Eastern District of Texas Federal Court Practice

Orion II: Summary Judgment of Infringement as to Hyundai's Redesigned Websites

Hyundai Motor America v. Clear With Computers, LLC, No. 6:08cv00302 (E.D. Tex., Aug. 24, 2009)
Holding: Motion for Summary Judgment on Noninfringement DENIED; Infringement GRANTED
Judge: Leonard Davis   

This case arises out of the Orion IP, LLC v. Mercedes-Benz USA, LLC, et al., 6:05cv322 litigation.  Orion settled with all defendants except Hyundai prior to trial. At trial, Hyundai alleged it did not infringe the patents and the patents were invalid. The he jury found Hyundai infringed the ‘627 patent, its infringement of the patent was willful, the ‘627 patent was not invalid, and Hyundai did not infringe the ‘342 patent. The jury awarded Orion $34 million in damages for Hyundai’s infringement of the ‘627 patent. The Court entered final judgment on the verdict and awarded Orion an ongoing royalty for Hyundai’s continued infringement.

Hyundai now claimed that it had redesigned its websites so that they no longer infringed, and filed this declaratory judgment action.  The plaintiff formerly known as Orion counterclaimed that you can put lipstick on a pig, but what you're doing with it is still illegal (at least in most states).  Judge Davis noted that the issues were before him on cross-motions for summary judgment and that the parties did not have any factual disputes as to how the changes have affected the websites.  Accordingly, after reviewing the applicable facts, he found that the accused websites were still infringing the patents, and according denied Hyundai's motion and granted CWC's. 

Patent case transferred to California

Chrimar Systems, Inc. v Garrettcom, Inc., et al, 2:09-cv-00085 (E.D. Tex., Aug. 27, 2009)
Holding: Motion to Transfer Venue GRANTED
Judge: T. John Ward

Friday was a good day for defendants!

Defendants' motion to transfer venue for convenience in this case was granted.  The remaining two defendants in this case had principal offices located in the transferee forum, and the Plaintiff . . . had no connections in the Eastern District, thus Judge Ward held that the "clearly more convenient" standard was met.

Patent Case Conditionally Stayed Following Final Office Action (plus a little lagniappe)

QPSX Developments 5 Pty Ltd. v. Ciena Corporation et al, 2:07-cv-00118 (E.D. Tex., Aug. 27, 2009)
Motion for Stay Pending Reexamination CONDITIONALLY GRANTED
Judge: Chad Everingham

Judge Everingham granted defendants' motion to stay pending an appeal of a final rejection in reexamination (plus some additional office actions, but pending appeal to the BPAI) on the condition the parties stipulate to not (1) argue invalidity at trial regarding prior art considered in the reexamination, or (2) pursue another reexamination.

The particular facts in the case were important to the Court, which wrote that "[t]he posture of the current reexamination proceedings concerning the [patent-in-suit] is unlike a number of other cases in which this court has denied motions to stay. Here, the claims in suit stand rejected multiple times, by multiple examiners. . . . [B]ecause the only claims asserted in this case are involved in reexamination, disposition of the appeal adversely to [plaintiff] will likely resolve the issues in this case - [plaintiff] unequivocally admits that it does not intend to amend the claims at issue."

Motion for Partial Summary Judgment on Indefiniteness Granted; Motion to Strike Expert Declaration Denied (but with a caveat)

Michael S. Sutton Ltd. v. Nokia Corp., --- F.Supp.2d ----, 2009 WL 2460994 (E.D.Tex. Aug 10, 2009) (NO. 6:07CV203)
Judge: Leonard Davis
Holding: Defendant's Motion for Partial Summary Judgment on the issues of indefiniteness, enablement, and utility GRANTED; Motion to Strike expert declaration DENIED
This is a claims construction opinion which also addressed the defendant's motions for partial summary judgment on the issues of indefiniteness, enablement, and utility as to one of the asserted claims, as well as a motion to strike a declaration by the plaintiff's expert.  In the course of construing the claims Judge Davis granted the requested summary judgment as to claim 3 of the asserted patent, but denied the motion to strike the expert's declaration.
With respect to the latter ruling, the Court's analysis was contained in an informative little nugget of a footnote.  In it, Judge Davis stated that the motion to strike provided "no legal basis" for striking an expert declaration attached to a claim construction brief. "However," he continued, "in fully considering Dr. Myler's declaration, the Court was ever mindful that conclusory and unsupported assertions are unhelpful and given very little weight when compared with the intrinsic record. See Phillips, 415 F.3d at 1317."  You ever notice judges don't seem to care much for "conclusory and unsupported" stuff?

Plaintiff Lacks Standing to Pursue Claims Absent Joinder of Owner

US Foam, Inc. v. On Site Gas Systems, Inc., 2009 WL 2605280(E.D.Tex. Aug 21, 2009) (NO. 2:07-CV-466-TJW, 6:08-CV-31-LED)
Judge: T. John Ward
Holding: Motion to Dismiss for Lack of Standing DENIED
What's a patent case without a motion to dismiss for lack of standing at the outset?  It'd be like the waiter forgetting to bring chips and hot sauce, right?  Well, in this case, Judge Ward was served with the requisite chips, salsa (and possibly queso, although the record isn't clear on this point) and denied the defendant's motion to dismiss for failure to join the patent owner, but determined that the patent owner was a necessary party and provided plaintiff leave to amend to add the new party. Judge Ward found that the patent owner had retained a significant amount of interest in the patent in suit, and that the exclusive licensee had failed to show that it has all substantial rights under the patent.  But a dismissal was not proper if the owner could be added, so he gave the plaintiff 60 days to invite the owner to the fiesta (continuing the Tex-Mex theme of this post).  If the defendant was cordially invited to refile the motion to dismiss, at which point the plaintiff would likely assume pinata status.  (For those of you not familiar with a pinata, it's sort of like a cross between pin the tail on the donkey and a lynching).

Patent verdict in Versata v. SAP

The Marshall jury in Judge Everingham's court rendered a verdict in the Versata v. SAP, 2:07cv153 case this afternoon.  The jury found all six submitted claims infringed, inducement and contributory infringement of one claim, found that the defendant has failed to prove one patent invalid for failure to satisfy the best mode requirement, and $138,641,000 in damages.

Summary Judgment Granted by N.D. Cal. in PartsRiver v. Shopzilla

PartsRiver, Inc. v. Shopzilla, Inc. et al (4-09-cv-00811) (N.D. Cal. August 21, 2009)

Judge: Claudia Wilken (N.D. Cal.)

Holding: Motion for Summary Judgment on Invalidity GRANTED

Readers may recall that PartsRiver was one of the first cases transferred out of the Eastern District of Texas earlier this year following the Federal Circuit's opinion in In re TS Tech, with Judge Folsom granting the pending motion to transfer venue to California, finding that "based on the regional nature of this case, that the Northern District of California is clearly more convenient to the parties and the potential witnesses" (he noted that the case was against six California defendants, with a seventh in Washington). 

Last week District Judge Claudia Wilken showed just how convenient California was for the defendants, granting their defendants' summary judgment motion of invalidity based on the on-sale bar. The court found that plaintiff made an offer for sale where "[its] proposal was a formal, written proposal that described the . . . project in five phases, identifying the work to be performed in each phase. . . . The . . . proposal also included a price and time-line for completion of the first phase and estimated costs for phases two through five, broken out by development and data entry. . . . Under these facts, a commercial offer for sale of the patented invention was made."  Judge Wilken rejected plaintiff's argument that a written proposal was part of its experimentation. "[B]ecause experimental use cannot preclude the on-sale bar after a reduction to practice," she wrote, "and Plaintiff concedes that the invention here was reduced to practice, Plaintiff cannot claim experimental use."  The court also rejected plaintiff's argument that "because the demo was a local embodiment and not the internet embodiment, the invention was not reduced to practice. . . . The fact that the inventors did not fully understand the 'full potential' of their invention or still needed to work on the internet embodiment does not preclude a finding that the invention was reduced to practice."

Summary Judgment Ruling Published in Abbott v. Centocor

Centocor Ortho Biotech, Inc. v. Abbott Laboratories, --- F.Supp.2d ----, 2009 WL 1473431(E.D.Tex. May 27, 2009) (NO. 2:07-CV-139)

Judge: T. John Ward

Holding: Summary Judgment as to priority date GRANTED; summary judgment as to anticipation defense DENIED

One of the things that happens when the a big verdict comes out (although none have been quite the size of the $1.6 billion in Abbott v. Centocor) is that the court's prior rulings in the case which Westlaw hadn't deemed worthy of publication start getting published.  This opinion by Judge granting in part one of defendant Abbott's motions for summary judgment just came out.  In it, Abbott argued that Centocor, through its actions before the United States Patent and Trademark Office (“PTO”) during the prosecution of the patents-in-suit, acquiesced to a priority date of no earlier than February 4, 1994. Centocor's acquiescence purportedly transpired through its abandonment of a parent application and the subsequent filing of a continuation-in-part (“CIP”) application in the face of an examiner's 35 U.S.C. § 112 (first paragraph) rejection. Judge Ward granted Abbott's motion for summary judgment that Centocor was entitled to a priority date of no later than February 4, 1994, but denied Abbott's motion that all of the asserted claims of the patents-in-suit were invalid as anticipated under 35 U.S.C. § 102(b).

Claims construction resulting in dismissal affirmed on appeal

RFID Tracker Ltd. v. Wal-Mart Stores Inc., (NO. 6:06 CV 363)
Judge: Leonard Davis
Holding: Claims construction ruling affirmed.

Blog readers may recall that last February Judge Davis entered a claims construction order in this case, which can be found at RFID Tracker Ltd. v. Wal-Mart Stores Inc., --- F.Supp.2d ----, 2008 WL 382317, E.D.Tex., February 11, 2008.  As part of the claim construction order in this case, he adopted Defendants’ definition of the term “interrogator/reader” and construed it to mean “an interrogator/reader that includes a field generator and a receiver, but not a transmitter”.  The Plaintiff subsequently stipulated to noninfringement as a result of the Court's claims construction ruling, and a final judgment was entered, followed by an appeal.

Last week the Federal Circuit affirmed Judge Davis' ruling in an unpublished per curiam opinion. 

Eastern District Bench/Bar Conference Details Announced

The brochure just came out for the 13th Annual Eastern District of Texas Bench/Bar Conference, which will be held October 15 and 16 at the Westin Stonebriar Resport in Frisco, Texas (reputed to be less susceptible to hurricanes than Galveston).  Download Bench Bar 09 Brochure

The panels all look good, but my personal favorite is the one I'll be chairing, What Every Law Clerk Knows, And What You Should Find Out, with Aileen Durrett, Career Law Clerk to U.S. District Judge Richard Schell & Benjamin Elacqua, Fish & Richardson, P.C. (and former law clerk to Judge Ron Clark).