By Memorandum Opinion entered by The Honorable Richard G. Andrews in Halosil Int’l, Inc. et al. v. Eco-Evolutions, Inc. et al., Civil Action No. 18-1375-RGA (D.Del. July 14, 2020), the Court granted Defendants’ Motion for Summary Judgment after finding that no reasonable jury could conclude that Defendants’ advertisements were literally false and Plaintiffs’ breach of contact claim was time-barred.

With respect to the false advertising claim, Plaintiff alleged that Defendants were liable under Section 43(a) of the Lanham Act, which prohibits false or misleading advertisements about a product. Id. at *6. Plaintiffs contended that Defendants’ statements were “literally false.” Id. Significantly, under the literally false theory, Plaintiffs are not required to show that the buying public was actually misled. Id. A court, in deciding whether an advertising claim is literally false, “must decide first whether the claim conveys an unambiguous message and second whether that unambiguous message is false. Only an unambiguous message can be literally false.” Id.

After analyzing the alleged false statements made in the promotional brochure for the subject product, the Court found that no reasonable jury could conclude that Defendants’ statements were literally false. Id. at *6-9. Accordingly, the Court granted summary judgment in Defendants’ favor.

A copy of the Memorandum Opinion is attached.

 

By Memorandum Opinion entered by The Honorable Colm F. Connolly in Power Integrations, Inc. v. CogniPower LLC, Civil Action No. 20-15-CFC (D.Del. July 1, 2020), the Court granted Defendant’s motion to dismiss counts 3, 4, and 5 of the Complaint pursuant to Federal Rule of Civil Procedure 12(b)(1) after finding that Plaintiff failed to establish declaratory judgment jurisdiction for the claims.

Plaintiff sought a declaratory judgment pursuant to 28 U.S.C. § 2201 that two of its products and the use of those products do not directly or indirectly infringe any of the three patents-in-suit owned by Defendant. Id. at *2. Defendant argued in support of its motion that Plaintiff failed to establish the existence of a “case or controversy between the parties” with respect to the patents-in-suit and, thus, the Court lacked subject matter jurisdiction over counts 3, 4 and 5. Id. Plaintiff countered arguing that Defendant’s allegations of infringement against Plaintiff’s customers implicitly accused Plaintiff of indirect infringement and, therefore, created a case or controversy sufficient to give the Court jurisdiction over the declaratory judgment counts. Id. at *6. After review of the record, the Court agreed that Plaintiff had failed to establish declaratory judgment jurisdiction for counts 3, 4 and 5. Id. at *6-10. Thus, counts 3, 4 and 5 were dismissed.

A copy of the Memorandum Opinion is attached.

 

Although I typically blog on intellectual property and antitrust cases in federal court in Delaware, attached for readers of the Delaware Intellectual Property Litigation Blog are links to two articles that I recently co-authored and published on (1) obtaining temporary restraining orders and preliminary injunctions in Delaware Chancery Court and (2) adjudicating business disputes in the Complex Commercial Division of Delaware Superior Court:

(1) https://www.law.com/delbizcourt/2020/06/10/obtaining-temporary-restraining-orders-and-preliminary-injunctions-in-chancery-court/

(2) https://news.bloomberglaw.com/us-law-week/insight-adjudicating-business-disputes-in-delawares-complex-commercial-division

 

By Order dated June 15, 2020 and issued by Chief Judge Stark, the United States District Court for the District of Delaware issued and adopted its re-opening guidelines that includes four phases of re-opening. Phase One of the re-opening will commence on Wednesday, June 17, 2020.

Phase One involves the court’s initial emergence from strict shelter-in-place orders in the community and from cancellation of in-person appearances in court. It is the first step toward an eventual return to normal operations through the four-phased approach. Great care is taken in Phase One to protect vulnerable individuals, to adhere to strict social distancing protocols, and to restrict in-person court activities only to functions that are critical.

During Phase One there will be no jury trials, criminal or civil, except in extraordinary circumstances if at all. Individual judges will continue to address continuance requests on a case-by-case basis. The court will continue to minimize on-site court proceedings using video-conferencing and teleconferencing to the greatest extent possible.

Phase Two will involve a gradual loosening of restrictions, taking care to protect safety and public health a more people return to court facilities and courtrooms. Even after entering Phase Two, the court can consider returning back to Phase One if local conditions worsen. Phase Two involves (a) expanding in-person court proceedings while continuing to encourage use of video-conferencing and teleconferencing where feasible; (b) restarting jury trials (with further details on how jury trials will be conducted to be forthcoming); and (c) other matters. As of this time, no date for the start of Phase Two has been announced.

Phase Three begins a cautious return to normal court operations with an awareness of the need to provide reasonable accommodations for vulnerable or otherwise affected employees and to maintain a constant vigilance and awareness of local health issues. Before entering Phase Three, the court will evaluate its experience in Phase Two and determine whether it is ready to proceed to Phase Three. Phase Three will include the full re-start of on-site and public facing activities, including court proceedings, subject to the discretion of the presiding judge. Naturalization proceedings also will resume during Phase Three. As of this time, no date for the start of Phase Three has been announced.

Phase Four represents court activity after a public health determination that COVID-19 has been suppressed within the United States. Courts will resume normal operations with no restrictions.

Copies of the Court’s Order and Re-Opening Guidelines are attached.

 

By Memorandum Order entered by The Honorable Leonard P. Stark in United Access Technologies, LLC v. AT&T Corp. et al., Civil Action No. 11-338-LPS (D.Del. June 12, 2020), the Court denied the motion of Defendants AT&T Corp., AT&T Services Inc. and SBC Internet Services, Inc. (collectively, “AT&T”) seeking to compel certain litigation funding-related discovery from Plaintiff United Access Technologies, LLC (“UAT”).  AT&T asserted that the information requested was not privileged and should be produced.  Id. at *1.  UAT opposed the production contending that litigation funding information is irrelevant, protected by the work-product doctrine, and is privileged.  Id. at *1-2.  The Court ordered documents responsive to certain categories to be produced by UAT for in-camera review.  Id. at *2.

After reviewing the documents in-camera, the Court found that (1) AT&T failed to meet the threshold requirement to show that the litigation funding-related discovery that it sought was relevant to the claims or defenses of the instant action; (2) AT&T failed to articulate how document within the scope of categories 2 and 3 were relevant to the specific claims or defenses of the instant case as opposed to merely speculating that the reasons underlying the order requiring production in Acceleration Bay LLC v. Activision Blizzard, Inc., 2018 WL 798731, at *3 (D.Del. February 9, 2018) were also present in the instant case; and (3) the documents did not appear to the Court to be relevant to any issue in the case.  Id. at *2-3.  Thus, the motion to compel was denied.

A copy of the Memorandum Order is attached.

With courts across the United States in different and various stages of re-opening to get back to some level of normalcy under the exigent circumstances created by the global coronavirus pandemic, I thought it would be helpful to my clients, co-counsel, and others outside of Delaware to provide an update on the Courts’ operations in Delaware (both federal and state courts) and re-opening plans as of May 30, 2020.

Federal Courthouse in Delaware

With respect to the federal courthouse in Delaware, which includes the United States District Court for the District of Delaware (D.Del.), the courthouse closed on May 29, 2020 until further notice due to a water leak affecting operation of the building. I suspect the water leak will be resolved and the courthouse will re-open and resume its operations under the exigent circumstances created by COVID-19, as set forth in the most recent Standing Order on court operations entered by Chief Judge Stark on May 27, 2020.

Some highlights of the matters set forth in the Court’s Revised Standing Order include the following:

▪ All civil and criminal jury selections and jury trials in D.Del. scheduled to begin before June 30, 2020 are continued pending further Order of the Court and will be reset by further Order of the assigned Judge.

▪ All deadlines set by the federal or local rules or by Court Order, including, but not limited to, scheduling orders in civil or criminal cases, remain in effect unless and/or until modified by further Order of the Court or the assigned Judge.

▪ Individual judges may schedule and hold in courtroom hearings, conferences, sentencings, change of plea hearings, and bench trials in the exercise of sound discretion consistent with the principles of the Court’s Standing Order(s) on COVID-19 and the sound administration of justice.

▪ All judges are encouraged to continue to conduct proceedings, including ADR proceedings, by telephone or videoconferencing where practicable and as permitted by law, and to take reasonable measures to avoid the necessity of out-of-town travel of litigants, witnesses, counsel or the public.

The wearing of face masks is required by all (including attorneys and Court employees) when interacting with Court staff and in the common or public areas of the Court facilities.

A copy of the Revised Standing Order of the D.Del. as of May 27, 2020 is attached.

State Courthouses in Delaware

Led by Chief Justice Seitz, the Delaware State Courts presented a summary of the interim report of the State Courts Reopening Committee on May 29, 2020. The report describes the various phases of the re-opening plan of the Delaware State Courts.

Phase 1 will start on June 8, 2020. Phase 1 will include no more than 25% of court staff, allow access by attorneys, bail bonds persons, private individuals posting bail, data miners, and the media, and the restart of some oral arguments, conferences and civil hearings that only involve judges and attorneys. The Courthouses will still be closed to the public during Phase 1 and a capacity limit of no more than 10 persons in any courtroom.

There are several requirements that will start with Phase 1 and continue until further Order by the Courts when entering the Courthouses: (1) wearing of face masks; (2) 6 feet social distancing; (3) answering COVID-19 screening questions;  (4) temperature scans; and (5) using hand sanitizer upon entering the buildings.

Phase 2 is scheduled to begin on June 15, 2020. Phase 2 is designed to reopen the Courthouses to the public, while at the same time, maintaining the entrance and screening requirements, 6 feet social distancing requirements, and capacity limit of no more than 10 persons in any courtroom at a time. Court staff will be increased to no more than 50% during Phase 2. Phase 2 will, among other things, include the resumption of bench trials in civil and criminal cases. No jury trials during Phase 2.

Jury trials in civil and criminal matters will resume during Phase 3. Staffing will be increased to 75% and the courtroom capacity limit will be increased to 50 persons during Phase 3. There is no date scheduled at this time for the start of Phase 3. The start of Phase 3 will depend on how things go in Phases 1 and 2. The Courts (in coordination with the medical community) will be monitoring whether there is any resurgence in the increase in the spread of the coronavirus during Phases 1 and 2 and how the procedures implemented during the prior phases are working before proceeding to Phase 3.

Phase 4 is the return of all proceedings to the courthouse in the new normal. There is no date scheduled at this time for the start of Phase 4. The start of Phase 4 will depend on how things go in Phase 3.

A copy of the Interim Report of Delaware State Courts Reopening Committee is attached.

A general principle that is clear at this time in both federal and state courts in Delaware is that the increased use of technology to conduct virtual hearings, conferences and meetings, where allowed under the law, is here to stay. Judges, attorneys, clients, parties, witnesses, and others involved in the legal process will continue to adjust and adapt to the “new normal” over time.

In the Report and Recommendation entered in Helios Streaming, LLC et al. v. Vudu, Inc., Civil Action No. 19-1792-CFC-SRF (D.Del. May 11, 2020), the Honorable Sherry R. Fallon recommends the Court grant defendant Vudu’s partial motion to dismiss plaintiffs’ claims of induced infringement asserted in Count I, Counts II through V, and Count VII of the complaint for failure to state a claim under Federal Rule of Civil Procedure 12(b)(6). Specifically, Judge Fallon recommends the dismissal of those claims after finding that the complaint does not sufficiently allege that (1) Vudu had knowledge of the patents asserted in Counts II through V and VII prior to the filing of the complaint; and (2) Vudu had knowledge its conduct induced infringement of the patent asserted in Count I of the complaint. Id. at *2-6.

A copy of the Report and Recommendation is attached.

By Memorandum Order entered by The Honorable Richard G. Andrews in Malvern Panalytical, Inc. v. TA Instruments-Waters, LLC et al., Civil Action No. 19-2157-RGA (D.Del., May 5, 2020), the Court granted Defendants’ partial motion to dismiss in part by dismissing the willfulness and contributory infringement claims asserted in Plaintiff’s amended complaint.

Plaintiff’s amended complaint asserts five (5) patents and identifies the accused products by name. Id. at *1. Defendants filed a partial motion to dismiss Plaintiff’s amended complaint asserting, among other things, that Plaintiff did not sufficiently allege willfulness as to the asserted patents and any contributory and/or induced infringement claims. Id.

Upon evaluation, the Court found that, although it was a close call, Plaintiff did not sufficiently allege willfulness as to the two (2) Plotnikov patents that are asserted. Id. The Court also found that Plaintiff did not sufficiently allege willfulness as to the three (3) Broga patents asserted. Id. In fact, “other than the assertion that Plaintiff and Defendants are competitors in a two-player industry, there are no factual assertions that begin to suggest, prior to the filing of the complaint, [Defendants had] actual knowledge as to the Broga patents.” Thus, the Court dismissed the willfulness claims with leave to amend in accordance with the scheduling order.

With respect to the alleged contributory infringement claims, the Court found that they appear to be nothing more than “meaningless additional boilerplate.” Id. at *2. Plaintiff failed to assert a plausible contributory infringement theory. Specifically, “[e]ach of the accused products is not alleged, as is required by 35 U.S.C. § 271(c), to be a ‘component’ that a customer uses as part of some other system that infringes or as a ‘material or apparatus for use in practicing a patented process.’” Id. Thus, the Court also dismissed the contributory infringement claims.

The Court denied the partial motion to dismiss with respect to the induced infringement claims after finding that it was sufficient at the pleading stage for Plaintiff to plausibly allege the ‘induced” part of induced infringement by alleging that Defendants (1) had actual knowledge of the asserted patents since the filing of the original complaint, and (2) provides product literature that instructs customers how to use the accused products in an infringing manner. Id.

A copy of the Court’s Memorandum Order is attached.