Justia Civil Procedure Opinion Summaries

Under the 1999 Agreement, Medtronic purchased Dr. Sasso's inventions, agreeing to royalty payments based on Medtronic’s sales of the defined Medical Device until “the last to expire of the patents included in Intellectual Property Rights, or if no patent application(s) issue into a patent having valid claim coverage of the Medical Device, then seven (7) years from the Date of First Sale of the Medical Device.” The initial patent application was filed in November 1999; two patents issued, both entitled “Screw Delivery System and Method.” Medtronic made royalty payments in 2002-2018. Sasso claimed that Medtronic was not paying royalties on sales of all relevant devices, and filed suit in Indiana state court. A judgment in Sasso's favor is on appeal.Medtronic sought a federal declaratory judgment. While Sasso describes the state court action as a contract case for payment for patent rights, Medtronic describes the federal action as a patent case in which payment requires valid patents. The Federal Circuit affirmed the dismissal of the suit without prejudice, based on abstention in view of the concurrent action in Indiana state court between the same parties concerning the same dispute. District courts possess significant discretion to dismiss or stay claims seeking declaratory relief, even when they have subject matter jurisdiction. View "Warsaw Orthopedic, Inc. v. Sasso" on Justia Law

Without permission from Epic, TCS downloaded thousands of documents containing Epic’s confidential information and trade secrets. TCS used some of the information to create a “comparative analysis”—a spreadsheet comparing TCS’s health-record software (Med Mantra) to Epic’s software. TCS’s internal communications show that TCS used this spreadsheet in an attempt to enter the U.S. health-record-software market, steal Epic’s client, and address key gaps in TCS’s own Med Mantra software.Epic sued. A jury ruled in Epic’s favor on all claims, including multiple Wisconsin tort claims. The jury then awarded Epic $140 million in compensatory damages, for the benefit TCS received from using the comparative-analysis spreadsheet; $100 million for the benefit TCS received from using Epic’s other confidential information; and $700 million in punitive damages for TCS’s conduct. The district court upheld the $140 million compensatory award and vacated the $100 million award. It reduced the punitive damages award to $280 million, reflecting Wisconsin’s statutory punitive-damages cap. The Seventh Circuit remanded. There is sufficient evidence for the jury’s $140 million verdict based on TCS’s use of the comparative analysis, but not for the $100 million verdict for uses of “other information.” The jury could punish TCS by imposing punitive damages, but the $280 million punitive damages award is constitutionally excessive. View "Epic Systems Corp. v. Tata Consultancy Services Ltd." on Justia Law

Security obtained the 180 patent in 2003. After being sued for patent infringement, Security’s competitor sought review of certain claims of the patent in 2015. The Patent Trial and Appeal Board instituted an inter partes review (IPR) and found the sole instituted claim unpatentable. The Federal Circuit summarily affirmed. The Supreme Court then denied a petition for certiorari, which did not raise any constitutional arguments.Security then sought a declaratory judgment that the retroactive application of an IPR proceeding to cancel claims of its patent violated its due process rights. The district court dismissed the suit for lack of subject matter jurisdiction. The America Invents Act, 35 U.S.C. 319, 141(c), provides for “broad Federal Circuit review” of the Board’s final written decisions and allows for review “only” in the Federal Circuit. The court concluded Congress intended to preclude district court review of Board decisions under the Administrative Procedures Act (APA). The Federal Circuit affirmed. Congress foreclosed the possibility of collateral APA review of IPR decisions by district courts. Security cannot bring an APA challenge when the statutory scheme separately establishes an adequate judicial remedy for its constitutional challenge. The APA authorizes judicial review of final agency actions only if there is no other adequate remedy. View "Security People, Inc. v. Iancu" on Justia Law

Decker developed the patented inventions while employed at the University of Texas and assigned the patents to UT. Gensetix obtained an exclusive license in the patents. The license agreement provides that, Gensetix must enforce the patents. The parties agreed to cooperate in any infringement suit and that nothing in the agreement would waive UT's sovereign immunity. Gensetix sued Baylor, alleging infringement and requested that UT join as a co-plaintiff. UT declined. Gensetix named UT as an involuntary plaintiff under FRCP 19(a). The district court dismissed, finding that UT is a sovereign state entity, so that the Eleventh Amendment barred joinder of UT, and that the suit could not proceed without UT.The Federal Circuit affirmed in part. UT did not voluntarily invoke federal jurisdiction; the Eleventh Amendment prevents “the indignity of subjecting a State to the coercive process of judicial tribunals” against its will. It is irrelevant that the license agreement requires the initiation of an infringement suit by Gensetix or cooperation by UT. The court erred in dismissing the suit without adequate analysis of Rule 19(b)'s factors: the extent to which a judgment might prejudice the missing required party or the existing parties; the extent to which any prejudice could be lessened; whether a judgment rendered in the required party’s absence would be adequate; and whether the plaintiff would have an adequate remedy if the action were dismissed. View "Gensetix, Inc. v. Baylor College of Medicine" on Justia Law

Uniloc filed patent infringement actions against Apple, which moved to dismiss, arguing that Uniloc had granted its creditor a license with the right to sublicense in the event of a Uniloc default. According to Apple, Uniloc had defaulted and “lacked the right to exclude Apple from using the patents.” Apple’s motion referenced material that Uniloc had designated as highly confidential. Uniloc asked the court to seal most of the materials in the parties’ filings, including citations to case law, quotations from published opinions, and 23 entire exhibits, including matters of public record. The court denied that motion. Uniloc sought reconsideration, stating that it was willing to make public more than 90 percent of the material it had originally sought to shield; it submitted a declaration including individual grounds for redacting or sealing the remaining materials and declarations from third-party licensees that disclosure would cause them significant competitive harm. The court denied Uniloc’s motion.The Federal Circuit affirmed with respect to Uniloc’s requests to seal its purportedly confidential information and that of its related entities and vacated with respect to licensees. In denying Uniloc’s “sweeping motion,” the court sent a strong message that litigants should submit narrow, well-supported sealing requests and “took seriously the presumption of public access.” The court failed to make sufficient findings on balancing the public’s right of access against the interests of the third parties in shielding their financial and licensing information from public view. View "Uniloc 2017 LLC v. Apple, Inc." on Justia Law

Valencell’s patent, entitled “Methods and Apparatus for Generating Data Output Containing Physiological and Motion-Related Information,” concerns systems for monitoring information such as blood oxygen level, heart rate, and physical activity. Apple sought inter partes review (IPR) of claims 1–13. The Patent Board instituted review of several claims but denied review of claims 3–5. Fitbit then filed an IPR petition for claims 1, 2, and 6–13 and moved for joinder with Apple’s IPR. The Board granted Fitbit’s petition, terminating Fitbit’s separate proceeding. The Supreme Court then held that all patent claims challenged in an IPR petition must be reviewed by the Board if the petition is granted. The Board re-instituted conducted further proceedings and issued a Final Written Decision, finding claims 1, 2, and 6–13 unpatentable, and claims 3–5 not unpatentable. Following the decision, Apple withdrew from the proceeding. Valencell challenged Fitbit’s right to appeal as to claims 3–5.The Federal Circuit held that Fitbit has a right to appeal but vacated as to claims 3–5. Fitbit’s rights as a joined party apply to the entire proceedings and include the right of appeal, conforming to the statutory purpose of avoiding redundant actions by facilitating consolidation, while preserving statutory rights, including judicial review. The court remanded for review of the patentability of claims 3-5 in light of claims of obviousness. View "Fitbit, Inc. v. Valencell, Inc." on Justia Law

Plaintiffs, twelve record companies, filed suit against defendant alleging claims for five separate violations of the Copyright Act. Plaintiffs are Delaware corporations, with eight having their principal place of business in New York, three in California, and one in Florida. Defendant, born in Rostov-on-Don, Russia, is a Russian citizen who still resides in Rostov-on-Don. Defendant owns and operates websites that offer visitors a stream-ripping service through which audio tracks may be extracted from videos available on various platforms and converted into a downloadable format.The Fourth Circuit reversed the district court's grant of defendant's motion to dismiss, holding that defendant's contacts sufficiently show he purposefully availed himself of the privilege of conducting business in Virginia. Therefore, the exercise of specific personal jurisdiction under Federal Rule of Civil Procedure 4(k)(1) is appropriate if it is constitutionally reasonable. Because the district court did not perform a reasonability analysis in the first instance, the court remanded for the district court to do so. View "UMG Recordings, Inc. v. Kurbanov" on Justia Law

Quincy’s Prevagen® dietary supplement is sold at stores and online. Quincy registered its Prevagen® trademark in 2007. Ellishbooks, which was not authorized to sell Prevagen®, sold supplements identified as Prevagen® on Amazon.com, including items that were in altered or damaged packaging; lacked the appropriate purchase codes or other markings that identify the authorized retail seller; and contained tags from retail stores. Quincy sued under the Lanham Act, 15 U.S.C. 1114. Ellishbooks did not respond. The court entered default judgment. Ellishbooks identified no circumstances capable of establishing good cause for default. The district court entered a $480,968.13 judgment in favor of Quincy, plus costs, and permanently enjoined Ellishbooks from infringing upon the PREVAGEN® trademark and selling stolen products bearing the PREVAGEN® trademark.The Seventh Circuit affirmed and subsequently awarded Rule 38 sanctions. Ellishbooks’ appellate arguments had virtually no likelihood of success and its conduct during the course of the appeal was marked by several failures to timely respond and significant deficiencies in its filings. These shortcomings cannot be attributed entirely to counsel’s lack of experience in litigating federal appeals. A review of the dockets suggests that Ellishbooks has attempted to draw out the proceedings as long as possible while knowing that it had no viable substantive defense. View "Quincy Bioscience, LLC v. Ellishbooks" on Justia Law

Odyssey filed the 678 patent application in 2004. After several procedural disputes and appeals, the Patent Board reversed an examiner’s rejections. The Technology Center Director issued an “examiner’s request for rehearing.” Odyssey did not address the merits, objecting to the procedural propriety of the request, and requesting reconsideration. Odyssey eventually made merits arguments, but without waiting for the Board’s decision, it sought judicial review.Odyssey filed its 603 application in 2006. After a final rejection of all claims, Odyssey appealed and filed a petition demanding that the examiner make certain evidence part of the written record and supplement his responses. The examiner further explained his decision. The Technology Center Director dismissed the petition as moot. Odyssey believed that the examiner’s answer to its appeal brief included new grounds for rejection. The Technology Center Director dismissed that assertion. Rather than filing a brief replying to the examiner’s answer, Odyssey sought judicial review.The PTO amended its rules of practice in ex parte appeals; final rules were published in November 2011, applicable to all ex parte appeals filed on or after January 23, 2012. Odyssey challenged the legality of these amendments.The Federal Circuit affirmed the dismissal of all three claims. In the first two counts, Odyssey was challenging actions not yet final before the Board; the Board could provide Odyssey with an adequate remedy, and if not, Odyssey had remedies under 35 U.S.C. 141 or 145. Count III was untimely under 28 U.S.C. 2401, the six-year statute of limitations for a facial APA challenge, which runs from the date the regulations were published. The complaint was filed in January 2018. View "Odyssey Logistics & Technology Corp. v. Iancu" on Justia Law

Lucky Brand and Marcel market clothing. Marcel registered the trademark “Get Lucky.” Lucky Brand registered the trademark “Lucky Brand” and other marks with the word “Lucky.” In a 2003 settlement agreement, Lucky Brand agreed to stop using the phrase “Get Lucky.” Marcel released its claims regarding Lucky Brand’s use of its other trademarks.In 2005, Lucky Brand sued Marcel for violating its trademarks. Marcel filed counterclaims turning on Lucky Brand’s continued use of “Get Lucky,” but did not claim that Lucky Brand’s use of its other marks alone infringed that mark. The court enjoined Lucky Brand from copying or imitating Marcel’s “Get Lucky” mark.In 2011, Marcel sued Lucky Brand, arguing only that Lucky Brand’s post-2010 use of Lucky Brand’s other marks infringed Marcel’s “Get Lucky” mark. Marcel did not allege that Lucky Brand continued to use "Get Lucky." Lucky Brand argued, for the first time since early in the 2005 Action, that Marcel had released those claims in the settlement agreement. The Second Circuit vacated the dismissal of the action, concluding that “defense preclusion” prohibited Lucky Brand from raising that unlitigated defense.A unanimous Supreme Court reversed. Any preclusion of defenses must, at a minimum, satisfy the strictures of issue preclusion or claim preclusion. Here, issue preclusion does not apply, so the causes of action must share a “common nucleus of operative fact[s]” for claim preclusion to apply. The 2005 claims depended on Lucky Brand’s alleged use of “Get Lucky.” In the 2011 suit, Marcel alleged that the infringement was Lucky Brand’s use of its other marks containing the word “Lucky,” not any use of “Get Lucky” itself. The conduct in the 2011 suit occurred after the conclusion of the 2005 suit. View "Lucky Brand Dungarees, Inc. v. Marcel Fashions Group, Inc." on Justia Law