Blog June 11, 2018
Minnesota Patent Litigation Wrap-Up — March 2017
- Person title
This post continues our monthly summary of patent litigation in the District of Minnesota, including short summaries of substantive orders issued in pending cases.
In March, 2017, there were nine notable substantive decisions or orders for pending cases.
Danfoss Power Solutions, Inc. v. Deltatech Controls, No. 16-cv-3111 (March 7, 2017) (Schiltz)
- Motion to dismiss: Denied
The Court tentatively agreed that Danfoss’s first amended complaint failed to plead a claim of direct infringement because it “failed to describe how the allegedly infringing products met certain elements of claim 1.” However, after further consideration of Danfoss’s briefing and hearing presentation, the Court changed its mind, finding that “[a]t this point, DeltaTech has received sufficient notice of Danfoss’s claims” and that the claims were plausible, including Danfoss’s claims for willful infringement.
Arctic Cat Inc. v. Polaris Industries Inc., No. 16-cv-0009 (March 28, 2017) (Bowbeer)
- Motion to strike infringement contentions: Granted-in-part; Motion for fees: Granted-in-part
Polaris moved to strike Arctic Cat’s infringement contentions on the grounds that Arctic Cat’s contentions failed to set forth sufficient analysis to show that the products charted were representative of the full class of accused products. The Court agreed, explaining that a “patentee cannot simply state without analysis in its infringement contentions that a product is representative and then shift to the accused infringer the burden of explaining why a charted product is not representative of uncharted accused products.” The Court further found that the products charted by Arctic Cat were not in fact representative of the broader class of accused products.
The Court ordered Arctic Cat to amend its contentions to provide a detailed analysis of a representative product for each accused vehicle and part number, and to provide a detailed explanation for why such analysis would apply to any uncharted products. The Court further awarded Polaris a portion of its fees associated with bringing the motion to strike. As the Court explained, “Arctic Cat’s failure to provide any analysis to support its selection and use of representative products both in its infringement contentions and when Polaris raised the issue in its responsive contentions and in subsequent letters (indeed, its insistence that no such analysis was required), and its failure even in the context of the instant motion to sustain its burden to show that its selected products were in fact representative, leads the Court to conclude, pursuant to Fed. R. Civ. P.37(a)(5)(A), that Polaris is entitled to recover at least some part of its reasonable attorneys’ fees . . . .”
Polaris Industries Inc. v. Arctic Cat. Inc., No. 15-cv-4475 (March 29, 2017) (Tunheim)
- Motion to dismiss counterclaims: Granted
In this patent infringement suit brought by Polaris against Arctic Cat related to Arctic Cat’s line of side-by-side ATVs, Judge Tunheim granted Polaris’s motion to dismiss Arctic Cat’s antitrust counterclaim. Arctic Cat’s counterclaim alleged two theories of antitrust liability by Polaris: First, that a series of patent infringement actions filed by Polaris amounted to a pattern of harassing litigation; and Second, that one of the suits filed by Polaris was objectively baseless.
The Court found that Arctic Cat’s first theory of antitrust liability failed as a matter of law, because the “three relevant cases that Polaris filed against Arctic Cat do not involve a ‘whole series of legal proceedings’ necessitating application of the California Motor and POSCO standard.” The Court similarly found Arctic Cat’s claim for sham litigation associated with one of Polaris’s infringement suits failed, because Arctic Cat had not shown that Polaris’s claim for infringement was based on an “objectively baseless” construction of the asserted claims.
Polaris Industries Inc. v. Arctic Cat Inc., No. 15-cv-4475 (March 10, 2017) (Noel)
- Motion to amend protective order: Granted-in-part
In connection with Polaris’s infringement suit against Arctic Cat, Arctic Cat filed two petitions for inter partes review (“IPR”) of the asserted patent, alleging the patent was invalid as obvious. Polaris sought to amend the protective order in the related district court proceeding to allow Polaris to use certain of Arctic Cat’s confidential information (obtained via discovery in the district court) in the IPR proceeding.
The Court largely denied Polaris’s motion, finding that under the current protective order, any confidential discovery obtained in the district court litigation shall be used only for purposes of that litigation. The Court further noted that “Polaris should employ the PTAB discovery procedures in order to seek the material in defending its claims in the IPR.” However, the Court then partially granted Polaris’s motion to allow Polaris to identify the confidential documents it sought to use in the IPR by bates number. Finally, the Court stated that “[s]hould Arctic Cat use the PTAB procedures to complicate the litigation and frustrate Polaris’s ability to defend itself in IPR initiated by Arctic Cat, the Court will not hesitate to revisit this issue upon a renewed motion.”
Polaris Industries Inc. v. Arctic Cat Inc., No. 15-cv-4475 (March 2, 2017) (Noel)
- Motion to amend complaint: Granted-in-part
Polaris sought to amend its complaint against Arctic Cat to add a claim for willful infringement. Polaris sought to add a claim for post-filing willfulness, but Polaris’s proposed amendment included several allegations from prior to the filing of the original complaint (and some contentions predated the issuance of the patent in suit). Judge Noel allows Polaris’s amendment as to post-filing conduct on the basis that “Arctic Cat has knowledge of the ‘501 patent [from the original complaint] and continues to sell the accused products.” However, Judge Noel denied Polaris’s motion to amend to the extent the proposed amendment referenced activities or allegations that took place prior to the issuance of the patent-in-suit, finding that “these allegations are not relevant to alleging conduct that occurred following the issuance of the patent-in-suit.”
Spineology, Inc. v. Wright Medical Tech., Inc., No. 15-cv-0180 (March 2, 2017) (Noel)
- Motion to compel: Granted-in-part
Wright Medical sought to compel notes taken by Spineology’s expert during testing of the accused “X-REAM” product. During a deposition of Spineology’s expert, it came to light that the expert had recorded several measurements of the accused product while examining the product, and Wright Medical requested production of the notes. The Court concluded that the parties’ stipulated Protective Order contained narrower protections than the Federal Rules for expert materials and so the dispute turned on whether the expert generated the notes “in forming any opinion in the litigation not included in the report.” The Court found that the withheld notes contained measurement data which formed the basis of the expert’s opinion, and so must be produced. However, the Court allowed Spineology redact any protected communications from the notes prior to production.
M-I Drilling Fluids UK Ltd. v. Dynamic Air Inc., No. 14-cv-4857 (Tunheim)
- Adopting report and recommendation awarding fees pursuant to 35 U.S.C. Â§ 285
M-I first brought suit against Dynamic Air Inc. (“DAI”) in 2013, but the court dismissed the original suit without prejudice for lack of sufficiently specific factual allegations. M-I filed a subsequent suit in 2014, but dismissed this second action after substantial discovery. DAI then brought a motion seeking fees from M-I for its defense of the lawsuit. Magistrate Bowbeer issued a Report and Recommendation recommending the Court award fees, and M-I appealed to Judge Tunheim. Judge Tunheim overruled M-I’s objections and adopted Magistrate Bowbeer’s recommendation, finding that M-I relied on insufficient evidence to support its 2014 complaint against DAI.
M-I and a subsidiary of DAI competed for a contract to manufacture systems to transport rock, sand, and other materials from an offshore oil platform to a ship. DAI’s subsidiary won the contract and M-I subsequently sued DAI for infringement. M-I’s complaint made a series of allegations against DIA’s involvement in the accused transport systems, but provided very little evidence to support its allegations. During discovery, DAI maintained that it had little to no contact with its subsidiary and did not design or otherwise participate in the creation of the accused transport systems. After obtaining this discovery, M-I sought to amend its complaint to add indirect infringement allegations against DAI. Although it added these claims, M-I “ceased litigation” against DAI after limited additional discovery, and M-I subsequently filed a motion to dismiss without prejudice.
The Court’s analysis turned on M-I’s pre-suit investigation for the 2014 lawsuit and whether M-I acted with “objective unreasonableness” in pleading unsupported allegations. Judge Tunheim analyzed each piece of evidence put forth by M-I, but found that such evidence did not support the allegations in M-I’s complaint. For example, although M-I pointed to a contract which identified DAI and its subsidiary as “partners,” the Court found this fact insufficient to substantiate an allegation that “DAI designed, sold, installed, and began operating an infringing Accused System.” The Court reached a similar result for M-I’s remaining evidence, concluding that it was “objectively unreasonable to assert that these quanta of evidence support” M-I’s infringement claim against DAI. As such, the Court confirmed DAI’s fee award, explaining: “The exceptionality of this case flows from M-I’s failure to perform enough investigation and produce enough ‘information’ to support its ‘belief’ in the [complaint].”
Luminara Worldwide, LLC v. Liown Electronics Co. Ltd, No. 14-cv-3103 (Nelson)
- Daubert motion: Granted-in-part
Among other issues, Defendants sought to exclude the opinion of Luminara’s “patent expert” on the grounds that his opinion failed to satisfy Rule 702 of the Federal Rules of Evidence. Defendants’ argued that Luminara’s expert’s opinions regarding obviousness failed to provide specific combinations, provide any motivations to combine reference, or to provide claim charts, among other issues. In the alternative, Defendants requested that Luminara’s expert be ordered to produce new reports and provide additional deposition testimony. Based on several procedural occurrences in the case (including an IPR opinion), the Court granted Defendants' motion for a new report and additional deposition testimony. The Court further cautioned that Luminara’s revised report should “give consideration to Defendants’ concerns regarding specificity and clarity, several of which the Court shares.”
Cutsforth, Inc. v. Westinghouse Air Brake Techs. Corp., No. 12-cv-1200 (Brisbois)
- Motion to quash subpoena: Granted
In connection with its claim for lost profits, Plaintiff Cutsforth sought to subpoena testimony and documents from one of Defendants’ customers, General Electric. However, in response to General Electric’s motion to quash, Cutsforth offered that if the subpoenaed entities would not voluntarily tender testimony for Defendants, Cutsforth would withdraw its subpoena. In response, Defendants served their own subpoena on General Electric, which General Electric also sought to quash.
Defendants’ subpoena sought discovery from General Electric as to General Electric’s “decision whether to purchase Cutsforth’s [patented product]” from 2002-2016 and the factors surrounding that decision. General Electric argued that its subjective reasons for not purchasing Cutsforth’s product and instead selecting the accused product were irrelevant to the lost profits analysis and sought to quash the subpoena.
Magistrate Brisbois analyzed the four Panduit factors for lost profits damages, but found that none of them implicated General Electric's “subjective belief as to whether it would have purchased” Cutsforth’s product had the accused product not been available. The Court further noted that “[e]liciting each purchaser's subjective belief regarding its purchasing decisions would require much broader discovery of potentially confidential, unduly burdensome, and purely hypothetical information from multiple nonparties.” As such, the Court granted General Electric’s motion to quash.
The opinions expressed are those of the authors on the date noted above and do not necessarily reflect the views of Fish & Richardson P.C., any other of its lawyers, its clients, or any of its or their respective affiliates. This post is for general information purposes only and is not intended to be and should not be taken as legal advice. No attorney-client relationship is formed.
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