Delaware Intellectual Property Law Update

March 7, 2017

Publication| Intellectual Property

Welcome to the latest edition of the Richards, Layton & Finger Intellectual Property Law Update. As always, if you have any questions about any of the decisions listed below or the District of Delaware in general, please let us know.

Chief Judge Stark Denies Defendant’s Request for Supplemental Infringement Contentions
In a rare order on the sufficiency of contentions, Chief Judge Stark denied the defendant’s motion to compel supplemental infringement contentions.  In Takeda Pharmaceutical Company Limited v. Teva Pharmaceuticals USA, Inc., C.A. No. 16-246-LPS (D. Del. Jan. 31, 2017), defendant Teva Pharmaceuticals USA, Inc. (“Teva”) claimed that the plaintiffs’ contentions failed to describe how its ANDA products satisfied the “two distinct components” requirement found in all claims of the patent-in-suit.  Teva also argued that the plaintiffs should not need to take discovery (including any testing of Teva’s tablets) before identifying the basis for their infringement claims.   

Judge Andrews Denies Defendant’s Motion to Dismiss
In Sanofi v. Lupin Atlantis Holdings SA, C.A. No. 15-415-RGA (D. Del. Jan. 26, 2017), Judge Andrews denied defendant Sandoz Inc.’s (“Sandoz”) motion to dismiss the plaintiff’s ANDA infringement action for lack of subject matter jurisdiction.  The motion arose from Sandoz’s filing of a Paragraph IV certification, which it later, during expert discovery, changed to a Paragraph III certification representing that Sandoz would not market its product before the relevant patent expired.  Thereafter, Sandoz filed its motion to dismiss, arguing that the change to a Paragraph III certification divested the Court of subject matter jurisdiction.  Judge Andrews rejected this argument.  

Chief Judge Stark Grants in Part Defendants’ Motion for Attorneys’ Fees
In W.L. Gore & Associates Inc. v. C.R. Bard, Inc., C.A. No. 11-515-LPS (D. Del. Feb. 8, 2017), Chief Judge Stark granted in part the defendants’ motion for attorneys’ fees incurred in responding to the plaintiff’s motion for sanctions under 28 U.S.C. § 1927.  The plaintiff filed the motion for sanctions after, on the morning of the first day of jury trial, the defendants represented to the Court that important documents from the plaintiff’s state tax proceedings were discovered and were relevant to the plaintiff’s claims for lost profits damages and secondary considerations of non-obviousness.  After the Court continued the trial for additional discovery, the plaintiff brought its motion for sanctions, arguing that the defendants had made misrepresentations to the Court regarding the documents at issue.  Judge Stark denied the motion for sanctions.

Chief Judge Stark Denies Defendant’s Motion to Dismiss Based on Discovery Violations
In Robert Bosch LLC v. Alberee Products, Inc., C.A. No. 12-574-LPS (D. Del. Jan. 24, 2017), Chief Judge Stark denied defendant Costco Wholesale Corporation’s (“Costco”) motion to dismiss under Federal Rule of Civil Procedure 37(b)(2), but granted Costco alternative relief by way of attorneys’ fees, additional discovery and evidentiary relief.  In opposition to Costco’s motion, Robert Bosch LLC (“BLCC”) argued that its parent company refused to produce documents despite the Court’s order for BLLC to do so.  Applying the Poulis factors, Chief Judge Stark held that BLLC had “effective control” over the production of its parent’s documents, which it appeared to have been able to acquire earlier in the litigation when helpful to BLLC’s position.    

Judge Andrews Rules on Motions in Limine
In Endo Pharmaceuticals Inc. v. Actavis Inc., C.A. No. 14-1381-RGA (D. Del. Feb. 8, 2017), Judge Andrews granted one, and denied two, pretrial motions in limine brought by the defendants and denied another filed by the plaintiffs.  The Court granted the defendants’ motion in limine prohibiting the plaintiffs’ expert from testifying to commercial success and long-felt need, as neither was addressed previously by the expert.  Judge Andrews denied the defendants’ motion seeking to prevent the plaintiffs from presenting evidence on an earlier invention date than the invention date the plaintiffs had agreed to in another litigation.

Chief Judge Stark Grants in Part and Denies in Part Cross-Motions to Strike Portions of Expert Reports
In Intellectual Ventures I LLC v. AT&T Mobility LLC, C.A. Nos. 12-193-LPS, 13-1632-LPS, 13-1633-LPS, 13-1635-LPS, 13-1636-LPS, 13-1637-LPS, 15-799-LPS, 15-800-LPS (D. Del. Jan. 31, 2017), Chief Judge Stark ruled on four motions to strike portions of expert reports and plaintiff Intellectual Ventures I LLC’s (“IV”) request for reconsideration of the Court’s invalidity ruling in light of recent Federal Circuit precedent.  The four motions to strike were directed to three of IV’s experts and one of the defendants’ experts.  IV’s three experts were accused of proffering new and untimely opinions and information.  Chief Judge Stark agreed with the untimeliness argument and granted most of the defendants’ requests.  In particular, Chief Judge Stark reviewed IV’s expert’s reply report to determine whether it contained “new opinions” and “supplemental analyses not disclosed” in the opening report or, instead, proper responses to issues raised in the opposition reports.  Upon review, Chief Judge Stark found that the reply portions “d[id] not solely contradict or rebut evidence raised in Defendants’ rebuttal reports . . . and that portions of it [we]re subject to being excluded under Rule 37(c)(1).”     

Chief Judge Stark Requires Plaintiff to Produce Documents Withheld on Purported Privilege Grounds
In Intel Corp. v. Future Link Systems, LLC, C.A. No. 14-377-LPS (D. Del. Jan. 27, 2017), Chief Judge Stark ruled on a number of disputes concerning the parties’ privilege logs.  After the initial teleconference, the Court “instructed the parties to ‘pick ten specific entries from the other side’s privilege log’ and then meet and confer regarding the chosen entries.  After resolving as many disputes as possible via meeting and conferring, the parties were instructed to submit their remaining disputes and related documents to the Court for in camera review.  Ultimately, the plaintiff submitted nine documents that the defendants challenged, and the defendants submitted seven at the plaintiff’s request.  Chief Judge Stark went through the documents looking for substantiation of the privileges asserted.  Ultimately, the Court found issues with the privilege assertions in five of the plaintiff’s documents, while holding that all of the defendants’ documents were properly withheld or redacted for privilege.   

Judge Sleet Holds Patent Not Invalid for Obviousness
Following a bench trial in AstraZenca AB v. Aurobindo Pharma Ltd., C.A. No. 14-664-GMS (D. Del. Feb. 2, 2017), Judge Sleet determined that the asserted claims of the patent-in-suit were not invalid for obviousness under 35 U.S.C. § 103.  In light of the trial testimony, Defendant Aurobindo Pharma Ltd. (“Aurobindo”) argued that the asserted claims were obvious because a person of ordinary skill in the art (of medicinal chemistry) would have been motivated to select vildagliptin as a lead compound, move the hydroxyadmantyl group, and add a cyclopropyl ring.  As to the argument that a person of ordinary skill in the art would have selected vildagliptin as a lead compound, Aurobindo pointed to vildagliptin’s “good potency, . . . favorable class history, and efficacy in biological data” as evidence that the compound was an obvious choice for lead compound.  Nonetheless, plaintiff AstraZeneca AB (“AstraZeneca”) countered that in light of two more advanced compounds that had already entered the clinic, it was only with the use of hindsight that Aurobindo argued a person of ordinary skill in the art would have selected vildagliptin as a lead compound.  The Court agreed with AstraZeneca, challenging Aurobindo’s expert’s narrow focus on potency.  Furthermore, the Court held that Aurobindo’s expert failed to show a motivation for a person of ordinary skill in the art to move the hydroxyadmantyl group.

Judge Robinson Rejects Obviousness Argument
In Endo Pharmaceuticals Solutions, Inc. v. Paddock Laboratories, LLC, C.A. No. 14-1422-SLR (D. Del. Feb. 10, 2017), Judge Robinson held that the testosterone injection patents at issue were not invalid for obviousness under 35 U.S.C. § 103.  This decision followed an ANDA bench trial on invalidity.    

Magistrate Judge Burke Grants and Denies in Part Proposals to Protective Order
In Boston Scientific Corporation v. Cook Group Incorporated, C.A. No. 15-980-LPS-CJB (D. Del. Feb. 10, 2017), Magistrate Judge Burke granted and denied in part the parties’ proposed modifications to the inter partes review (“IPR”) provision of the protective order.  The Court denied the defendant’s proposal requiring the plaintiff’s outside counsel to withdraw from representing the plaintiff in the litigation before participating in any IPR proceedings.  Judge Burke stated that an amendment to the protective order in that regard was not necessary because the protective order only excluded counsel with access to the defendant’s confidential information and the plaintiff’s counsel represented that they had not been given access to the defendant’s confidential information.

Judge Andrews Grants Motion to Enforce Settlement After Finding of Invalidity

In CallWave Communication LLC v. Verizon Services Corp., C.A. No. 12-1704-RGA (D. Del. Feb. 13, 2017), Judge Andrews granted plaintiff CallWave Communication LLC’s (“Callwave”) motion to enforce a settlement agreement with Telecommunication Systems Inc. (“TCS”).  The settlement arose from patent litigation between Callwave and defendants Verizon Services Corp. (“Verizon”) and Google Inc. (“Google”).  TCS was the supplier of the accused product to Verizon, had agreed to indemnify Verizon and advised the Court that TCS and Callwave had reached an agreement in principle to resolve the claims against Verizon.  After the Court was notified of Verizon’s settlement, the Court granted co-defendant Google’s motion for summary judgment, finding the patent-in-suit invalid for lack of patentable subject matter.  Following the Court’s decisions, TCS refused to continue negotiations, arguing that the parties failed to agree on essential terms.     

Judge Sleet Denies Motion for Temporary Restraining Order and Preliminary Injunction
In CrowdStrike, Inc. v. NSS Labs., Inc., C.A. No. 17-146-GMS (D. Del. Feb. 13, 2017), Judge Sleet denied plaintiff CrowdStrike, Inc.’s motion for a temporary restraining order and preliminary injunction. The plaintiff had engaged defendant NSS Labs., Inc. to privately test the plaintiff’s software for its strength in the face of cyber attacks.  After a few rounds of private tests, the defendant informed the plaintiff that it would perform a public test of the software. The plaintiff sued to enjoin the defendant from disclosing the results of the public test at a technology conference, which began on February 14, 2017. 

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