customers Ferro and Pyrotek, unrelated Mexican entities, and that contact was limited to Stellar's Mexican Patent and potentially infringing acts in Mexico. Stellar sent notice letters to the customers alone, and although Allied responded on behalf of its customers, Stellar never responded to Allied's letter. [*5] Stellar then sued only the customers, not the manufacturer. Stellar also limited its actions to Mexico. Stellar filed suit in Mexico, suing for infringement of a Mexican patent under Mexican laws. It has not threatened or alleged infringement of the '974 patent in the United States, much less filed suit. Stellar took no actions directed at Allied, no actions with regard to its '974 patent, and no actions under U.S. patent laws.


Considering the totality of the circumstances, we agree with the district court that there is not a substantial controversy of sufficient immediacy and reality to confer declaratory judgment jurisdiction. Stellar sent notice letters to Ferro and Pyrotek in Mexico, and it sued Ferro and Pyrotek in Mexico. Stellar did not even respond to Allied's letter about the Mexican Patent on behalf of Ferro and Pyrotek. Nor has Stellar taken any action in the United States or any action on the '974 patent. Allied has failed to establish a case or controversy regarding Stellar's U.S. patent in the United States under Article III.

In Intellectual Ventures v. Motorola, Judge Newman challenges nonobviousness finding

The outcome of the Intellectual Ventures case [ 2017 U.S. App. LEXIS 17666 ]:

We hold that substantial evidence supports the jury's verdict regarding the validity of claim 41 of the '144 patent and claims 1, 10, 11, and 13 of the '462 patent, but conclude that substantial evidence does not support the jury's verdict of direct infringement of claim 41 of the '144 patent. Since a finding of direct infringement is a predicate to any finding of indirect infringement, we reverse all of the infringement findings with respect to the '144 patent. We therefore affirm the district court's judgment in part, reverse in part, and remand for further proceedings on the asserted claims of the '462 patent.

Judge Newman dissented in part:

I agree with the holding of non-infringement of the '144 patent, and join the judgment of reversal of the district court's judgment of liability with respect to that patent.1 I respectfully dissent from my colleagues' sustaining the validity of the '144 and '462 patents, for I believe that the claims in suit would have been obvious to a person of ordinary skill in the field of the invention.


Although my colleagues state that "the jury was free to disbelieve [Motorola's] expert and credit [IV's] expert," Maj. Op. at 12 (alterations in original), the court's obligation is to assure that questions of law are correctly decided, and that for factual disputes, substantial evidence on the record as a whole supports the legal conclusion. The question of law is whether a person of ordinary skill in this art would deem it obvious to combine an authenticating step as in Micali, with the process of Overend. See 35 U.S.C. § 103 (whether "the differences between the subject matter sought to be patented and the prior art are such that the subject matter as a whole would have been obvious at the time the invention was made to a person having ordinary skill in the art to which said subject matter pertains.").


Applying law and precedent, the combination of Overend and Micali renders claim 41 obvious. First, "when a patent claims a structure already known in the prior art that is altered by the mere substitution of one element for another known in the field, the combination must do more than yield a predictable result." KSR Int'l Co. v. Teleflex Inc., 550 U.S. 398, 416, 127 S. Ct. 1727, 167 L. Ed. 2d 705 (2007). And second, "[w]hen a patent simply arranges old elements [*37] with each performing the same function it had been known to perform and yields no more than one would expect from such an arrangement, the combination is obvious." Id. at 417 (internal quotation marks and citation omitted). The Court explained that "a court must ask whether the improvement is more than the predictable use of prior art elements according to their established functions." Id.

In light of the evidence, no reasonable jury could have found claim 41 to be nonobvious. There is not substantial evidence that a receipt confirming delivery is not a delivery confirmation message as in the prior art, especially given the express teachings of Micali's authenticating device. A "patent for a combination which only unites old elements with no change in their respective functions . . . obviously withdraws what already is known into the field of its monopoly and diminishes the resources available to skillful men." Id. at 415-16 (quoting Great Atl. & Pac. Tea Co. v. Supermarket Equip. Corp., 340 U.S. 147, 152-153, 71 S. Ct. 127, 95 L. Ed. 162, 1951 Dec. Comm'r Pat. 572 (1950)).