Chicago IP Attorney & Lawyer : R. David Donoghue : Chicago IP Litigation Blog

Simonian v. Allergan, Inc., No. 10 C 2414, Slip Op. (N.D. Ill. Apr. 28, 2011) (St. Eve, J.).

Judge St. Eve denied defendant Allergan's motion to dismiss plaintiff Simonian's false patent marking suit holding that the false marking statute was constitutional pursuant to the Take Care Clause. The government retained little control over false marking actions, but that was less of a concern because false marking cases were civil not criminal. And, in fact, the government retained sufficient control. The executive branch was notified of each suit because the district court clerk was required to give the Director of the Patent Office (a member of the executive branch) notice of every patent suit. Furthermore, the government may intervene in every case. And when the government intervenes, plaintiff cannot dismiss a case without the government's agreement.
 

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The Counselors of Real Estate v. Masters Commercial Real Estate, Inc., No. 11 C 3173, Slip Op. (N.D. Ill. Aug. 18, 2011) (St. Eve, J.).

Judge St. Eve entered a consent judgment as part of a settlement in this trademark dispute involving the CRE and CRE marks. Here were the key elements of the judgment:

Defendant Masters Commercial Real Estate could not use the letters "CRE" in "sequence or substantial sequence", except when referring to plaintiff, in relation to real estate services.

Defendant was also enjoined from using the letters "MCRE" in sequence or substantial sequence.

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Morningware, Inc. v. Hearthware Home Prods., Inc., No. 09 C 4348, Slip Op. (N.D. Ill. Apr. 12, 2011) (St. Eve, J.).

Judge St. Eve granted defendant Hearthware's motion for reconsideration holding that the claim term cooking enclosure required no construction. The Court originally construed "cooking enclosure" to mean "an oven housing and a metallic oven pan supported by a base." The Court held that the instruction imported a claim limitation. Furthermore, the doctrine of claim differentiation required broader constructions because other independent claims that further defined the cooking enclosure as having a metallic oven pan as a base were made superfluous by the original construction.

The Court also held that Hearthware's motion should have been brought pursuant to Fed. R. Civ. P. 54(b) which gives the Court authority to reconsider its interlocutory decisions, not Rule 59(e) which only applies once the Court has entered judgment.
 

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The patent pilot program started this month in the Northern District and across the country.  The pilot program is a ten-year look at ways to handle patent cases more effectively.  The main component of the pilot program is judges in pilot districts, including the Northern District, self-selecting as patent judges.  Patent cases will continue to be randomly assigned to all Northern District judges.  But when a non-patent judge is assigned a patent case that judge will have thirty days to order reassignment of the case.  When reassignment is ordered, the case will be randomly reassigned to one of the patent judges.  There will also be patent-related education and programs offered for the patent judges across the country. 

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Sloan Valve Co. v. Zurn Indus., No. 10 C 204, Slip Op. (N.D. Ill. Mar. 8, 2011) (St. Eve, J.).

Judge St. Eve granted plaintiff Sloan's motion to lift the stay pending reexam of the patent-in-suit to modify the Protective Order. The Patent office required production of all information material to patentability, even if it is subject to a Protective Order. MPEP § 724. But the Protective Order was silent as to whether Sloan could provide the Patent Office with confidential information.

The Court noted case law holding that MPEP § 724 could not override district court orders. Telecomm. Sys., Inc. v. Mobile 365, Inc., No. 06 C 485, 2009 WL 594 3235 (E.D. Va. Mar. 31, 2009). As a result, the proper method for a patentee was exactly what Sloan did - seek a modification to the governing Protective Order.

So, the Court modified the Protective Order to allow disclosure to the Patent Office, so long as MPEP § 724.02 procedures for maintaining documents as confidential.
 

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Morningware, Inc. v. Hearthware Home Prods., Inc., No. 09 C 4348, Slip Op. (N.D. Ill. Feb. 23, 2011) (St. Eve, J.).

Judge St. Eve construed the the claims of counter-plaintiff Hearthware's patent involving halogen convection ovens. Of particular note, the Court construed the following terms:

• "A cooking enclosure" means "an oven housing and a metallic oven pan supported by a base." This definition fit with the language of the abstract and the summary of the invention.
   
• "A fan" means "one or more fans." The Court declined Morningware's argument that fan be limited to the fan described in the preferred embodiment.
   
• "A fan chamber" means "one or more enclosed spaces, through which a fan moves air, that are in the power head and above both the cooking enclosure and the heating unit." The Court held that a more particular definition proposed by Morningware would require improper importation of limitations into the claims from the specification.

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Civix-DDI, LLC v. Hotels.com, L.P., No. 05 C 6869, Slip Op. (N.D. Ill. Jan. 19, 2011) (St. Eve, J.).

Judge St. Eve granted in part plaintiff Civix-DDI's ("Civix") motion to strike defendants' (collectively "Hotels.com") allegedly "new defenses and witnesses" in this patent case. The Court held as follows:

• Hotels.com was free to update its corporate witnesses based upon changed jobs and responsibilities, so long as the new witnesses were made available for deposition if they might potentially be called at trial.
   
• Disclosure of a new piece of prior art ten months after the close of fact discovery would prejudice Civix, and Hotels.com did not justify its late disclosure. The prior art was, therefore, excluded pursuant to Fed. R. Civ. P. 37.
   
• The Court also excluded a license for Google technology that was executed in relevant part in August 2010, about three months before Hotels.com's supplemental interrogatory response disclosing the license. While a three month delay was sometimes acceptable, it was not in this case. Fact discovery closed seven months before the agreement was executed and ten months before the supplemental response identifying the license. And expert discovery was set to close four months after the supplement. Civix, therefore, would have been prejudiced by Hotels.com's three month delay in this case. So, the license was excluded.
   

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Civix-DDI, LLC v. Hotels.com, L.P., No. 05 C 6869, Slip Op. (N.D. Ill. Jan. 19, 2011) (St. Eve, J.).

Judge St. Eve granted in part plaintiff Civix-DDI's ("Civix") motion to strike defendants' (collectively "Hotels.com") allegedly "new defenses and witnesses" in this patent case. The Court held as follows:

• Hotels.com was free to update its corporate witnesses based upon changed jobs and responsibilities, so long as the new witnesses were made available for deposition if they might potentially be called at trial.
   
• Disclosure of a new piece of prior art ten months after the close of fact discovery would prejudice Civix, and Hotels.com did not justify its late disclosure. The prior art was, therefore, excluded pursuant to Fed. R. Civ. P. 37.
   
• The Court also excluded a license for Google technology that was executed in relevant part in August 2010, about three months before Hotels.com's supplemental interrogatory response disclosing the license. While a three month delay was sometimes acceptable, it was not in this case. Fact discovery closed seven months before the agreement was executed and ten months before the supplemental response identifying the license. And expert discovery was set to close four months after the supplement. Civix, therefore, would have been prejudiced by Hotels.com's three month delay in this case. So, the license was excluded.

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Civix-DDI, LLC v. Hotels.com, No. 05 C 6869, Slip Op. (N.D. Ill. Oct. 25, 2010) (St. Eve, J.).

Judge St. Eve construed the terms of the patents-in-suit to internet technology. From a procedural standpoint, the Court did the parties and readers of the opinion the favor of identifying the Court's construction in a bulleted list at the beginning of the opinion, as well as at the end. Lists of the construed terms and their construction opinions make claim constructions far more readable.

Of particular note, the Court construed the following terms:

• "Associated category" means "a classification both stored in the database and provided or selected by a user that divides particular items of interest into subgroups." The Court gave "little weight" to a construction from a prior case which the parties in that case stipulated to because defendants in this case were not parties to that case, nor did they have privity with the prior defendants.
   
• "Connected to" means "joined together or linked to, in a direct or indirect manner." Because neither the claim language nor the specification exclude an indirect connection, the construction included both direct and indirect connections.
   
• "Database" means "a collection of related information organized for convenient access." The Court accepted the construction from the prior case because it was supported by the intrinsic evidence. Nothing in the claims or specifications required a single device as proposed by defendants.
   
• "Internet" means "a system of linked computer networks, worldwide in scope, that is typically associated with using TCP/IP as a standard protocol." This was the Court's construction from the prior case, but it was reached after a de novo review of the construction and all relevant evidence. Additionally, "Internet" and "internet" were construed to mean the same thing.
   
• "User" means "a human being."
   
• "Video" means "a presentation of multiple sequential frames of image data." The construction was intended to create a distinction between digital pictures and video.
   
• "Within a radius about the one port" means "within a circular area the center of which is the user's present physical location."

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Simonian v. Allergan, Inc., No. 10 C 2414, Slip Op. (N.D. Ill. Nov. 30, 2010) (St. Eve, J.).

Judge St. Eve denied defendant Allergan's motion to dismiss plaintiff Simonian's false patent marking claim regarding Allergan's RESTASIS product. The Court, citing its Blistex decision, held that false patent marking claims were subject to Fed. R. Civ. P. 9(b) heightened pleading requirements. Simonian's general averment that Allergan marked with an allegedly expired patent with an intent to deceive was sufficient, without more facts.

The Court also held that the fact that RESTASIS was marked with an unexpired patent, did not insulate Allergan from marking with an expired patent as well, citing Clontech Labs., Inc. v. Invitrogen Corp., 406 F.3d 1347 (Fed. Cir. 2005). In Clontech, the Federal Circuit explained that "an unpatented article" was one "not covered by at least one claim of each patent with which the article is marked." Id. at 1352 (emphasis added).
 

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The Chamberlain Group, Inc. v. Lear Corp., No. 05 C 3449, Slip Op. (N.D. Ill. Nov. 24, 2010) (St. Eve, J.).

Judge St. Eve ruled on the parties' numerous summary judgment motions in this patent case involving garage door opener remote control technology.* The Court first addressed the controlling claim constructions. Judge Moran previously construed the claim terms, but on appeal those constructions were amended by the Federal Circuit. Plaintiffs argued that the Federal Circuit's constructions were not binding and were open to further construction. But the Court held that the Federal Circuit's constructions were the law of the case and were binding upon the parties. Because plaintiffs' arguments for summary judgment of infringement were premised upon its own claim constructions, and not the Federal Circuit's constructions, those motions were denied.

Next the Court considered whether there was a question of fact that the accused devices used "binary code" as required by the patents. The parties agreed that an absence of binary code would require a finding of noninfringement. But the parties disputed whether defendant Lear's accused products used binary code. Ultimately the battle of the parties' experts created a question of material fact precluding summary judgment of either infringement or noninfringement.

The Court granted plaintiffs summary judgment as to Lear's argument that the asserted claims were not directed to patentable subject matter. Lear argued that plaintiffs' claims simply covered algorithms, but the cases were directed to devices that were by definition not just algorithms.

Plaintiffs were also granted summary judgment as to Lear's claim that plaintiff's committed inequitable conduct by failing to disclose a particular patent to the Patent Office as prior art. Plaintiffs had provided the art to a prior examiner, in a parent application. Once a patent applicant submits prior art in a parent application, that art is considered disclosed in any progeny applications.

* Click here for much more on the case in the Blog's archives.
 

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Simonian v. Blistex, Inc., No. 10 C 1201, Slip Op. (N.D. Ill. Nov. 3, 2010) (St. Eve, J.).

Judge St. Eve denied defendant Blistex's Fed. R. Civ. P. 12(b) motion to dismiss Simonian's false patent marking case. As an initial matter, the fact that most of Simonian's statements were made upon information and belief did not require dismissal. The Court then held that false patent marking, or at least its intent requirement, was subject to Rule 9(b) heightened pleading. But Simonian met that standard by pleading that Blistex allegedly falsely marked its lip-ointment products with an expired patent.
 

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Poulsen Roser A/S v. Jackson & Perkins Wholesale, Inc., No. 10 C 1894, Slip Op. (N.D. Ill. Nov. 15, 2010) (St. Eve, J.).

Judge St. Eve denied plaintiff Pousen Rosen's ("Poulsen") Fed. R. Civ. P. 59(e) and 60(b) motion for reconsideration of the Court's decision dismissing the case as to the individual defendants for lack of personal jurisdiction in this Lanham Act case.

First, "new evidence" in the form of the District of South Carolina Bankruptcy Court's order consolidating the corporate defendants was irrelevant and did not alter the Court's analysis. The Bankruptcy Court made no finding regarding the relationship between the corporate and individual defendants.

Second, the Court reconsidered and upheld its analysis regarding the corporate defendants' internet contacts. The Seventh Circuit rejected the Zippo case's sliding scale for internet-based jurisdiction because of the possibility of creating universal jurisdiction:

__ F.3d __, 2010 WL 3547647, at *6 (7^th Cir. 2010).

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Chamberlain Group, Inc. v. Lear Corp., No. 05 C 3449, Slip Op. (N.D. Ill. Sep. 10, 2010) (St. Eve, J.).

Judge St. Eve denied defendant Lear's motion to amend its complaint adding new inequitable conduct defenses. While leave to amend is freely granted and delay alone is usually not enough to deny leave, Courts retain discretion to deny leave to amend. In this case, Lear waited until after fact discovery closed in this five-year-old case to seek leave to amend. And without explanation, Lear appeared in court three times and eight entries were added to the docket between the depositions in which Lear allegedly discovered the inequitable conduct and filing of its motion. Furthermore, Lear had been aware of the individuals accused of committing the inequitable conduct for several years. Finally, plaintiff Chamberlain Group would have been prejudiced by amendment at this late date because the expert reports the parties had already exchanged would have to have been revised or supplemented if Lear was allowed to amend.
 

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Chamberlain Group v. The Lear Corp., No. 05 C 3449, Slip Op. (N.D. Ill. Jul. 15, 2010) (St. Eve, J.).
 

Judge St. Eve denied plaintiff Chamberlain's motion to compel further deposition of a witness in this patent case. The Court noted that the information sought from the deposition could be relevant. But the Court denied the motion for failure to comply with the meet and confer rule, Local Rule 37.2. And the Court explained that it would no longer consider motions based upon Fed. R. Civ. P. 26-37 without a Local Rule 37.2 statement:

(1) that after consultation in person or by telephone and good faith attempts to resolve differences they were unable to reach an accord, or (2) counsel's attempts to engage in such consultation were unsuccessful due to no fault of counsel's. Where the consultation occurred, this statement shall recite, in addition, the date, time and place of such conference, and the names of all parties participating therein. Where counsel was unsuccessful in engaging in such consultation, the statement shall recite the efforts made by counsel to engage in consultation.

Defendants' only efforts to resolve the dispute occurred at the deposition where the issue arose. This did not meet the Local Rule 37.2 requirement.
 

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Chamberlain Group, Inc. v. Lear Corp., No. 05 C 3449, Slip Op. (N.D. Ill. Jul. 12, 2010) (St. Eve, J.).

Judge St. Eve denied plaintiffs' motion for a letter of request to India's Ministry of Law and Justice seeking a deposition of an individual third party that previously was a software programmer for defendant's software vendor Wipro. Despite identifying the witness in July 2009, Plaintiffs did not file their motion until June 2010, two weeks before the close of discovery.

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Simonian v. Hunter Fan Co., No. 10 C 1212, Slip Op. (N.D. Ill. Jul. 8, 2010) (St. Eve, J.).

Judge St. Eve denied defendant Hunter Fan's motion to dismiss plaintiff's false patent marking case. Hunter Fan argued that the Court lacked subject matter jurisdiction because approximately four hours before this suit was filed, another plaintiff filed a separate suit in the Northern District of Texas accusing Hunter Fan of the same alleged false patent marking. The False Claim Act did have a first-to-file provision, 31 U.S.C. § 3730(b)(5), but the provision expressly limited its application to False Claims Act cases. Because false patent marking is part of the Patent Act, not the False Claims Act, the first-to-file limitation was not applicable. 

In reply, Hunter Fan argued that 35 U.S.C. § 292 allowed for only a single claim, and that the reasoning of the False Claim Act's first-to-file rule should have been applied to the false patent marking statute.  Hunter Fan, however, waived these arguments by failing to make them in its opening brief. 

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Sloan Valve Co. v. Zurn Indus., Inc., No. 10 C 204, Slip Op. (N.D. Ill. May 4, 2010) (St. Eve, J.).

Judge St. Eve granted in part plaintiff/counter-defendant Sloan's Fed. R. Civ. P. 12 motions in the patent infringement case involving a flush valve handle assembly. The Court dismissed defendant/counter-plaintiff's (collectively "Zurn") invalidity and noninfringement counterclaims to the extent they challenged patent claims other than those identified as allegedly infringed in Sloan's complaint. The Court could have exercised jurisdiction over the counterclaims if Zurn had met the MedImmune standard independently for each of Sloan's unasserted claims, but Zurn did not.

The Court denied Sloan's Fed. R. Civ. P. 12(b)(6) motion to dismiss Zurn's inequitable conduct counterclaim. Zurn met the materiality standard by pleading that Sloan should have known that admissions made in a prior, related reexamination proceeding were relevant to the Examiner in the later application. 

The Court dismissed Zurn's estoppel and misuse affirmative defenses. Each were pled in a single sentence and without particularized facts.

The Court also dismissed Zurn's lack of actual notice affirmative defense. Zurn also denied Sloan's actual notice allegation in its answer. Because actual notice was denied in the answer, it was not a proper affirmative defense. Finally, the Court dismissed Zurn's noninfringement and exceptional case affirmative defenses.  Neither was a proper affirmative defense. 

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Morningware v. Hearthware Home Prods., Inc., No. 09 C 4348, Slip. Op. (N.D. Ill. Nov. 16, 2009) (St. Eve, J.).

Judge St. Eve denied defendant Hearthware's Fed. R. Civ. P. 12(b)(6) motion to dismiss plaintiff Morningware's Lanham Act unfair competition and product disparagement claims, as well as related state law claims.  Hearthware allegedly bought Morningware's trademarks as Google AdWord keywords so that when a Google user searched for Morningware's trademarks, a Hearthware "sponsored link" showed up above the standard search results, along with the following text written by Hearthware:

        The Real NuWave® Oven Pro Why Buy an Imitation?  90 Day Gty.

Hearthware did not dispute that the MORNINGWARE mark was protectible or that it was owned by Morningware.  Instead, Hearthware argued that purchasing "Morningware" as an AdWord keyword was not a "use" in commerce.  The Court noted that although the Seventh Circuit had not decided the issue, courts have largely adopted a broad reading of "use" that included AdWords purchases.  But in this case, the Court could not decide the issue without fact-finding which was not appropriate in a Rule 12(b)(6) motion.  The Court, therefore, denied the motion to dismiss.

Hearthware also argued that purchasing AdWords could not create customer confusion.  But the Court held that Morningware pled sufficient facts to show initial interest confusion which is actionable pursuant to the Lanham Act, even if the confusion is only brief and the customer is aware of the true source of the goods by the time a purchase is made.

The Court also held that Hearthware's alleged "Why Buy an Imitation" advertisement text was sufficient for a disparagement case as a fact-finder could determine that the text could lead a consumer to believe that Morningware's product was an imitation of Hearthware.  Morningware's state law claims survived the motion to dismiss for the same reasons as the Lanham Act claims. 
 

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The most popular posts on the Blog during 2009, in terms of both views and reader questions, were those on the Local Patent Rules.  Because of high interest, I have plans for additional analysis this year.  This is the first of those posts.  In late 2009, I had an article published in Bloomberg Law discussing why the new Rules will drive patent cases to the Northern District of Illinois.  Bloomberg generously allowed me to post a pdf version of the story -- click here to download it -- and to repost it on the blog.  Here is the article:

The Northern District of Illinois enacted Local Patent Rules ("LPR" or "Rules") on October 1, 2009. The purpose of the Rules is to normalize patent litigation in the Northern District of Illinois and to streamline the patent litigation discovery process. See LPR, Preamble. The rules also make clear that the court does not intend to become a "rocket docket." In fact, the Rules create a schedule that would have cases ready for trial in a little over two years, although cases would not necessarily be tried at that time. That is at most a modest change from the court's average time to trial for all cases—about twenty-seven months, according to the most recent Federal Court Management Statistics.

The Northern District of Illinois did not intend that its new Rules would drive patent cases to Chicago, as has happened when other courts enacted local patent rules, such as the Eastern District of Texas. But despite its intentions, the Northern District of Illinois's plan to normalize patent litigation practice and streamline discovery will significantly increase patent filings in Chicago. To understand why the Rules will increase case filings, it is important to understand the process created by the Rules, and then look at the impact specific Rules will have for both patentholders and accused infringers.

The Rules

The Rules were drafted and revised after public comment by a committee comprised of practitioners representing a cross-section of the District's patent bar and four Northern District of Illinois judges: Chief Judge James F. Holderman, Judge Matthew F. Kennelly, Judge James B. Zagel, and Judge Amy J. St. Eve. The Rules were then enacted by the Northern District of Illinois judges.

The Rules require early discovery through substantial production obligations accompanying all parties' Initial Disclosures. The Rules also require parties to take early positions on the merits of their claims and defenses in the form of Initial Contentions, presumably based upon documents exchanged with Initial Disclosures. Finally, the Rules position claim construction at the end of fact discovery, and show a preference against summary judgment motions prior to claim construction.

Here is a more detailed look at the schedule and duties contemplated by the Rules:

Protective Order. A standard two-tier protective order is deemed entered when Initial Disclosures are served. LPR 1.4. Any party is free to seek modifications to the protective order. Id. The automatic entry of the order prevents discovery delays while parties negotiate a proposed protective order and reduces legal fees for the negotiation.

Initial Disclosures & Production. Two weeks after the accused infringer answers, or two weeks after the patentholder answers any counterclaims, the parties must exchange substantive, non-evasive Fed. R. Civ. P. 26(a) Initial Disclosures. LPR 2.1. And along with the Initial Disclosures, the parties must exchange initial document production.

LPR 2.1(a) requires patentholders to produce all documents regarding: 1) any sale, offer for sale or use of the patented invention before filing; 2) design, reduction to practice, or invention of the patented technology generally; 3) all communications with the U.S. Patent and Trademark Office (the prosecution history) for the patents in suit and any patents from which they claim priority; and 4) ownership of the patent. LPR 2.1(b) requires that along with its Initial Disclosures, an accused infringer produce: 1) documents sufficient to show the operation and construction of each element of any product or process specifically accused in the Complaint; and 2) copies of all known prior art. Additionally, all parties are required to identify which documents, by Bates number, fall into each required production category. For cases in which there are lengthy lists of accused products, both the production and the identification of documents by categories could be a significant undertaking early in a case.

Initial Contentions. Two weeks after Initial Disclosures are served, parties claiming patent infringement serve Initial Infringement Contentions that will likely be substantive because the patentholder should have the accused infringer's Initial Disclosure document production. LPR 2.2. Two weeks after Initial Infringement Contentions are served, accused infringers serve Initial Non-infringement, Unenforceability and Invalidity Contentions. LPR 2.3. Along with these contentions, accused infringers must produce any additional documents relied upon including prior art and technical information. Two weeks later, patentholders must serve an Initial Response to Invalidity Contentions. LPR 2.5.

Final Contentions. Twenty-one weeks after Initial Infringement Contentions, parties claiming infringement serve Final Infringement Contentions, and accused infringers serve Final Unenforceability and Invalidity Contentions at the same time. LPR 3.1. Four weeks later, accused infringers serve Final Non-infringement Contentions and parties claiming patent infringement serve Final Enforceability and Validity Contentions (after the final contentions, leave of Court is required for any amendments). LPR 3.2. This gives the parties about four months to complete the bulk of their technical discovery and depositions.

Final Contentions are not amendable without a Court order upon a showing of good cause and an absence of unfair prejudice to the opposing party. LPR 3.4. In a comment, the court noted that its adoption of a new, unargued claim construction would be an example of good cause.

Deadline for Stays Pending Reexamination. No party can seek a stay pending reexamination after serving its Final Contentions. LPR 3.5. The Rule, however does not create a presumption for staying cases pending reexamination prior to the cutoff date. Id.

Claim Construction. The claim construction process begins two weeks after defendant's Final Invalidity Contentions are served with an exchange of terms and proposed constructions. LPR 4.1(a). Within seven days of exchanging terms, the parties must meet and confer to agree upon no more than ten terms for construction by the court. Presenting more than ten terms requires prior leave of court and requires a showing of good cause. LPR 4.1(b).

Claim Construction Briefing. Five weeks after exchanging terms, accused infringers file opening claim construction briefs along with a joint appendix by all parties including the patents in suit and their prosecution histories consecutively paginated. LPR 4.2(a)-(b). Parties claiming patent infringement have four weeks to file response briefs. LPR 4.2(c). Accused infringers have fourteen days to file a reply. LPR 4.2(d). Any party offering witness testimony must include a sworn declaration and promptly make the witness available for deposition. If witness testimony is included in a response brief, the reply deadline is extended by seven days.

After the reply brief is filed, the parties have seven days to file a joint claim construction chart setting out each claim term, the proposed constructions, and the parties' proposal for a claim construction hearing.

Claim Construction Hearing. The Rules contemplate a claim construction hearing four weeks after the reply brief, but the judge can decline a hearing. LPR 4.3. The lack of a hearing may be a reason to allow a sur-reply brief. Id. A judge also may decide not to accept a reply brief. The parties must exchange all exhibits, including demonstratives, at least three days before a claim construction hearing. Id.

Fact Discovery Close. Fact discovery closes six weeks after the claim construction rulings, which triggers expert discovery followed by a dispositive motion deadline. LPR 1.3. Fact discovery is also suspended from four weeks after the LPR 4.1(a) exchange of claim terms, until the Court enters a claim construction ruling. LPR 1.3. This leaves parties free to focus on claim construction briefing without dealing with discovery issues at the same time.

Expert Discovery. Three weeks after the close of fact discovery, parties must make their initial expert witness disclosures for non-claim construction issues on which they have the burden of proof. LPR 5.1(b). Five weeks later, rebuttal expert witness disclosures are due. LPR 5.1(c). Expert depositions must be finished five weeks later. LPR 5.2. Supplementation of expert reports after the LPR 5.1 deadlines is presumed prejudicial and is not allowed absent a showing that the material could not have been added or amended earlier and that there is no unfair prejudice. LPR 5.3.

Trial. Cases should be trial ready approximately two years after the filing of the complaint. This would be slightly faster than the Northern District of Illinois's average time to trial of twenty seven months. But the Rules do not require that trial occur at that time, just that the case is ready for trial.

The Rules Will Drive Patent Cases to Chicago

While the Northern District has made clear that it is not transforming itself into a "rocket docket" like the District of Virginia or the Western District of Wisconsin, the newly enacted Rules will significantly increase patent litigation filings in Chicago. The cases will not proceed to trial faster than the Northern District's average for Eastern all cases of slightly more than twenty-seven months, but the path to trial will be significantly different as described above. The changes are even-handed, with Rules benefiting patentholders being largely offset by the Rules that benefit accused infringers. One might expect even-handed Rules to have little impact on filings, but in this case patentholders will conclude that the Rules provide enough value to overcome the Rules that benefit accused infringers. The Rules, therefore, will draw patent cases to the Northern District. Here are the particular elements of the Rules that will attract patent plaintiffs to the Northern District, along with an analysis of how the Rules nevertheless also benefit accused infringers.

1. Substantive Initial Disclosures & Document Production.

LPR 2.1 requires that parties exchange significant discovery along with their Initial Disclosures. In particular, accused infringers must produce documents sufficient to show how all specifically accused products or processes operate. LPR. 2.1(b). This early document production, which is generally contemplated by Rule 26 but almost never done in practice, will be a major draw for patentholders. The ability to get immediate technical information in discovery, without the expense of serving document requests, is significant. It allows patentholders to have information before preparing their Initial Infringement Contentions. Patentholders will also get a preview of invalidity defenses and patentholders receive all of this information early in the case, before they incur significant discovery costs.

But while LPR 2.1 will attract patent plaintiffs, it also benefits accused infringers. As described above, patentholders must make an initial document production as well, and their obligation is more significant. LPR 2.1(a). Additionally, as with accused infringers, patentholders must identify which documents correspond to each of the four categories. Having this early information will allow accused infringers to evaluate their defenses early in the case and prepare for early dispositive motions such as motions challenging ownership or validity based upon a bar date. And the documents will allow accused infringers to update affirmative defenses or add counterclaims before there could be any prejudice.

Finally, the accused infringers' production obligation regarding its products is only triggered if the patentholder specifically identifies the accused products in its complaint. This will strongly encourage plaintiffs to identify the accused products in the complaint. A standard which comports with the Twombly/Iqbal pleading standards and will lead to more focused patent litigations. R. David Donoghue, The Uneven Application of Twombly in Patent Cases: An argument for Leveling the Playing Field, 8 J. Marshall Rev. Intell. Prop. 1.1 (2008).

2. Defendant opens and closes Markman briefing.

Most Districts either have two rounds of concurrent claim construction briefing or a traditional opening-response-reply schedule with the patentholder opening and replying. Significantly, the Rules provide for a single set of briefs, with the accused infringer—not the patentholder—submitting the initial and final briefs. The court reasoned that this briefing schedule provided the best, most coherent set of papers because a patentholder's opening brief often argues for "ordinary" meanings of most terms without specific proposed definitions. Then after the accused infringer offers constructions in its response, the patentholder offers detailed constructions of those terms for the first time on reply. That scenario either leaves the accused infringer without a chance to answer the patentholder's constructions on the papers, or it requires a sur-reply. Similarly, concurrent briefing results in the parties arguing past each other, generating briefs that do not fully crystallize the issues for the court. Writing first and last, of course, benefits the accused infringer. But the patentholder saves money by only writing one brief and can make any follow up arguments during a hearing or seek a sur-reply if the court does not hold a hearing.

3. Late Claim Construction briefing.

The final major draw for patentholders is the late claim construction proceedings. In addition to cost savings in the briefing process, claim construction is set during the end of a floating fact discovery period that is scheduled to end forty-five days after the court rules on claim construction. Maintaining pre-claim construction uncertainty through most of discovery benefits patentholders. Furthermore, the Rules make clear that a judge can disregard early dispositive motions that would require claim construction before the claim construction contemplated by the Rules. LPR 1.1. So, patentholders may face fewer early summary judgment motions.

Conclusion

The Northern District of Illinois's Local Patent Rules are evenhanded, benefiting both patentholders and accused infringers. But the specific benefits afforded patentholders will drive patentholders to file in the Northern District of Illinois over other courts, some that may have faster times to trial.

R. David Donoghue is a litigation partner in Holland & Knight's Intellectual Property Group focusing on patent disputes. His practice spans diverse technology areas including cellular telephony, computer software, internet technologies, pharmaceuticals, automotive technologies, television production equipment, nutritional supplements, and numerous medical devices. He also has extensive intellectual property licensing experience. Mr. Donoghue was previously with Delphi, the world's largest automotive supplier, where he was a founding member of Delphi's Technology Licensing and Litigation group. Additionally, Mr. Donoghue founded and authors the Chicago IP Litigation Blog where he analyzes intellectual property cases in the Northern District of Illinois (www.chicagoiplitigation.com). He can be reached by phone at 312.578.6553 or by email at david.donoghue@hklaw.com.

© 2009 Bloomberg Finance L.P. All rights reserved. Originally published by Bloomberg Finance L.P in the Vol. 3, No. 48 edition of the Bloomberg Law Reports – Intellectual Property. Reprinted with permission. The views expressed herein are those of the authors and do not represent those of Bloomberg Finance L.P. Bloomberg Law Reports® is a registered trademark and service mark of Bloomberg Finance L.P.

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Judge Moran passed away yesterday.  Click here for the Northern District's official statement.*  This is a difficult post for me to write.  It is hard, maybe impossible, to capture Judge Moran's impact on the Northern District of Illinois in a relatively short blog post.  Judge Moran served as a federal district judge for almost thirty years, including as Chief Judge in the early 1990s.  Judge Moran also served Illinois as a state representative and spent several years in the Army after getting his undergraduate degree from the University of Michigan and before attending Harvard Law School. 

As a district judge, Judge Moran was respectful, thoughtful, and thorough.  Judge Moran's most lasting contributions to the Northern District were likely as a mentor and a writer.  Judge Moran's opinions were detailed and well reasoned, but most of all his opinions were written in straight forward language that opened the federal courts to people without legal training.  Judge Moran's passing is a significant loss.

[UPDATE:]  The Chicago Tribune posted a detailed obituary here with more comments from Judge Moran's peers and a more detailed account of his impressive legal career.

*  I will post more information regarding any memorials, as the information becomes available.  On a procedural note, Judge St. Eve is hearing any motions pending on Judge Moran's docket until further notice.

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American Taxi Dispatch, Inc. v. American Metro Tax & Limo Co., __ F. Supp.2d __, 2008 WL 4616855 (N.D. Ill. Oct. 20, 2008) (St. Eve, J.).

 Judge St. Eve permanently enjoined defendants' (collectively “Metro”) use of trademarks infringing plaintiff American Taxi's American Taxi marks, and awarded American Taxi damages in the amount of Metro's gross sales as well as attorney's fees. American Taxi began using its marks in 1975. Metro incorporated and began using their American Metro Taxi marks in early 2007. American Taxi filed the instant suit for trademark infringement, Lanham Act unfair competition and related state law claims. Metro initially defended itself, but after repeatedly missing deadlines th Court entered a default judgment and allowed American Taxi to submit proofs, which led to this opinion.

Pursuant to Fed. R. Civ. P. 54(c), the award could not exceed in form or amount what was demanded in the pleadings. The Court held that the complaint justified a permanent injunction. American Taxi alleged that Metro's infringing acts harmed American Taxi's goodwill, and the Seventh Circuit has held that damage to goodwill can constitute irreparable harm. And American Taxi backed up its complaint with an affidavit detailing actual confusion between the marks. Furthermore, a tailored injunction would not put Metro out of business. In fact, Metro's owner claimed that Metro had been dissolved. So, the balance of harms weighed in American Taxi's favor. And finally, there is a public interest in knowing whom they conduct business with, which favored an injunction. The Court, therefore, permanently enjoined Metro and its affiliates, successors and assigns from using its marks or any others that were confusingly similar to the American Taxi marks.

The Court then awarded damages in the amount of Metro's provable gross sales. The Court focused its analysis on the Seventh Circuit's recent WMS Gaming, Inc. v. WPC Prods. Ltd. decision in which the Seventh Circuit held that plaintiff need only prove gross sales and then the burden shifts to defendant to prove its costs -- click here to read the Blog's post about that decision. As a result, where defendant is in default, plaintiff's may be awarded defendant's gross profits.

Finally, the Court held that the case was exceptional, warranting an award of attorney's fees. But the Court limited the amount of fees because the request was “less than a model of clarity” and it was not clear from the submission which of the time entries were appropriate.

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The Seventh Circuit instituted a Commission to study the implementation of the ABA Jury Project.  The Northern District was heavily represented on the Commission.  The following Northern District Judges were members of the Commission:  Bucklo, Brown, Coar, Darrah, Denlow, Der-Yeghiayan, Gottschall, Holderman, Kennelly, Lefkow, Moran, Schenkier, St. Eve, and Zagel.  The Commission recently published its report -- click here to read it.  The report describes a two phase analysis.  In the first phase, district judges tested the following seven ABA Principles:

1.       Twelve-Person Juries;

2.       Jury Selection Questionnaires;

3.       Preliminary Substantive Jury Instructions;

4.       Trial Time Limits;

5.       Juror Questions;

6.       Interim Trial Statements by Counsel; and

7.       Enhanced Jury Deliberations.

Other Principles, such as juror notebooks and allowing jurors to take notes, were already in such widespread use that they were not tested.  Click here for the Phase One Project manual detailing the principles, the rationales and authority behind them, and suggested procedures.  Phase One resulted in questionnaires from 22 participating federal trial judges, 74 participating attorneys and 303 jurors from 38 trials that used one or more of the seven Principles.  Based upon the analysis of Phase One results and questionnaires, the Commission focused Phase Two on the following four Principles:

1.       Juror Questions;

2.       Interim Trial Statements by Counsel;

3.       Twelve-Person Juries; and

4.       Preliminary Substantive Jury Instructions.

These Principles were chosen because of Phase One popularity (78% of jurors reported that being able to ask questions increased their satisfaction with the process) and because of a desire to study the Principles more.  Click here for the Phase Two manual.

In Phase Two, 108 jurors from 12 trials employing one or more of the Phase Two Principles filled out questionnaires.  In addition, 12 attorneys and 4 district judges that participated also filled out questionnaires.  The results are interesting, but more importantly create the opportunity to powerfully impact the trial system across the Seventh Circuit in ways that benefit all of the stakeholders in the trial process -- the litigants, the jurors, the judge and the judge's chambers, and the litigators.

All four of the Phase Two Principles showed significant benefits to the trial process.  83% of jurors reported an increased understanding of the facts when allowed to ask written questions through a judge -- the questions were reworded to meet evidentiary rules.  And 75% of judges and 65% of attorneys thought the questions benefited jurors.  Similarly, preliminary substantive jury instructions were found to improve trials by jurors (80%), judges (85%) and attorneys (70%).  And the same was true for interim statements to the jury -- jurors (80%) and judges (85%).  Finally, twelve-person juries were found not to harm efficiency, while increasing juror diversity.

Each of the four Phase Two Principles, as well as several of the additional three Phase One Principles deserve more attention and analysis.  So, over the next several weeks I will provide follow up posts discussing the findings of those Principles in greater detail.  I will start with the idea of juror questions, which I find particularly important, later this week or early next.

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Eazypower Corp. v. Jore Corp., No. 04 C 6372, 2008 WL 3849921 (N.D. Ill. Aug. 14, 2008) (Zagel, J.)

Judge Zagel construed the claims of plaintiff Eazypower’s patent to a portable screwdriver with a flexible shaft. Of particular interest, the Court held that despite Eazypower’s Jepson claim format, its preamble was not limiting. 

Jepson claiming is a drafting style – common in Europe, but relatively rare in the United States – in which the prior art is described in the preamble and the claimed improvements over the prior art are described in the body of the claim. The Court acknowledged that Jepson claims carry a rebuttable presumption that the claim’s preamble is limiting. But the Court held that the Eazypower rebutted the presumption in this case. The claim’s preamble, therefore, was not limiting. First, the Court relied upon two 2003 Northern District opinions, by Judges Guzman and St. Eve, holding that the preambles of the claims at issue overcame the presumption and were not limiting. While these opinions were not controlling, the Court found them well-reasoned and persuasive. The Court explained that the preambles were not limiting because they were “not necessary to give life to the claims,” citing Judge Guzman’s decision. Eazypower v. Vermont Am. Corp., No. 01 C 3252, 2003 WL 1720024, at *10 (N.D. Ill. Mar. 28, 2003).

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The Seventh Circuit's Judge Posner is scheduled to begin a bench trial this morning on the issue of inequitable conduct in New Medium Technologies LLC v. Barco NV, No. 05 C 5620.  The trial is scheduled to last today and tomorrow, but could go as long as Wednesday.  I represented a party that was in the case, but settled and was dismissed from the case last year.  As a result, I have not covered any opinions from the case, previously before Judge St. Eve.  But I am going to observe some of the trial, and I may blog about the trial if I find some interesting things to say that relate more to the trial techniques of counsel or Judge Posner's courtroom than the facts of the case.

But if you are interested in watching Judge Posner hear a patent case or what I expect to be some excellent advocacy from the Niro firm, for plaintiffs, and Baker & McKenzie, for defendants, the bench trial is being heard in Judge St. Eve's courtroom.

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Here are several stories worth checking out, but that did not warrant a separate post:

• PA Tracer's monthly patent filings report is out.  The Northern District had nine new cases filed in July.  That is reasonably busy for the deep summer, but nothing compared to the Eastern District of Texas's 25 new patent cases -- click here to read PA Tracer's post.
   
• The St. Louis Post-Dispatch ran a story recently about Judge St. Eve -- click here to read it.*  The story discusses many traits that are obvious to those who have practiced before her.  Judge St. Eve is very punctual and efficient, and she has absolute control of her courtroom, which she maintains with a civility and kindness that are impressive.  The article also speculates, using unnamed colleagues and media as sources, that Judge St. Eve will eventually be on Supreme Court short lists.  Here's hoping she stays in the Northern District a long time before getting called up to One First Street.
   
• Chicago Lawyer Magazine did a nice profile on Chicago IP lawyer Carol Genis of Bell, Boyd & Lloyd.  Click here to read it.  The article largely focuses on how Genis develops strong bonds of trust and friendship with clients.
   
• Duane Valz, Vice President & Associate General Counsel of Yahoo!’s Global Patent Strategy, is discussing approaches for patenting Internet-related ideas in a webinar on Wednesday, September 3 from 1:30 - 3:00 CT -- click here for more information.

*  Hat tip to the WSJ Law Blog for pointing out the story here.

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On Wednesday, August 13 at noon CT, I am giving a teleseminar with Evan Brown (a fellow Chicagoan who writes the insightful Internet Cases blog) and Professor Eric Goldman (who writes the excellent Technology & Marketing Law Blog) discussing the current state of the Communication Decency Act's Good Samaritan clause.  The seminar will focus on, among other things, the Roommates decision in the Ninth Circuit -- click here for Goldman's posts on the case -- and the Craigslist decision from the Seventh Circuit (upholding a Judge St. Eve opinion) -- click here for the Blog's posts about that case and here for Brown's posts. 

Click here for ALI-ABA's web brochure about the seminar.  It promises to be an interesting discussion with lively debate.  And ALI-ABA has generously offered a $30 discount off of the seminar's $149 cost for Blog readers that use this code:  TSPV02DD.

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Nat'l. Spiritual Assembly of the Baha'is of the U.S.A. Under the Hereditary Guardianship, Inc. v. Nat'l. Spiritual Assembly of the Baha'is of the U.S.A., Inc., ___ F.Supp.2d ___, 2008 WL 1839078 (N.D. Ill. Apr. 23, 2008) (St. Eve, J.).

Judge St. Eve denied defendant the National Spiritual Assembly of the Baha'is of the United States' (the "NSA") motion to hold non-parties Franklin D. Schlatter, Joel B. Marangella, the Provisional National Baha'i Council ("PNBC"), the Second International Baha'I Council (d/b/a Baha'is Under the Provisions of the Covenant)("SIBC"), and the Baha'i Publishers Under the Provisions of the Covenant ("BPUPC")(collectively the "Alleged Contemnors") in contempt for violating the 1966 permanent injunction against plaintiff The National Spiritual Assembly of the Baha'is of the United States Under the Hereditary Guardianship, Inc.'s (the "NSA-UHG" or "UHG") use of the NSA's trademarks. Shortly after the injunction was entered, the NSA-UHG dissolved. NSA argued that its former officers, Schlatter and Marangella, remained bound by the injunction. But the Court held that officers or agents of an entity that are not personally named in an injunction are only bound while acting for the named entity or a subsequent entity formed to avoid the injunction. Schlatter's and Marangella's alleged contempt, therefore, is dependent on their new entity PNBC's status.

The Court held that PNBC was not in privity with NSA-UHG. NSA-UHG followed the directives of its spiritual leader, Mason Remey. PNBC, however, followed the directives of its spiritual leader Marangella, not Remey. Furthermore, Marangella specifically instructed PNBC and its members not to violate the injunction. PNBC, Schlatter and Marangella, therefore, were not in privity with NSA-UHG and not bound by the injunction.

Similarly, non-parties Jensen, SIBC and BPGPC were not in privity with NSA-UGH, even though they admitted to being successors-in-interest to Remey. Jensen disassociated themselves from the NSA-UGH and Remey several years before the injunction was issued.

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e360Insight, LLC v. Comcast Corp., No. 08 C 340, Slip Op. (N.D. Ill. Apr. 10, 2008) (Zagel, J.).

Judge Zagel granted defendant Comcast judgment on the pleadings, dismissing plaintiff e360Insight’s ("e360") Computer Fraud and Abuse Act, First Amendment, and related state law claims. e360, an Internet marketer and accused email spammer, alleged that Comcast harmed e360 by unjustifiably blocking all or most of e360’s emails from Comcast’s customer email accounts. Comcast stopped e360's emails with filtering software that identified and stopped emails from e360 addresses.

Comcast argued that the Good Samaritan clause of the Communications Decency Act, 47 U.S.C. § 230(c)(2), provided Comcast absolute immunity from e360's claims because Comcast voluntarily filtered e360's emails to restrict access to what Comcast believed was objectionable content. The Court held that the Good Samaritan clause provided absolute immunity for ISPs that filtered for objectionable material. The Court also held that Judge St. Eve's and the Seventh Circuit's recent Chicago Lawyers' Committee v. Craigslist opinions – click here for more on those cases – were not applicable. Those opinions limited the clause's protection for ISPs that chose not to filter. Because Comcast filtered, it enjoyed absolute protection. The Court also held that e360's compliance with Congress's spam prevention laws, 15 U.S.C. §§ 7701-13 (Controlling the Assault of Non-Solicited Pornography and Marketing Act of 2003 ("CAN-SPAM") was irrelevant. Regardless of compliance with CAN-SPAM, the Good Samaritan clause still allowed the ISP to make a good faith judgment that e360's emails were objectionable. And e360 did not sufficiently plead Comcast's lack of good faith in determining that the emails were objectionable.

Eric Goldman at the Technology & Marketing Law Blog has a good post on this case and several other district court cases considering § 230(c) defenses. – click here for his post.

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Tomorrow I will be back to case analysis, but there is some Northern District news and some excellent IP and litigation blog posts worth reading, here they are:

• Ninth Annual Pro Bono and Public Interest Awards -- The Northern District and the Federal Bar Association are seeking nominations for excellence in pro bono and public interest work. Nominations should be based upon work performed in civil cases before the Northern District which are no longer pending. Send nominations by March 28 to:

Amy Rettberg, Executive Law Clerk
Email: amy_rettberg@ilnd.uscourts.gov
Chambers of the Chief Judge James F. Holderman
219 South Dearborn Street, Suite 2548
Chicago, Illinois 60604

• Patent Reform is Moving Forward -- The Senate is preparing to vote on the Patent Reform Act after its spring recess (yes, it is spring already in DC).  Here is some additional coverage of the Act's status:

271 Patent Blog -- looking at the latest amendments to the Act.

Maryland Intellectual Property Blog -- looking at the latest amendments and questioning whether proponents have the sixty votes necessary for cloture, thereby avoiding a filibuster.

Patent Docs -- taking sides, but asking you to call your Senators regardless of which side you take.

• Check out the newest entry to Chicago's law blog scene, the Lean & Mean Litigation Blog.  It is not IP-focused, but it is an interesting read for any commercial litigator or litigant.
  
• William Patry at Patry on Copyright has an interesting post about the difficulties of serving corporate entities based upon a District of the District of Columbia case involving a pro se plaintiff.  The best advice, of course, is to hire counsel because if you do not get the party served properly, you have no case.
  
• The Seventh Circuit affirmed Judge St. Eve's ground breaking opinion in the CLC v. Craigslist case.  The Seventh Circuit held that an ISP is exempt from cases based upon user content when the case attempts to treat the ISP as a publisher of the content.  This is considerably narrower than most of the other circuits, which have held that Section 230 exempts ISPs from essentially all suits based upon user content.  For more coverage, check out the WSJ Law Blog (which erroneously elevates Judge St. Eve to the Seventh Circuit), Internet Cases, and the Technology & Marketing Law Blog (very detailed analysis of Judge Easterbrook's opinion).
  

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The Northern District has posted the Seventh Circuit's new proposed pattern jury instructions for patent cases on its website -- click here for a copy.  The instructions include all of the recent revisions to the patent laws, including KSR and Seagate. The Seventh Circuit requested comments on the instructions be sent to:

Chief Judge Robert L. Miller, Jr.
robert_miller@innd.uscourts.gov
325 Robert A. Grant Federal Building
204 S. Main St.
South Bend, IN 46601

Comments will be accepted until April 1st.  Also, below is my list of IP jury instructions by Northern District judge, I am sure we will start to see some new ones soon in light of the turbulent 18 months patent law has had:

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The Chicago Tribune has set up a live blog, written by Bob Secter and Jeff Coen, of the government's criminal case against Tony Rezko.  The blog promises daily, "gavel-to-gavel" coverage of the Rezko trial -- click here for background on the case from the Tribune.  This case does not have an intellectual property angle that I am aware of, but it provides an excellent view of a trial as seen through the eyes of non-lawyers, a very important perspective for litigators.  Additionally, Judge St. Eve gets at least her share of IP cases -- click here for discussion of Judge St. Eve's opinions in the Blog's archives.*

Here is some of the Tribune's coverage of the voir dire from yesterday, largely performed by the Court:

Another potential juror, No. 475, teaches cooking classes, often on Fridays. St. Eve sounded as if she was ready to work with the cooking teacher to accommodate her schedule. "If we structured the trial so that it would go Mondays through Thursday and not have trial on Fridays, the days you have cooking classes, would that be good for you?" the judge asked.

Some of St. Eve's questions were more chatty than legal. The cooking teacher, for example, was asked what was on the menu at her next class. The answer: Beef Bourguignon and mashed potatoes.

Another juror was asked where she liked to go snowboarding. Still another was asked about her desire to learn Spanish. "Have you learned any words yet?" the judge asked.

"Just the bad things," the woman responded.

St. Eve also complimented No. 475 on an answer the prospective juror gave to a presubmitted question about whether people who contribute to a campaign should expect something in return. "A thank-you would be nice," the woman wrote.

I will keep an eye on the Tribune's blog and will highlight other especially interesting items from it.

*  Judge St. Eve also gets her share of high profile cases.  She must be tired of the publicity after having the Conrad Black trial and now the Rezko trial within twelve months of each other.

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Black & Decker, Inc. v. Robert Bosch Tool Corp., No. 2007-1243, 1244, Slip Op. (Fed. Cir. Jan. 7, 2008).*

The Federal Circuit affirmed the Northern District jury’s obviousness verdict, and Judge St. Eve’s denial of defendant’s inequitable conduct claim. But the Federal Circuit reversed the Northern District’s construction of “power conversion circuit” and remanded for further proceedings and, perhaps, a new trial.** The Federal Circuit held that the Northern District relied largely upon claim differentiation for its construction and, in the process, gave the patent scope beyond the disclosed invention.

The Federal Circuit held that the Northern District’s pre-KSR obviousness jury instruction was not reversible because defendants identified no evidence in the record that supported an obviousness finding even under the broader KSR standard.

* Click here for extensive coverage of this case in the Blog’s archives.

**  The Court scheduled a status conference early next week.  We may learn at that conference whether a new trial is being scheduled or whether summary judgment will be briefed or a settlement conference scheduled first.

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Brian Higgins's Maryland IP Law Blog post about the progeny of In re Seagate, 497 F.3d 1360 (Fed. Cir. 2007), inspired me to do follow up posts identifying Northern District cases discussing recent major IP decisions.  The first looks at cases discussing eBay Inc. v. MercExchange, L.L.C., 126 S.Ct. 1837, 164 L.Ed.2d 641 (2006).  Here they are:*

• Black & Decker Inc. v. Robert Bosch Tool Corp., No. 04 C 7955, 2006 WL 3446144 (N.D. Ill. Nov. 29, 2006) (St. Eve, J.). -- Granting a permanent injunction in a case between competitors.
  
• Chamberlain Group, Inc. v. Lear Corp., No. 05 C 3449, 2007 WL 1017751 (N.D. Ill. Mar. 30, 2007) (Moran, J.). -- Granting a preliminary injunction in a case between competitors and holding that in eBay the Supreme Court limited the automatic presumption of irreparable harm based upon infringement.

For further analysis of post-eBay decisions, check out my post about Michael Smith's analysis (click here) and my post discussing Ray Nimmer's thoughts on the potential for compulsory licensing regimes because of eBay (click here).

*  A brief note on methodology:  this was not a thorough study and does not include cases that granted or denied injunctions without discussion.  For a more comprehensive list of decisions nationwide (updated through the end of 2007) go to the Fire of Genius.

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Nutrinova Nutrition Specialties & Food Ingredients GmbH v. Viachem, No. 07 C 4232, Min. Order (N.D. Ill. Nov. 21, 2007) (St. Eve, J.).

Judge St. Eve granted in part plaintiff’s motion to compel various discovery. The Court ordered defendants to produce various once-privileged documents disclosed to unidentified customers pursuant to an alleged common interest privilege. The Court acknowledged that common interest could protect such disclosures. But defendants failed to identify the specific customers that were shown documents, which documents were disclosed or when the disclosures occurred. On that record, the Court could not find that defendants had maintained the privilege. 

The Court also ordered defendants to update their privilege log to identify any attorneys on the log. And the Court ordered the parties to meet and confer regarding uncrystalized disputes over defendants’ answers to some interrogatories.

Practice Tip: It is the rare judge that appreciates discovery motions, let alone motions where the parties did not identify what the actual issues were. It is very important to follow both the letter and the spirit of Local Rule 37.2 meet and confers.

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Nutrinova Nutrition Specialties & Food Ingredients GmbH v. Viachem, No. 07 C 4232, Min. Order (N.D. Ill. Nov. 27, 2007) (St. Eve, J.).

Judge St. Eve granted in part plaintiff’s Fed. R. Civ. P. 12(e) motion for a more definite statement regarding defendant The Ingredient House’s (“TIH”) affirmative defenses and counterclaim. The Court ordered TIH to amend its patent misuse affirmative defense to provide factual allegations outlining the alleged misuse. TIH’s original defense simply stated that plaintiff’s claims were “barred by patent misuse.” The Court also ordered TIH to amend “incongruous statements” in its pleading that appeared to be clerical errors.

The Court denied plaintiff’s motion as to TIH’s defamation counterclaim. TIH was not required to plead which state’s law governed TIH’s defamation claim.

Practice Tip: Defendants frequently plead affirmative defenses with an unsupported statement of the defense. The better practice, and the one that avoids Rule 12(e) motions, is to plead at least the basic facts underlying the defense.

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Black & Decker, Inc. v. Robert Bosch Tool Corp., No. 06 C 4440, Min. Order (N.D. Ill. Jul. 13, 2007) (Manning, J.).*

In the first Northern District opinion to address the Supreme Court’s MedImmune declaratory judgment standard, Judge Manning denied plaintiff Black & Decker’s (“B&D”) motion to dismiss defendant Robert Bosch Tool Corp.’s ("Bosch") declaratory judgment counterclaims for lack of subject matter jurisdiction. In a prior case between the parties before Judge St. Eve (numerous prior opinions are discussed in the Blog's archives), B&D asserted that two models of Bosch's Power Box radio (the "Old Power Box") infringed B&D's two patents (the "Old Patents").  Shortly before Judge St. Eve held trial in the previous case, B&D brought this suit against Bosch asserting that Bosch's new model of its Power Box radio (the "New Power Box") infringed a third patent (the "New Patent").  At about the same time, B&D sought leave to present evidence at trial before Judge St. Eve that the New Power Box infringed the Old Patents.  Judge St. Eve, however, held that B&D had not disclosed the New Power Box as an accused product and that Bosch would be prejudiced by adding it immediately before trial.  After the trial before Judge St. Eve, the jury returned a verdict that the Old Power Boxes willfully infringed certain claims of the Old Patents.

Shortly after Judge St. Eve excluded the New Power Box from her trial, B&D amended the complaint in this case to allege infringement of the Old Patents.  In response, Bosch added declaratory judgment counterclaims regarding a third set of B&D patents (the “Smith patents”) which B&D had never asserted against Bosch. Bosch argued that an actual controversy existed because of the history of litigation between the parties and B&D’s prior testimony that it placed a high value on the exclusivity its patents provided in the workplace radio marketspace. B&D countered that, despite filing two suits against Bosch, B&D had never asserted the Smith patents against Bosch, or any other party. B&D also argued that St. Eve had already dismissed similar counterclaims in the last case for lack of actual controversy. But St. Eve’s decision was based upon the Federal Circuit’s old reasonable apprehension test, which the Supreme Court’s MedImmune decision overruled. Looking at “all of the circumstances,” as required by MedImmune, the Court held that an actual controversy existed. Among other reasons, the Court noted that the wide-ranging dispute between the parties regarding the workplace radios, suggested that it was in the parties’ best interests to resolve any dispute regarding the Smith patents.

*  You can read a copy of the Minute Order here.

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Ace v. Marn, No. 06 C 5335, 2007 WL 1541747 (N.D. Ill. Apr. 17, 2007) (St. Eve, J.).

Judge St. Eve granted in part and denied in part plaintiff/counterdefendant Ace Hardware Corp.'s ("Ace") Fed. R. Civ. P. 12(b)(6) motion to dismiss defendants/counter-plaintiffs' (collectively "Marn") counterclaims.  The Court denied the motion as to Marn's breach of contract claim and dismissed Marn's fraud and tortious interference claims.  Ace and Marn entered an agreement (the "Agreement") allowing Marn the right to use certain Ace trademarks and to purchase product for resale from Ace.  Marn alleged that Ace and its representatives breached the Agreement, made numerous misrepresentations leading up to the signing of the Agreement and failed to provide promised inventory.  Ace argued that Marn's breach of contract claim should be dismissed because it did not identify a specific provision of the Agreement that was breached, citing several Northern District cases.  But noted that each of Marn's cases came down before the Seventh Circuit's decision in Kolupa v. Roselle Park Dist., 438 F.3d 713, (7th Cir. 2006).  In Kolupa the Seventh Circuit explained the Rule 8(a)(2) requirements:

[i]t is enough to name the plaintiff and the defendant, state the nature of the grievance, and give a few tidbits (such as the date) that will let the defendant investigate. . . .  Any district judge (for that matter, any defendant) tempted to write "this complaint is deficient because it does not contain ..." should stop and think:  What rule of law requires a complaint to contain that allegation?  Any decision declaring "this complaint is deficient because it does not allege X" is a candidate for summary reversal, unless X is on the list in Fed. R. Civ. P. 9(b).

Kolupa at 714-15 (emphasis in original).  Based upon the Kolupa decision the Court held that Marn was not required to cite a specific breached section of the Agreement.

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Black & Decker, Inc. v. Robert Bosch Tool Corp., No. 06 C 4440, 2007 WL 1232089 (N.D. Ill. Apr. 25, 2007) (Manning, J.).

Judge Manning granted defendant's, Robert Bosch Tool Corp. ("Bosch") Fed. R. Civ. P. 12(c) motion for judgment on the pleadings, holding that plaintiff's, Black & Decker ("B&D"), patent infringement claims against Bosch's new product regarding B&D's previously asserted patents were barred by res judicata.  In the prior case before Judge St. Eve (numerous prior opinions are discussed in the Blog's archives), B&D asserted that two models of Bosch's Power Box radio (the "Old Power Box") infringed B&D's two patents (the "Old Patents").  Shortly before trial before Judge St. Eve, B&D brought the instant suit against Bosch asserting that Bosch's new model of its Power Box radio (the "New Power Box") infringed a third patent (the "New Patent").  At about the same time, B&D sought leave to present evidence at trial before Judge St. Eve that the New Power Box infringed the Old Patents.  Judge St. Eve, however, held that B&D had not disclosed the New Power Box as an accused product and that Bosch would be prejudiced by adding it immediately before trial.  After the trial before Judge St. Eve, the jury returned a verdict that the Old Power Boxes willfully infringed certain claims of the Old Patents.

Shortly after Judge St. Eve excluded the New Power Box from her trial, B&D amended the complaint in the instant case to allege infringement of the Old Patents.  Bosch then argued that res judicata barred B&D's claims based upon the Old Patents.  Judge Manning held that res judicata applied because the trial before Judge St. Eve resulted in a final verdict, the parties to that case were identical to those in the instant case and the claims had "identity" with each other.  Judge Manning noted that B&D admitted that the causes of action had "identity"  when it sought to reassign the instant case to Judge St. Eve and stated that:  both cases involve the same patents; both cases involve the same product, the Power Box; both cases involve the same facts; and both cases involve the same issues of law. 

B&D argued res judicata should not apply because Bosch had sought to have the New Power Box claims litigated in a separate case.  But Judge Manning denied the argument, noting that Bosch had argued that B&D should not be able to bring its claims late in the suit before Judge St. Eve and also that res judicata should preclude any future B&D suit based upon the New Power Box.  Additionally, Judge Manning held that B&D could have litigated the New Power Box in Judge St. Eve's case because B&D was aware of the product throughout the suit and that at least some sample products had been made by or for Bosch. 

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As I pointed out early this week, the Conrad Black trial has little or no intersection with IP, but I could not resist posting about Neil Steinberg's column in yesterday's Chicago Sun-Times.  Steinberg spent a day observing the Black trial and provided his impressions of the jury system and Judge St. Eve.  Two of his observations were particularly interesting.  First, he found the trial very boring.  As IP lawyers and particularly patent lawyers, this is something we have to struggle with.  Making technology analysis and damages interesting is a difficult job and keeping jurors who only see a portion of the litigation proceedings awake and attentive can be difficult.

Second, Steinberg notes that "pay all that money to lawyers for a reason."  I would like to believe he meant because of the immense skill involved, but I am afraid it is because of how boring and complex he found the trial.

Finally, my wife, who clerked for Judge St. Eve, assures me that I will not suffer Steinberg's potato peeler fate when I say that while Judge St. Eve is very attractive, her most important judicial attributes are her intellect and her kind, but strong command of her courtroom.  Here is a brief quote from Steinberg's column:

"Oh dear." Spoken by a pal in Judge Amy St. Eve's courtroom. There is not enough tedium in our daily lives, apparently, so we are visiting a trial revolving around complex issues of accountancy.

I wish the limits of journalistic candor allowed me to explain the meaning of that "oh dear," uttered as the jury returns to the courtroom after lunch.

The contrast could not be more stark, between Lord Conrad Black, the grandiose publishing patrician, in his deep blue, subtly pinstriped bespoke suit, and the floral burst of middle American casualness sitting heavily in judgment. It was as if a line waiting for corn dogs and cotton candy at Great America had somehow blundered into a state funeral.

Sitting in court, I scour the language, searching for terms that adequately describe the colors the jury are wearing. Canary yellow. Soft bubble gum pink. Bright blue. Muddy teal. Electric poached salmon. Two women wear an identical shade of aircraft-landing paddle green.

And those are the easy ones. One lady has on what I finally decide is tiger print. A man sports what appears to be big polka dots on olive green.

A trial is also going on. The testimony centers around "Generally Accepted Accounting Standards" and overhead projections with titles such as "Statement of Financial Accounting Standards No. 57."

And hell is typically envisioned with flames. ...

After an hour I am ready to chew off my leg to escape. I would here launch into a tribute to the pixie good looks of Judge St. Eve -- I'm sure that the occasional glance in her direction is all that keeps some forced to be here from slipping into madness -- were it not for the certainty that my wife would calmly set down the paper, reach over to the kitchen drawer, remove a potato peeler and then skin me alive with it.

Three thoughts, which came as I fled the courtroom, a drowning man breaking the surface and filling his lungs with sweet, sweet air.

1) The cynical assumption is that these working-class Americans will throw Black into prison for the crime of being rich. Perhaps true, perhaps a snooty, unfair insult to the average American, considering that we managed, in our waddling, oafish way, to invent computers, land on the moon and kick the Germans out of France.

2) They pay all that money to lawyers for a reason.

3) Whatever you are doing today, even if you are kneeling in muck, gathering crushed aluminum cans and tossing them into a shopping cart to sell later, count your blessings. You could be in court.

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Michael Sneed's Tuesday Chicago Sun-Times column included an entry entitled "Ring.  Ring."about the Northern District.  She rarely covers Northern District happenings, but the Conrad Black trial is major international news.  Sneed reports that during the Black trial, an attorney's cell phone "erupted" with a ring tone from The Exorcist.  The always gracious Judge St. Eve reportedly responded to the ring, saying "I hope you didn't program that ring just for this trial." 

While the Black trial is not intellectual property-related, I am blogging about Sneed's piece because it highlights an important practice tip:  If you cannot turn off your phone when you enter a courtroom, at least put it on vibrate.  Everyone has made the mistake of forgetting to silence your phone (mine was in church, very embarrassing), but to avoid it altogether leave your phone on vibrate permanently.

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According to this Law.com article, effective May 1st the Northern District of Texas, based in Dallas, has instituted local patent rules similar to those used in the more famous (at least in patent circles) Eastern District of Texas, which were modeled after the Northern District of California's Local Patent Rules.  Additionally, the Southern District of Texas, based in Houston, is considering adopting a similar set of local patent rules.  Perhaps the courts think that the variety of direct flights to Dallas or Houston combined with the same Texas charm and hospitality available in Marshall, will give the Northern and Southern Districts a leg up on their colleagues to the east.  Of course, all of this would fall apart if Congress revises the venue requirements as Patently-O suggests it might.

But regardless of what Congress does, this spreading of special patent local rules, which I am all for, makes me wonder if the Northern District of Illinois will follow the trend and adopt their own special patent rules.  Some judges already have standing orders outlining their processes for claim construction proceedings.  For example, Judge St. Eve's procedures can be found on her site in the "Patent Cases" section.

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Black & Decker Inc. v. Robert Bosch Tool Corp., No. 04 C 7955, 2006 WL 3883286 (N.D. Ill. Dec. 18, 2006) (St. Eve, J.).*

Judge St. Eve granted judgment as a matter of law for plaintiff, holding that the jury's findings of invalidity and obviousness were not supported by legally sufficient evidence.  At trial, defendant introduced an article describing a prior art radio as 102(b) prior art using its expert.  But the expert testified that one of the claim elements was missing.  Defendant argued that pictures of the radio that were not used in the article, showed the device.  But the Court held that defendant could not piece together the article, testimony and pictures to prove that the article disclosed all elements of the claimed invention.  The jury's obviousness finding was not supported by legally sufficient evidence because defendant did not present clear and convincing evidence of a motivation to combine its obviousness prior art references.

* You can find much more on this case in the Blog's archives.

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Black & Decker Inc. v. Robert Bosch Tool Corp., No. 04 C 7955, 2007 WL 108412 (N.D. Ill. Jan 12, 2007) (St. Eve, J.).

Judge St. Eve denied defendant's motion for a new trial, altered judgment or judgment as a matter of law in this patent dispute (more on this case and the injunction in the Blog's archives).  Defendant first argued that the jury's infringement findings on various claim elements were not supported by the facts.  The Court denied each argument, citing facts that supported the jury's infringement findings.  Defendant also argued that the jury's verdict that claim 1 of USPN 6,788,925 (the "'925 patent") was valid while the almost identical claim 2 of the '925 patent was invalid was inconsistent.  Defendant sought an altered judgment or a new trial as a remedy.  The Court first noted that several Circuits would have waived this objection because defendant did not object to the alleged inconsistency when the jury rendered its verdict.  But because the Seventh Circuit has not directly ruled on the issue (the matter is governed by region-specific law because it is a procedural matter), the Court did not waive the objection.  The Court did, however, waive any arguments Defendant first made in its reply brief.  Having addressed the procedural posture of the arguments, the Court held that the jury's validity findings on the two claims was sufficiently supported.  Because the two claims, although substantially the same, had different elements, the Court held that a rational jury could have come to different validity conclusions for each claim and denied defendant's request for a new trial. 

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Black & Decker Inc. v. Robert Bosch Tool Corp., No. 04 C 7955, 2006 WL 3883937 (N.D. Ill. Dec. 27, 2006) (St. Eve, J.).

Judge St. Eve denied defendant's emergency motion to prohibit plaintiff from sending Rule 65(d) notice letters regarding the Court’s permanent injunction to defendant’s customers (more on this case and the injunction in the Blog's archives). But before analyzing defendant’s emergency motion, the Court first addressed defendant’s prior motion to clarify the injunction which the Court previously denied. In the motion to clarify, defendant stated that it had sold approximately 150,000 infringing radios to various resellers prior to being enjoined. Defendant argued that those resellers should be free to sell their supplies of infringing radios. The Court denied the motion because it was first raised in a sur-reply brief regarding plaintiff’s motion for a permanent injunction without presentation of any detailed facts, legal argument or supporting case law. 

Even in its motion to clarify, defendant “failed to adequately develop [its] argument with specific facts and relevant case law.” The Court warned that counsel served as both client advocates and officers of the Court. As the latter, the Court stated that:

[I]t is incumbent on trial counsel to assist the court and to fully and fairly represent the legal issues in the case within the applicable statutory and common law framework relevant to the factual dispute before the court for resolution.

Accordingly, [defendant’s] counsel-as officers of the court and advocates for their client-had the responsibility to raise the issue of the 145,377 [radios] in a cogent manner at the first possible opportunity and not in its motion to clarify or in a sure-reply. The Court cannot anticipate every relevant argument counsel should make on behalf of its clients nor is it the Court’s role to do so.

(citations omitted).  Having addressed defendant's prior motion to clarify, the Court acknowledged that its permanent injunction did not enjoin third parties, such as defendant’s customers, but noted that a Rule 65(d) notice letter regarding the enjoined conduct was the required first step before plaintiff could bring contempt proceedings against defendant’s customers for aiding and abetting any violation of the injunction by defendant. The Court also quoted the text of the notice letter and held that, while it could have used more precise language in parts, it did not direct the recipient to stop sales or state that the recipient was enjoined by the Court’s injunction. Additionally, any lack of precision in the letter’s wording was fixed by the inclusion of the permanent injunction itself.

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Black & Decker Inc. v. Robert Bosch Tool Corp., No. 04 C 7955, 2006 WL 3883286 (N.D. Ill. Dec. 18, 2006) (St. Eve, J.).*

Judge St. Eve denied defendant's motion for vacature of a lost profits award and for a new trial.  First, defendant argued that the jury's finding that it induced infringement could not stand because it shipped the product at issue with an AC power cord (non-infringing) and a battery (infringing), but plaintiff had not shown that each individual sale of a product resulted in an infringing use.  Prior to trial defendant argued that plaintiff must show a one-to-one correspondence between each unit sold and a customer's direct infringement citing Chiuminatta concrete Concepts, Inc. v. Cardinal Indus., Inc., 1 Fed. Appx. 879 (Fed. Cir. 2001) (unpublished op.).  The Court denied that argument.  In its post-trial motion, defendant argued that proof of sales is not sufficient for an award of induced infringement citing Golden Blount, Inc. v. Robert H. Peterson Co., 438 F.3d 1354 (Fed. Cir. 2006).  But the Court distinguished Golden Blount because the issue in that case was that some product was returned to the alleged infringer before being assembled into an infringing product, which may or may not have been sold.  There was no induced infringement because the product at issue may never have been sold.  In the instant case, the Court held that the product with the infringing configuration had been sold and, therefore, upheld the jury's finding of induced infringement.

Defendant also argued that the trial evidence overwhelmingly supported the conclusion that the product was "almost always" used in a non-infringing way (with an AC power cord instead of a battery) and that, therefore, the jury's award should be vacated and a new trial ordered.  But the Court held that its inquiry was whether the jury was presented with "a legally sufficient amount of evidence from which it could reasonably derive its verdict," not whether defendant's conclusion was supported.  The Court held that there was a legally sufficient amount of evidence.  Each infringing product was shipped with an instruction manual and video demonstrating the infringing use.

*There is much more analysis of various opinions from this case in the Blog's archives.  Does anyone feel like this is becoming Black & Decker v. Robert Bosch week at the Blog?  There is only one other opinion from the case in my queue and then we will be on to other cases.

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Black & Decker Inc. v. Robert Bosch Tool Corp., No. 04 C 7955, 2006 WL 3883919 (N.D. Ill. Dec. 7, 2006) (St. Eve, J.).

This is Judge St. Eve's permanent injunction order (numerous opinions from this case and its resulting jury trial have been analyzed in the Blog and can be found in the Blog's archives).  The injunction is notable for its thoroughness, in describing both the claims at issue and the enjoined products or classes of products.  The order even includes electrical schematics of a portion of the enjoined invention.

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Black & Decker v. Robert Bosch Tool Corp., No. 04 C 7955, 2006 WL 3883921 (N.D. Ill. Nov. 20, 2006) (St. Eve, J.).

Judge St. Eve's latest opinion in this patent dispute awarded plaintiff its costs pursuant to Fed. R. Civ. Pro. 54(d) over defendant's objection that plaintiff's alleged misconduct.  My analysis of Judge St. Eve's opinion which analyzed defendant's misconduct allegations, as well as opinions addressing numerous other aspects of this case and the resulting trial, can be found in the Blog's archives.  In response to defendant's allegations of misconduct, the Court cited her previous opinion finding that there was no misconduct and noted that counsel for both parties "exhibited rigorous advocacy on behalf of their clients."  The remainder of the opinion determined which requested fees were appropriate.  It serves as an excellent primer on what fees will be paid in the Northern District and what acceptable charges are for those fees.

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Black & Decker Inc. v. Robert Bosch Tool Corp., No. 04 C 7955, 2006 WL 3783006 (N.D. Ill. Dec. 22, 2006) (St. Eve, J.).

Having already denied plaintiff summary judgment on defendant's inequitable conduct defense (here) and increased damages 50% and awarded prejudgment interest compounded monthly (here), the Court denied defendant's motions for judgment as a matter of law, to alter the willfulness judgment and for a new trial.  The Court's denial of these sort of post-trial motions is far from surprising, in light of the substantial burdens that must be overcome to win them.  Of special note, defendant argued that the jury's willfulness determination was not valid because the evidence relied upon was defendant's knowledge of a competing product that it believed to constitute patented technology, not defendant's knowledge of the specific patents that were infringed.  The Court held that the relevant inquiry is the infringer's knowledge of the existence of patent rights, not specific patents.

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Black & Decker Inc. v. Robert Bosch Tool Corp., No. 04 C 7955, 2006 WL 3359349 (N.D. Ill. Nov. 20, 2006) (St. Eve, J.).

In this post-trial opinion, Judge St. Eve denies plaintiff's motion for attorney's fees, enhances the jury's damages award by 50% pursuant to 35 USC Section 284 and awards plaintiff prejudgment interest compounded monthly.  Despite the jury's willfulness finding the Court held that attorney's fees were not warranted because defendant's advocacy was consistently professional and the substantive positions it argued were largely meritorious.

The Court enhanced damages by 50% (an additional $875,000) based upon:  1) evidence that defendant copied plaintiff's design and ideas; 2) defendant's lack of good faith basis for continued infringement (lack of opinion of counsel); 3) defendant's size and financial condition; 4) the fact that the case was not close; and 5) defendant's failure to take remedial action (five of the nine Read factors, Read Corp. v. Portec, Inc., 970 F.2d 816 (Fed. Cir. 1992)).  But the Court noted that defendant's level of culpability did not evidence "wanton disregard" and, therefore, did not warrant a full trebling of damages.

The Court also awarded plaintiff prejudgment interest.  Defendant did not object to the interest award, but rather sought that the interest be based upon the T-Bill rate instead of the prime rate, as plaintiff requested.  The Court held that the T-Bill rate was more appropriate because it would compensate plaintiff without providing a windfall, but did compound interest monthly because plaintiff would have had access to the profits from any royalties or lost sales at least monthly.

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Civix-DDI, LLC v. National Assoc. of Realtors, No. 05 C 6869, 2006 WL 3210504 (N.D. Ill. Nov. 6, 2006) (St. Eve, J.).

Judge St. Eve denied defendant Yahoo! Inc.'s ("Yahoo") summary judgment motion which argued that plaintiff Civix-DDI's ("Civix") patent infringement claims were barred by Civix's covenant not to sue in its settlement agreement (the "Settlement Agreement") with third party Navteq, a provider of relevant navigation data to Yahoo.  The Court held that Yahoo was a third party beneficiary of the Settlement Agreement because Yahoo purchased the data at issue from Navteq and that the Settlement Agreement protected such third parties from suit.  But the Court found an issue of material fact as to whether each of Yahoo's accused activities "relate in any way" to the Navteq technology and information, as required by the covenant not to sue. 

Practice Tip:  Make sure to both make all of your arguments and respond to each of your opponent's arguments.  In this opinion, the Court repeatedly noted that neither party offered sufficient arguments to allow for a definitive ruling regarding the scope of the covenant not to compete.  For example, the Court stated:

Civix and Yahoo! offer insufficient arguments to support their respective positions and they do not rebut each other's arguments as to whether the scope of "with respect to or in any way relating" is a "function" within a "service" or an entire "service."

It is much harder for a court to rule in your favor if you do not explain (and support) why it should.

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Black & Decker Inc. v. Robert Bosch Tool Corp., No. 04 C 7955, 2006 WL 3069544 (N.D. Ill. Oct. 24, 2006) (St. Eve, J.).

After a jury found that defendant willfully infringed certain claims of the patents-in-suit, Judge St. Eve conducted a bench trial to determine whether the patents were unenforceable based upon prosecution counsel’s alleged inequitable conduct in failing to disclose known prior art to the PTO during examination.* A finding of inequitable conduct based upon failure to disclose material information requires that the information was material to patentability and that the failure to disclose was done with intent to mislead the PTO. The Court denied the inequitable conduct claim focusing on the second prong of the inequitable conduct test – intent.  In short, prosecution counsel’s failure to disclose the alleged prior art (the “Smith patents”) to the PTO was not inequitable conduct because prosecution counsel believed the invention under examination (the “Dome patents”) was prior art to the Smith patents. Whether or not the Dome patents were in fact prior art to the Smith patents was not relevant to the question of prosecution counsel’s intent.

* Judge St. Eve previously denied plaintiff’s motion for summary judgment on inequitable conduct discussed in this post, along with a longer description of the facts of the case.

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Crafting proposed jury instructions is one of the first steps when preparing for trial.  And one of the first steps in drafting those instructions is looking for pattern or sample instructions that the court has previously used or endorsed.  In order to help speed that process, I am adding a new Blog feature.  I have gathered the jury instructions that each of the Northern District judges identify on their respective  web pages as either form or model instructions.  Most have general civil instructions and a few have specific sample instructions for various types of IP suits.

This list should save you time when you are looking for model instructions, but I would like to make it even more useful. If you have a set of instructions used in a Northern District IP case send them to me and I will add those instructions to the list (either anonymously or with credit to the sender, at the sender's discretion). 

So, send me your jury instructions -- chicagoiplitigation@yahoo.com -- and the name of the judge that presided over the trial.  As I receive new instructions, I will add them to this post.  If I get a large response, I will do additional posts on the instructions or create a separate page where you can access the files.

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During prosecution, B&D identified the Domes patents to the Examiner of the Smith patents. B&D failed, however, to raise the Smith patents with the Examiner of the Domes patents, despite having the right to suggest changes to or comment upon documents filed with the PTO during prosecution of the Domes patents.

B&D argued that the Smith patents were not material to patentability because the Examiner of the Smith patents did not rely upon the Domes patents. But the Court found a question of material fact as to whether the Domes and Smith patents shared subject matter. B&D also argued that there was no intent to deceive the PTO because Domes prosecuted the patents and was not aware of the Smith patents. The Court found a question of fact on this point also because B&D had the ability to comment on filings during Domes’s prosecution of his patents and because the license agreement between Domes and B&D may have put him on notice of the Smith patents. Finally, the Court found a question of fact as to whether B&D intended to deceive the PTO because B&D purchased exclusive rights to the Domes patents more than one year before the last of the Domes patents issued, and could have disclosed the Smith patents during that year.

On another procedural note, make sure to know the time limits set forth in the Federal Rules. The Court struck B&D’s motion to strike Bosch’s inequitable conduct defense for failure to state a claim because B&D failed to file the motion within twenty days of receiving the Answer, as required by Fed. R. Civ. P. 12(f).

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