Beckman Coulter, Inc. v. Sysmex Am., Inc., No. 18 C 6563, Slip Op. (N.D. Ill. Apr. 26, 2019) (Rowland, Mag. J.). Magistrate Judge Rowland granted in part defendants’ (collectively “Sysmex”) motion to compel more definite responses regarding plaintiff Beckman Coulter’s dates of conception and reduction to practice in this patent case involving automated software for … Continue Reading
At the start of the new year, many of us are spending time looking back at where we have come from and forward to where we want to go. As part of that process, many are making resolutions to make 2015 better than ever. In that spirit, over the next several weeks, I am reposting … Continue Reading
Scholle Corp. v. Rapak LLC, No. 13 C 3976, Slip Op. (N.D. Ill. Jul. 24, 2014) (Kendall, J.). Judge Kendall ruled on numerous motions filed after the Court granted a preliminary injunction in this patent case. Of particular note, the Court held as follows: The Court granted defendant Rapak’s motion to construe more than five … Continue Reading
R-Boc Reps., Inc. v. Minemyer, No. 11 C 8433, Slip Op. (N.D. Ill. Cole, Mag. J.). Judge Cole denied plaintiff R-Boc’s motions to amend its Final Invalidity Contentions with an allegedly new theory regarding the phrase “approximately perpendicular” based upon the Supreme Court’s Nautilus indefiniteness decision and related motion for summary judgment of invalidity based … Continue Reading
The Court also struck some, but not all, of the experts’ opinions based upon trader usage. Trading Techs. Int’l, Inc. v. CQG, Inc., No. 05 C 4811, Slip Op. (N.D. Ill. Sep. 10, 2014) (Coleman, J.). Judge Coleman granted in part and denied in part defendants’ (collectively “CQG”) motion to strike portions of plaintiff Trading Technologies’ … Continue Reading
Rehco, LLC v. Spin Master, Ltd., No. 13 C 2245, Slip Op. (N.D. Ill. Mar. 17, 2014) (Leinenweber, J.). Judge Leinenweber granted defendant Spin Master’s motion to dismiss plaintiff Rehco’s patent infringement claim related to a toy airplane, granted in part Spin Master’s motion to strike and granted Rehco’s motion to strike. As an initial … Continue Reading
In October along with proposed revisions to the Local Patent Rules, the Northern District proposed new Local Patent Rules for Electronically Stored Information (“LPR ESI”). The LPR ESI share many commonalities with standing ESI Orders being used in patent cases in districts across the country. Additionally, the proposed LPR ESI is consistent with the existing … Continue Reading
The Northern District of Illinois has proposed a series of changes to the Local Patent Rules. Comments regarding the changes are due by December 3. The proposed changes are listed and discussed below. For the most part, they clarify ambiguities in the existing LPR and will be very valuable for those of us practicing pursuant … Continue Reading
AmTab Mfg. Corp. v. SICO, Inc., No. 11 C 2692, Slip Op. (N.D. Ill. June 19, 2012) (Darrah, J.). Judge Darrah denied defendants’ (collectively “SICO”) request to modify the Local Patent Rules standard protective order to include a prosecution bar. While a prosecution bar could be appropriate, SICO failed to provide the specific facts necessary … Continue Reading
Groupon Inc. v. MobGob LLC, No. 10 C 7456, Slip Op. (N.D. Ill. May 25, 2011) (Hibbler, Sen. J.).
Judge Hibbler granted plaintiff Groupon's motion to strike defendant MobGob's affirmative defenses and to dismiss MobGob's counterclaims, and denied MobGob's motion to dismiss Groupon's claim in this patent dispute involving online marketing systems.
MobGob's Motion to Dismiss
Groupon pled the intent elements of its indirect infringement claims upon information and belief. And that pleading was sufficient even though intent is governed by Fed. R. Civ. P. 9(b) because even pursuant to Rule 9(b), intent and knowledge can be pled generally. Additionally, it was reasonable to infer from Groupon's allegations that MobGob created or had someone create the accused system and the public nature of Groupon's patent that MobGob had actually knowledge of its accused infringement.
Groupon's Motions to Strike and Dismiss
First, Groupon sought to strike MobGob's affirmative defense of invalidity. The Court initially noted that motions to strike are disfavored because they are unlikely to streamline a case or make resolving the case more efficient. But the Court still struck MobGob's invalidity defense. MobGob's invalidity defense did nothing more than identify the relevant statutory sections, offering not a single fact, upon information and belief or otherwise. While the Court noted there were some policy reasons for not holding affirmative defenses and counterclaims to the Twombly/Iqbal standards, the Seventh Circuit required that they be met for any pleading. The Court, therefore, struck MobGob's invalidity defense. And for the same reason, the Court dismissed MobGob's invalidity counterclaim because it also offered no facts. The Court also noted that it would not excuse inadequate pleading because of the Local Patent Rule 2.3(b) invalidity contentions that MobGob would be required to serve shortly after answering. The LPR 2.3(b) disclosures require significantly more detail than Fed. R. Civ. P. 8 notice pleading. So, MobGob could meet its Rule 8 obligations without providing the level of detail required by LPR 2.3(b).
The Court also struck MobGob's affirmative defense regarding ownership of Groupon's patent because it also lacked factual support, and because it did not accept Groupon's facts as true, as required by an affirmative defense, instead challenging Groupon's facts.
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I am often asked if declaratory judgment counterclaims delay the Local Patent Rule ("LPR") initial disclosure and contention obligations -- generally two weeks after a defendant's answer or other response to the complaint. LPR 2.1 is clear that initial disclosures are due two weeks after the answer unless "another" patent is asserted in counterclaims. "Me too" declaratory judgment claims focused only upon the asserted patents, therefore, do not delay the initial disclosure deadline. Initial disclosures are due two weeks after defendant's answer or response, unless defendant adds a new patent to the case in its counterclaims.
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One of the common early questions I get about the Local Patent Rules ("LPR") is how to address the LPR 2.1(a) & (b) document production that must accompany the LPR 2.1 initial disclosures. There is no set requirement for providing any statement regarding the production. In theory, it would be sufficient to send a cover letter with the production referencing LPR 2.1(a) or (b). But the better practice is to include an extra section in your initial disclosures identifying the LPR 2.1(a) or (b) production.
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This is the third installment of my twenty five tips for Northern District of Illinois litigation practice, with a focus on IP litigation. The tips are gleaned from my practice in the Northern District, my time as a law clerk for the Hon. Gordon J. Quist in the Western District of Michigan, and my reading of all of the Northern District of Illinois intellectual property opinions over the last four years. As you read them, let me know if you come up with others. I will be glad to include them as I go. Here are tips eleven through fifteen:
11. Respect Twombly / Iqbal pleading standards. The Northern District is no different than the rest of the country's district courts -- patent infringement requirements have not changed from the form in the Federal Rules. But that is not necessarily the case for Lanham Act, copyright or trade secret claims. There are numerous decisions dismissing, often with leave to amend, these more fact-specific intellectual property claims. And even in the patent context plaintiffs benefit from pleading with more particularlity. The more detail a defendant has the more information they should disclose about their accused products or systems as part of their Local Patent Rule 2.1(b) initial disclosure document production requirements. That means that the plaintiff will have more material with which to prepare its Local Patent Rule 2.2 intial infringement contentions. Finally, regardless of the type of claim, many and perhaps most judges rely upon Twombly / Iqbal to require more than a bare recitation of the elements of affirmative defenses. So, it is especially important to add some facts to your affirmative defenses.
12. Prepare Local Rule 56.1 statements with care. This is probably the most frequent Local Rule hang up in Northern District of Illinois opinions. It is critical that movants meet the Local Rule 56.1 requirements, among others, a numbered statement of undisputed material facts supported by admissible evidence. If the facts are not supported or if they are legal conclusions, judges routinely strike or disregard them.
13. Respond to Local Rule 56.1 statements with evidence. Far too often, parties respond to Local Rule 56.1 statements without evidence. Those responses are almost always deemed admissions. Without admissibile evidence to counter statements of fact they are almost always admitted.
14. Watch your judge's webpage. Each judge maintains the equivalents of standing orders on their webpage, often in multiple places and links across the page. It is critical that you read them at the beginning of your case and that you recheck them regularly. At a minimum, check them before you file anything with the Court. I find that the website instructions change with much greater frequency than the old, paper standing orders did. And while judges try to make it easy to see what they change, if you are not looking you will miss it.
15. Always file notices of motion. In some districts, notices of motions are not required or even discouraged. In the Northern District of Illinois, they are required of every motion. If you fail to file one, you will likely hear from the Clerk's office. Also, make sure to file the notice after the motion, not before. If you file the notice before the motion, you will generally have to refile it.
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Albecker v. Contour Prods., Inc., No. 09 C 6312, Slip Op. (N.D. Ill. May 3, 2010) (Castillo, J.).
Judge Castillo construed the claims in this patent case involving a wedge-shaped backrest and legless leisure chair. Of particular interest, the Court construed the following terms:
"Secured to" was defined as "attached using attachment means" that connect a type cushion to a foundation. The "secured to" definition excluded unitary top cushion foundations. The fact that the Court's definition excluded one embodiment because that embodiment was part of a restriction requirement; and
"face of the generally wedge shaped foundation" was not properly briefed, but the Court held that the face was top surface.
The Court declined to construe other claim terms because the parties told the Court that the construed terms were the key terms.
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I am proud to announce that the Chicago Bar Association has honored me, and the Blog, with the 2010 Herman Kogan Media Award. I usually do not post about personal awards, but I am making an exception because this one stems from my work on the Blog. I was the first winner of the Kogan Award's new online category. The print and broadcast category recipients of the 2010 Kogan Awards were, respectively, The Chicago Reporter and Chicago's ABC 7 News. I received the award for my series of posts on the Local Patent Rules at the end of 2009 -- click here to read the posts. The award comes with a $1,000 journalism scholarship, which I have given to Loyola University Chicago's journalism school.
Here is a little bit more about the Herman Kogan Media Awards:
Established in 1989, CBA's Herman Kogan Media Awards competition honors local journalists and legal affairs reporting. Qualified candidates in the Chicago metropolitan area submitted entries in one of three entries: Print, Broadcast or Online. The competition celebrates the life of Herman Kogan, whose career spanned more than 50 years and included positions as an editor, reporter, feature and editorial writer, historian, literary critic and radio host.
Thank you to the Chicago Bar Association and the Herman Kogan Media Award committee for this honor. And if you are interested in hearing more about the award and how I blog, click here for an interview LexBlog did with me after the award.
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This Tuesday, March 23 at noon central, I am presenting a CLE program to the Chicago Bar Association's Intellectual Property Law Committee about the Local Patent Rules. If you read the Blog regularly, you have read a lot of my thoughts on the new Rules. The presentation Tuesday will spend some time on the logistics of the Rules, but will focus far more heavily on how to use the Rules in practice both offensively and defensively. The event is being held at the CBA's building, 321 S. Plymouth Court, and lunch will be served.
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The Northern District has become the jurisdiction of choice for 35 USC Section 292 false patent marking suits. Of the more than 80 false marking suits filed this year, more than half were filed in Northern District. Granted many of the suits, 38, have been filed by a single plaintiff and his counsel, but several other plaintiffs have chosen the Chicago federal courts to file complaints that arguably could have been filed in almost any district court. As I have watched the cases pile up, I have spent a fair amount of time trying to determine why the plaintiffs are choosing Chicago. While the numbers could be skewed by one plaintiff, Simonian, that has filed the majority of the cases, several other plaintiffs are availing themselves of the Chicago courts, so I do not think that answers the question. Rather, I think the Chicago filings are a by-product of the new Local Patent Rules, for two reasons: 1) assuming that the Local Patent Rules apply to these cases (and I believe they will) the Local Patent Rules will place most of the upfront responsibilities on the defendant-patentholder; and 2) the proposed case schedule that would have cases tried in two years gives plaintiffs a moderate case length moderating their potential fees and costs while maintaining a relatively high defense cost for the defendants, including the potential threat of the longer pre-Rules schedule for most Northern District of Illinois patent cases prior to enacting the Rules. Before I analyze the reasons further, some background will be valuable as false marking is a very new phenomena in patent law and remains unknown to many.
Modern False Marking Cases
The first of the modern false marking cases, excluding the occasional false marking claim in a broader patent dispute between competitors, was Pequignot v. Solo Cup Co., No 1:07cv897-LMB/TCB (E.D. Va. July 2, 2009). In that case, Solo was accused of falsely marking coffee cup lids sold to Starbucks. The Eastern District of Virginia's Judge Brinkema granted Solo Cup summary judgment finding that there was no intent to deceive the public in Solo's alleged false marking based upon the advice of Solo's counsel that it would be reasonable to replace molds identifying expired patents with molds showing no marking gradually. Additionally, the Court held that a patent marking "offense," punishable by a fine up to $500, was the decision to improperly mark, not each improperly marked product. That decision significantly reduced the damages potential for false marking cases, and is currently on appeal at the Federal Circuit.
Then in the last week of December 2009, the Federal Circuit decided Forest Group, Inc. v. Bon Tool Co. In that case, the district court followed reasoning similar to the Solo case fining defendant $500 for a single decision to false mark. But the Federal Circuit reversed, holding that the fine was to be assessed per falsely marked product. That drastically changed the damages calculus for false marking claims, and led to the deluge of patent false marking cases beginning this January.
In the first quarter of this year, at least to date, more than 80 false marking cases have been filed. The Federal Circuit will soon hear oral argument in Pequignot v. Solo Cup, to rule upon the bounds of the intent required by 35 USC Section 292. The only potential relief for patent holders is a section of the current patent reform bill in the U.S. Senate that would require that the false patent marking plaintiff have been harmed by the alleged false marking - check out a discussion of the provision at the Patent Docs.
The Local Patent Rules are Driving False Marking Cases
With that background, the question remains - why are so many false patent marking cases being filed in the Northern District? As I proposed above, the reasons stem from the Northern District's new Local Patent Rules. First, many people see false marking cases as commercial litigation in patent litigation's clothing. That is not completely the case, however. In fact, the parties must determine whether the marked product reads upon the patent claims, unless the the only issue is an expired patent. That means that the court and the parties must conduct a full infringement analysis with all of the required claim charts, technical analysis, expert discovery, Markman hearings and perhaps even summary judgment motions. That means that the Local Patent Rules will likely govern these cases, bringing with them the required Initial Disclosures and production obligations, and claim charts.
That is significant because the false marking plaintiff does not have all of the obligations of either a typical patent plaintiff or defendant, while the false marking defendant has most of its obligations. The plaintiff will not have to produce his reduction to practice documents, prosecution histories, etc. along with Initial Disclosures, although the defendant likely will have to at least produce the prosecution histories. And the defendant will also have the obligations of a typical defendant - producing documents sufficient to show how each accused product or process works. So, the defendant has initial discovery burdens that are not shared by the plaintiff, and the plaintiff is guaranteed early document production. Additionally, the defendant will likely be obligated to produce initial infringement contentions, after which the plaintiff would have to respond with noninfringement contentions. So, the plaintiff not only escapes initial production requirements, but also gets to file its initial claim charts last. These are significant costs for the defendant which may benefit the plaintiff, at little up front cost. Additionally, knowing that these costs are coming early in the case may drive the defendant's willingness to settle up. Of course, it could always backfire on the plaintiff and drive the defendant's settlement down in line with the amounts spent upon early discovery.
Second, the Local Rules contemplate a two year time-to-trial, as opposed to the prior patent litigation average in Chicago that was likely in excess of three years. So, the plaintiff still has a moderately long time to trial, driving up the defendant's likely litigation fees and expenses, but not so long that the plaintiff feels like it will never see its potential award.
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I am working on some additional analysis of the Local Patent Rules, after I finish with a trial in the next several weeks. But for now, this Chicago Daily Law Bulletin story quotes me and several others about the impact of the Rules:
New rules could boost patent filings
By Jerry Crimmins
Law Bulletin staff writer
New rules for patent litigation that have been in effect here for only a month are expected to increase patent litigation in the Northern District of Illinois, local lawyers say.
Until Oct. 1 the Northern District of Illinois did not have standard local rules for the scheduling of events in patent cases, according to these lawyers.
"I think [the rules] will increase filings ... for a couple reasons," said R. David Donoghue, who writes the Chicago IP Litigation Blog.
"They benefit plaintiffs in a few ways that would draw plaintiffs to file their claims in the Northern District of Illinois when they can," Donoghue said.
Donoghue is a partner at Holland & Knight LLP.
The rules will "speed up the average length of time in patent cases from filing to trial," said Allan J. Sternstein, director of the Intellectual Property and Intellectual Property Litigation Department at Dykema, Gossett PLLC.
Yet the rules "will maintain sufficient time so the case can get done in a manner beneficial to both parties," Sternstein added. "Simply stated, it won't be too fast. It won't be a rocket docket.
"The biggest advantage," Sternstein said, is "it gives the attorneys and clients a much more solid foundation on which to base budgets and scheduling."
That in itself will bring more patent litigation to Chicago, Sternstein predicted.
Local patent lawyers on the Litigation Committee of the Intellectual Property Law Association of Chicago certainly saw it that way, he said.
"A lot of local patent attorneys felt a lot of the business was going to places where they did have local patent rules," according to Sternstein.
Bradford P. Lyerla of Marshall, Gerstein & Borun LLP, also agreed the new rules could bring more patent cases to the Northern District of Illinois. "No question about that."
But "I wouldn't expect to see a huge uptick," Lyerla noted.
He said the customs followed in the Eastern District of Texas and in Delaware are more advantageous to plaintiffs in patent cases so those places will continue to attract more filings.
Lyerla is a trial lawyer who focuses on patent and trade secret litigation.
The new rules were drafted by a committee of lawyers affiliated with the Intellectual Property Law Association of Chicago and four federal judges here.
Judge Matthew F. Kennelly chaired the drafting committee, which also included Judge James B. Zagel, Judge Amy St. Eve and Judge James F. Holderman, chief judge of the U.S. District Court here.
Sternstein and Lyerla were among the seven practitioners on the drafting committee.
The rules expect a case to be ready for trial in 25 to 26 months, Donoghue said.
This compares to a previous average time to trial of up to 43 months, according to Lyerla.
"The time to trial in the Northern District of Illinois for a patent cases was really, really, really long, just way out of kilter with other cases in the Northern District of Illinois," Lyerla said.
For other federal litigation here, time to trial is about 24 months, according to Lyerla.
As examples of the new rules, Donoghue cited two benefits to plaintiffs and two benefits to defendants.
"The claim construction process is held late in discovery ... later than in most other local patent rules'' found in some other federal jurisdictions, Donoghue said.
The claims construction process is the way a judge decides on the meaning of certain, disputed words or phrases in the patent at issue, Donoghue said.
To have this process late in the litigation allows the plaintiff broader discovery and depositions and a broader patent infringement theory throughout, Donoghue explained.
The new rules also require both sides to produce "initial disclosures'' or categories of documents that could be relevant along with names of witnesses and individuals with knowledge about the case only about nine weeks after the complaint is filed, Donoghue continued.
The earliness is another advantage for plaintiffs, he said.
As an advantage for defendants, he said the new rules require plaintiffs to produce early on the documents showing ownership of the patents allegedly infringed as well as documents on the development of those patents.
That early discovery helps defendants, according to Donoghue.
"The other big benefit to the defendant is the claim construction briefing process," he continued.
Normally, a plaintiff writes the opening brief in the claims construction process. The defendant responds, and the plaintiff then replies to that, he said.
"In these rules, it's reversed," Donoghue said. "Defendant files the opening and reply brief. Plaintiff files just the response brief."
Lyerla said that five years ago, he proposed to Holderman in private that local patent rules be drawn up for the Northern District of Illinois. Lyerla said he was politely rebuffed.
Holderman "said it would never happen," explaining that the tradition here is that district court judges "pretty much run their own show in terms of scheduling," according to Lyerla.
But since then Holderman has become an advocate for "a more thoughtful approach to patent litigation in the federal courts," Lyerla said.
The Litigation Committee of IPLAC began discussing the issue again under its new chairman, Dean A. Monco, Lyerla added.
In 2007 Sternstein, who was on that committee, said he approached Holderman about drawing up rules, and "Judge Holderman was very receptive."
Sternstein was named chairman of a subcomittee of the IPLAC Litigation Committee to work with the judges to draw up the new rules.
After a long process of publishing drafts, comments and revisions, the rules went into effect Oct. 1.
But Sternstein said as soon as the drafts started circulating, "some of the judges started using our drafts."
The other lawyers on the drafting committee were Edward D. Manzo, Michael P. Padden, Marshall Seeder, and Paul K. Vickrey.
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The Northern District of Illinois continued its historically busy intellectual property docket in 2009. For the first time in several years, there was a slight decrease in patent case filings. Of course, that is not surprising in light of a difficult economy and patent filings being down across the country. And I suspect that the new Local Patent Rules* will result in an increase in patent litigation filings for 2010. Trademark cases bucked their downward trend over the last several years, and were up by about 10% over 2008. Finally, copyright cases continued a relatively steep decline. But despite the decline, the Northern District maintains one of the most active copyright dockets in the country. This chart shows the number of yearly patent, trademark and copyright cases filed in the Northern District during calendar years 2006 through 2009 (data gathered from the Stanford IP Clearinghouse and Pacer):
Northern District IP Case Filings
* Click here for much more on the Local Patent Rules in the Blog's archives.
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** Guest Post by Scott A. McKeown of Oblon Spivak & PatentsPostGrant.com **
The face of patent litigation in the U.S. has evolved greatly in the last 5 years with respect to patent reexamination. For patent litigators, throughout the U.S. and especially the Northern District of Illinois, the emergence of this now seemingly reliable strategic option is an important case management consideration. Indeed, if not adequately considered in the course of litigation counseling, reexamination ignorance may create malpractice opportunities for unsuccessful defendants.
Defendants, as well as those concerned with patents clouding their competitive landscape are increasingly requesting patent reexamination at the USPTO. When prior art patents and printed publications can be effectively presented to enable the USPTO to reject original patent claims, the expectation is that the prosecution of the reexamination proceeding will result in cancellation or amendment of original patent claims.
The sudden growth in reexamination filings can be attributed to several factors. These factors include, the emergence of the "non-practicing entity"(NPE) problem, the eligibility of inter partes reexamination for post 1999 patent application filings, and the efforts of the USPTO and Congress to overhaul the reexamination process, first with legislation overruling the Portola Packaging decision in 2002, and with creation of a special USPTO unit in 2005.
In 2005, the USPTO established the Central Reexamination Unit (CRU) to exclusively handle all reexaminations, whether ex parte or inter partes within the Office. The CRU created a procedure by which every reexamination proceeding is processed by a team (3) of experienced primary examiners. The CRU has greatly improved the responsiveness and quality of patent reexamination.
With respect to NPEs, reexamination is an attractive strategy as an active reexamination may shut down (i.e., stay) an otherwise costly litigation by forcing the dispute away from the high cost battle of district court litigation, back to the PTO. At the PTO, the NPE's leverage of contingency litigation counsel and forced discovery costs are removed. Moreover, the standard of review in reexamination for proving unpatentability is much more favorable to a challenger as compared to the district court action. In federal district court the standard to invalidate a U.S. patent is "clear and convincing evidence." Whereas, in reexamination, the US PTO can establish unpatentability by a "preponderance of evidence," and unexpired claims are given their broadest reasonable interpretation. See 37 C.F.R. 1.555(b)(2)(ii).
Upon conclusion of a reexamination, canceled or amended claims will present the challenger with freedom to operate either through non-infringement of the altered claims, or decrease liability through the doctrine of intervening rights.
With this background in mind, a review of a recently asserted malpractice claim is presented along with a discussion of the new Local Patent Rules of the Northern District of Illinois as they pertain to concurrent reexaminations.
In Ecast Inc. v. Morrison & Foerster L.L.P. (Superior Court for the State of California, County of San Francisco) Ecast, a former client of MoFo, sued the firm for malpractice. The compliant stemmed from MoFo's defense of Ecast in a patent infringement suit in the Northern District of Illinois. In the suit, six patents were asserted against Ecast by Rowe International Corp and Arachnid Inc. (Rowe International Corp., and Arachnid, Inc. v. Ecast, Inc., Rockola Mfg. Corp., and View Interactive Entertainment Corp. (click here for much more about this case from the Chicago IP Litigation Blog's archives).
Notably, at paragraph 25 of the complaint, it is alleged that:
Once Defendants undertook to represent Ecast in the Rowe case, Defendants failed to sufficiently explain and advise Ecast of the benefits Ecast could have derived by filing a request for reexamination of the patents-in-suit. Proper pursuit of a patent reexamination could have resulted in a stay of the Rowe litigation for a substantial period of time. Although technically a stay, the reexamination process often serves to effectively end the patent litigation in many cases and could have terminated the Rowe case. (emphasis added)
Paragraphs 28-29 go on to allege that:
Had Ecast been properly advised of the benefits to be gained by the reexamination process, mainly a significant stay of the Rowe case possibly leading to avoidance of all further litigation risks, legal fees and expenses, then Ecast would have chosen to pursue reexamination. Ecast would have pursued reexamination and it would likely have been successful because approximately one month after new counsel substituted in as counsel of record for Ecast in the Rowe case, a reexamination of the Arachnid patents was sought by Ecast and granted by the Patent and Trademark Office. The reexamination resulted in a finding that there was a substantial question as to the patentability on all the Arachnid patents. Under these circumstances, the claims are often modified or cancelled.
Because the reexamination was pursued at such a late date and in such close proximity to the commencement of trial, no stay of the Rowe case was imposed because Ecast's request came too late. (emphasis added)
Surely, whether or not reexamination would have truly benefited Ecast is speculative, likewise, the likelihood of obtaining a stay is quite subjective, varying significantly in accordance with the stage of reexamination as well as the perception of reexamination efficacy/efficiency in each forum. Nevertheless, a failure to properly counsel a client on the potential benefits of reexamination, as alleged here, appears to be a significant risk going forward.
With respect to the timing discussion of the complaint, a late filing of a reexamination request may have become even more critical in view of new local patent rule, LPR 3.5, which requires:
Absent exceptional circumstances, no party may file a motion to stay the lawsuit pending reexamination in the U.S. Patent Office after the due date for service of the Final Contentions pursuant to LPR 3.2. (emphasis added)
In other words, since the request for a stay must be presented in the above time frame, and as reexamination may take time to advance to a point favorable to a challenger (i.e, final rejection or appeal stage) it is n ow of even greater importance that reexamination be explored and if necessary instituted at the earliest possible point in a dispute.
Patent Reexamination, concurrent with, or even in place of more traditional litigation practices is becoming increasingly commonplace. While patent reexamination was once viewed as an ineffective procedure, and critics may still cite inefficiencies, significant strides have been made at the USPTO to present a viable post grant challenge mechanism. In view of recent developments in the Northern District of Illinois, practitioners would be well advised to explore reexamination options with clients early in the representation.
Scott A. McKeown is a partner with Oblon, Spivak, McClelland Maier & Neustadt and a team leader of the Reexamination and Reissue Practice Group. He is a founder and frequent contributor to patentspostgrant.com
* If you are interested in writing a guest post for the Chicago IP Litigation Blog, send an email by clicking here.
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Last month I had the opportunity to participate in a panel discussing the Northern District of Illinois' new Local Patent Rules* hosted by Applied Discovery. In addition to me, the panelists were:
* Mark Ouweleen of Bartlit Beck
* David Callahan of Kirkland & Ellis
The panel briefly touched on the mechanics of the Rules, and then dove into the implications of the Rules for Northern District patent litigation generally, as well as specific issues litigants will likely face with the Rules. Here are some of the highlights:
The Rules will increase patent litigation filings in the Northern District despite the fact that the 2+ year trial timeline does not create a rocket docket.
The Rules are widely accepted as positive by both sides of the bar.
The Initial Disclosure document production requirements will have the most significant impact. Plaintiffs will need to prepare their cases early, and defendants cannot delay prior art searches.
The combination of early document production and early initial contentions means that parties will not be able to use the first six months of a patent case to try settling it without much investment in the case.
Ouweleen pointed out that other courts have used the contention disclosures to exclude new information after content deadlines without a showing of good cause. That places a premium on early prior out searches and fleshing out each party's technical case early.
Callahan believed that the Rules will focus cases on the substantive issues, instead of negotiating over protective orders and interrogatory responses. That is a benefit to judges (reduced motion practice), litigants (reduced cost), and litigators (more time to focus on the art of lawyering and the substantive case).
It will be very interesting to test the accuracy of these predictions once we have a year or two of data using the Rules.
* Click here for much more on the Blog's archives about the Local Patent Rules.
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If you cannot make the Applied Discovery roundtable discussion about the new Local Patent Rules that I am participating in this Wednesday, November 11, from 11:30 until 2:00pm (click here for more information and click here to register by email, but move quickly because space is running out), or if you just cannot get enough analysis of the Rules, check out what looks like it will be a great teleseminar by Law Seminars International, tomorrow from 2:00 until 3:00pm.* Law Seminars promises to address:
The background and history of the Rules;
What the Court is trying to achieve with the Rules; and
The Rules' implications for plaintiffs and defendants.
The scheduled speakers include:
Allan J. Sternstein, Dykema Gossett PLLC
Edward D. Manzo, Cook Alex Ltd.
Paul K. Vickrey, Niro, Scavone, Haller & Niro, Ltd.
For registration information, click here.
* In the interest of full disclosure, I plan to attend using a media pass generously provided to me by Law Seminars.
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Next Wednesday, November 11, from 11:30 am until 2:00 pm, I am participating in a roundtable discussion about the Northern District's new Local Patent Rules hosted by Applied Discovery. Blog readers have already read a lot about the Local Patent Rules -- click here, here and here for some of the Blog's analysis of the Rules. But this panel will add valuable perspective from other members of the Chicago patent bar. I am especially looking forward to the insights of friend and former colleague David Callahan of Kirkland & Ellis.
Here is Applied Discovery's description of the event and registration information:
Applied Discovery is pleased to offer a roundtable forum led by local experts discussing the practical consequences of the rules and the effects the rules could have on patent litigation in the Northern District of Illinois. Virginia Henschel, vice president for e-discovery affairs at Applied Discovery will be moderating the panel. Ms. Henschel's distinguished career prior to Applied Discovery includes serving as counsel for Sunoco, Inc., where she managed all facets of ESI for litigation, including designing and managing defensible data collection and production for large, complex legal matters.
If you have not already registered, there is still time to join us for a spirited analysis of the new Rules with opinions from plaintiffs, defendants and the bench.
• An overview of the Rules and the specific new obligations placed on patentees, accused infringers, and declaratory judgment plaintiffs.
• The effects of the new Rules on patent filings in the Northern District of Illinois.
• Scheduling deadlines and new requirements.
• Changes in the discovery process.
• Mark Ouweleen, Partner, Bartlit Beck Herman Palenchar & Scott LLP
• David Donoghue, Partner, Holland & Knight LLP
• David Callahan, P.C., Partner, Kirkland & Ellis LLP
Wednesday, November 11, 2009
11:30 am - 2:00 pm
Union League Club
65 West Jackson Boulevard, Room 710
Chicago, IL 60604
(Business Attire Required)
RSVP BY 11/6
If you wish to attend, please email Jennifer Towell at email@example.com as soon as possible. Space is limited.
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