IP Law Alert : Intellectual Property Lawyers & Attorneys : Gibbons Law Firm : Copyrights, Patent Infringement, Unfair Competition

In Re Acer America Corp. is the latest in a growing body of opinions authored by the Federal Circuit finding that the United States District Court for the Eastern District of Texas has abused its discretion in denying the transfer of a case to a more convenient venue under 28 U.S.C. § 1404(a). The United States Court of Appeals for the Fifth Circuit launched the opening salvo against the Eastern District’s unwillingness to transfer cases in its In re Volkswagen of America, Inc. opinion, and the Federal Circuit repeatedly has followed suit, granting writs of mandamus in favor of transfer in In re Nintendo Co., In re Hoffman-La Roche, Inc., In re Genentech, and In re TS Tech.

In the instant case, the U.S. District Court for the Eastern District of Texas denied a motion by twelve defendants seeking to transfer a patent infringement case to another district. The transfer motion was based primarily on the fact that all but one of the U.S.-based defendants were headquartered in California. Dell, as the lone Texas-based defendant, operates its headquarters outside of the Eastern District, 300 miles from Marshall, Texas, where the litigation was pending before Judge Everingham.

The Federal Circuit began its analysis by applying the public and private factors used in a forum non conveniens analysis. The private factors of the analysis include (1) the relative ease of access to sources of proof; (2) the availability of compulsory process to secure the attendance of witnesses; (3) the cost of attendance for willing witnesses; and (4) all other practical problems that make a trial easy, expeditious and inexpensive. The public factors to be considered are (1) the administrative difficulties flowing from court congestion; (2) the local interest in having localized interests decided at home; (3) the familiarity of the forum with the law that will govern the case; and (4) the avoidance of unnecessary problems of conflicts of laws or in the application of foreign law.

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On December 1, 2010, the latest version of the Federal Rules of Civil Procedure went into effect. As part of the new rules, significant changes were made to Rule 26 regarding the discovery of information from experts retained to provide testimony. As of Wednesday, witnesses who were not previously required to provide a written report must now provide a summary disclosure of their opinion. In addition, draft expert reports and some communications between expert witnesses and counsel will no longer be discoverable, and expert reports will now only need to contain information regarding “facts or data considered by the witness in forming” an opinion.

Of special interest are the last two changes to Rule 26. Specifically, Fed. R. Civ. P. 26(a)(2)(B)(ii)  will now limit expert reports to “facts or data” rather than having previously required the disclosure of “data or other information” considered by the witness. As explained in the notes of the Advisory Committee, the facts or data limitation is meant to keep these disclosures to those which are factual in nature and will now exclude the discovery of counsel’s theories or mental impressions.

Similarly, draft expert reports and communications between expert witnesses and counsel will no longer be discoverable. Rather, the Advisory Committee explained that Fed. R. Civ. P. 26(b)(4) will now provide work-product protection against the discovery of “draft reports and disclosures or attorney-expert communications.” However, there will be three exceptions to the protection of attorney-expert communications, namely, those involving an expert’s compensation; facts or data provided by the attorney to an expert that were used in forming the opinion; and any assumptions that counsel provided to the expert and were relied upon to form the opinion.

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The Federal Circuit’s recent decision in AstraZeneca LP v. Apotex Inc. illustrates the tension that generic drug manufacturers may face between complying with FDA labeling requirements and avoiding trespassing on others’ patent rights. In that decision, the Federal Circuit affirmed the District Court of New Jersey’s ruling enjoining Apotex’s “at risk” launch of a generic version of an inhaled corticosteroid for asthma patients. In short, AstraZeneca owned a method patent on once-daily dosing of the drug at issue. Although Apotex omitted all references to once-daily dosages from its product label, it was required by the FDA to include “downward titration” language that encouraged patients to reduce their daily intake of the drug to the lowest dose that provides a beneficial effect. AstraZeneca argued that this language induced patients to infringe its method patent, and the court agreed.

For its part, Apotex argued that it lacked the specific intent required to induce infringement because its product label did not instruct patients to engage in the infringing once-daily dosing, and because its instructions allowed for non-infringing use of the drug. The Federal Circuit was not persuaded. Rather, it agreed with the lower court that the language encouraging reduced intake would necessarily result in some users engaging in AstraZeneca’s patented method. The court also found that Apotex’s attempt to design its label around the infringing use showed that it had the requisite knowledge and intent to induce infringement.

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