First to File

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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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Continue Reading False Claims Act Does Not Bar Multiple False Marking Suits

Bajer Design & Marketing, Inc. v. Whitney Design,, Inc., No. 09 C 1815, Slip Op. (N.D. Ill. Jun. 26, 2009) (Zagel, J.).
Judge Zagel denied defendant Whitney Design’s (“Whitney”) Section 1404(a) motion to transfer plaintiff Bajer Design & Marketing’s (“Bajer”) patent infringement case to the Eastern District of Missouri, where Whitney filed a declaratory judgment case after being served with Bajer’s complaint. Although Bajer was not a Chicago-based company, its choice of forum still deserved significant deference because the alleged injury occurred in Chicago. Bajer filed the complaint after identifying the accused infringement at the International Housewares Show in Chicago. Whitney argued that the accused infringement occurred in the St. Louis area where Whitney researched and designed the accused clothes hampers. But the Court held that the point of sale, Chicago, was the situs of the injury.
Whitney also argued that convenience of the parties weighed in favor of transfer because all of its documents and people were in the St. Louis area. But the Court held convenience weighed against transfer because the parties could transfer documents electronically and, in any event, the documents would have to be sent to the parties’ counsel across the midwest. And the convenience of third parties also weighed against transfer. The only third party, the inventor, lived in Iowa almost equidistant from Chicago and St. Louis.
Finally, the interests of justice did not weigh in favor of transfer. Whitney argued that time to trial in the Eastern District of Missouri was significantly faster than in the Northern District of Illinois. But the Court held that those statistics were irrelevant because they were for all cases, not split up by case types.
The Court denied Bajer’s preliminary injunction motion seeking to enjoin the Eastern District of Missouri case. Because that court stayed its case pending the Northern District of Illinois’s decision on the transfer motion, there was no need to enjoin a stayed case.
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Continue Reading Point of Sale was Situs of Injury in Motion to Transfer Analysis

As promised, the new Patent Reform Acts were introduced in Congress this week — click here for the Senate bill and here for the House bill. While I have not yet done a comprehensive review, I understand that the bills are largely similar. Here are some highlights of the bills:
They move from the current first to invent system to the international norm, first to file.
Expanded reexamination and a new period of post-grant review.
Damages provisions require that the specific contribution over the prior art be considered and allow consideration of licensing terms for similar noninfringing substitutes. As Dennis Crouch points out, for alternatives in the public domain the comparable license could be free.
Specifically allows for Federal Circuit jurisdiction of interlocutory claim construction appeals where the district court approves the appeal.
Federal Circuit judges would no longer be required to live within fifty miles of the District of Columbia.
The venue provisions are changed to narrow possible venues.
There is plenty of commentary in the blogosphere. Here are some of the best:
271 Patent Blog (giving highlights, noting changes from the last version and do not miss Peter Zura’s blog makeover);
Patent Docs (discussing the Senate press conference announcing the Senate bill and noting BIO’s response to the bills); and
Patently-O (giving highlights and noting changes from the most recent attempted reforms) and here (reposting comments from Google’s Head of Patents and Patent Strategy, Michelle Lee).
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Continue Reading Patent Reform Act of 2009

BorgWarner, Inc. v. Hilite Int’l., Inc., No. 07 C 3339, 2008 WL 3849908 (N.D. Ill. Aug. 14, 2008) (Zagel, J.)
Judge Zagel denied defendant Hilite’s 23 U.S.C. §1404(a) motion to transfer. Plaintiff BorgWarner filed this patent infringement suit over variable camshaft timing (“VCT”) in June 2007. Hilite answered and counterclaimed in March 2008. Five days after answering, Hilite filed a suit in the District of Delaware alleging that BorgWarner infringed Hilite’s VCT patent. Hilite reasoned that its VCT case was related to a prior Delaware patent case filed by BorgWarner on the patent currently at issue in the Northern District, and, therefore, by the transitive property this suit and BorgWarner’s closed Delaware case were related.
While the Seventh Circuit does not strictly follow the first-to-file rule, its use was warranted in this case. BorgWarner’s choice of forum deserved some deference. And the Northern District, while equivalent to Delaware in terms of time to trial, was significantly faster for average disposition without court actions – 6.2 months in the Northern District to 12.5 months in Delaware. Convenience factors were neutral, and therefore weighed in favor of keeping the case in the Northern District.
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Continue Reading Motion to Transfer Filed 11 Months After the Complaint is Denied

Personified, LLC v. Sales Consultants of Cary, LLC, No. 08 C 3123, 2008 WL 3200842 (N.D. Ill. Aug. 8, 2008) (Der-Yeghiayan, J.)
Judge Der-Yeghiayan granted declaratory judgment (“DJ”) defendant Sales Consultants of Cary’s (“SCC”) Fed. R. Civ. P. 12(b)(6) motion to dismiss DJ plaintiff Personified’s trademark case in favor of SCC’s later-filed District of North Carolina action. Shortly after its parent registered the trademark “Personified,” Personified began using the name and allegedly received a cease and desist letter from SCC who offered staffing services using the name “Personified.” SCC’s letter allegedly demanded that Personified immediately change its name and pay SCC damages. In response, Personified filed this suit seeking a declaratory judgment that it had not violated trademark laws or engaged in unfair competition. SCC countersued in the District of North Carolina several days later.
The Court had federal question jurisdiction because of the Lanham Act issues. Personified was the first to file, but the Court noted that the Seventh Circuit did not strictly follow the first-to-file rule. And the Court exercised its “wide discretion,” declining to exercise jurisdiction over the declaratory action. SCC was the natural plaintiff. Instead of filing suit after receiving the cease and desist letter, Personified could have gone to SCC to resolve the dispute. Additionally, Personified was already preparing a motion to transfer the North Carolina action to the Northern District. The Court also denied a motion to stay its ruling pending a decision by the District of North Carolina. If the North Carolina Court transferred the case to the Northern District, Personified would not face substantial hardship by having to replead its DJ claim.
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Continue Reading No Declaratory Judgment Jurisdiction Because Defendant is Natural Plaintiff

The Patent Reform Act is on the Senate’s calendar and is expected to be voted on in February. The version voted out of the Senate Judiciary Committee is different than the version passed by the House. Experts expect that, instead of forming a joint committee to resolve the differences which generally requires a second vote by both chambers, the House will vote on any version of the Patent Reform Act passed by the Senate.
That means that it is time to take a close look at the Senate version of the Patent Reform Act. The damages and venue provisions continue to be some of the most significant and hotly-contested. And it is no surprise that the various stakeholders are making their positions heard loudly again. I considered analyzing each provision of the current Senate bill, but Patent Docs beat me to it and did an excellent job:
Venue
Damages
First to file
Several other blogs are also keeping a close eye on the stakeholders and the sausage-making aspects of the Patent Reform Act, among the best:
271 Patent Blog
Filewrapper
IP Biz
Patent Barristers
Patently-O
Maryland IP Law Blog (and here regarding the increased internet coverage of Patent Reform during February)
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Continue Reading Patent Reform: It’s Baaaaaaaaack!