Thursday, March 15, 2018

Previously Undisclosed Market Share Apportionment Theory Stricken From Expert Report

The court overruled plaintiff's objections to the magistrate judge's order partially striking the report of plaintiff's damages expert. "⁠[Plaintiff] contends . . . all of the information [the expert] relied upon in forming his market share apportionment opinion was made known to [defendant] during fact discovery. To the extent [defendant] needed additional third-party discovery, [plaintiff] alleges it is [defendant's] fault for not seeking it earlier. The Court disagrees. Even if all the information [the expert] relied upon in forming his opinion was made known to [defendant], the market share apportionment theory itself was never disclosed prior to [his] report. Instead, [plaintiff] maintained only its two-player/product market theory, a theory that (at least in part) contradicts the newly-asserted market apportionment theory. That [defendant's] own discovery may have shown that the market was not a two-party/product market is not the issue."

Integra LifeSciences Corporation et al v. HyperBranch Medical Technology, Inc., 1-15-cv-00819 (DED March 13, 2018, Order) (Stark, USDJ)

Wednesday, March 14, 2018

Post-Trial Amendment of Pleadings Permitted to Assert Alter-Ego Claim Against Bankrupt Defendant’s Individual Owners

Following a $30 million jury verdict and defendant's filing for bankruptcy, the court granted plaintiff's motion to amend its complaint to add defendant's co-owners as defendants along with alter ego and veil-piercing claims. "⁠[Plaintiff] explains that it learned of [defendant's] and the [defendant's owners'] alleged efforts to avoid liability only when it reviewed the bankruptcy filings.⁠ . . . [Defendant] counters that [plaintiff] was 'on clear notice before trial of the substantial risk that [defendant] would be unable to pay the enormous sums [plaintiff] was seeking. Had it wanted to hedge its bets by asserting claims against other entities, it should have sought leave to do so long before now.' But that argument entirely misses the point. Veil-piercing and alter-ego claims are not mere contingency plans for uncollectable defendants. They are specific theories of liability which, absent plausible grounds, would be frivolous to plead. [Plaintiff] argues that the alleged abuse of the corporate form -- the necessary fact that underlies veil-piercing and alter-ego claims -- only came to light later on. The Court certainly will not punish [plaintiff] for failing to assert a claim prior to having the evidence to back it up."

FieldTurf USA, Inc. et al v. Astroturf, LLC, 2-10-cv-12492 (MIED March 12, 2018, Order) (Murphy, USDJ)

Tuesday, March 13, 2018

Apple Not Collaterally Estopped From Denying Infringement by Redesigned Version of FaceTime

The court denied plaintiff's motion for summary judgment that the redesigned version of defendant's adjudicated product infringed its network security patents because there were genuine disputes of material fact which precluded a finding of collateral estoppel. "⁠Apple argues that issue preclusion is inapplicable here, as the redesigned product differs in design and operation from the product at issue in the [earlier lawsuit]. . . . Particularly, Apple notes that the accept message from the FaceTime servers to the caller device was changed between the first version of FaceTime and the redesigned FaceTime. Apple suggests this change to FaceTime was so significant that the servers can no longer meet the 'indication' requirement of the claims. . . . [T]he accused devices in this case are not essentially the same as the devices at issue in the [prior] case. [Defendant] has raised a question of material fact as to whether the redesigned version of [the adjudicated product] infringes the claims of the asserted patents. The parties’ arguments stem from a fundamental factual dispute with respect to the design and operation of the redesigned product, which the Court declines to resolve at summary judgment. Whether, after the changes to the accept message, the [accused] servers fall within the scope of the court’s claim construction is a question of fact for the jury to resolve at trial."

VirnetX Inc. et al v. Apple Inc., 6-12-cv-00855 (TXED March 9, 2018, Order) (Schroeder, USDJ)

Monday, March 12, 2018

Office Closed a Few Weeks Before Lawsuit is a Regular and Established Place of Business for Venue

The court overruled defendant's objection to the magistrate judge's recommendation to deny its motion to transfer for improper venue because defendant had a regular and established place of business in the district through its office that closed a few weeks before plaintiff filed suit. "Abiding by the Federal Circuit's admonition that '⁠[i]n deciding whether a defendant has a regular and established place of business in a district, no precise rule has been laid down and each case depends on its own facts,' the undersigned finds that the fact that [plaintiff] filed suit in this District within weeks after [defendant] closed its doors is reasonable. Finding that [defendant's] established and regular business in the District weeks before suit was filed is sufficient for establishing venue pursuant to Section 1400(b) does not offend Section 1400(b)'s purpose 'to eliminate the "abuses engendered" by previous venue provisions allowing such suits to be brought in any district in which the defendant could be served.'"

ParkerVision, Inc. v. Apple Inc. et al, 3-15-cv-01477 (FLMD March 8, 2018, Order) (Davis, USDJ)

Friday, March 9, 2018

Clinical Activities Within § 271(e)(1) Safe Harbor Are Not “Acts of Infringement” For Determining Venue

The magistrate judge recommended granting defendants' motion for summary judgment of improper venue because there were no infringing acts in the district inasmuch as the accused activities fell under the safe harbor provision of 35 U.S.C. § 271(e)(1). "Plaintiff has not alleged any facts showing activities in this District other than those statutorily exempted from infringement by § 271(e)(1). . . . [T]he relevant question here is not whether Defendants engaged in uses outside the District that are not 'solely' or 'reasonably related' to seeking FDA approval, but rather, whether Defendants have engaged in any such uses in this District so that venue is proper. . . . [A]ll acts of infringement in the Eastern District of Texas are solely clinical, and therefore, the § 271(e)(1) safe harbor applies despite purported nonexempt activity in Minnesota."

Snyders Heart Valve LLC v. St. Jude Medical SC, Inc. et al, 4-16-cv-00812 (TXED March 7, 2018, Order) (Priest Johnson, MJ)

Thursday, March 8, 2018

Expert Testimony Based on Modified Claim Construction Precluded

The court granted in part plaintiff's motion in limine to preclude expert testimony premised on a revised construction of the claim term in question. "⁠[T]he court [previously] construed the claim term 'intumescent' to describe 'a substance that swells and chars upon exposure to heat or flame.' . . . [O]ver three years after the claim construction . . . [defendant] seeks to offer evidence from one of ordinary skill in the art that infringement of the claim term 'intumescent' requires proof that the coating 'swells to a sufficient degree to act as a thermal barrier to lessen the effects of heat or flame on the underlying fabric.' . . . [T]he court declines to further define the term 'swell.' . . . [Defendant] should be permitted to present evidence by an expert as to whether he observes any swelling . . . and criticisms of [plaintiff's] expert’s findings. . . . [H]e may not testify as to any opinion that the results reportedly observed by [plaintiff's expert] fail to indicate swelling 'to a sufficient degree to act as a thermal barrier to lessen the effects of heat or flame on the underlying fabric' because he has conducted no testing to support such a statement."

Precision Fabrics Group, Inc. v. Tietex International, Ltd., 7-17-cv-03037 (SCD March 5, 2018, Order) (Schroeder, USDJ)

Wednesday, March 7, 2018

Initiating Ex Parte Reexamination Instead of Inter Partes Review No Basis For Denying Stay

The court granted defendant's motion to stay pending its requests for ex parte reexamination and rejected plaintiff's argument that defendant was engaging in gamesmanship by not seeking inter partes review. "⁠[Plaintiff] argues that [defendant] only made this choice because it wanted to delay this litigation as much as possible, as evidenced by the longer timeline for completion of ex parte reexamination and the fact that reexamination does not have the same estoppel effect as IPR. . . . [I]t was reasonable for [defendant] to choose not to pursue IPR given that the constitutionality of the procedure is currently being considered by the United States Supreme Court. . . . Moreover . . . choosing ex parte reexamination makes economic sense because IPR filing fees alone would cost $50,000 more than reexamination."

Carlson Pet Products, Inc. v. North States Industries, Inc., 0-17-cv-02529 (MND March 5, 2018, Order) (Menendez, MJ)