Great Week for CCRG at Federal Circuit

I thought I’d write to congratulate my partner, Anthony Garza, for having a great week at the Federal Circuit. The Federal Circuit, on February 11 and 12, 2015, returned two decisions in favor of firm clients (United Access Technologies and Babbage Holdings).

In United Access Technologies v. CenturyTel (decision available here), the Federal Circuit held that collateral estoppel did not apply to United Access’ infringement claim, despite an earlier unfavorable general jury verdict against United Access’ predecessor-in-interest to the patents-in-suit. The district court had found that the jury’s verdict against the patentee in the earlier action worked collateral estoppel in the instant case, thereby precluding United Access’ infringement claim against CenturyTel. The Federal Circuit reversed, writing:

The essence of United’s argument is as follows: The JMOL order in the EarthLink case established only that the jury could permissibly have reached its verdict on either of two possible grounds—either that EarthLink’s system did not infringe because it lacked a telephone or that the standard ADSL technology was not within the scope of the patents in suit. The EarthLink JMOL decision therefore did not establish that the jury necessarily based its verdict on a conclusion that the standard ADSL technology did not infringe United’s patents. Accordingly, it was improper for the district court to hold that United is collaterally estopped from litigating that issue in this case.

That analysis is correct.

In In re Konami (available here), the Federal Circuit rejected Konami’s attempt to have Babbage’s patent infringement case transferred from Texas to California via a writ of mandamus. The Federal Circuit denied the mandamus petition, writing:

In denying transfer, the district court explained that “Konami’s entire Motion consist[ed] of one page with four paragraphs of argument,” and, by contrast, “Babbage . . . provide[d] twenty pages (not including exhibits) of response and analysis to the specific 28 U.S.C. § 1404(a) factors.” Babbage Holdings, LLC v. Konami Digital Entm’t, 2:13-cv-754-JRG, slip op. at 3 (E.D. Tex. Sept. 29, 2014). Moreover, while Konami referenced a different case involving Babbage Holdings that was transferred, it was pointed out to the court that Konami was not actually headquartered in the Northern District of California and did not identify its own witnesses or documents within the transferee district. Id.

The party seeking transfer bears the burden of proving that there is sufficient cause for transfer of venue. In re Volkswagen of Am., Inc., 545 F.3d 304, 315 (5th Cir. 2008) (en banc); cf. In re Apple Inc., 743 F.3d 1377, 1379 (Fed. Cir. 2014) (noting the relevance of the movant’s failed submission of sufficient evidence to suggest that transfer was appropriate). Given the nature of Konami’s transfer motion, we cannot say that it was a clear abuse of discretion for the district court to conclude that Konami did not meet its burden in this regard.

 

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Judge O’Connor Invalidates Federal Regulatory Regime Relating To Buying/Selling Handguns Across State Lines Due To Second Amendment

On February 11, 2015, Judge O’Connor issued an opinion (available here) that invalidated certain federal laws relating to the buying, transporting, and selling of handguns across state lines. The federal laws, in essence, require that handgun sales crossing state lines go through federal firearm licensees. In other words, federal law “prevents all legally responsible and qualified individuals from directly acquiring handguns from FFLs in every state other than their state of residency[.]”

The Court found that “the federal interstate handgun transfer ban burdens conduct that falls within the scope of the Second Amendment.” The Court then determined that it would apply strict scrutiny to the laws in question. Next, the Court concluded that “Defendants have not shown that the federal interstate handgun transfer ban is narrowly tailored to be the least restrictive means of achieving the Government’s goals under current law. The federal interstate handgun transfer ban is therefore unconstitutional on its face.”

Judge O’Connor also found that the laws would fail constitutional analysis under intermediate scrutiny, and that the laws violate the Due Process Clause of the Fifth Amendment to the United States Constitution.

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New Lawsuits

There have been many new patent infringement lawsuits recently filed in the Northern District of Texas, including the following:

  • In 3rd Eye Surveillance v. Dallas Credit Union, plaintiff filed suit (available here) accusing defendant of infringing three patents relating to video security systems.
  • In Lennon Image Technologies, LLC v. Mary Kay, Lennon accuses Mary Kay of infringing U.S. Patent No. 6,624,843, titled “Customer Image Capture and Use Thereof in a Retailing System” through the sale of its Virtual Makeover Application and Virtual Makeover Mobile Apps. (Complaint available here.)
  • In STOP, LLC v. Recovery Health Corp., plaintiff accuses defendants of infringing patents relating to systems for locational tracking of monitored persons (complaint available here).
  • In Thermotek v. Madonado Medical, plaintiff seeks a declaratory judgment for patent misuse and invalidity of U.S. Patent No. 8,485,995, and also asserts breach of contract and fraud claims against defendants (complaint available here).
  • Avioniqs, LLC has filed a slew of cases alleging infringement of U.S. Patent Nos. 5,771,020 and 7,688,214, which claim technology relating to weather warning and lightning locating systems. The defendants in the cases include Delta, DHL, Air Canada, Frontier, Alaska Airlines, United Airlines, Qatar Airways, American Airlines, US Airways, FedEx, JetBlue, and UPS.
  • In JSDQ Mesh v. Sine Networks, the plaintiff accuses the defendant of infringing several patents claiming technology relating to call routing systems. (Complaint available here.)
  • In Raniere v. AT&T & Microsoft, the plaintiff accuses defendants of infringing patents claiming technology relating to switching systems. (Complaint available here.)
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Fifth Circuit Reverses N.D. Tex. Decision Vacating Arbitration Award in BNSF Railway Case

In BNSF Railway v. Alstom Transportation (decision available here), the Fifth Circuit reversed a decision from the Northern District of Texas in a case involving an arbitration panel’s decision. The district court had partially vacated the panel’s final award. The Fifth Circuit reversed that decision and reinstated the panel’s final award. The decision demonstrates how limited a review of an arbitration award is: “Our review of the underlying award is exceedingly deferential. [T]he sole question for us is whether the arbitrator (even arguably) interpreted the parties’ contract, not whether he got its meaning right or wrong.”

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Judge Boyle’s Non-Compete Decision In Brink’s Case

I recently came across a thorough Memorandum Opinion and Order issued by Judge Boyle (available here) last year in Brink’s v. Patrick. The opinion contains an excellent summary of Texas law on non-competes. Of interest is Judge Boyle’s finding that “even if the [non-compete] agreement did effectively impose a four-year restriction, the Court cannot conclude that such a restriction would be unreasonable under Texas law.”

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Judge Lynn Issues Judgment In Wheels Pros Case

On January 28, 2015, Judge Lynn issued a Judgment (available here) in the Wheels Pros case. The Judgment granted the Plaintiff’s motion for default judgment. It also granted permanent injunctive relief, required the destruction of infringing articles, and referred the damages determination to Magistrate Judge Toliver for an evidentiary hearing.

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Magistrate Judge Stickney Awards Costs Against Attorney Who Missed Settlement Conference

On February 5, 2015, Magistrate Judge Stickney issued an Order (available here) in Dagher v. Deutsche Bank directing the payment of defendants’ costs. Judge Stickney had set a settlement conference, but the plaintiffs’ attorney informed the Court one hour before the conference that she did not plan to attend because she believed the conference was on a different day and that, in any event, her clients would not be present because she could not locate them. Judge Stickney found:

As a result, Defendants expended resources in providing a representative who traveled from Florida for the settlement conference. Defendants are instructed to submit to the Court their costs incurred, including airfare for their representative to attend the settlement conference. [The Plaintiffs’ attorney] is ordered to reimburse Defendants the costs incurred for their representative being present. No attorney fees are ordered at this time, only costs of the travel, hotel and other incidentals related to the travel. 

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Judge O’Connor Declines to Stay Case Pending Ex Parte Reexamination

On January 26, 2015, Judge O’Conner issued an Order (available here) in Newco Enterprises v. Super Heaters. Judge O’Conner denied a motion to stay the case pending the completion of ex parte reexamination proceedings after considering the relevant factors.

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Judge Kinkeade Issues Markman Decision in Securus Case

On January 27, 2015, Judge Kinkeade issued a thorugh, fifty-plus page Markman opinion (available here) in Securus Technologies v. Global Tel*Link, which construed the disputed terms of the three patents in suit.

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Supreme Court Issues Trademark Tacking Decision in Hana

In Hana Financial v. Hana Bank (decision available here), the Supreme Court took up the issue of whether trademark “tacking” is for the judge or the jury to decide. The Supreme Court found that it was for the jury, not a judge:

Rights in a trademark are determined by the date of the mark’s first use in commerce. The party who first uses a mark in commerce is said to have priority over other users. Recognizing that trademark users ought to be permitted to make certain modifications to their marks over time without losing priority, lower courts have provided that, in limited circumstances, a party may clothe a new mark with the priority position of an older mark. This doctrine is called “tacking,” and lower courts have found tacking to be available when the original and revised marks are “legal equivalents” in that they create the same, continuing commercial impression. The question presented here is whether a judge or a jury should determine whether tacking is available in a given case. Because the tacking inquiry operates from the perspective of an ordinary purchaser or consumer, we hold that a jury should make this determination.

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