Posts in District Courts

Looking back over the final few weeks of 2023, patent filings were typical at the Patent Trial and Appeal Board (PTAB) and slightly above average in district courts, with the last weeks of the year seeing 68 district court complaints filed and 25 new PTAB petitions [December 11-17]; followed by 57 district court complaints filed and 29 new PTAB petitions [December 18-24]; and wrapped up with 24 district court complaints filed and 13 new PTAB petitions [December 25-31].

The U.S. Court of Appeals for the Federal Circuit (CAFC) today issued a precedential ruling that affirmed a district court’s denial of preliminary injunction to DexCom, Inc., holding that the language of the governing contract’s forum selection clause expressly allowed for the filing of inter partes review (IPR) proceedings in certain circumstances. DexCom and Abbott Diabetes Care, Inc. entered into a settlement and license agreement in 2014, following years of patent litigation over their competing glucose monitoring system patents. The governing agreement included a Covenant Period and a forum selection clause that DexCom argued was breached by Abbott’s filing of eight IPR petitions following the expiration of the Covenant Period and 10 months after DexCom filed an infringement suit against Abbott in the Western District of Texas.

On December 27, the New York Times Company became the latest complainant to accuse OpenAI’s Large Language Model, ChatGPT, as well as Microsoft’s GPT-4-powered Bing Chat, of widespread copyright infringement. The Times alleges that Microsoft and OpenAI reproduce Times content verbatim and also often attribute false information to the Times. OpenAI has been sued by numerous creators and authors for training its chatbots on content found online, including non-public or copyright-protected content. For example, the Times included examples in its complaint in which prompts to ChatGPT asking it to reproduce paywalled content resulted in verbatim excerpts from the article in question.

On December 26, the U.S. Court of Appeals for the Federal Circuit (CAFC) issued a precedential decision in K-fee System GmbH v. Nespresso USA, Inc., reversing a claim construction ruling and summary judgment of noninfringement issued by the Central District of California. In construing the claim term “barcode” de novo, the Federal Circuit found that the district court erred in finding that its definition expressly excluded “bit codes” in light of the patent owner’s representations during European patent opposition proceedings.

With respect to patents subject to a commitment to license on a Fair Reasonable and Non-Discriminatory (FRAND) or Reasonable and Non-Discriminatory (RAND) basis, 2023 saw many interesting developments. This includes several new pool-based licensing programs being launched, and others gaining traction, various interlocutory decisions, the dismissal of some antitrust suits, and, as always, the specter of possible government intervention.

In October of 2023, a divided panel of the U.S. Court of Appeals for the Federal Circuit ruled in Great Concepts, LLC v. Chutter, Inc., 84 F. 4th 1014 (Fed. Cir. 2023) that a fraudulent filing for incontestability under Section 15 of the Lanham Act is not a proper ground for the Trademark Trial and Appeal Board (TTAB) to cancel a registration under Section 14 of the Act. In so holding, it endorsed prior rulings to the effect that fraud in filing a Section 8 affidavit of continuing use, or a renewal application under Section 9—acts of “maintaining” a registration—constitutes “obtaining” a registration within the meaning of Section 14, while rejecting earlier TTAB decisions that had treated Section 15 affidavits the same way.

A California jury on Monday awarded what is reportedly the “largest maximum statutory damages verdict for photography infringement in U.S. history,” according to a press release issued by the plaintiff’s counsel in the case. Scott Hargis is an architectural photographer who sued Pacifica Senior Living Management LLC in September 2022 for damages and injunctive relief related to infringement of 43 of Hargis’ photos that Pacifica used to advertise and market its senior living facilities.

From SAG-AFTRA strikes to the class action lawsuit of McKernan against Stability AI, Stability Diffusion and Midjourney, the creative industries are concerned with the ability of AI systems to produce outputs in the likeness of their original works. Earlier this year, a class action lawsuit against popular generative AI developers Stability AI, Midjourney, and DeviantArt was filed in the United States alleging copyright infringement. McKernan and others claimed that generative AI outputs have reproduced a significant portion of their original work.

On December 15, the U.S. Court of Appeals for the Federal Circuit (CAFC) issued a precedential decision in ParkerVision, Inc. v. Vidal affirming the Patent Trial and Appeal Board’s (PTAB) invalidation of ParkerVision’s patent claim to down-converting electromagnetic (EM) signals in wireless communication networks. In so holding, the Federal Circuit upheld the PTAB’s use of claim construction conflicting with parallel proceedings in the Western District of Texas on the grounds that the patentee defined the term “storage element” as a lexicographer.

Although the proceedings before federal district courts may not garner as much attention as those of the U.S. Court of appeals for the Federal Circuit or the Supreme Court, they can be an important proving ground for the decisions rendered by those courts. And 2023 was no exception to that rule. As discussed below, the Zogenix v. Apotex and Teva v. Eli Lilly decisions provide a glimpse into what litigants can expect in the aftermath of the GSK v. Teva and Amgen v. Sanofi decisions, respectively. These cases will have an especially significant impact on the life sciences industry, and watching how these decisions are applied by the district courts should be a priority for practitioners in this space.

Centripetal Networks was dealt a blow by the U.S. District Court for the Eastern District of Virginia yesterday when the court ruled that it had failed to prove that Cisco infringed three of its patents. It’s a years-long case that the court referred to as having an “unusual history.” The district court first entered one of the highest damages awards ever issued in a patent case, following a 22-day bench trial. In an opinion authored by the late Judge Henry Coke Morgan, Jr., the court found that Cisco willfully infringed four out of five of Centripetal’s asserted patents and awarded enhanced damages in an amount of $755,808,545 (enhanced by a factor of 2.5X), and prejudgment interest in an amount of $13,717,925, which resulted in a total past damages award amount of $1,903,239,288.

It was an overall below-average week for patent filings at both the Patent Trial and Appeal Board (PTAB) and district courts. The PTAB had only 15 new PTAB petitions—all inter partes reviews (IPRs), while the district court had only 24 new complaints filed. There were two more Fintiv discretionary denials this week, with the Board denying institution of two IPRs filed by IBM against inventor-controlled DigitalDoor Inc. [funding unknown] patents broadly related to various aspects of data security technologies.

Recently, Wen Xie argued on IPWatchdog that the U.S. Copyright Office (USCO) and the U.S. Patent and Trademark Office (USPTO) have reached different conclusions regarding “the creative and conceiving capabilities of machines,” which leads to intellectual property (IP) law being self-contradictory. According to Xie, the USCO presumes that artificial intelligence (AI) is creative, while the USPTO does not reach a similar conclusion regarding AI inventorship. I disagree.

Several attorneys associated with patent monetization firm IP Edge are being referred to their state disciplinary bars, the Texas Supreme Court’s Unauthorized Practice of Law Committee, the U.S. Patent and Trademark Office (USPTO) and the Department of Justice for their conduct in directing several individuals, including a fried chicken restaurant owner and a surgical assistant, to undertake liabilities associated with patent litigation in U.S. district court without disclosing the interests of IP Edge, which stood to gain 90% of the gross recovery from the asserted patents.

In 2017, screenwriters Lee Alfred and Ezequiel Martinez Jr. embarked on what would be a five-year journey for their copyright infringement claim against Walt Disney Pictures over the Pirates of the Caribbean franchise. Now, one year after it resolved, their legacy lives on through a new era of copyright litigation in Hollywood. Courts continue to rely on the Ninth Circuit’s decision in the Pirates case to allow screenwriters and other artists to proceed past the pleading stage. With that pendulum swing, litigants in copyright cases over Hollywood films will face a range of undeveloped issues. This article provides a brief recap of the impact from the Pirates case and identifies several open issues that litigants are likely to address in future cases as a result.