2013 01 16 gguls pat lit - venue and parties (class 2)

7/29/2019 2013 01 16 GGULS PAT LIT - Venue and Parties (Class 2)

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Deposition MechanicsSeptember 27, 2007

Brian Mitchell

Justin T. Beck

Robert B. MorrillBrian E. Mitchell

January 16, 2012

GOLDEN GATE UNIVERSITY SCHOOLOF LAW:

JURISDICTION, VENUE AND PARTIES


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AGENDA

Declaratory judgment actions

Prefiling Investigation (Rule 11)

Subject matter jurisdiction

Personal jurisdiction

Venue


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AGENDA





Venue

3


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Declaratory Judgment Action

Defensive declaratory judgment

Brought as a counterclaim (shield)

Offensive declaratory judgment

Brought as an original suit (sword)

4


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Declaratory Judgment Action

There must be an actual case or

controversyTwo part test before 2007: (1)

objectively reasonable apprehensionof suit and (2) activity that constitutesinfringement (or concrete steps)

5


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MedImmune v. GeneTech (2007)A patent licensee may sue for a declaration

of invalidity or non-infringement without firstbreaching the license.

Change in the reasonable apprehension

test? Seefootnote 11.


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SanDisk v. STMicro

The Supreme Court's opinion inMedImmune represents a rejection of our

reasonable apprehension of suit test.Even ST's statement that it does not

intend to sue does not moot the actual

controversy created by its acts. (Opinionof the court)


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SanDisk v. STMicro (cont.)

[U]nder the court's standard virtually any

invitation to take a paid license relating tothe prospective licensee's activities wouldgive rise to an Article III case orcontroversy if the prospective licensee

elects to assert that its conduct does notfall within the scope of the patent.(Concurring Opinion)


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The patent owner can file suit first, and

then send the demand letter or draftlicense. Drawbacks?

How to Avoid Declaratory Relief?


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A Race to the Courthouse

The first-filed action generally controls

Meaningful preparation for infringementand some assertion of the patent needed

Acts up to the filing of the complaint areconsidered


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AGENDA





Venue

11


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Plaintiffs Prefiling Investigation Rule 11

Ownership analysis

Claim interpretation

Reasonable efforts to determine if accusedproduct meets all claim limitations

Claim charts encouraged but not required


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Cannot rely solely on clients analysis

Not required: Validity analysis Why?

Best practice: Prepare a detailed file

memo

Plaintiffs Prefiling Investigation


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Def.s Prefiling Investigation Rule 11

Affirmative allegations have (or are likely

to have after discovery) evidentiarysupport E.g., invalidity

Denials are warranted by facts or made onlack of information E.g., noninfringement

SeeMetcalf, Satisfying Rule 11 Prior toInitiating Patent Infringement Claims 7 FED CIRCUIT B.J. 321, 327 (1997)


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Judin v. United States

Judin/Van Der Walls investigation:

Observed the accused device in a post office from adistance

Did not attempt to obtain a device

Did not reverse engineer a device Did not interpret any claim terms

Did not read the claims on the device

Did not consult with an expert


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Judin v. United States

Holding:

Rule 11 requires investigation before, not after, filing acomplaint

No effort to obtain an accused device and noexplanation for failing to do so

Attorney was unreasonable in giving blind deferenceto his client

Post-filing consultation with an expert does not curepre-filing failure

Trial court abused discretion in not sanctioning Judinand Van Der Wall


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Problems Pages 89-90

1. Suggest filing a declaratory relief suit to

FAST? BIPOLAR letter offering a license

BIPOLAR suits against others

BIPOLAR trade secret suit against FAST

Mere offer of a license, no threat to sue, no reasonableapprehension

Likely SanDiskdeclaratory relief jurisdiction


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Additional facts

Generic threat to sue Rumor of suit by BIPOLAR

Customer threats

What result?

Still more facts

A face to face negotiation will be held next week


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3. Crows letter:

Identifies infringing products

Identifies the patents

Threatens to sue

Tractors-R-Us options?

Declaratory relief suit?


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Crows options on Green II?

Now Contributory or inducedinfringement, T-R-U only sells blades, withadvice

Green II will directly infringe

Wayne can sue distributor Smith on thesame theories



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AGENDADeclaratory judgment actions




Venue

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Subject Matter JurisdictionDistrict Court has exclusive jurisdiction of

actions arising under the patent laws Action for malpractice related to patents?

Patent issues first raised in a state court counterclaim?

International Trade Commission

Jurisdiction over imports if patent holder has adomestic industry


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Administrative court located in Washington,DC

Has own rules and judges (ALJs)No jury

No money damages

ALJ decision reviewed by Commission


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Remedy (exclusion order banning imports)

reviewed by PresidentAppeal to Federal Circuit

Parallel District Court actions often stayed

FAST



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Venue

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Personal JurisdictionGeneral Jurisdiction

Is defendant doing business in the jurisdiction?

Special Jurisdiction Did defendant direct activities at forum residents?

I shot an arrow into the air, It fell to earth, I knew not

where Did the claim arise out of those activities?

Is the exercise of jurisdiction reasonable?


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Where Does a Corporation Reside?

Federal Circuit law governs

Test is whether defendant can be served: Do minimum contacts exist?

Is service proper under forum states long arm statute?

A major corporation may reside in all 50states


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Beverly Hills Fan v. Royal Sovereign

Selling a product into the forum through

intermediaries is considered to bepurposeful shipping of the product into the

forum state

Does the sale in the forum arise, directly or indirectly,

from the efforts of the accused infringer to serve themarket for its product in the forum state?

Could the accused infringer placing its product into thestream of commerce reasonably anticipate being hauled

into court in the forum?


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Beverly Hills Fan v. Royal Sovereign

In what other states would there be

personal jurisdiction over Beverly Hills? Any state where there were fan sales of any magnitude

of any goods of the accused infringer 3% of the

infringers total sales in this case With any nationally distributed product, there is virtually

national personal jurisdiction


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Genetic Implant v. Core-Vent

Jurisdiction for declaratory relief

Appointing a distributor combined withcease and desist letters is purposefulavailment of the forum states facilities


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Venue

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Where Can Defendant be Sued?

28 U.S.C. 1400: venue exists:

Where defendant resides

Or, where defendant committed acts of

infringement andhas a regular andestablished place of business


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Shopping for a forum where should

you file?

Hometown?

Hometown bias

Convenient

Rocket Docket?

Fast and plaintiff friendly

Will the case stick?

The other sides hometown?


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Experienced Judges, educated jurypool?

ITC? Will the other party trump your suit in a

faster forum?

Shopping for a forum where should

you file?


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District to District Comparisons*Chart 8 page 99

Transfer rates: NDCA 2.1%

EDTX 8.9%

Disposition by motion:

NDCA 9.0%, EDTX 1.9%

Disposition by trial: NDCA 2.1%

EDTX 5.1%

Chart 9 page 100 Patentee win rates range from 47% (DMA) to 83%

(DNJ)


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Friendly Juries*


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Why EDTX

People flock to the EDTX - and especially to Judges Ward andDavis - precisely because they know that the judges will let thecases linger and will generally sit on summary judgment motionsand if they do grant them, will wait until the end of the entire

case, thereby increasing settlement pressure.

Patent Troll Blog


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Patent Filings/Judge*


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Patent Trolls?As seen by the Trolls As seen by industry


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Patent Trolls?


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Problems Page 127ON-LINE - Delaware corporation doing business only in

Massachusetts

MICRONET California ISP selling all over the worldthrough an interactive web site

ON-LINE sent a cease and desist letter re 111 patent

Negotiations failed, ON-LINE set a January 1, 2007 datefor suit

Today is January 16

Litigation options?


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Problems Page 127Where can ON-LINE file suit?

CA, WA, NY

What about MA? Has MICRONET sold goods over the internet to MA

residents?

Mere offer is not enough

Where can MICRONET sue for declaratory relief? MA, DE

What about California?

ON-LINE store in CA closed two years ago?


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What Can A Defendant Do?

Is there personal

jurisdiction?Forum Non

Conveniens (28

USC 1404)? Discretionary

Multiple factors

Not appealable


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In Re TS Tech USA Corp Is mandamus available?

Available in extraordinary circumstances to correct aclear abuse of discretion or usurpation of judicial powerwhere no other means of obtaining the relief desired


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Forum Non Conveniens (28 USC 1404)?

Fifth Circuit law applies Volkswagen II Ohio more convenient for witnesses and evidence

No connection to Texas

Stretches logic to say local interest weighs against

transfer where rationale could apply to any district Mandamus available where 1404(a) transfer denied

In Re TS Tech USA Corp


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Since TS Tech In re Genentech, 556 F.3d 1338 (Fed.Cir.

2009 In re Hoffmann-La Roche, 587 F.3d 1333

(Fed. Cir. 2009)

In re Nintendo, 589 F.3d 1199 (Fed. Cir.2009)

In reLink_A_Media, 662 F.3d 1221 (Fed.Cir. 2011) (applying 3rd Circuit law)Media,662 F.3d 1221 (Fed. Cir. 2011) (Applying

Third


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America Invents Act of 2011

Venue left unchanged Original bill had venue provision similar to TS Techrule,

but provision was dropped because Federal Circuitviewed as doing a good job in forcing the Eastern Districtof Texas to transfer cases out

Change in joinder law Trolls had brought suits in EDTX against multiple

corporations doing business nationally

AIA bars joinder of unrelated defendants in one patent

suit, effective immediately Must bring multiple suits, which cannot be consolidated

for trial


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But the Trolls Strike BackCommon tactic today is to file dozens of

single defendant suits, and seekconsolidation for pretrial purposes underRule 42(a)

If suits must be filed in different districtsfor venue purposes seek centralizationunder 28 U.S.C. 1407o Blue Spike filed 60 suits in 12 different districts B

2013 01 16 gguls pat lit - venue and parties (class 2)

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