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.
One unanswered question about the pilot program remains: If a non-patent judge was assigned a patent case less than thirty days before the program kicked off on September 19, can the non-patent judge order the patent case reassigned pursuant to the pilot program? I have not seen it happen yet, but I suspect it could over the next week or two.
The Northern District issued the following list of judges who have self-selected as patent judges:
Chief Judge James F. Holderman
Judge Ruben Castillo
Judge John W. Darrah
Judge Gary S. Feinerman
Judge Virginia Kendall
Judge Matthew F. Kennelly
Judge Joan Humphrey Lefkow
Judge Rebecca R. Pallmeyer
Judge Amy J. St. Eve
Judge James B. Zagel

Continue Reading Northern District of Illinois Patent Program Begins

Healix Infusion Therapy, Inc. v. HHI Infusion Servs., Inc., No. 10 C 3772, Slip Op. (N.D. Ill. Jan. 27, 2011) (Zagel, J.).
Judge Zagel denied plaintiff Healix’s motion for summary judgment as to defendant HHI’s alleged tortious interference and denied HHI’s motion to dismiss Healix’s tortious interference claim. The motion to dismiss was premised upon application of Washington law, but the Court held that Texas law applied and the claim was properly plead.
Regarding summary judgment, both parties “cried foul” as to the other’s Local Rule 56.1 compliance. The Court held that both parties were correct. But in light of the mutual non-compliance, the Court considered the substance of the motion, instead of resolving it on procedural grounds. Additionally, the Court held that emails offered as evidence were admissible over a hearsay objection as business records pursuant to FRE 803(6). Finally, the Court held that there was a question of fact as to whether HHI’s alleged interference was willful and intentional.

Continue Reading Mutual Non-Compliance With Local Rule 56.1 Avoids Procedural Grant or Denial

Healix Infusion Therapy, Inc. v. HHI Infusion Servs., Inc., No. 10 C 3772, Slip Op. (N.D. Ill. Jan. 27, 2011) (Zagel, J.).
Judge Zagel granted in part defendants’ motion to dismiss plaintiff Healix Infusion Therapy’s (“Healix”) complaint, which included copyright infringement, trademark infringement and tortious interference claims, all related to the parties’ competition for medical infusion services, as follows:
The Court dismissed Healix’s claims for statutory damages on its copyright claims. The record showed that Healix filed for its copyright registrations after defendants began the alleged infringements, and more than three months after first publication. As a result, statutory damages were not recoverable. Healix could only receive actual damages. Furthermore, the Court denied Healix’s request to amend its pleadings to include a demand for actual damages because Healix had already filed four complaints in the case and never sought actual damages.
Although sparse, Healix’s trademark claims were sufficiently plead. Defendants argued that Healix had not pled use in commerce. But it was sufficient that Healix pled that Defendants displayed Healix’s marks to the public and that Defendants allegedly copied Healix’s marks with intent to use them in selling Defendants services to the consuming public.
Tortious Interference
The Court took Defendants’ motion to dismiss Healix’s tortious interference claim under advisement, in favor of a fully briefed summary judgment motion on the issue that more fully set out the relevant facts.
The Court denied the defendant’s motion to dismiss defendant Metro Infectious Disease Consultants (“Metro”). Defendants argued that Metro was never specifically accused to have committed any acts in the complaint. Instead, Healix defined as a single entity three defendants, including Metro. But the Court held that it was sufficient in this instance for Healix to group Metro with two other defendants and make all allegations against Metro as part of the defined entity.

Continue Reading Allegations of Defendant’s Acts as a Group Sufficient to Plead Copyright and Trademark Infringement

Gordon-Darby Sys., Inc. v. Applus Techs., Inc., No. 10 C 1863, Slip Op. (N.D. Ill. Dec. 23, 2010) (Zagel, J.).
Judge Zagel granted plaintiff’s motion to dismiss its patent infringement claims regarding vehicle emissions testing with prejudice and to dismiss defendants’ noninfringement, invalidity and unenforceability claims without prejudice. After the parties engaged in some discovery, plaintiff determined that it no longer wanted to pursue its claims and gave defendants a covenant not to sue. Based upon that covenant, the parties agreed that all of their claims should be dismissed, except for defendants’ inequitable conduct claims. Defendants argued that those claims were related to its 35 U.S.C. Section § 285 claim to make the case exceptional and award defendants their attorney’s fees. Citing the Federal Circuit’s decision in Monsanto Co. v. Bayer Bioscience N.V., 514 F.3d 1229 (Fed. Cir. 2008), the Court held that, although the Federal Circuit had not squarely decided the issue, the precedent was clear that the covenant divested the Court of subject matter jurisdiction over the inequitable conduct declamatory judgment claim.
The Court, however, retained independent jurisdiction over defendants’ Section § 285 claim to make the case exceptional and award defendants their attorney’s fees. And the Court acknowledged that it could consider unenforceability as part of the exceptional case analysis, which could trigger a holding that the patents in suit were unenforceable due to inequitable conduct.

Continue Reading Court Dismisses Case and Considers Unenforceability With Exceptional Case Motion

The Federal Bar Association – an excellent group that is worth joining (disclosure: I am a member) – recently held a panel of Northern District judges. Here are my notes regarding Judge Zagel’s comments:
The most valuable cost control tool Judge Zagel has found is an early deposition, often of a 30(b)(6) designee, allowing for a second deposition later in the case. The early deposition tends to narrow discovery and case issues.
Clerks write first drafts of Judge Zagel’s opinions, with one clerk taking even cases and the other taking odd numbered cases. Clerks can write first drafts because a majority of cases are inadequately prosecuted or defended and, therefore, do not result in motions that are difficult, close calls.
Judge Zagel writes 10-15% of his own opinions.
Judge Zagel does voir dire by himself. Counsel do not ask questions.

Continue Reading N.D. Illinois Judicial Panel: Judge Zagel

Salud Natural Entrepreneur, Inc. v. Nutricento Internacional, Inc., No. 09 C 4417, Slip Op. (N.D. Ill. Jan. 27, 2011) (Zagel, J.).
Judge Zagel denied defendant Azteca Products’ (“Azteca”) Fed. R. Civ. P. 12(b)(2) motion to dismiss for lack of personal jurisdiction in this Lanham Act case. Azteca’s officer, a non-lawyer, purported to file an answer on Azteca’s behalf. Azteca then hired counsel who participated in Rule 26 scheduling conferences. Azteca’s officer then filed a Rule 12(b)(2) motion to dismiss without counsel, which the Court struck because it was not filed by counsel, and a corporate entity cannot act pro se. The Court then entered a default judgment and an injunction against Azteca. Azteca hired counsel and asked through counsel that the default be vacated. The Court vacated the judgment and agreed to consider whether Azteca’s personal jurisdiction arguments had been waived. Noting the “bizarre posture of the case, the Court held that Azteca had not preserved its jurisdiction arguments.
The answer did not waive Azteca’s arguments because as a pro se filing it was treated as never having been filed. But counsel did participate in Rule 26(f) conferences, although he filed no notice of appearance, and offered no suggestion that Azteca would challenge jurisdiction during that time. Furthermore, jurisdiction was challenged for the first time more than thirty days after the other defendants settled based upon discussions that Azteca did not participate in. Regardless of the legal impact of Azteca’s filings, by the time Azteca challenge jurisdiction, plaintiff had developed a “reasonable expectation” that Azteca would defend itself in Illinois.

Continue Reading Defendant Waived Personal Jurisdiction by Its Actions, If Not Its Filings

Eazypower Corp. v. Jore Corp., No. 04 C 6372, Slip Op. (N.D. Ill. Oct. 20, 2010) (Zagel, J.).
Judge Zagel denied defendant Jore’s (“Jore”) motion for summary judgment of invalidity in this patent dispute regarding screwdrivers with flexible extension shafts. As a preliminary matter, plaintiff Eazypower repeatedly failed to comply with Local Rule 56.1 regarding statements of material fact. Despite that, the Court accepted Eazypower’s additional facts and responses to Jore’s statements of fact because Jore had sufficient opportunity to respond to them.
Jore argued that a particular screwdriver with a flexible extension shaft, the FB-19, was sold in the United States in the mid-1980s and was invalidating prior art. Eazypower did not dispute that the FB-19 taught each element of the identified patent claims. But Eazypower did dispute that the FB-19 was in fact prior art. First, Eazypower argued that Jore had not sufficiently corroborated its evidence that the FB-19 was sold in the United States in the mid-1980s. Jore’s corroborating evidence – several third parties with knowledge – was sufficient. But there was evidence conflicting with Jore’s position. An age analysis of the FB-19 packaging suggested that it had been built in the late 1970s or early 1980s, but it also showed traces of an adhesive that was not available in the mid-1980s. Additionally, Eazypower showed that relevant shipping records for the period did not show any sales or import of FB-19s. The Court, therefore, held that there was a question of material fact and denied summary judgment.

Continue Reading Lack of Documentation Regarding Use at the Relevant Time Prevents Summary Judgment

RNA Corp. v. The Procter & Gamble Co., No. 08 C 5953, Slip Op. (N.D. Ill. Oct. 21, 2010) (Zagel, J.).
Judge Zagel held that defendant Procter & Gamble’s (“P&G”) intellectual property rights could not be held infringed based upon the available evidence and held that on the available record, the Court could not grant attorney’s fees because a prevailing party could not be determined, in this Lanham Act case regarding P&G’s alleged trademarks and trade dress in its Herbal Essence hydrating shampoos and conditioners. Through a series of settlement conferences, the parties agreed to the scope of a preliminary and then a permanent injunction, but were unable to determine money damages issues. The parties, therefore, agreed to submit the remaining issues to trial by the Court on the papers. The Court, therefore, ruled based upon the parties’ written submissions. In my experience, this is a relatively unique way to resolve and especially to try a case in federal court. And it is an excellent example of how willing the Northern District bench tends to be to find cost-effective ways to resolve what are otherwise often prohibitively expensive intellectual property disputes.

Continue Reading Court Tries Lanham Act Case on the Papers

Healix Infusion Therapy, Inc. v. HHI Infusion Servs., Inc., No. 10 C 3772, Slip Op. (N.D. Ill. Aug. 9, 2010) (Zagel, J.).
Judge Zagel denied plaintiff Healix’s motion to compel and its motion for sanctions. The motion to compel was denied without substantive analysis for failing to meet and confer with defendant pursuant to Local Rule 37.2. The motion for contempt was denied because defendant had complied with the Court’s general orders to produce documents and respond to subpoenas. Defendant did produce documents and respond to the subpoenas. Defendant did not violate those orders by refusing to produce specific documents while producing others.

Continue Reading Discovery Motion Denied for Failure to Meet and Confer

Simonian v. Bunn-O-Matic Corp., No. 10 C 1203, Slip Op. (N.D. Ill. Aug. 23, 2010) (Zagel, J.).
Judge Zagel stayed plaintiff Simonian’s false patent marking case pending the Federal Circuit’s standing decision in Stauffer – which has since issued, holding that any person has standing without regard to injury in fact.
The Court also indicated that, once the stay was lifted, it would deny defendant’s Fed. R. Civ. P. 12(b)(6) motion to dismiss Simonian’s complaint for failure to adequately plead intent to deceive pursuant to Fed. R. Civ. P. 9(b). Simonian pled that defendant knowingly marked its coffeemakers with expired patents. That was sufficient to meet the rebuttable presumption of intent as set out in Solo Cup. It did not matter that Simonian’s claims were generic as evidenced by the use of nearly identical allegations in more than forty false patent marking cases Simonian had filed in the Northern District of Illinois.

Continue Reading Marking With Expired Patent Sufficient for Pleading Intent