Judge Anthony J. Trenga shared his perspectives on the Preliminary Injunction standards following the Fourth Circuit’s adoption of Winter v. NRDC, 129 S.Ct. 365 (2008) in Real Truth about Obama, Inc. v. FEC, 575 F.3d 342 (4th Cir. 2009) in a "View from the Bench" CLE hosted by the Northern Virginia Chapter of the Federal Bar Association. The need to clearly establish the likelihood of success on the merits was paramount. The former "flexible interplay" of (a) irreparable harm; (b) balance of the equities; (c) likelihood of success on the merits; and (d) public interest has been replaced with the requirement that an independent demonstration by the moving party as to each factor must be demonstrated. Despite the routine practice of supporting motions for preliminary injunction with affidavits or verified complaints, Judge Trenga noted that one holdover from the Blackwelder case was that testimony could still be permitted to assist a "perplexed judge." Recent opinions reflect a greater scrutiny of the injunction factors. In FBR Capital Markets & Co. v. Short, 2009 U.S. Dist LEXIS 94558 (E.D.Va Oct. 9, 2009) (J. O’Grady), plaintiff’s motion for a preliminary injunction in a theft of trade secrets case was denied upon a determination that although plaintiff showed a risk of loss, it had not demonstrated any actual loss of customers; further, any demonstrated loss of income could be compensated, undermining the "irreparable harm" factor. In a franchisee/franchisor dispute with covenants not to compete and trademark claims, the court again denied injunctive relief upon determining that inconsistencies in the facts precluded a finding that the plaintiff was likely to succeed on the merits. Allegra Network LLC v. Reeder, 2009 U.S. Dist LEXIS 103688 (E.D.Va. Nov. 4 2009) (J. O’Grady). In a building construction matter, plaintiff’s motion for an injunction was denied upon defendants’ demonstration that not only could plaintiff not establish any of the necessary factors, he had waited for a year to bring the matter to court. Glassman v. Arlington County, Va et al, 1:09cv01249 (Jan.22, 2010).

On Thursday, February 25, the jury returned its verdict in Humanscale v. CompX, on CompX's claims for infringement of its '054 and '767 patents relating to keyboard trays.  The results:

• All asserted claims of both patents infringed
• All asserted claims of both patents not invalid
• Humanscale's laches defense rejected
• Reasonable royalty damages up to the date the counterclaims were filed:  $17,220,000
• Reasonable royalty damages from then until December 31, 2009:  $2,152,200
• Reasonable royalty percentage going forward:  6%

The Court had previously granted Humanscale's motion for a directed verdict on willfulness, so these damages will likely not be enhanced.  See CompX's press release on the jury verdict here. 

The Court had also previously stayed Humanscale's claims for infringement of its '097 patent, pending an ITC determination regarding the same allegations.  On Tuesday, Judge Paul Luckern at the ITC issued a final determination that CompX had infringed two claims of Humanscale's '097 patent (although he also determined that one of those claims was obvious), and stated that he would recommend a limited exclusion order barring entry of CompX's keyboard trays and a cease and desist order against CompX.

See our previous posts on these cases here. 

On Friday, February 19, the Eastern District of Virginia vacated its earlier order granting judgment in favor of Apple, and dismissed the case, pursuant to the parties' joint stipulated order.  The order finally resolves the case between the parties, including Monec's pending appeal to the Federal Circuit.  In its memorandum supporting the request for vacatur, Monec explained that the parties resolved the case using the Federal Circuit's mediation process.  Monec contended that the parties' resolution rendered the Court's judgment moot, and that there were open questions as to whether Monec had a full and fair opportunity to litigate its claims, and whether the Court applied proper procedural standards in issuing judgment in favor of Apple so early in the case, before any discovery or claim construction process.  See our previous posts on the case here. 

Patent infringers must have notice of a patent before they can be liable for patent infringement damages.  Notice can come in many forms, including by lawsuit, cease-and-desist letters, or proper patent marking. 35 U.S.C. Section 287(a) permits recovery of damages based on the constructive notice provided by proper patent marking, even where no actual or direct notice to the alleged infringer has been given.

OceanTomo LLC, the Chicago-based company that brokers deals for IP portfolios and hosts live patent auctions, has recently launched a web site dedicated to virtual patent marking.  See www.patentmarking.com.  Its purpose is to provide free public information linking products and services to their associated patents.  According to the website, information can be posted in three forms: (1) from the actual product manufacturers or service providers themselves; (2) from observations of registered users; and (3) from validated information provided by Ocean Tomo and/or a trusted affiliate organization.

OceanTomo espouses virtual marking as a way to avoid the hassles associated with actual product marking, while also helping to prevent false marking charges.  If patent reform measures were to pass that included a provision permitting virtual marking, OceanTomo states, product manufacturers could replace the specific number on the product itself with a pointer to a website that has the patent information for that product.

Will this be the wave of the future for patent marking?  Tough to say.  Within the field of patent law, patent marking is a fairly black-and-white principle in a sea of gray.  Your product is either properly marked or it isn't.  While one can see the benefits to OceanTomo as an information aggregator (are we still saying "eyeballs" in 2010?) and service provider (minimum annual subscription is apparently $5,000), the benefits to the potential patent enforcer may be less apparent.  If OceanTomo is calling for a switch from marking your product with a patent number to marking it with a website pointer, then doesn't the product still need to be marked somehow?  Not sure where that hassle is eliminated, although I suspect it could make things easier when a product is covered by many patents and the product owner has an electronic means to update the patent list.  Still, what if the site goes down for a couple of hours?  Will an alleged infringer have infringement windows of opportunity as a result?  Until the kinks are worked out and any legislation is fully developed, it may be tough to get virtual marking permitted under Section 287.

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In ResQNet.com, Inc. v. Lansa, Inc., decided February 5th, the Federal Circuit affirmed a district court finding of patent infringement, but reversed and remanded as to damages, holding in a per curiam opinion that plaintiff ResQNet’s expert had improperly relied on extraneous past license evidence in calculating a royalty rate.  Building on its September, 2009 decision in Lucent Technologies, Inc. v. Gateway, Inc., the court in ResQNet reaffirmed that “[a]ny evidence unrelated to the claimed invention does not support compensation for infringement but punishes beyond the reach of the statute.”

One approach to determining a “reasonable royalty” for patent infringement, introduced in Georgia-Pacific Corp. v. U.S. Plywood Corp., 318 F. Supp. 1116 (S.D.N.Y. 1970), is to estimate the rate a hypothetical license would have featured had the parties willingly negotiated prior to the infringement.  In calculating such a rate, a party may rely on any substantial evidence, including royalty rates paid in connection with other, actual licenses for the use of the infringed patent or any other sufficiently similar patents.

Such past license evidence, however, must be “sufficiently comparable to the hypothetical license” at issue.  In Lucent, the Federal Circuit had held that four of the eight license agreements used to calculate a royalty rate “differ[ed] substantially from the hypothetical negotiation” and therefore failed to adequately support the damages calculation.  The court ruled similarly in ResQNet, holding that five of the seven licenses relied on by ResQNet’s expert not only granted rights in the patent, but also included “services such as training, maintenance, marketing, and upgrades” that were “unrelated” to the claimed invention.

The ResQNet court suggested that these “inapposite” licenses were purposefully included in the expert’s calculations to inflate the royalty rate, and that no actual link existed between them and the patented technology.

In dissent, Judge Newman suggested that the ResQNet majority’s opinion misapplied its own precedent, claiming that Lucent does not call for disqualification of all past license evidence that does not wholly relate to the claimed technology.  Rather, if it is at least fractionally relevant, such evidence should be included in rate calculations, though valued proportionally.

Dennis Crouch (Patently-O) and Peter Zura (The 271 Patent Blog) have also blogged about the ResQNet decision.

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On Friday, February 19, Humanscale and CompX completed the first week of a jury trial in the Richmond Division of the EDVA, before Judge Spencer.  See our previous post on the case here.  At issue are CompX's claims of infringement of the '054 and '767 patents, and Humanscale's counterclaims of noninfringement and invalidity.  CompX rested on the third day, and the Court denied all of the Humanscale's motions for judgment as a matter of law, save one.  The Court granted Humanscale's motion on willfulness.  Humanscale started presenting evidence on Friday, and the trial resumes on Monday, February 22. 

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The trademark infringement lawsuit filed by the Virginia-based language learning software company Rosetta Stone against Google is now scheduled to go to trial on May 3, 2010, before a jury in Alexandria, Virginia.  Google's previous motion to dismiss the lawsuit was denied.  This lawsuit is one of several trademark infringement lawsuits filed against Google in federal courts since Google reportedly adopted a new policy allowing advertisers to use trademark terms in their ad text, but it is the only such action pending in the EDVA. Because of the jurisdiction’s well-known speedy docket, it is likely that this case will be the first of the new Adword cases to reach judgment.

Google’s current policy is posted here.

Eric Goldman has a post discussing the cases against Google here on his Technology & Marketing Law Blog.

Dennis Crouch has an interesting post from yesterday at PatentlyO on conflicting statutory provisions providing for appeals of rejections by the BPAI in ex parte reexamination proceedings, namely whether the patentee can appeal to the District of DC, or whether the Federal Circuit has exclusive jurisdiction over such appeals.   Addressing this issue in Sigram Schindler v. Kappos, 2009 WL 4981473 (E.D. Va. Dec. 18, 2009), the Eastern District of Virginia agreed with the PTO's interpretation (found in 37 C.F.R. § 1.303 and in MPEP § 2279) that section 141 controls, and that appeals lie only at the Federal Circuit. 

The Reexamination Center also has a good discussion of this issue here. 

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In the wake of the Federal Circuit’s decision in Wyeth v. Kappos, the USPTO recently announced an interim procedure for patentees to request patent term adjustment recalculations.  In Wyeth, the Federal Circuit affirmed Wyeth and Elan Pharma International Ltd.’s request to extend patent term adjustments under 35 U.S.C. 154(b), due to the USPTO’s delay in prosecuting their patent applications.   Commissioner for Patents Robert Stoll stated that “the USPTO is working to modify its computer program to comply with the Federal Circuit’s decision as soon as possible. Until then, this interim procedure will enable patentees to request a recalculation quickly and at no charge.”   The USPTO expects that the software modification needed to comply with the Wyeth decision will be completed by March 2, 2010.  In the interim, the USPTO is providing patentees with the ability to request a recalculation of their patent term adjustment without a fee or petition as is normally required pending completion of necessary modifications to the USPTO’s computer program.

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In recent years, PwC has analyzed trends in patent litigation and issued a report focusing on a particular "hot topic" in the arena.  For 2009, that topic was Non-Practicing Entities, and their effect on patent litigation.  The 2009 report draws a number of interesting conclusions about NPEs, including the statistic that since 2002, NPEs have consistently won larger damage awards that operating companies.  Not surprisingly, the Eastern District of Virginia was identified as the fastest docket in the country with an average time-to-trial in patent cases of .88 years.  The study also concludes that the Rocket Docket is a pro-patentee jurisdiction, largely because of its speedy docket, higher success rates for patentees (ranked third with a success rate of 48.6% for patentholders), and larger median damage awards.  

The 271 blog has a discussion of the report here, as does the Prior Art blog here.  

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Everyone is anxiously awaiting the Supreme Court's decision in In re Bilski, but until then, AwakenIP has collected here an extremely comprehensive collection of resources on the Bilski case.  It has everything from commentary, to blog posts, to transcripts and briefs, including amicus briefs at the Federal Circuit.  Definitely a website to visit for anyone interested in the Bilski case.

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On November 24, the Court dismissed Juniper's claims of infringement, and GraphOn's counterclaims, with prejudice, based on a covenant not to sue that Juniper had given to GraphOn, which the Court concluded eliminated the existence of a case or controversy under Article III of the Constitution.  Fifteen days later, GraphOn filed its motion for attorney fees.  Unfortunately for GraphOn, the motion was a day late; under Rule 54(d)(2)(B)(i), motions for attorney fees are due within fourteen days of the entry of judgment.  The Court denied the motion, finding that GraphOn's excuse that it miscalculated the due date was insufficient to constitute excusable neglect under Rule 6.  GraphOn has appealed both the dismissal and the denial of its motion for fees to the Federal Circuit.  GraphOn's brief is due March 8. 

PATracer also has a discussion of this case here.  See our previous discussion of this case here. 

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On February 13, 2009, Humanscale sued CompX International and CompX Waterloo in the EDVA for infringement of US Patent No. 5,292,097.   Humanscale designs and manufactures keyboard support products, such as the keyboard tray in the '097 patent.  In response, Defendants filed the usual counterclaims for invalidity, noninfringement, and unenforceability, and also asserted infringement by Humanscale of US Patent Nos. 5,037,054 and 5,257,767. Early in the case, the Court stayed the claims on the '097 patent, based on a concurrent ITC investigation, and let the claims on the '054 and '767 patents go forward.  Almost exactly a year later, it looks like parties are headed to trial by jury before Judge Spencer in Richmond.  On February 5, 2010, the Court heard oral argument on Humanscale's motion for summary judgment of invalidity and laches (the only summary judgment motion that appears to have been filed), and denied it from the bench.  According to the current scheduling order, the parties are scheduled to begin trial on February 16.   

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Patent cases are notoriously expensive to litigate.  As a result, more and more parties are turning to Rule 12(c) in an attempt to narrow down issues in the case, or to dismiss the case entirely.  In Monec v. Apple (which this blog has previously covered here), the Eastern District of Virginia dismissed the case in its entirety, finding that the plaintiff could not recover based on the claims of the patent as written.   And more recently in the Norfolk Division, defendant Walden University filed a Rule 12(c) motion asserting that certain claims of the patent at issue in its case against Digital-Vending Services International are indefinite, in part because they claim both an apparatus and a method.  In addition to arguing that Walden's motion is premature, because the claims have not yet been construed, DVSI has opposed Walden's motion on its merits.  The Court has neither set a date for the hearing nor ruled on the motion. 

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The IP Section of the Virginia State Bar has announced its 2010 writing competition, for articles relating to intellectual property law, or the practice of intellectual property law.  According to the VSB's website, the contest is open to students at Virginia law schools, or Virginia residents attending law school outside the Commonwealth of Virginia.  The prize is $4,000 and publication of the article on the VSB IP Section website.  Articles are due by May 29, 2010.  More details can be found here.

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PRE Holding, Inc. v. Monaghan Medical Corporation was dismissed without prejudice pursuant to a Stipulated Order entered on January 27, 2010, in the Richmond Division of the Eastern District of Virginia.  The lawsuit had been pending in the EDVA since July 21, 2009, when PRE Holding asserted that the Defendants infringed U.S. Patent No. 7,562,656, which is directed toward an aerosol medication inhalation system to aid in the delivery of aerosolized medicaments to patients.  Monaghan subsequently requested an Inter Partes Reexamination of the ’656 patent, and the USPTO granted the request on January 20, 2010, and entered a First Office Action rejecting all of the asserted claims as unpatentable. 

Defendant Trudell Medical International agreed to be bound by the USPTO’s disposition of the Reexamination Proceeding to the same extent that Monaghan is bound.  Defendants also agree to discontinue selling the accused products in the United States before the presently scheduled trial date of July 12, 2010.

The Court also ordered that the six year statute of limitations for obtaining damages in the case was tolled from the date the suit was filed through the date on which a final ruling is entered in the Reexamination Proceeding, and that damages would not be limited during that tolling period.