Patent Case Summaries June 17, 2020

Patent Case Summaries | Week Ending June 12, 2020

A weekly summary of the precedential patent-related opinions issued by the Court of Appeals for the Federal Circuit and the opinions designated precedential or informative by the Patent Trial and Appeal Board.

Munchkin, Inc. v. Luv n’ Care, Ltd., et al., No. 2019-1454 (Fed. Cir. (C.D. Cal.) June 8, 2020). Opinion by Chen, joined by Dyk and Taranto.

The Federal Circuit held that the district court abused its discretion in granting Luv n’ Care’s motion for attorney’s fees under 35 U.S.C. § 285 and 15 U.S.C. § 1117(a). 

Munchkin sued Luv n’ Care for trademark infringement, unfair competition, trade dress infringement, and patent infringement relating to certain spillproof drinking containers. Later, Munchkin voluntarily dismissed all of its non-patent claims with prejudice, and Munchkin’s patent was held unpatentable through an IPR, prompting Munchkin to dismiss its patent infringement claims as well.

Luv n’ Care moved for attorneys’ fees under 35 U.S.C. § 285 and 15 U.S.C. § 1117(a). The district court granted the motion, finding the case to be “exceptional” on the basis that Luv n’ Care’s trademark and trade dress claims were substantively weak and that Munchkin should have been aware of the substantive weakness of its patent’s validity. Munchkin appealed.

The Federal Circuit reversed, noting that the issues forming the basis for the district court’s award of attorneys’ fees had not fully been litigated. The court explained: “This case represents ‘an unusual basis for fees,’ in that the district court’s exceptional-case determination rests on an examination of issues—trademark infringement, trade dress validity, and patent validity—that were not fully litigated before the court.” The Federal Circuit ruled that Luv n’ Care had “failed to make the detailed, fact-based analysis of Munchkin’s litigating positions to establish they were wholly lacking in merit,” and the district court’s opinion “likewise lacked adequate support.”

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DTN, LLC v. Farms Technology, LLC, Nos. IPR2018-01412, IPR2018-01525 (June 14, 2019) (designated precedential on June 11, 2020). Opinion by Hoskins, joined by Weidenfeller and Ippolito. 

In connection with two IPRs, the parties filed joint motions to terminate the proceedings based on a settlement agreement. Pursuant to 35 U.S.C. § 317(b), the parties filed a copy of their written settlement agreement. The agreement, however, referenced two collateral agreements that were not filed. 

The parties argued that § 317(b) does not require filing the collateral agreements because those agreements are not “between the patent owner and a petitioner” or “between the parties,” and were not “made in connection with, or contemplation of, the termination of” the two IPRs. The Patent Trial and Appeal Board, however, interpreted § 317(b) as requiring that only the settlement agreement itself needs to be between the patent owner and a petitioner. The statute refers to “any” collateral agreement, and the Board ruled “that the term ‘any’ means ‘any,’ so the collateral agreements need not be between the patent owner and a petitioner to fall under the ambit of the statute.” The Board explained that adopting the parties’ interpretation of § 317(b) would allow parties to circumvent the statute’s filing requirement, frustrating the statute’s purpose.

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Sattler Tech Corp. v. Humancentric Ventures, LLC, No. PGR2019-00030 (July 26, 2019) (designated informative on June 11, 2020). Opinion by Gerstenblith, joined by Daniels and Paulraj.

In a petition for PGR, the Petitioner asserted that a design patent for a VESA mount adapter bracket was unpatentable under 35 U.S.C. § 171 for lack of ornamentality. The claimed portions of the design included top and bottom tabs and “eight raised grommets arranged in diagonal pairs toward the four corners of the plate.” The Petitioner argued that the design is primarily functional rather than primarily ornamental.

The Patent Trial and Appeal Board explained that determining whether a claimed design is dictated by its function may focus on “the availability of alternative designs.” The Board also identified additional factors to consider in situations where the existence of alternative designs is not dispositive of the invalidity inquiry.

Upon conducting that analysis, the Board instituted the PGR proceeding, finding that the Petitioner had shown that it is more likely than not that the challenged claim is unpatentable. The Petitioner adequately explained how the features of the claimed adapter bracket “are dictated by their function to attach to the back of certain monitors.” The only design element that appeared to be optional was known to provide a functional (not ornamental) benefit. The Board was thus “persuaded that, on the present record, the claimed design for the adapter bracket as a whole appears primarily functional, rather than primarily ornamental.”

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Kokusai Electric Corp. v. ASM IP Holding B.V., No. IPR2018-01151 (Aug. 20, 2019) (designated informative on June 11, 2020). Opinion by Praiss, joined by Tierney and Crumbley.

In an IPR, the parties filed a joint motion to terminate the proceeding based on a settlement reached by the parties. The motion additionally requested that the Patent Trial and Appeal Board grant in part the Patent Owner’s unopposed motion to amend, involving replacing certain canceled claims with proposed substitute claims. The parties asserted that it would be more efficient to add the proposed substitute claims in the IPR rather than in a reissue application or request for reexamination.

The Board ruled that, “based on the facts of this case, … it is appropriate to terminate this proceeding without rendering a final written decision or a decision on the Motion to Amend.” The Board explained that it was not enough that the motion to amend was unopposed because a decision on a motion to amend “requires a determination as to the patentability of the substitute claims.” The Board also expressed “uncertainty regarding the Office’s ability to issue amended claims in the absence of a final written decision and trial certificate under 35 U.S.C. § 318” in contrast to the clear authority to do so through reexamination or reissue proceedings.

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Curt G. Joa, Inc. v. S.P.A., No. IPR2016-00906 (June 20, 2017) (designated informative on June 11, 2020). Opinion by Chagnon, joined by Kokoski and Kalan.

The Patent Trial and Appeal Board provided guidance on the use of confidential information at an oral hearing.

The Board granted the Patent Owner’s request to close a portion of a hearing to the public in order to discuss confidential information. The Board ordered that up to thirty minutes of the total time for the hearing “shall be closed to the public to provide an opportunity for presentation of argument and evidence relating to confidential information.” After the parties’ presentations during the open portion of the hearing, the courtroom “shall be closed to persons not authorized to access confidential information.” Each party was allocated up to fifteen minutes of argument relating to confidential information, but a party could allocate more of its time to the open portion. Also, the parties were directed not to include confidential information in any demonstrative exhibit.

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