Justia Commercial Law Opinion SummariesArticles Posted in Patents
Suprema, Inc. v. Int’l Trade Comm’n
Cross Match claimed that defendants violated 19 U.S.C. 1337(a)(1)(B)(i) by importing articles that infringe or are used to infringe its patents. The International Trade Commission entered a limited exclusion order barring importation of certain optical scanning devices. In 2013, the Federal Circuit first vacated and remanded for revision of the order to bar only a subset of the scanners, reasoning that an exclusion order may not be predicated on a theory of induced infringement under 35 U.S.C. 271(b) where direct infringement does not occur until after importation of the articles the exclusion order would bar. In doing so, the panel effectively eliminated trade relief under Section 337 for induced infringement and potentially for all types of infringement of method claims. The Federal Circuit later granted en banc rehearing and upheld the Commission’s position. Because Section 337 does not answer the question, the Commission’s interpretation of Section 337 is entitled to Chevron deference. The Commission’s interpretation is reasonable because it is consistent with Section 337 and Congress’ mandate to the Commission to safeguard United States commercial interests at the border. View "Suprema, Inc. v. Int'l Trade Comm'n" on Justia Law
Yazdianpour v. Safeblood Techs., Inc.
Licensees entered into a licensing agreement with Safeblood Tech for the exclusive rights to market patented technology overseas. After learning that they could not register the patents in other countries, Licensees sued Safeblood for breach of contract and sued Safeblood, its officers, and patent inventor for fraud, constructive fraud, and violations of the Arkansas Deceptive Trade Practices Act (ADTPA), Ark. Code 4-88-101 to -115. The district court dismissed the fraud claims at summary judgment. The remaining claims proceeded to trial and a jury found for Licensees, awarding them $786,000 in contract damages and no damages for violations of the ADTPA. The district court awarded Licensees $144,150.40 in prejudgment interest. The Eighth Circuit reversed as to the common-law fraud claim and the award of prejudgment interest, but otherwise affirmed. Licensees produced sufficient evidence that the inventor made a false statement of fact; the district court did not abuse its discretion when it gave the jury a diminution-in-product-value instruction; and Licensees waived their inconsistent-verdict argument. View "Yazdianpour v. Safeblood Techs., Inc." on Justia Law
Grigoleit Co. v. Whirlpool Corp.
Whirlpool purchased injection-molded plastic knobs and decorative metal stampings from Grigoleit. In 1992 Whirlpool told Grigoleit that it would start using products made by Phillips. Grigoleit believed that Phillips was using a method protected by its patents. Ultimately Grigoleit licensed its patents to Whirlpool and Phillips; instead of royalties Grigoleit got Whirlpool’s business for the “Estate” and “Roper” brand lines and a promise of consideration for other business. The agreement and the patents expired in 2003. An arbitrator concluded that Whirlpool had failed to consider Grigoleit’s parts for some lines of washers and dryers and was liable for payment of money royalties or damages. Grigoleit demanded the profit it would have made had Whirlpool purchased its requirements of knobs exclusively from Grigoleit. The district court concluded that a reasonable royalty fell in the range of 1¢ to 12¢ per part and the parties then agreed that royalties would then be $140,000. The Seventh Circuit affirmed, reasoning that lost profits differ from royalties. The caption on the contract is “LICENSE AGREEMENT” and the heading on paragraph 3 is “Royalties.” The agreement is a patent license; the court was not obliged to treat it as a requirements contract. View "Grigoleit Co. v. Whirlpool Corp." on Justia Law
UPI Semiconductor Corp. v. Int’l Trade Comm’n
uPI and Richtek design and sell DC-DC controllers that convert direct current from one voltage to another, and are embodied in chips for downstream devices such as computer motherboards. uPI was founded by former Richtek employees; its chips are imported into the U.S. either directly or as incorporated in downstream devices. Richtek complained to the International Trade Commission that uPI misappropriated Richtek’s trade secrets and infringed Richtek’s U.S. patents, in violation of the Tariff Act, 19 U.S.C. 1337. uPI offered to enter into a consent order and to cease importation of products produced using or containing Richtek’s trade secrets or infringing Richtek’s patents. Over Richtek’s objection, the ALJ entered the consent order substantially as drafted by uPI. The Commission terminated the investigation. A year later Richtek filed an Enforcement Complaint. An ALJ distinguished between products that were accused in the prior investigation and products allegedly developed and produced after entry of the Consent Order, finding violations as to the formerly accused products and that the post- Consent Order products infringed two patents, but were independently developed and not produced using Richtek’s trade secrets. The Commission affirmed with respect to the formerly accused products and reversed in part with respect to the post-Order products. The Federal Circuit affirmed concerning the formerly accused products, but reversed the ruling of no violation as to the post-Consent Order products.View "UPI Semiconductor Corp. v. Int'l Trade Comm'n" on Justia Law
Microsoft Corp. v. Int’l Trade Comm’n
In 2010, Microsoft filed a complaint in the U.S. International Trade Commission, alleging that Motorola had violated the Tariff Act of 1930, 19 U.S.C. 1337, by importing mobile phones and tablets that infringe several Microsoft patents. The Commission instituted an investigation and, after an evidentiary hearing, the ALJ found that the accused Motorola products did not infringe the 054, 762, 376, or 133 patents and that Microsoft had failed to prove that the mobile devices on which it relied actually implemented those patents. The Commission upheld the ALJ’s findings, finding that Microsoft failed to prove that the Microsoft-supported products on which it relied for its domestic-industry showing actually practiced the patents. The Federal Circuit reversed in part, first affirming that Motorola does not infringe the 054 patent and that Microsoft failed to prove that a domestic industry exists for products protected by the 762 and 376 patents. With respect to the 133 patent the Commission relied on incorrect claim constructions in finding no infringement, the only basis for its finding no violation, for the main group of accused products. The court affirmed the noninfringement finding for the accused alternative design. View "Microsoft Corp. v. Int'l Trade Comm'n" on Justia Law
DSM Desotech Inc. v. 3D Sys. Corp.
Rapid-prototyping “additive technology” creates parts by building layer upon layer of plastics, metals, or ceramics. Subtractive technology starts with a block and cuts away layers. Additive technology include SL, fused deposition modeling, laser sintering, 3D printing, direct metal laser sintering, and digital light processing. 3DS is the sole U.S. supplier of SL machines, which use an ultraviolet laser to trace a cross section of an object on a vat of liquid polymer resin. The laser solidifies the resin it touches, while untouched, areas remain liquid. After one cross-section has solidified, the newly formed layer is lowered below the surface of the resin. The process is repeated until the object is completed. Users of SL machines often own many machines with varying sizes, speeds, and accuracy levels. 3DS began equipping some of its SL machines with wireless technology that allows a receiver to communicate with a transmitter on the cap of a resin bottle. A software-based lockout feature shuts the machine off upon detection of a resin not approved by 3DD. 3DS has approved two of Desotech’s resins and entered into negotiations for approval of additional resins. After negotiations broke down, Desotech sued, alleging tying, unreasonable restraint of trade, and attempted monopolization under the Sherman Act; tying under the Clayton Act; patent infringement; and violations of the Illinois Antitrust and Uniform Deceptive Trade Practices Acts. The district court granted 3DS summary judgment on the antitrust claims and certain state-law claims. The parties stipulated to dismissal of the remaining claims. The Federal Circuit affirmed. View "DSM Desotech Inc. v. 3D Sys. Corp." on Justia Law
Suprema, inc. v. Int’l Trade Comm’n
Cross Match claimed that Suprema and Mentalix violated 19 U.S.C. 1337(a)(1)(B)(i) by importing articles that infringe or are used to infringe its patents. The International Trade Commission entered a limited exclusion order barring importation of certain optical scanning devices, finding that Mentalix directly infringed a method claim by using its own software with imported Suprema scanners and found that Suprema induced that infringement and that certain of Suprema’s imported optical scanners directly infringe other claims of the 993 patent. The Commission found no infringement of the 562 patent. The Commission held that Suprema and Mentalix failed to prove that the 993 patent was invalid as obvious over two prior art patents. The Federal Circuit vacated and remanded for revision of the order to bar only a subset of the scanners. An exclusion order based on a section 1337(a)(1)(B)(i) violation may not be predicated on a theory of induced infringement under 35 U.S.C. 271(b) where direct infringement does not occur until after importation of the articles the exclusion order would bar. View "Suprema, inc. v. Int'l Trade Comm'n" on Justia Law
Forrester Envt.l Servs., Inc. v. Wheelabrator Techs.,Inc.
Forrester and Wheelabrator are competitors in the market for phosphate-based treatment systems for stabilizing heavy metals in waste such as incinerator ash, to prevent heavy metals from leaching into drinking water sources. Wheelabrator calls its treatment system “WES-PHix” and has obtained several related U.S. patents. Forrester calls its system “FESI-BOND” and has also obtained patents. In 2001, Wheelabrator entered into a license agreement that granted Bio Max the exclusive right to use and sublicense WES-PHix® in Taiwan. Bio Max sublicensed WESPHix to Kobin, which used WES-PHix at its Taipei plant. Forrester learned that Kobin was dissatisfied with WES-PHix due to the odor it generated. Forrester developed a variation on its system, addressing the odor problem, and persuaded Kobin to license FESI-BOND for use at its plant. Wheelabrator sent a letter asserting that Kobin was in breach of its WES-PHix sublicense agreement and threatening legal action. Kobin stopped purchasing from Forrester and entered into a new sublicense with Wheelabrator. Forrester filed suit alleging violation of the New Hampshire Consumer Protection Act; tortious interference with a contractual relationship; tortious interference with Forrester’s prospective advantage; and trade secret misappropriation. The district court denied remand and granted summary judgment for Wheelabrator. The Federal Circuit vacated, with instructions to remand to state court. View "Forrester Envt.l Servs., Inc. v. Wheelabrator Techs.,Inc." on Justia Law
Motiva, LLC v. Int’l Trade Comm’n
Motiva’s patent, issued in 2007 and titled “Human Movement Measurement System,” generally relates to a “system for ... testing and training a user to manipulate the position of ... transponders while being guided by interactive and sensory feedback . . . for the purpose of functional movement assessment for exercise and physical rehabilitation.” Motiva accused Nintendo’s Wii video game system of infringement. The district court stayed the case pending patent reexamination. Motiva then filed a complaint with the International Trade Commission, asserting that the Wii infringed the patent, so that its importation violated the Tariff Act. After the Commission began its investigation, Nintendo moved for summary determination under Section 337, which prohibits importation of articles that infringe a valid and enforceable U.S. patent if “an industry in the United States, relating to the articles protected by the patent ... exists or is in the process of being established.” 19 U.S.C. 1337(a)(2). According to Nintendo, there were no commercialized products incorporating Motiva’s patented technology, and Motiva’s activity aimed at developing a domestic industry consisted solely of the litigation. The administrative law judge agreed. The Federal Circuit affirmed. View "Motiva, LLC v. Int'l Trade Comm'n" on Justia Law
Versata Software, Inc. v. SAP Am., Inc.
Versata’s patents relate to computer-based pricing of products. In prior art, each factor required separate database queries, so that determining a price was highly inefficient. The claimed invention identifies all the groups to which a customer belongs and all corresponding price adjustments and product-related factor. Versata marketed a successful product, Pricer, sold as a package with other Versata software or as an addition to enterprise systems offered by companies like SAP. While Versata’s patent application was pending, SAP released a new version of its software that contained hierarchical pricing capability, which, it stated, was like Pricer. Pricer sales faltered. Versata sued for infringement. In the first trial, the jury found that SAP directly infringed asserted claims, induced and contributed to infringement of one claim, and that the claims were not invalid, and awarded $138,641,000. The court granted JMOL of noninfringement of the 400 patent, but denied JMOL of noninfringement of the 350 patent. Before the second trial, SAP modified its products with a patch that prevented users from saving data into certain fields. The jury concluded that the products still infringed and awarded $260 million in lost profits and royalties of $85 million. The court entered a permanent injunction. The Federal Circuit vacated the injunction as overbroad, but otherwise affirmed. View "Versata Software, Inc. v. SAP Am., Inc." on Justia Law