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Chicago IP Litigation Tracking Northern District of Illinois IP Cases

Tag Archives: Fujitsu

Illinois Savings Clause Revives Third Party Claims

Posted in Pleading Requirements

Fujitsu Ltd. v. Tellabs Ops., Inc., No. 12 C 3229, Slip Op. (N.D. Ills. Apr. 18, 2014) (Holderman, Sen. J.).

Judge Holderman denied defendants’ (collectively “Tellabs”) Fed. R. Civ. P. 12(c) motion to dismiss two Fujitsu entities’ trade secret and other tort counterclaims based upon the relevant statute of limitations in this patent case.  The Court held that while the claims were otherwise time-barred, they were preserved by the Illinois Savings Clause which waives the statute of limitation for counterclaims where plaintiff’s original claim arose before the counterclaim was time-barred.  Here the Fujitsu defendants presented evidence that Tellabs’ patent claims arose before Fujitsu’s counterclaims were time-barred.  And although at least one Fujitsu defendant was technically a third party, the cases were sufficiently related to warrant application of the Savings Clause. 

Parent Cannot Seek Lost Profits Based Upon Subsidiaries Sales

Posted in Damages

Fujitsu Ltd. v. Tellabs, Inc., No. 09 C 4530, Slip Op. (N.D. Ill. Dec. 21, 2012) (Holderman, C.J.).

Judge Holderman granted defendants (collectively “Tellabs”) summary judgment that plaintiff Fujitsu Limited was not able to seek lost profits in this patent litigation.  Fujitsu, the patent holder, did not sell a covered product in the United States (a requirement for lost profits), but its subsidiary Fujitsu Network Communications (“FNC”) did.  Fujitsu Limited argued that the profits of FNC inexorably flowed to Fujitsu Limited warranting lost profits. Fujitsu Limited argued that various payments from FNC to Fujitsu Ltd. represented profits from sales of patented goods.  The Court, however, held that the payments were for use of trademarks, employees working for FNC and part of a corporate tax planning.  Because the payments did not represent the profits from patented goods, Fujitsu Ltd. could not seek lost profits.

 

Local Patent Rules: Party Limited to Arguments Made in Final Contentions

Posted in Summary Judgment

Fujitsu Ltd. v. Tellabs, Inc., No. 09 C 4530, Slip Op. (N.D. Ill. Sept. 26, 2012) (Holderman, C.J.).

Chief Judge Holderman granted defendant Tellabs’ motion for summary judgment of invalidity in this patent case.  As an initial matter, the Court held that Tellabs was limited to the arguments set forth in its Local Patent Rule 3.1 final invalidity contentions.  The Court, therefore, disregarded Tellabs’ anticipation arguments, which were not in the final contentions, and focused upon the obviousness arguments, which were in the final contentions.

The Court held that the asserted prior art was a printed publication because of undisputed testimony that the article was presented at a standards setting meeting and that at the meeting 25 copies of the article were distributed without restriction.  The Court acknowledged that Tellabs had not provided any evidence of an individual that actually received one of the reports.  But it was enough that Tellabs had provided “substantial” circumstantial evidence corroborating its testimony.  For example, subsequent articles written by third parties referenced the prior art paper. 

Finally, the Court considered the obviousness arguments.  Fujitsu failed o challenge Tellabs four page obviousness arguments, except to argue that the prior art reference was not enabling.  However, the Court held that a prior art need not be enabling, it simply must teach the elements of the claims in suit. 

Experts Review of Document Erases Privilege

Posted in Trial

Tellabs Ops., Inc. v. Fujitsu Ltd., No. 08 C 3379 & 09 C 4530, Slip Op. (N.D. Ill. Aug. 29, 2012) (Cole, Mag. J.).

Judge Cole, after an evidentiary hearing, ordered Fujitsu to produce all documents related to an extensive inspection of plaintiff Tellabs’ optical scanner in this patent case.  Fujitsu claimed that certain reports related to the inspection were privileged, but Fujitsu’s expert report stated that the expert had reviewed those report.  Fujitsu and its expert argued that the expert’s statements about reviewing the reports were erroneous.  While the expert had received the reports, he thought they were other documents and put them in a pile without ever reading them.  Regardless of whether the expert and counsel remembered the facts correctly, the story was improbable.  The Court did not believe that an “eminent” professor who was acutely aware of the need for accuracy could mistakenly misstate what he had reviewed twice.  Because the Court held that the expert had considered the reports, any privilege that may have attached to them was waived.

Reduction to Practice is a Question of Disputed Fact

Posted in Summary Judgment

Tellabs Ops., Inc. v. Fujitsu Ltd., No. 08 C 3379, Slip Op. (N.D. Ill. Jul. 27, 2012) (Holderman, C.J.). 

Chief Judge Holderman denied plaintiff Tellabs’ motion for summary judgment of invalidity.  As an initial matter, there was a question of fact regarding whether defendant Fujitsu could swear behind Tellabs’ prior art references based upon an alleged reduction to practice.  The Court could not determine based upon undisputed facts or as a matter of law whether or when Fujitsu reduced its invention to practice.

Parties’ Employees May Maintain Work Product Protection, Just Not in This Case

Posted in Discovery

Tellabs Ops., Inc. v. Fujitsu Ltd., No. 08 C 3379 & 09 C 4530, Slip Op. (N.D. Ill. May 1, 2012) (Cole, Mag. J.).

Judge Cole denied defendant and counter-plaintiff Fujitsu’s motion for a protective order prohibiting plaintiff and counter-defendant Tellabs from getting discovery regarding Fujitsu’s inspection of Tellabs’ optical scanner in this patent litigation regarding optical amplifiers.  Fujitsu argued that the inspection was conducted by its employees specifically in anticipation of litigation and, therefore, was work product because the employees would not be testifying at trial.  The issue before the Court was whether an employee could be “specially employed . . . in anticipation of litigation” pursuant to Fed. R. Civ. P 26(b)(4)(D). 

The district courts were split on the answer.  The Court noted that had the Rule been intended to expressly exclude a party’s employees, it would likely have required that the individual be “specially retained” instead of “specially employed.”  The Advisory Committee Note was also instructive, if not conclusive, in excluding generally employees not “specially employed on the case.”  If the Advisory Committee intended to exclude general employees, it could have excluded all general employees in the Note. 

Having determined that the Fujitsu employees could be protected by Rule 26(b)(4)(D) as specially employed, the Court turned to the facts of the case.  But Fujitsu had not met its burden to show that its analysis was done in anticipation of litigation, for at least the following reasons:

  • The evidence showed competition issues, not an expectation or anticipation of litigation at the time of the analysis.
  • The “primary motivating purpose” behind the investigation was not litigation, but at least include competitive concerns.  The fact that the reasons may have later “morphed” into litigation was not relevant.

The Court also commended both sides and their counsel for rarely presenting discovery disputes to the Court.

No Inequitable Conduct Where Multiple Inferences Can be Drawn as to Intent

Posted in Summary Judgment

Fujitsu Ltd. v. Tellabs Ops., Inc., No. 09 C 4530, Slip Op. (N.D. Ill. Jul. 31, 2012) (Holderman, C.J.).

Judge Holderman granted plaintiff Fujitsu’s motion for summary judgment of no inequitable conduct.  The inventors allegedly failed to disclose two prior art references which had been disclosed in prior patent prosecutions, each of which was disclosed during prosecution of the patents in suit.  There was a question of fact as to whether each reference was duplicative of other disclosed art and, therefore, was material.  But defendant Tellabs did not show the required specific intent - the specific intent “must be the single most reasonable inference able to be drawn from the evidence.”  Therasence, Inc. v. Becton, Dickinson & Co., 649 F.3d 1276, 1290 (Fed. Cir. 2011).  In each case, it was reasonable to infer intent to deceive from the undisputed facts.  But it was also reasonable to infer that the inventors believed the references were cumulative or that the inventors forgot to include the references.  Because multiple inferences could be drawn, there was no intent as a matter of law.

Term Used as an Adjective in Specification Required Constructive When Used as Verb in Claims

Posted in Claim Construction

Fujitsu Ltd. v. Tellabs Ops., Inc., No. 09 C 4530, Slip Op. (N.D. Ill. Jul. 27, 2012) (Holderman, C.J.).

Chief Judge Holderman construed an additional claim term - “transmitting” - one month before trial in this patent involving optical transmission systems.  “Transmitting” was used as an adjective modifying “terminal,” and as a verb describing what a terminal did.  Constructing “transmitting” as an adjective was unnecessary because it was used throughout the patent and one of ordinary skill would have understood the meaning.  But “transmitting” was only used as a verb in the claims, warranting construction.  “Transmitting” was construed to mean “engaged in the transmission of.”  The Court declined to construe terms that were not in the claims to be tried in one month.

Court Declines to Decide Speculative Motion to Strike

Posted in Pleading Requirements

Fujitsu Ltd. v. Tellabs Ops., Inc., No. 09 C 4530, Slip Op. (N.D. Ill. Jul. 19, 2012) (Holderman, C.J.).

Chief Judge Holderman denied plaintiff Fujitsu’s motion to strike defendant Tellabs’ unclean hands defense and its unfair competition claim.  Neither count was pled.  They were only identified in Tellabs’ supplemental initial disclosures.  Tellabs reasoned that it could not ascertain whether it needed to seek leave to amend adding the claims to the pleadings until after a Rule 30(b)(6) corporate deposition.  Regardless, the Court held it need not address Fujitsu’s concerns until Tellabs actually sought leave to amend its pleadings.

Disputed Reduction to Practice Dates Prevents Invalidity Summary Judgment

Posted in Summary Judgment

Tellabs Ops., Inv. v. Fujitsu Ltd., No. 08 C 3379, Slip Op. (N.D. Ill. July 27, 2012) (Holderman, C. J.). 

Judge Holderman denied plaintiffs’ (collectively “Tellabs”) motion for summary judgment of invalidity in this patent case.  Tellabs’ two pieces of prior art were both dated before the patents’ earliest priority date.  But defendant Fujitsu offered inventor testimony corroborated by a technical paper that the invention was reduced to practice before the prior art dates.  As a result, there was a question of fact as to whether Tellabs’ references were, in fact, prior art. 

Additionally, the Court denied Tellabs’ motion as to obviousness.  While Tellabs’ references proved that one of ordinary skill would have known that optical transmission systems had a variable number of channels.  But the prior art did not teach the patents’ particular solutions.