A key objective of many local patent rules is to encourage parties to solidify their legal theories regarding infringement and invalidity at the outset of litigation.  These rules save litigant and court resources by preventing the ‘shifting sands’ approach to claim construction, i.e., it discourages parties from subsequently amending their claim charts throughout the lawsuit, thereby making the opposition respond to a moving target of contentions.  To this end, under their local patent rules, some courts will only allow for amendment of contentions when these amendments are made for good cause and when the moving party acts diligently in amending based on newly discovered information.

          Some districts have already held that good cause is lacking where a party moves to amend contentions based on a Markman ruling in their favor.  See, e.g., Thermapure v. Just Right Cleaning, No. CV–11–0431–RHW, 2013 WL 3340494 (E.D. Was. Nov. 7, 2012).  In Silver State Intellectual Technologies, Inc. v. Garmin International, Inc. (.pdf), No. 2:11-CV-01578-PMP, 2014 WL 3687245 (D.Nev. July 24, 2014), Judge Pro took a similarly narrow view of what constitutes good cause in deciding that a Markman ruling adopting the opposing party’s claim construction does not necessarily give rise to good cause to amend.

       Following the court’s Markman ruling adopting plaintiff’s claim construction, the accused infringer amended its contentions to include new invalidity arguments based on newly identified prior art in light of the court’s construction.  The defendant argued that the good cause requirement was met due to the court’s adoption of claim construction other than defendant’s.  Indeed, the District of Nevada’s Local Patent Rules identifies a court’s claim construction different from that proposed by a party as an example of a circumstance that may support a finding of good cause for that party to amend its contentions. D. Nev. R. 16.1-12.  However, Judge Pro noted that such a finding is not automatic, “particularly where the Court adopts the construction proposed by the other party, as such a construction would not come as a surprise to the party seeking to amend.” Id. at *4.  Judge Pro granted plaintiff’s motion to strike for lack of good cause those portions of defendant’s amended contentions that were added based on the court’s claim construction.  This order was based in part on the fact that the defendant had sufficient notice that the court might construe the claims as it did, because that construction was proposed by the plaintiff in its initial claim construction brief filed nearly a year before the court’s construction order.  Thus, according to the court, the defendant was aware of the risk of such a construction being adopted and should have prepared accordingly, and that its subsequent adoption did not constitute good cause for the amended contentions.

     The court’s order was also based in part on the defendant’s lack of diligence in amending its contentions following the Markman ruling.  The defendant filed its amendments on the final day of fact discovery, nearly two months after the construction order.  Therefore, the court held, the plaintiff would be unfairly prejudiced by having to extend discovery and expend resources to respond to the new contentions. Key Takeaway:

    Litigants should not assume that they will have automatic leave to amend their contentions following an adverse claim construction.  They should anticipate the possibility that the court will adopt the opposing party’s proposed claim construction and should act diligently to conduct discovery and amend their contentions as necessary.

The editor thanks Cameron Clawson, a soon-to-be associate at Husch Blackwell, for his assistance in writing this post.

In patent litigation governed by local patent rules, a party claiming infringement must usually serve a “Disclosure of Asserted Claims and Infringement Contentions.” This disclosure must sufficiently identify each claim and the infringing product or process of the opposing party. Jurisdictions, however, have different standards for sufficient disclosures and courts have substantial discretion in determining the disclosing party’s obligations. In Times Three Clothier, LLC v. Spanx, Inc. (pdf), 2014 WL 1795210, *4 (S.D.N.Y. May 6, 2014), Judge Cote denied an amended infringement contention that directly contradicted a prior contention because there was no longer an inference of infringement. On October 29, 2013 Times Three received a patent describing women’s shapewear in which the middle section included a more compressive material than the upper or lower sections. That same day, Times Three brought an infringement action against two of Spanx’s products claiming that they followed the same design with high compression mid-sections and lower compression outer sections. Times Three incorrectly referred to the waist lining of the Spanx product as the middle (with 64% spandex) and the body section as the top (with 20% spandex). On February 4, 2014, Spanx advised Times Three that the waist lining was actually the lower section of the garment with the body being the middle. In response, Times Three reversed its contention to state by amendment that the body section had more compression material than the waist lining and removed its supporting citations. In light of the reversal, Spanx filed a motion to strike Times Three’s amendment. In its reasoning, the Court determined that “where information is reasonably available to plaintiffs before discovery, infringement contentions must be sufficient ‘to raise a reasonable inference that all accused products infringe’ and to permit the Court to ‘make a principled decision on whether discovery will proceed.’” Because Times Three’s initial contentions now supported a finding of non-infringement, the court stayed the case on the applicable patent and found that more detailed infringement contentions were required before discovery could proceed.” The court noted that this was not an issue of unknown discovery because the products were publicly available at low cost. Key Takeaway: Plaintiffs should be careful when asserting an amendment to an infringement contention that is contrary to their original claim. If new facts create contradictory positions between the original and amended infringement contentions, the amended claims should be sufficiently detailed to justify the contradiction and provide adequate support for their assertions. The author thanks Josh Nosal, a student at the University of Texas School of Law, for his assistance in writing this post.

The Local Patent Rules have been designed to require parties to solidify their theories in the early stages of litigation and adhere to them as the case progresses. Yet, the rules are not an entirely rigid structure. They retain some flexibility by providing a non-exhaustive list of circumstances that may warrant an amendment to parties’ original contentions. However, this flexibility decreases the predictability of which amendments will be successful under the rules. 

In Depomed Inc. v. Actavis Elizabeth LLC (.pdf), 2014 WL 1877613 (D.N.J. May 8, 2014), Judge Pisano ruled that a defendant, after unreasonable delay, could not amend its Invalidity Contentions without a good cause to permit the amendment. On August 24, 2012, defendant stated in its Invalidity Contentions that the disputed patent was invalid due to an indefinite size claim, which read “is of a size exceeding the pyloric diameter in the fed mode.” On April 11, 2014, the last day of expert discovery, during defendant’s deposition of plaintiff’s expert, the expert admitted that he could not determine what size would satisfy the claim. On April 14, 2014, defendant informed the plaintiff and the court that it would like to amend its invalidity contention by including the expert’s admission. On April 15, 2014, defendant served its amended invalidity contentions on the plaintiff. On April 17, 2014 the plaintiff notified the defendant that it intended to object to the amendment and filed its objection on April 22, 2014. In its reasoning, the Court applied Local Patent Rule 3.7 and denied defendant’s motion to amend its contentions. The Court found that even though defendant had asserted a general indefiniteness in its 2012 contention, it had not raised this specific issue until the eve of trial, which created an unreasonable delay and unduly prejudiced the plaintiff. Additionally, the Court found no good cause to permit the amendment because defendant was aware of the issue of indefiniteness but failed to assert it during either expert discovery or claim construction. Key takeaway: The Local Patent Rules are flexible when it comes to amending invalidity contentions, but contenders should present new issues at the earliest possible time and should continuously maintain important issues in order to preserve their relevance. Otherwise, a court may prevent a party from supplementing its invalidity contention for lack of good cause and unreasonable delay even if the issue has been previously raised. The author thanks Josh Nosal, a student at the University of Texas School of Law, for his assistance in writing this post.

In patent litigation governed by the local patent rules, a plaintiff patent owner is required to disclose original infringement contentions.   The patent owner also sometimes discloses amended infringement contentions that add new accused products as more information is obtained in discovery.  A patent owner may also choose to withdraw certain infringement contentions on certain accused products in its amendments for strategic reasons.  In this scenario, one question that arises is whether a patent owner may reassert infringement of an accused product that was originally cited as infringing but later not included in an amended infringement contention. In LMT Mercer Group v. Maine Ornamental (.pdf) , 2014 WL 284238 (D.N.J. Jan. 24, 2014), Judge Wolfson ruled that a plaintiff patent owner was not allowed to reassert infringement of the originally accused Polaris Light product when its subsequent first and second amended infringement contentions did not include the Polaris Light product.  In December of 2010, plaintiff filed its complaint asserting infringement of the Polaris Light product among others.  In December of 2012, plaintiff filed its original Local Patent Rule 3.1 infringement contentions that also included the Polaris Light product.  In January of 2013, plaintiff filed its first amended infringement contentions that did not include the Polaris Light product and further stated that “The Supplemental Infringement Contentions are herein supplemented at the request of Defendant, and hereby supersedes the Infringement Contentions.”  In March of 2013, plaintiff served its second amended infringement contentions, but again did not include the Polar Light product.  At this time, plaintiff’s attorney discussed the reassertion of Polaris Light as an accused product, but defendant’s attorney would not consent to that reassertion.  Soon after, defendant filed a motion for summary judgment stating that plaintiff had waived its right to reassert infringement of the Polaris Light product.  Plaintiff filed a motion to reassert the Polaris Light product as an infringing product. In its reasoning, the Court first declined to apply the “law of waiver” under New Jersey state law.  Instead, the Court found that Federal Circuit law and the local patent rules, not New Jersey law, should resolve this question.  On the issue of waiver, the Court found that questions of material fact relating to the intent to waive precluded defendant’s summary judgment motion.  Nonetheless, the Court found that plaintiff did not have “good cause” to reassert the Polaris Light product as an infringing product.  Therefore, the alleged infringement of the Polaris Light product was eliminated from the case.  Id. at p. 16. Key takeaway:   Patent Owners asserting infringement should carefully include all infringing products in all of its amended infringement contentions. Otherwise, a court may prevent that party from reasserting an accused product at a later stage.

In patent litigation, a court will sometimes dismiss some, but not all, defenses of an accused infringer in a summary judgment ruling.  Even though some of its defenses were rejected by the court, the accused infringer may nonetheless continue to sell its accused products.  In this scenario, questions arise as to whether the continued sales constitute willful infringement, and if so, whether the local patent rule infringement contentions must be amended to present this evidence of willful infringement at trial. In Sloan Valve Co. v. Zurn Industries, Inc. (.pdf), 2014 WL 51293, *3 (N.D.Ill. Jan. 7, 2014), U.S. District Court Judge St. Eve examined this same question and held that the patent owner was not permitted to amend its contentions or tell the jury that the accused infringer continued to sell its accused products after its invalidity defenses had been defeated at the summary judgment stage.  Unpersuasive to the Court were two prior opinions concluding that a patent owner could inform the jury that the accused infringer continued to sell its accused products after the court granted summary judgment finding infringement.  See, Revolution Eyewear, Inc. v. Aspex Eyewear, Inc., 2008 WL 6873811 at *5 (C.D. Cal. Jan. 3, 2008) (finding that defendant “willfully infringed [plaintiff’s] patent when it continued to sell the infringing frames after the Court granted [plaintiff’s] motion for summary judgment on the issue of infringement”); Avocent Huntsville Corp. v. ClearCube Tech., Inc., 2006 WL 2109503 (N.D. Ala. July 28, 2006) (finding that court’s granting of plaintiff’s motion for partial summary judgment on infringement “may fall under the rubric of the ‘totality of the circumstances’ test, tending to show [defendant’s] infringement was (and continues to be) willful”).  To Judge St. Eve, these cases were distinguishable because they resolved issues of infringement on summary judgment, not issues of validity.  Thus, she held that “[patent owner] may not introduce evidence that certain of [accused infringer’s] affirmative defenses did not survive summary judgment.” In support of the holding, the Court found that “[t]he Court’s summary judgment opinion on certain affirmative defenses in this case is not the type of information that is highly relevant to final infringement contentions and certainly does not meet the good cause standard that Local Patent Rule 3.4 requires. Rather, [patent  owner’s] proposed amendments give credence to [accused infringer’s] argument that [patent owner’s] true intent is to inform the jury of the Court’s adverse rulings on certain of [accused infringer’s] affirmative defenses. This is not a proper use of final infringement contentions.”        

When multiple defendants are sued in a single lawsuit, it is common for those joint defendants to share legal positions.   For example, when asserting invalidity contentions, the defendants will sometimes disclose a single set of invalidity contentions applicable to all joint defendants.  Alternatively, a second defendant may serve invalidity contentions disclosing that, in addition to its own stated contentions, the second defendant also incorporates the invalidity contentions of one or more other first defendants.  Whether that type of incorporation by reference is allowed is not expressly addressed by the local patent rules.  In Warner Chilcott Company, LLC v. Lupin Ltd. (.pdf), 2013 WL 4084237, *1 (D.N.J. August 13, 2013), one defendant, Lupin, sought to amend its invalidity contentions one year after the preliminary contentions were due and even after the close of fact discovery.  Specifically, Lupin sought to add an “Ovcon” product to its invalidity contentions because the product was (i) produced by Plaintiff during the fact discovery phase of this case, (ii) referenced by the co-defendant in its invalidity contentions, and (iii) well-known to Plaintiff.   Plaintiff opposed the amendment arguing that “Lupin’s new theories would inject multiple new issues into the case that would inevitably require additional discovery….”  Id. at *1.  When examining the possible prejudice to the Plaintiff caused by the proposed amendment, the Court noted that a different defendant disclosed the Ovcon product in its own invalidity contentions which were then incorporated by reference into Lupin’s preliminary contentions.  Therefore, the Court found that Plaintiff “had more than adequate notice of the invalidity defenses Lupin proposes to add and/or expand upon and will not be prejudiced if Lupin is permitted to do so.”  Id. at *3. Key Takeaway:  When asserting preliminary invalidity contentions, one defendant may be able to rely upon another defendant’s preliminary contentions if those other preliminary contentions are incorporated by reference.

To support a request for a permanent injunction, a patent owner will sometimes offer evidence that its own product practices the claimed invention.  Some courts require that a patent owner’s product be included in its preliminary infringement contentions should the party wish to rely on such evidence.   Further, where a patent owner first attempts to offer such evidence of its product after the preliminary infringement contentions have been served, a court may preclude the party from relying on such evidence as untimely. In Mediatek, Inc. v. Freescale Semiconductor, Inc. (.pdf), 2013 WL 5236709, *2-3 (N.D. Cal. Sept. 17, 2013), the court ruled that a patent owner’s failure to identify its own product within its preliminary infringement contentions prevented it from relying upon the product as evidence.   Rejected was the patent owner’s argument that it need not disclose its product in its preliminary infringement contentions because the product was still under development at the time.  More convincing to the court was the argument that the product was required to be disclosed in the preliminary contentions under local patent rule 3-1(g) which states in pertinent part: “If a party claiming patent infringement wishes to preserve the right to rely, for any purpose, on the assertion that its own apparatus, product, device, process, method, act, or other instrumentality practices the claimed invention, the party shall identify, separately for each asserted claim, each such apparatus, product, device, process, method, act, or other instrumentality that incorporates or reflects that particular claim.” In its reasoning, the court found there was no credible reason why the patent owner’s product could not have been disclosed in the preliminary infringement contentions.  The court also distinguished the opinion in Apple v. Samsung Electronics Co., 2012 WL 5632618, *2-3 (N.D. Cal. Nov. 15, 2012) wherein the court permitted amended infringement contentions that added a new product sold by the opposing party. Key Takeaway: Where a patent owner wishes to rely on its own product for any purpose at trial, that party should carefully examine both its existing products and those products under development when preparing its preliminary infringement contentions.

In defending a patent infringement claim, an accused infringer will often locate additional prior art in the course of its case investigation.  When the prior art is located after the accused infringer has already disclosed its invalidity contentions, a question often arises under the local patent rules as to whether the accused infringer is permitted to include the new prior art in revised contentions.  Recently, the District Court of New Jersey analyzed this question and provided some additional guidance regarding the relevant factors of good cause and timeliness in seeking to amend the invalidity contentions. In  Jazz Pharmaceuticals v. Roxane Laboratories (.pdf), Case No. 2:10-cv-6108 (D.N.J. Feb. 28, 2013), the Court ruled that the accused infringer was not allowed to amend its invalidity contentions with additional prior art from the FDA.  On the issue of good cause for the requested amendment, the Court stated that “the Federal Circuit has stated that parties must ‘proceed with diligence in amending when new information comes to light in the course of discovery.’ O2 Micro, 467 F.3d at 1366-68.  Thus, to illustrate good cause, the moving party must demonstrate its diligence. (Id at 1366).”   The Court rejected the accused infringer’s argument that it was diligent in a five month delay in finding the FDA prior art because FDA materials are not the type of materials that is customarily searched for in an initial prior art search.  On the issues of timeliness, the court rejected the accused infringer’s argument that a delay in amending its contentions was justified because it needed to confirm that the prior art-at-issue was not cumulative of the art already disclosed in its initial contentions, as well as to confirm that the prior art was publicly available. Key Takeaways: At least one court has determined that the unique type of prior art located does not excuse its late disclosure.  Moreover, taking additional time to confirm that new prior art is not cumulative of other prior art or to confirm the new prior art is public may not justify an otherwise untimely disclosure.

When defending a patent infringement case, an accused infringer often needs to provide many details concerning its patent invalidity contentions under the local patent rules.  Whether the accused infringer’s contentions also should include the priority date to be used for prior art invalidity purposes is an open question.  A priority date may be important in determining whether patent claims are invalid as anticipated by the prior art.   In the District Court of Colorado, the Court recently ruled that an accused infringer need not make such a priority date disclosure under the local patent rules. In Health Grades, Inc. v. MDX Medical, Inc. (.pdf), 2013 WL 136187  (D.Col. Jan. 10, 2013), the District Court of Colorado adopted the local patent rules from the Northern District of California at the request of the parties “to reduce discovery and other litigation costs….”  Contrary to his expectation, Magistrate Boland found that the parties “employed those rules to greatly increase their discovery and pretrial conflicts, not reduce them.”  (Opinion, p. 2) The accused infringer disclosed a first and second supplemental set of invalidity contentions with no mention as to the proper priority date for prior art purposes.  Previously, the patent owner disclosed that it was relying on a priority date at least as early as the filing date of provisional application no. 60/771,757, which was filed on Feb. 8, 2006.  In its third supplemental set of invalidity contentions, the accused infringer asserted for the first time that “[t]he ‘060 Patent is not entitled to benefit from the earlier filing date of provisional application no. 60/771,757 (the ” ‘757 application”) because the ‘757 application does not meet the requirements of 35 U.S.C. § 112, first paragraph, with respect to the patented claims of the ‘060 Patent.  For example, the ‘757 application does not contain a written description of at least the following features of the’060 Patent: [citing absent features].  Therefore, the ‘060 Patent cannot benefit from the earlier filing date of the ‘757 application under 35 U.S.C. § 119(e).” (Opinion, p. 3) Reviewing Local Patent Rule 3-3 from the Northern District of California, the Court found no express requirement that invalidity contentions take a position on a priority date for prior art purposes.  Accordingly, no leave to amend the invalidity contentions for good cause was required by the local patent rules. Key Takeaway: Without an express requirement in the local patent rules that a priority date position is required in invalidity contentions, accused infringers now have at least one precedent supporting their ability to amend invalidity contentions on this issue late in discovery.

Many local patent rules allow a patent owner to amend its infringement contentions after the Court issues its Markman ruling. Indeed, patent owners sometimes assume that they will be allowed to freely amend their infringement contentions just as they can freely amend their complaint. However, because the local patent rules were designed, in part, to crystallize a party’s contentions early in the case, requested amendments to contentions are sometimes denied by the Courts even after a Markman ruling. In Thermapure v. Just Right Cleaning, Case No. 2:11-cv-431 (E.D. Was. Nov. 7, 2012), Judge Whaley ruled that his Markman ruling did not constitute “good cause” for the plaintiff to amend its infringement contentions. Plaintiff argued there was “good cause” to add two new infringement contentions based upon the Court’s Markman interpretation of the claim term “predetermined temperature” in a patent relating to sanitization by heat. In support, Plaintiff cited Local Patent Rule 124 which allows amendment of infringement contentions upon a showing of: (1) good cause and, (2) no prejudice to the non-moving party. Under the Local Patent Rule, good cause would include a claim construction by the Court different from that proposed by the party seeking amendment. Here, however, because the Court adopted Plaintiff’s own proposed claim construction, the Court did not believe there was sufficient “good cause” for the Plaintiff to amend its infringement contentions. In its reasoning, Judge Whaley noted that in contrast to the more liberal policy for amending pleadings, “the philosophy behind amending claim charts is decidedly conservative, and designed to prevent the ‘shifting sands’ approach to claim construction.”   LG Elecs. Inc. v. Q—Lity Computer Inc., 211 F.R.D. 360, 367 (N.D.Cal. 2002). The local patent rules were “designed to require parties to crystallize their theories of the case early in the litigation and to adhere to those theories once they have been disclosed.”  O2 Micro Int’l Ltd. v. Monolithic Power Sys., Inc., 467 F.3d 1355, 1366 n. 12 (Fed. Cir. 2006) Key Takeaway:  While a plaintiff often is allowed to amend its infringement contentions after a Markman ruling,  a court may not allow such an amendment if it is based upon the same Markman ruling that  plaintiff requested in the first place.