Infringement contentions

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.

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.”        

On July 26, 2013, the Federal Circuit Advisory Council issued a Model Order Limiting Excess Patent Claims and Prior Art (.pdf).   The Model Order requires a successive narrowing of elected patent claims by limiting the patent owner to no more than five asserted claims per patent after issuance of the claim construction order.  Also at that time, the accused infringer is limited to no more than six asserted prior art references per patent.   If the patent owner asserts infringement of only one patent, all per-patent limits are increased by 50%.  The purpose of the Model Order is to control the cost and complexity of patent litigation.  While the patent bar has waited to see how many Courts would adopt the Model Order since July, this author has located only one court to adopt some form of the Model Order, the Eastern District of Texas.  On October 29, 2013, Chief District Judge Leonard Davis of the U.S. District Court for the Eastern District of Texas issued General Order 13-20 (.pdf) that adopted many provisions of the Federal Circuit’s Model Order.  The General Order slightly differs from the Model Order with respect to the timing in electing patent claims and prior art.  Two months prior to the General Order, Judge Michael Schneider issued an opinion in Keranos, LLC v. Silicon Storage Tech. et al., (.pdf), 2013 WL 5763738, *4 (E.D. Tex. Aug. 5, 2013), relying upon the Federal Circuit Model Order in limiting the accused infringer to two or three prior art references per claim. Key Takeaway: Although some anticipated that many District Courts would be quick to adopt the Federal Circuit’s Model Order, adoption of the Model Order has been rare.

      When asserting doctrine of equivalents (“DOE”)  infringement contentions, questions often arise as to how much detail is required under the local patent rules.   Patentees have argued that a detailed DOE element-by-element disclosure is required only when the Court first determines that the claims do not literally infringe.  While the local patent rules often do not expressly state that a patentee must provide an element-by-element DOE disclosure, several courts have required such a detailed DOE disclosure prior to any ruling on literal infringement.

      In Ameranth, Inc. v. Pizza Hut, Inc. et al. (.pdf), 2013 WL 3894880 (S.D. Cal. July 26, 2013), the Court found that a patentee’s initial infringement contentions must include a substantive, DOE element-by-element disclosure under the local patent rules.          In the U.S. District Court for the Southern District of California, Local Patent Rule 3.1e requires that each infringement contention state, “[w]hether each element of each asserted claim is claimed to be literally present and/or present under the doctrine of equivalents in the Accused Instrumentality.”   In an effort to expressly comply with the rule, the patentee included this generic statement for each claim element: “If this element is not found to be literally present, it is present under the doctrine of equivalents.”  The Court ruled that such a generic statement is inadequate under the rules and must be restated with more substantive detail.   Although the Court conceded there was some uncertainty in the law, it was persuaded by several recent opinions from the U.S. District Court for the Northern District of California holding that a patentee must substantively describe the alleged similiarities under the DOE to particular claim elements.  Id. at * 5 (citing Optimum Path, LLC v. Belkin Int’l, Inc., 2011 WL 1399257, *8 (N.D. Cal. April 12, 2011) and Nazomi Communs., Inc. v. Nokia Corp.,, 2013 WL 3146796, *5 (N.D. Cal. June 18, 2013))  The Court reasoned that such a detailed element-by-element disclosure was supported by the policy behind the local patent rules to “crystallize … theories of the case early in the litigation….”  O2 Micro Int’l, Ltd. v. Monolithic Power Sys., 467 F.3d 1355, 1364 (Fed. Cir. 2006) Key Takeaway: When asserting initial DOE infringement contentions, a patentee should research the relevant case law to determine whether the Court will require more than literal compliance with the local patent rule.

When preparing patent infringement claim charts under the local patent rules, a plaintiff will often attempt to provide a single claim chart that applies to many similar products rather than provide a claim chart for each and every accused product. The courts interpreting the local patent rules have differed on whether such representative claim charts are proper. Patent litigants should be well informed on this issue because a court’s interpretation of the local patent rule is often dispositive. In Voxpath RS, LLC v. LG Electronics U.S.A., Inc. (.pdf), the Court ruled that a single infringement claim chart representative of many similar accused products was improper and disallowed the case to proceed on those similar accused products. In its ruling, the Court did not accept the plaintiff’s reliance on previous court rulings from the Eastern District of Texas and the Northern District of California that have allowed for the disclosure of a single chart for multiple accused products where “products likely operate in a manner reasonably similar to the infringement theory described in [plaintiff’s preliminary infringement contentions].”  See, Honeywell Int’l, Inc. v. Acer America Corp., 655 F.Supp.2d 650, 657 (E.D.Tex. 2008).  Instead, the Court emphasized that the local patent rules require a claim chart mapping out where “each infringing product (identified by model number) contains each element of the claim it infringes.” (L. Pat. R. 3.1(b)-(c)) The Court also rejected the plaintiff’s argument that it would be unduly burdensome to create a separate chart for each accused product, especially given the plaintiff’s financial status. Finally, the Court was persuaded by the fact that the plaintiff did not explain how the allegedly similar products were so similar from a technology standpoint that a single claim chart was justified. Key Takeaway: A patent owner should not assume that a single claim chart representative of similar accused products will be found sufficient under the local patent rules. Instead, if such a representative claim chart is relied upon, a plaintiff should be prepared to also disclose how the products are similar or identicial from a technology standpoint to justify a single claim chart under the local patent rules.

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.

Where an accused infringer does not perform all the steps in a method patent claim or does not sell all the components required in a product patent claim, the patent owner is often forced to accuse the infringer with indirect infringement instead of direct infringement.  (See, 35 U.S.C. § 271(b) and (c)).  While the local patent rules are often clear that a patent owner’s infringement contentions must identify the products that directly infringe by “name or model number” when the theory is one of direct infringement,  it is less clear whether the contentions must identify which products directly infringe by “name or model number” when the theory against the accused infringer is one of indirect infringement. In Fujitsu Ltd. v. Belkin Intl. et al., Case No. 5:10-cv-3972, pp. 11-14 (N.D. Cal. Sept.28, 2012), the Court ruled that the patent owner’s indirect infringement contentions must identify those third-party computer cards by name that were directly infringing even though the theory of liability was one of indirect infringement.  In its reasoning, the Court noted that Patent Local Rule 3-1 of the Northern District of California requires that within 14 days after the initial case management conference, the patentee must serve on each opposing party a “Disclosure of Asserted Claims and Infringement Contentions,” identifying “[s]eparately for each asserted claim, each accused apparatus, product, device, process, method, act, or other instrumentality (“Accused Instrumentality”) of each opposing party of which the party is aware.” Patent L.R. 3-1(b). The identification of Accused Instrumentalities must be “as specific as possible,” and should include the “name or model number, if known.”  Id. For claims of indirect infringement, the Infringement Contentions must include “an identification of any direct infringement and a description of the acts of the alleged indirect infringer that contribute to or are inducing that direct infringement. Insofar as alleged direct infringement is based on joint acts of multiple parties, the role of each such party in the direct infringement must be described.” Patent L.R. 3-1(d).  Fujitsu argued to the Court that its indirect infringement contentions were sufficient even though they did not identify by name certain third-party computer cards that were alleged to be directly infringing.  Although Local Patent Rule 3-1(d) does not expressly state that the patent owner must identify the directly infringing third-party product by name, Judge Koh ruled that such an identification is required.  In essence, Judge Kohn incorporated the contention requirements for direct infringement by specific product name into the requirements for indirect infringement contentions.  As a result, the patent owner was not allowed to advance its indirect infringement arguments that relied upon the direct infringement of certain previously unidentified computer cards alleged to be directly infringing.  Key Takeaway:  When preparing infringement contentions that rely upon a theory of indirect infringement, closely examine the local patent rules and corresponding case law to determine what other details concerning the underlying direct infringement should also be disclosed.

After serving its original infringement contentions, a patentee will sometimes discover the existence of additional products that were not included in the infringement contentions. Sometimes these additional products were publicly known before the original infringement contentions were served. Litigants often dispute whether it is fair for these types of products to later be included in the lawsuit as at-issue accused products.

In Smartphone Technologies LLC v. HTC Corporation, 2012 WL 1424173 (E.D. Tex. March 16, 2012), the Court denied plaintiff’s request to amend its infringement contentions by adding three more products that existed prior to the original infringement contentions being served. In June 2011, plaintiff served its original contentions asserting the certain smartphones infringed the at-issue patents. Before any Markman ruling, plaintiff sought amend their infringement contentions by adding twenty additional accused products. Seventeen of the accused products did not exist until after the original infringement contentions were served in June 2011, but three of them did exist previously.  Id. at 1. Plaintiff conceded that it inadvertently omitted two of the three at-issue products that existed before June 2011.  Id. at 3. While the Court denied plaintiff’s request to add the three pre-June 2011 products, it did allow plaintiff to add the seventeen post-June 2011 products.  Id. The Court found that plaintiff “has not demonstrated diligence sufficient for a showing of good cause” as to the three products in existence prior to June 2011.  Id.

Key Takeaway:  A plaintiff  should include all publicly known accused products in its original infringement contentions. Otherwise, some courts may not allow a plaintiff to add those accused products to the patent infringement case.

For a different Court perspective, see Vasudevan Software, Inc. v. International Business Machines, Corp., et al., 2011 WL 940263, *2 (N.D. Cal. 2011) (granting leave to amend infringement contentions based on partially public information because the party had shown due diligence).

Patent owners often face the need to substantively change their infringement contentions after the Court issues its Markman rulings. Whether such amendments are permitted often depends on the local patent rules and the nature of the amendments. 

In Cooper Innovations Group LLC v. Nintendo Co., Ltd., 2012 WL 628465 (W.D. Pa. Feb. 27, 2012), the District Court struck plaintiff’s amended infringement contentions that were served soon after the Court’s Markman hearing. Although Local Patent Rule 3.7 permits an amendment if made in “a timely fashion, asserted in good faith and without purpose of delay,” the Court found that “consideration of any such proposed amendment must balance the asserted need for the amendment with the purposes and philosophy embodied in the Local Patent Rules.” Id. at *2. The local patent rules “seek to advance the orderly progression of patent litigation by requiring the parties ‘to crystallize their theories of the case early in the litigation and to adhere to those policies once they have been disclosed.’ ” Id. at 2. (citing Atmel Corp. v. Info. Storage Devices, Inc., 1998 WL 775115, *2 (N.D.Cal. Nov. 5, 1998).

Here, plaintiff’s original infringement contentions asserted the Wii Console was the “equipment” and the Wii Remote was the “transmitter.” After the Markman ruling, the plaintiff asserted the opposite claiming the Wii Console was now the “transmitter” and the Wii Remote was the “equipment.” Id. at 3. In striking the plaintiff’s post-Markman contentions, the Court reasoned that, “[p]laintiff’s attempt to read the Local Patent Rules as authorizing the supplementation of infringement contentions after claims construction without consideration of the policies underlying the Rules is misplaced. The liberalization of local patent rules was not intended to displace the very purposes for having such rules.” 

Key Takeaway:  Do not assume that one automatically will be able to amend local patent rule contentions after a Markman ruling. 

For a different Court perspective, see SSL Services, LLC v. Citrix Systems, Inc., 2012 WL 909318 (E.D.Tex. March 16, 2012)(allowing amended infringement contentions after Markman ruling) or Vasudevan Software, Inc. v. International Business Machines, Corp., et al., 2011 WL 940263, *2 (N.D. Cal. 2011) at *3-4 (amending charts after claim construction hearing is not prejudicial despite “reasonable arguments” of prejudice by the non-moving party).