Federal Circuit Finds Cease and Desist Letters Do Not Establish Personal Jurisdiction Over a Patentee

In Radio Systems Corporation v. Accession, Inc., 98 U.S.P.Q.2d 1485 (Fed. Cir. 2011), Accession, Inc. is the owner of U.S. Patent No. 7,207,141 (“the ‘141 patent). The ‘141 patent is directed to a portable pet access door (the “Widget”) that can be inserted into sliding glass doors. The company is a New Jersey corporation with its principal place of business in Hamilton, New Jersey. Accession’s sole employee is its president and inventor of the Widget, Thomas Sullivan.

Federal Circuit Finds Declaratory Judgment Not Available Against Field of Use Licensee Where Patent Owner Could Not Be Joined

In A123 Systems, Inc. v. Hydro-Quebec, 626 F.3d 1213 (Fed. Cir. 2010), Hydro-Quebec (HQ) is a licensee of U.S. Patent Nos. 5,910,382 and 6,514,640, which are owned by the Board of Regents for the University of Texas System (UT).  The license gives HQ an exclusive license within a specified field of use.  HQ had threatened suit against A123 for infringement of these patents, whereby A123 filed a Declaratory Judgment against HQ in the District of Massachusetts claiming non-infringement on August 14, 2006.  HQ moved to dismiss alleging that UT was a necessary party and could not be joined due to Eleventh Amendment immunity, and filed its own suit with UT in the Northern District of Texas.  A123 further filed a reexamination request for the patents, which resulted in the Texas action being stayed and the Massachusetts was dismissed without prejudice while the reexamination continued.  On conclusion of the reexamination, A123 motioned to reopen the Massachusetts action, which HQ opposed on

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Federal Circuit finds Covenant Not to Sue Divests Court of Jurisdiction Where Basis of Declaratory Judgment Was Invalidity

In Dow Jones & Company, Inc. and Dow Jones Reuters Business Interactive, LLC v. Ablaise LTD. and General Inventions Institute A, Inc., Docket No. 09-1524 (Fed. Cir. May 28, 2010), Ablaise LTD. (Ablaise) owns U.S. Patent No. 6,961,737 (the ‘737 patent) and No. 6,295,530 (the ‘530 patent).  Both patents claim methods for a Web server to send individualized content and formatting instructions in the form of Web pages that are generated on the fly in response to user preference information encoded in the user’s HTTP request for the specific Web page. In 2006, Ablaise accused Dow Jones & Company,  Inc. (Dow) of infringing its ‘737 and ‘530 patents and simultaneously offering Dow a licensing agreement.  Dow refused, and sued saying both patents were invalid and not infringed.  Abliase counterclaimed for infringement on both patents.  The district court rejected Abliase’s motion to dismiss Dow Jones’ invalidity claim against the ‘530 patent and found the ‘737 patent as invalid due to obviousness

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Northern District of Illinois Finds That Declaratory Judgment Action Available Against Private Sector Owner of Patent Owned in Common with Government

In Sourceone Global Partners LLC. V. KGK Synergize, Inc., Civ. Case No. 08 C 7403 (N.D. Il. May 13, 2009), KGK Synergize (“KGK) is an assignee of U.S. Patent No. 6,987,125 (the ‘125 patent), which generally relates to a nutritional supplement for lowering cholesterol.  The ‘125 patent was invented by Najla Guthrie, Elzbieta Kurowska, John Manthey, and Robert Horowitz pursuant to a partnership between the Department of Agriculture and KGK.  Pursuant to the partnership agreement, Mr. Mathaney and Mr. Horowtiz assigned their rights to the Federal Government, and Ms. Guthrie and Ms. Kurowska assigned their rights to the KGK.  KGK later exclusively licensed their interest in the ‘125 patent to Sourceone Global Partners (Sourceone) for the purpose of making and selling Sytrinol.  The Government is not a signatory to this license. Subsequently, Sourceone developed on its own Cholesstrinol, which Sourceone believed did not infringe the ‘125 patent and therefore was not subject to the royalty provisions of the license.  KGK

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Federal Circuit Finds No Subject Matter Jurisdiction for Declaratory Judgment Where No Evidence of Threat and Only Evidence of Notice is a Patent Marking

In Prasco v. Medicis Pharmaceutical Corp. et al., 87 USPQ2d 1675 (Fed. Cir. Aug. 15, 2008), Medicis manufactures a benzoyl peroxide cleanser under the name TRIAZ®.  The cleanser is marked as being covered by four patents: U.S. Patent Nos. 5,648,389, 5,254,334, 5,409,706, and 5,632,996. The four patents are owned by Medicis and Imaginative Research Associates.  Prasco makes a competing generic benzoyl peroxide cleanser: OSCION™.  On learning of the four patents,  Prasco filed a declaratory judgment action under 28 U.S.C. § 2201 in order to declare that OSCION™ does not infringe U.S. Patent Nos. 5,648,389, 5,254,334, 5,409,706, and 5,632,996. There was no dispute that Medicis was unaware of OSCION™ prior to the filing of the declaratory judgment.  Instead, Prasco alleged that the declaratory judgment action was proper for three reasons.  First, Medicis’ marking of TRIAZ® products in compliance with 35 U.S.C. § 287 exposed Prasco to damages, thereby bringing the possibility of immediate harm.  Moreover, due to a prior infringement suit

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Federal Circuit Finds Lack of Jurisdiction for Declaratory Judgment Act

In Benitec Australia, LTD. v. Nucleonics, Inc., 83 U.S.P.Q.2d 1449 (Fed. Circ. 2007), the United States Court of Federal Appeals for the Federal Circuit affirmed the Delaware District Court’s decision dismissing Nucleonics’ declaratory judgment counterclaims against Benitec Australia regarding invalidity of U.S. Patent No. 6,573,099 (“ ‘099 patent”), which related to RNA-based disease therapy, for lack of subject matter jurisdiction.  Benitec and Nucleonics are both biotechnology companies that are engaged in gene silencing, where a cell is exposed to foreign DNA specifically engineered to contain portions of the target gene to be silenced.  The foreign DNA then produces molecules that shut down the expression of the target gene.  This technology is called RNA interference (RNAi) gene silencing.  Benitic owns the ‘099 patent which relates to RNA-based disease therapy, and sued Nucleonics for infringement.  Nucleonics moved to dismiss Benitec’s complaint for failure to state a claim and lack of jurisdiction.  Nucleonics also argued that it would not be ready to file

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Federal Circuit Finds Declaratory Judgment Possible During Licensing Negotiations

In SanDisk Corp. v. STMicroelectronics Inc., 82 USPQ2d 1173 (Fed. Cir. 2007), STMicroelectronics sent a letter to SanDisk regarding possible cross-licensing.  The letter explicitly discussed a license and did not make an explicit reference to contemplated litigation.  The letter instead listed twelve patents that “may be of interest.”  SanDisk responded that both STMicroelectronics and SanDisk would continue “friendly discussions” relating to the technology, and SanDisk and STMicroelectronics met multiple times to discuss the licensing offer and issues.  During an August 27, 2004 meeting, the STMicroelectronics indicated that the meeting was characterized as settlement discussions under Federal Rules of Evidence 108 such that any discussions therein would not be considered evidence.  Significantly, no confidentiality clause was included in the discussions. In the August 27, 2004 meeting, STMicroelectronics gave a package to SanDisk detailing the products covered by STMicroelectronics’ patents, with detailed claims analysis.  STMicroelectronics’ counsel acknowledged that the package was sufficiently detailed as to be sufficient to start a Declaratory Judgment. 

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Licensing Strategies After MedImmune: The Potential Impacts Of The Supreme Court AllowING Licensees in Good Standing to file Declaratory Judgments Against Licensors

By Gregory L. Clinton[1] and James G. McEwen[2] INTRODUCTION On January 9, 2007, the United States Supreme Court issued its decision in MedImmune, Inc. v. Genentech Inc., 549 U.S. ___ (2007) that reversed a line of decisions by the Federal Circuit most recently set forth in Gen-Probe Inc. v. Vysis, Inc., 359 F.3d 1376 (Fed. Cir. 2004).  Under Gen-Probe, unless the licensee breached the license as was done in Lear, Inc. v. Adkins, 395 U.S. 653 (1969), the licensee was not in sufficient imminent threat of suit to satisfy the case or controversy requirement of Article III of the Constitution.  Therefore, under Gen-Probe, the licensee could not file a declaratory judgment under the Declaratory Judgment Act, 28 U.S.C. § 2201(a), to contest the validity or enforceability of the licensed patent.  In reversing this line of decisions, the Court held that a sufficient case or controversy exists to allow a licensee in good standing to file a declaratory judgment to determine

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Supreme Court Finds that Licensees in Good Standing Can File Declaratory Judgments Against Licensors Without First Breaching the License

On January 9, 2007, the United States Supreme Court issued its decision in MedImmune, Inc. v. Genentech Inc., 549 U.S. ___; 81 USPQ2d 1225 (2007), which reversed a line of decisions by the Federal Circuit most recently set forth in Gen-Probe Inc. v. Vysis Inc., 359 F.3d 1376; 70 USPQ2d 1087 (Fed. Cir. 2004).  Under Gen-Probe, unless the licensee breached the license as was done in Lear, Inc. v. Adkins, 395 U.S. 653; 162 USPQ 1 (1969), the licensee was not in sufficient imminent threat of suit to satisfy the case or controversy requirement of Article III of the Constitution.  Therefore, under Gen-Probe, the licensee could not file a request for declaratory judgment under the Declaratory Judgment Act, 28 U.S.C. § 2201(a), to contest the validity or enforceability of the licensed patent.  In reversing this line of decisions, the Court held that a sufficient case or controversy exists to allow a licensee in good standing to file a declaratory judgment

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Federal Circuit finds Patent Owner Retains Standing to Enforce Patent After Exclusive License That Does Not Transfer All Substantial Ownership Rights

In Aspex Eyewear, Inc. v. Miracle Optics, Inc., Contour and Aspex sued Miracle for infringement of U.S. Patent No. 6,109,747 (hereinafter referred to as the ‘747 patent).  The ’747 patent was originally assigned by the inventor to Contour. After this assignment, Contour and nonparty Chic Optic, Inc. executed an agreement that gave Chic Optic, Inc. certain rights under the ’747 patent, including exclusive right to make, use and sell the product in the United States, the first right to commence legal action against third parties for infringement and virtually unlimited right to sublicense all of its rights to third parties. Under the agreement, Contour retained the right to commence legal action against third parties for infringement if Chic refused to do so, and the agreement contained a clause providing an expiration date for the agreement, a single option to extend, and a second expiration date if the option to extend was exercised. The expiration date was well before the expiration

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