Patent litigators sometimes face issues resembling the age old debate: which came first, the chicken or the egg?   While local patent rules require a plaintiff to assert its infringement contentions on all infringing products, the plaintiff sometimes cannot do so on all products because it lacks the necessary discovery to understand certain non-public products such as software.  At the same time, without first asserting those products in its infringement contentions, courts sometimes deny any discovery on those same non-public products.  Similarly, an accused infringer will sometimes need discovery on prior art, but the court will not allow discovery on that prior art until such time it is asserted in an invalidity contention.  In Nippon Steel v. Posco et al. (.pdf), 2014 WL 1266219, *1 (D.N.J. March 26, 2014), the District Court denied a defendant’s requested discovery on plaintiff’s own prior art manufacturing process.  The Court reasoned that because the defendant did not assert the plaintiff’s manufacturing process as prior art in its invalidity contentions, no further discovery would be permitted on that process.  The Court further relied upon Local Rule 3.3(a) which requires that all prior art be asserted in the invalidity contentions.  The Court further implied that the defendant should have asserted all the potential prior art even if it did not possess all the details required by the local rule. “[Defendant] never sought to assert any contentions, detailed or not, regarding what they now allege is prior art.  If our Local Patent Rules are to have any impact, they cannot create an incentive for parties to evade disclosure of their positions until deadlines have expired.” Key Takeaway: At least according to this Court, a defendant would be well advised to assert all potential prior art in its invalidity contention even if it does not yet possess all relevant details concerning the prior art.  Otherwise, the defendant may well be denied discovery and the ultimate use of the prior art to prove invalidity.    

Following the lead of the U.S. District Court for the District of New Jersey, the U.S. District Court for the Eastern District of Texas just announced the adoption of a General Order amending the disclosure requirements for cases under the Hatch-Waxman Act, 21 U.S.C. § 355.  The new rule takes effect after a notice and comment period ending on April 1, 2014.   Similar to local patent rule 3.6(j) from the District of New Jersey, the new Eastern District of Texas local patent rule 3-8(e) requires the following:

“(e) Each party that has an ANDA application pending with the Food and Drug Administration (“FDA”) that is the basis of the pending case shall: (1) notify the FDA of any and all motions for injunctive relief no later than three business days after the date on which such a motion is filed; and

(2) provide a copy of all correspondence between itself and the FDA pertaining to the ANDA application to each party asserting infringement, or set forth the basis of any claim of privilege for such correspondence, no later than seven days after the date it sends or receives any such correspondence.”

The stated purposes of the new rule are to help ensure coordination between related FDA proceedings and district court litigation, and also avoid a recurring discovery issue regarding the production of correspondence to and from the FDA both prior to and during litigation.   The District of Idaho also has a local patent rule for Hatch-Waxman cases, but has not yet adopted this specific disclosure rule.  It will be interesting to see if more District Courts also adopt this new local patent rule.

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.”        

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 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.

      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.

Following up on my earlier post dated December 28, 2012, the proposed local patent rules at the United States District Courts for the Eastern and Southern Districts of New York are now in effect as of April 8, 2013.  The local patent rules for the Eastern District of New York (.pdf) and the Southern District of New York (.pdf) are much less detailed than local patent rules adopted by other courts.  For example, the Eastern and Southern Districts of New York only require the following for infringement contentions, “… a party claiming patent infringement must serve on all parties a ‘Disclosure of Asserted Claims and Infringement Contentions,’ which identifies for each opposing party, each claim of each patent-in-suit that is allegedly infringed and each product or process of each opposing party of which the party claiming infringement is aware that allegedly infringes each identified claim.”  (L.P.R. 6)  This minimal disclosure stands in stark contrast to other courts such as the Northern District of California which require much more detail for infringement contentions.

To obtain a more convenient location for a court fight, patent infringement defendants sometimes attempt to transfer their case to a forum closer to home.  Because all federal district courts possess the same subject matter jurisdiction to hear patent infringement cases, patent infringement defendants rarely assert that one federal court is more substantively equipped to hear the case over another.  Still, the question has been raised as to whether certain courts with local patent rules are, in fact, more substantively equipped to adjudicate patent infringement cases.  In One StockDuq Holdings, LLC v. Becton, Dickinson and Company (.pdf), 2013 WL 1136726 (W.D. Tenn. March 18, 2013), the Court recently ruled that its own set of local patent rules was one factor supporting the denial of a case transfer.   At issue was the defendant’s request for the Court to transfer the case from the Western District of Tennessee to the District of Utah which does not have its own local patent rules.  In its reasoning the Court stated, “[w]hile this Court has no reason to believe that there is any material difference in the expertise or manner of handling patent cases in the Western District of Tennessee and the District of Utah, Plaintiff’s selection of this Court is a rational one.  This Court uses Local Patent Rules for the management of patent cases and is the only Patent Pilot Program court located in the same circuit as Plaintiff.  A Plaintiff’s rational choice of forum should be entitled to some deference in considering whether to transfer the action to a different district.”  (Id. at pp. 20-21)  The Court further noted that there is some evidence suggesting that district courts with more patent cases are affirmed at a greater rate by the Federal Circuit than district courts in general.  See Adam Shartzer, Patent Litigation 101: Empirical Support for the Patent Pilot Program’s Solution to Increase Judicial Experience in Patent Law, 18 Fed.Cir.B.J. 191, 232-33 (2009).”  (Id. at 20) Key Takeaway: For those patent litigants facing a motion to transfer, the presence or absence of local patent rules may be enough to tip the transfer question in their favor.