Patent Litigation

As 2021 begins and intellectual property (IP) strategies are being developed for the new year, it is a good time to reflect on what IP issues were prominent in 2020.  According to many readers, hot topics included Chinese foreign filing licenses, patenting involving either artificial intelligence (AI) or COVID-19, inter partes review, and attorney fee awards.

A Chinese Court recently decided that it has the willingness, and jurisdiction, to set a global licensing rate that is fair, reasonable, and non-discriminatory (“FRAND”) for standard essential patents (“SEP”). 

Recently in Nike, Inc. v. Skechers U.S.A., Inc., 2:17-cv-08509 (C.D. Cal.) (October 26, 2020), the U.S. District Court for the Central District of California granted-in-part and denied-in-part Defendant, Skechers U.S.A., Inc.’s (“Skechers”), motion to limit Plaintiff, Nike, Inc.’s (“Nike”), claim seeking attorney’s fees related to the infringement of its eight asserted design patents, resulting in the bifurcation of the willfulness issue from the trial on the merits.

In high-stakes litigation, parties go to great lengths to prove their case.  One such example is ongoing litigation between two giants in the paint and coatings world.  Sherwin-Williams Co. and PPG Industries, Inc. are involved in a patent infringement dispute over BPA-free can coatings.

In Network-1 Techs., Inc. v. Hewlett-Packard, No. 18-2338, the Federal Circuit reversed and vacated multiple aspects of the district court’s final judgment holding that Hewlett-Packard (HP) did not infringe U.S. Patent No. 6,218,930 (“the ’930 patent”) disclosing an apparatus and method for remotely powering Ethernet compatible equipment.

In the latest decision addressing antitrust liability for FRAND commitments, Judge Barbara M. G. Lynn of the Northern District of Texas dismissed a complaint from Continental Automotive Systems, Inc. (“Continental”) alleging, inter alia, violations of §§ 1 and 2 of the Sherman Act, and declaratory judgment as to FRAND obligations against Avanci, LLC (“Avanci”) and various members of its patent pool (collectively, “Defendants”).

Another major development in global standard essential patent litigation was handed down today, as the UK Supreme Court upheld lower court rulings that forced an efficient infringer of essential patents to accept a global license or face an injunction.

On July 30, 2020, the U.S. District Court for the District of Delaware, in APS Technology, Inc. v. Vertex Downhole, Inc. et al, No. 19-cv-01166, denied Vertex Downhole’s Rule 12(b)(6) motion to dismiss APS’s patent infringement complaint.

In XY, LLC v. Trans Ova Genetics, LC (Case 2019-1789, issued July 31, 2020), the Federal Circuit provided another example of a life sciences method claim avoiding patent ineligibility under the Alice framework at step one, altogether avoiding the “inventive concept” analysis under step two. 

The Federal Circuit yesterday, in a decision likely to be celebrated by holders of standard essential patents (“SEPs”), found that it is appropriate for the jury to decide essentiality of a patent, rather than the judge during claim construction.  This decision in Godo Kaisha IP Bridge I v. TCL Commc’n Tech. Holdings Ltd. also approved of the use of the standard as evidence of infringement where it was established that the accused products are standard compliant. 

On July 13, 2020, the U.S. District Court for the Eastern District of Michigan, in Mich. Motor Techs., v. Volkswagen Aktiengesellschaft, No. 19-10485, granted Volkswagen’s motion to dismiss Michigan Motor Technologies’ (MMT’s) willful infringement claims and request for enhanced damages under 35 U.S.C. § 284 because MMT failed to allege sufficient facts to plausibly establish that Volkswagen acted egregiously and with knowledge of both the asserted patents and Volkswagen’s infringement thereof.

Yesterday we discussed the Federal Circuit’s decision in Uniloc 2017 LLC v. Hulu, LLC  confirming the Board’s authority to review contingent substitute claims after the original claims have been held invalid by a federal court.  Today we cover the panel’s ruling that the Board can use any patentability requirement to evaluate and reject proposed substitute claims in an IPR, notwithstanding that originally-petitioned claims in such proceedings can only be challenged under §§ 102 and 103 based on prior patents and printed publications.

Entities with patent-related relationships with state universities scored a victory under the rarely implicated (at least for patent practitioners) doctrine of sovereign immunity.  For patent holders, sovereign immunity comes into play when a state actor, for example a state university, enters contracts related to patents, such as in Gensetix v. Baylor College of Medicine. 

Last week a Federal Circuit panel in Uniloc 2017 LLC v. Hulu, LLC issued an important decision regarding inter partes review (IPR) before the Patent Trial and Appeal Board on two questions concerning contingent motions to amend—(i) whether the Office has statutory authority to review the patentability of substitute claims after a final federal-court judgement of invalidity of those claims and, if yes, (ii) whether that review of patentability may include analyzing the substitute claims for patent eligibility under 35 U.S.C. § 101. 

Recently, in Packet Intelligence LLC v. NetScout Sys., Inc., No 19-2041 (July 14, 2020), the Court of Appeals for the Federal Circuit reversed a jury verdict of $3.5 million in pre-suit damages and vacated the trial court’s enhancement of that award because licensees of the asserted patents failed to properly mark allegedly patent practicing products.

Germany’s highest court has clearly and emphatically placed SEP implementers on notice that hold-out will not be tolerated, and that implementers must proactively share the burden and obligation to timely achieve a FRAND license.  An infringer’s conduct during FRAND negotiations is decisively important, and an infringer’s failure to undertake its burden and satisfy its obligations will preclude it from claiming that the patentee acted anti-competitively, or abused a dominant market position. 

Recent oral arguments at the Fed Circuit suggest that the U.S. may be taking steps which would enhance its attractiveness for SEP patent holders looking to resolve licensing disputes.  The Federal Circuit heard oral argument on Monday, July 6th, in Godo Kaisha IP Bridge I v. TCL Commc’n Tech. Holdings Ltd., No. 19-2215, that may pave an easier path for owners of standard essential patents (“SEPs”) to prove literal infringement of products that comply with that standard. 

The Federal Circuit recently reaffirmed a case where common sense was used to supply a missing element in a § 103 obviousness analysis.  On June 26, 2020, the Federal Circuit issued a decision in B/E Aerospace, Inc. v. C&D Zodiac, Inc., Nos. 2019-1935, 2019-1936 (Fed. Cir. Jun. 26, 2020) (“B/E Aerospace”) affirming a Patent Trial and Appeal Board (“PTAB”) final written decision finding patent claims invalid in view of a combination of prior art and common sense.

Judge Albright of the Western District of Texas (“WDTX”) recently rejected yet another attempt by Apple to transfer a patent case to the Northern District of California (“NDCA”). Judge Albright’s June 19, 2020 order describes how Apple—not plaintiff Uniloc—was attempting to forum shop by seeking to move essentially all of its cases filed in Texas to NDCA. 

On June 26, 2020, the U.S. District Court for the District of Delaware, in VLSI Tech. LLC. v. Intel Corp, No. 18-0966-CFC, denied VLSI’s motion for leave to amend to add claims for willful infringement of U.S. Patent Nos. 6,212,633 (the “’633 patent”) and 7,523,331 (“the ’331 Patent”) based on pre-suit activity but granted it as to alleged post-suit infringement (which Intel did not oppose).