April 2013

Fed. Cir. Affirms Invalidity Findings By E.D. Texas Jury

Claims from four patents were infringed, but invalid as anticipated and obvious, a jury in the Eastern District of Texas found. In an opinion by Chief Judge Rader, the Federal Circuit rejected the patent owner’s challenge to the jury verdict as a matter of law, and also rejected its request for a new trial. Ceats, Inc. v. Continental Airlines, Inc., No. 2012-1614 (Fed. Cir. April 26, 2013). CEATs, Inc. had alleged that various airlines and online reservation companies infringed U.S. Patent Nos. 7,454,361,7,548,866, 7,660,728, and 7,548,869. The patents were directed to “providing information over a network about the availability of seats at an event or on a plane flight, and permitting the user to select or purchase the seats of his choice.” One patent was directed specifically to selecting airline seats. Another recited “information relating to ‘sets of individual seats.’” In contrast, other patents recite information related to a “plurality of available individual seats.” At trial, the defendants focused on Microsoft’s Expedia, which indisputedly was publicly used prior to the priority date of the patents-in-suit. Expedia, as some of us old folks may recall, “was [and is] an online travel reservation system that permitted customers to buy plane tickets and… Read More »Fed. Cir. Affirms Invalidity Findings By E.D. Texas Jury

Form 18 Trumps Iqbal and Twombley, Says Fed. Cir.

Form 18 of the Federal Rules of Civil Procedure is the definitive authority concerning whether a plaintiff has adequately plead a claim of patent infringement. K-Tech Telecommunications, Inc. v. Time-Warner Cable, Inc., Nos. 2012-1425 and 2012-1446 (Fed. Cir. April 18, 2013). If Form 18 conflicts with Bell Atl. Corp. v. Twombly, 550 U.S. 544 (2007) and Ashcroft v. Iqbal, 556 U.S. 662 (2009), Form 18 controls. Thus, the Court reaffirmed its decision in R+L Carriers, Inc. v. DriverTech LLC (In re Bill of Lading Transmission & Processing System Patent Litigation), 681 F.3d 1323 (Fed. Cir. 2012), which came down a few weeks after the appeal in the present case was filed. The plaintiff had sued several parties for allegedly infringing four patents generally directed to “modifying a major channel number, a minor channel number, and/or a carrier frequency to identify a television program.” The district court first granted the defendants’ motion to dismiss and allowed the plaintiff to amend its complaint, and then granted a dismissal altogether after, in the district court’s view, the plaintiff had still failed to meet the requirements of Iqbal and Twombley. The complaints at issue alleged that the defendants “infringe the K-Tech patents by ‘making,… Read More »Form 18 Trumps Iqbal and Twombley, Says Fed. Cir.

Patent Litigation Protective Orders: Patent Prosecution Bars, Source Code

In a lawsuit where the plaintiff, Unwired Planet, had asserted 10 patents against Apple, the parties disagreed about the appropriate scope of a protective order. Unwired Planet, LLC v. Apple. Inc., No. 3:12-CV-00505-RCJ (VPC) (D. Nev. April 11, 2013). One disagreement concerned whether a patent prosecution bar should prevent the plaintiff’s litigation counsel from participating in reexamination proceedings so long as the litigation counsel did not draft or amend claims. The parties also disagreed concerning Unwired Planet’s ability to print Apple’s source code, and the manner in which it could include source code in court filings. Patent Prosecution Bar Concerning the patent prosecution bar, the parties had agreed “to a provision barring litigation counsel for either party from participating in the prosecution of patent applications related to ‘the functionality, operation, and design of the mobile applications relating to the technology disclosed in any of the patents-in-suit.’” However, Apple further argued that counsel who had accessed its highly confidential information, including source code, should be barred from any participation in (1) re-examination proceedings or (2) patent acquisition related to the foregoing functionality. The magistrate judge agreed with the plaintiff Unwired Planet that the patent prosecution bar need not be applied wholesale… Read More »Patent Litigation Protective Orders: Patent Prosecution Bars, Source Code

Software Copyright Infringement Defenses: Ownership of a Copy and Implied License

A defendant accused of infringing a software copyright was, according to facts plead in the plaintiff’s complaint, an owner of a copy of the software under 17 U.S.C. § 117(a)(1). Further, the facts established that the defendant had an implied license. Therefore, the court in Zilyen, Inc. v. Rubber Mfrs. Ass’n, No. 12-0433 (RBW) (D.D.C April 2, 2013), granted the defendant’s motion to dismiss under Federal Rule of Civil Procedure 12(b)(6). As plead in the plaintiff’s complaint, the parties had entered into a contract for the plaintiff to deliver to the defendant CDs that included content specified by the defendant. The defendant paid half of the agreed-upon price to the plaintiff upon execution of the contract. When the CDs were delivered, the defendant’s employees ran the CD software on their computers, and alleged that there was an error.  The defendant never paid the balance of the contract price. The plaintiff sued, alleging breach of contract and copyright infringement. The defendant moved to dismiss (and also brought counterclaims, which the plaintiff moved to dismiss). The plaintiff alleged that, when the defendant’s employees used the CD software, they made unauthorized, unlicensed copies. The defendant raised affirmative defenses of implied license and that its actions… Read More »Software Copyright Infringement Defenses: Ownership of a Copy and Implied License

Settlement Agreement Forum Selection Clause Read Narrowly

Forum selection clauses in settlement agreements should be very carefully worded. That is the lesson of Synopsys Inc. v. Mentor Graphics Corp., No. C 12-5025 MMC (N.D. Cal. April 3, 2013), where the court refused to apply the forum selection clause in a settlement agreement. The court reasoned that a provision for the retention of jurisdiction by a prior court did not apply where it was invoked not in an action to enforce the settlement agreement, but as an affirmative defense in a declaratory judgment action claiming that patents were invalid and not infringed. Mentor Graphics sued EVE for patent infringement in the District of Oregon in 2006. That case settled. After a settlement conference, the court made a minute entry in the docket as follows: “Case settles. The clerk is directed to enter a 60 day order of dismissal. The court shall retain jurisdiction over the settlement agreement.” The clerk did not mention retention of jurisdiction in the settlement order, which, as filed, stated that the case was “dismissed with prejudice, subject to either party reopening the case in the event of failure to consummate final settlement within sixty (60) days.” Mentor Graphics and EVE then did enter into a settlement… Read More »Settlement Agreement Forum Selection Clause Read Narrowly

Evidence Not Required to Rebut Presumption That Anticipatory Prior Art Is Enabled

The Federal Circuit has clarified a patent applicant’s burden to rebut the presumption that a prior art reference is enabling of allegedly anticipated claims. In re Morsa, No. 2012-1609 (Fed. Cir. April 5, 2013). The court therefore vacated and remanded a decision from the Board of Patent Appeals and Interferences, where the Board had affirmed a patent examiner’s rejections under 35 U.S.C. § 102. However, the court did affirm the Board with respect to obviousness rejections, under 35 U.S.C. § 103, of numerous of the applicant’s claims. The rejected claims were generally directed to “receiving a benefit information request from a user, searching a benefit information database for benefits matching the request, and then returning benefit information to the user.” The single piece of prior art cited by the examiner was a 127 word press release that disclosed “a state-of-the art software program designed to help maximize the benefits and services that consumers receive from public and private agencies. It can be configured to evaluate any or all benefits and programs required – Federal, State and/or local.” The examiner alleged that various features of the claims were either explicitly or implicitly disclosed in the press release, or would have been… Read More »Evidence Not Required to Rebut Presumption That Anticipatory Prior Art Is Enabled