A recent court decision precluding a patent owner from relying on any of its proffered evidence to support a proposed reasonable royalty rate should be studied carefully by patent owners. See Acceleration Bay LLC. v. Activision Blizzard Inc., C.A. No. 16-00453-RGA, 2018 U.S. Dist. LEXIS 178362 (D. Del. Oct. 17, 2018). The case underscores how closely courts are evaluating evidence put forward to support a proposed reasonable royalty and the need to carefully vet such evidence (and decide who will present it) early in the case. In Activision, the defendant moved to preclude the plaintiff’s damages theories and supporting evidence. The court granted-in-part defendant’s motion. The plaintiff patentee had sought to support its proposed reasonable royalty rate of 15.5 percent with four pieces of evidence: (1) testimony of its Vice President of Licensing; (2) testimony of its CEO; (3) an industry report; and (4) an agreement between the defendant and a third party. The court precluded all four categories of evidence. First, the court precluded the testimony of the plaintiff’s licensing executive, stating that a reasonable royalty opinion is necessarily based on specialized knowledge, which the executive lacked. The court also found that the executive lacked personal knowledge of the...
Author: Wendy R. Stein
A recent district court decision found prosecution disclaimer stemming from statements by a patentee distinguishing its inventions from the prior art when opposing inter partes review. See Game & Tech. Co. v. Blizzard Entm’t, Inc., 2018 U.S. Dist. LEXIS 58424 (C.D. Cal. Apr. 4, 2018). As alleged infringers are increasingly filing petitions for inter partes review of patents asserted against them, the case illustrates how to use statements made by a patentee to oppose inter partes review against them in a related district court patent litigation. In Blizzard Entm’t, Game and Technology Co. Ltd. (GTCO) sued the defendant game developer, alleging that the defendant’s manufacture, sale, and distribution of online games infringed three patents: U.S. Patent No. 8,035,649, 8,253,743, and 7,682,243. After the Court transferred the case from the Eastern District of Texas to the Central District of California, the defendant petitioned for IPR of all patents-in-suit and moved to stay the action pending inter partes review. The Court stayed the case pending inter partes review. In March 2018, the Patent Trial and Appeal Board (PTAB) issued a decision concerning the ‘743 patent, finding all claims unpatentable under 35 U.S.C. § 103. As to the ‘649 and ‘243 patents however,...
Barco, N.V. & Barco, Inc. v. Eizo Corp. & Eizo Inc., aff’d, Barco, N.V. & Barco, Inc. v. Eizo Corp. & Eizo Inc., Appeal No. 2017-2086 (Fed. Cir. Apr. 3, 2018) is the latest federal district court decision analyzing the rule against recapture under 35 U.S.C. § 251. The Court of Appeals for the Federal Circuit summarily affirmed the lower court’s decision under Rule 36. As patent applicants are increasingly using the reissue process to try to remove limitations relied upon to distinguish prior art during an original prosecution – in many instances to broaden claim scope to cover a competitor’s product – Barco follows a judicial trend of courts stamping down on this abuse of the reissue statute. Violation of the rule against recapture has been treated as a question of law reserved for the court as opposed to the jury. Courts analyzing the issue use a three step test: 1) whether, and in what respect, the reissue claims are broader in scope than the original patent claims; 2) whether the broader aspects of the reissue claims relate to subject matter surrendered in the original prosecution; and 3) whether the reissued claims were materially narrowed in other respects to...
Merz N. Am., Inc. v. Cytophyl, Inc. is the latest federal district court decision analyzing the meet and confer requirement of Federal Rule of Civil Procedure 37. As discovery issues continue to dominate the first 12 to 18 months of civil litigation (depending on the jurisdiction), litigators should review recent decisions, at least one of which denied a discovery motion for failure to adequately meet and confer. Under Rule 37(a)(1), a party moving to compel discovery must certify that it “has in good faith conferred or attempted to confer with the person or party failing to make . . . discovery in an effort to obtain it without court action.” Because neither the Rule nor the advisory notes accompanying it specify which methods of conferring are appropriate, individual courts have interpreted Rule 37’s meet and confer requirement through local rules and judicial decisions. For example, the Local Rules for the Eastern District of Texas require, “at a minimum, a personal conference, by telephone or in person, between an attorney for the movant and an attorney for the non-movant.” Further, while some courts have addressed the merits of a motion to compel despite a failure to adequately meet and confer, see,...
The United States District Court for the District of Nevada recently issued an Order casting doubt on a litigant’s ability to obtain blanket discovery from an adversary’s prior patent litigation without a specific showing of relevance. Anyone opposing overbroad discovery requests seeking “all documents” from a prior patent litigation should read a series of decisions in the case captioned Racing Optics v. Aevoe Corporation (“Racing Optics”).
U.S. Copyright Office Seeks Public Comment and Holds Public Roundtables Concerning DMCA Safe Harbor Provisions
The United States Copyright Office recently published a notice in the Federal Register (“the Notice”) seeking public comment in connection with a study it is conducting to evaluate the impact and effectiveness of the DMCA safe harbor provisions contained in 17 U.S.C. § 512 (“Section 512”). Comments, due on Friday April 1, 2016, could pave the way for a Congressional amendment to the DMCA and in particular, to the safe harbors relied upon by service providers to avoid liability for copyright infringement by users.
A federal district court in the Northern District of California has recently given litigants in trademark counterfeiting cases guidance on where wrongful seizure claims under the ex parte provisions of the Lanham Act may be brought. The court ruled in United Tactical Systems, LLC v. Real Action Paintball, Inc. that wrongful seizure claims may be brought in any federal court, and not just the court that ordered the seizure. The case should be watched by accused infringers who have been the target of an ex parte seizure under the Lanham Act.
Illinois Court Refuses to Release Frozen Funds or Enlarge Bond Amount in Trademark Counterfeiting Case
A federal district court in the Northern District of Illinois has refused a request by certain defendants accused of trademark counterfeiting to release funds frozen in PayPal accounts and to increase the amount of a bond posted by the plaintiff in the case. The case highlights an uptick in challenges to financial asset restraints by defendants and nonparties in trademark counterfeiting cases and the discretion courts have in setting an appropriate bond to protect defendants in such cases.
Court Orders Nonparty Bank to Produce Documents Said to be Located Abroad in Trademark Counterfeiting Case
After more than five years of litigating access to documents requested in a subpoena directed to a nonparty foreign bank, the district court in Gucci Am. Inc. v. Weixing Li has ordered the bank to produce the documents, despite objections from the bank that production would violate Chinese law. The decision written by Judge Sullivan of the Southern District of New York, is an important decision for brand owners seeking to obtain financial documentation related to the sale of allegedly counterfeit goods.
New York Real Property Owners at Risk for Exposure to Joint and Several Liability in Connection with Trademark Counterfeiting Taking Place on Their Property
Brand owners are increasingly asserting claims against owners of real property where alleged trademark counterfeiting is taking place. Three recent actions filed in the Southern District of New York, styled Michael Kors, LLC v. Mulberry Street Properties Corp., et. al., 15-cv-5504 (S.D.N.Y.); Michael Kors, LLC v. Canal Venture, Inc. et. al., 15-cv-5788 (S.D.N.Y.); and Michael Kors, LLC v. Mid Center Equities Associates, et. al., 15-cv-5856 (S.D.N.Y.), raise the question of when property owners/lessors can be held jointly and severally liable for damages resulting from the sale of counterfeit goods on their properties.