Justin T. BeckRobert B. Morrill Brian E. Mitchell

January 30, 2013

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• PTO Procedures (cont.)• Discovery• Experts

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Ex Parte reexam of network jukebox patent

Examiner finds prior art karaoke machine anticipates

Board reverses based on◦ Claim construction of “jukebox” limited to

“coin operated”◦ Impression that karaoke machines are

only operated by DJs Both arguments could have been

rebutted in an inter partes review

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Trial Court finds claims for use of vacuum in “healing” wounds are obvious and grants JMOL

Federal Circuit reverses based on construction of “healing” that requires complete healing, rather than improvement

PTO’s “broadest reasonable interpretation” standard applied to “healing” and reduced burden of proof might lead to a different result.

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“The grant rate of motions to stay is highly judge-dependent and (somewhat less obviously) district-dependent.”

Matthew Smith, Foley & Lardner

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What if the patentee amends the claims before the PTO?

What if the PTO invalidates the claims, but the patentee appeals?

What if the PTO confirms the claims, but the accused infringer appeals?

What if the PTO adopts a different claim construction from the District Court?

Defendant:◦ Cheaper◦ Efficient (especially for court)◦ PTO has expertise in patent validity◦ No Prejudice

Plaintiff:◦ Long delay◦ Case will not go away◦ Untimely

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Stay with conditions imposed◦ Submit all art◦ Agree to estoppel

Stay preferred for inter partes review Long delays still seen as a problem

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“Essentially a reprosecution of all claims”

Reasons for filing:◦ Write new claims to cover competitor◦ Broaden claims (within 2 years)◦ Narrow claims because of prior art

What can’t be fixed:◦ New matter/best mode◦ Inequitable conduct◦ Recapture surrendered matter

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Reissue?◦ Who can file a reissue application?◦ Save money◦ New claim limiting the tube to a “tapered tube” to

overcome the enablement issue◦ New method claim to cover sequential use of

multiple floats

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Reexamination?◦ What art can be considered? Smith reference, since not before the PTO Also raises the issue of inequitable conduct

Second prior art publication? Section 303 allows the PTO to consider previously cited

references◦ Should the court order a stay for reissue or

reexamination? Infringement not before the PTO Section 102(g) issue not before the PTO Prior invention by another

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A. Cannot be considered – not a patent or printed publication

B. If Snyder was previously considered and the examiner decided the claims were not anticipated, cannot be considered again for anticipation

Tip: Use Snyder in a new obviousness argument

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C. Cannot be considered – not a patent or printed publication

D. Cannot be considered

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• PTO Procedures (cont.)• Discovery• Experts

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“I have always been a supporter of discovery, and discovery has always supported me.” Anonymous Patent Litigator

When? What do I want? What do I need? How do I get it? How much will it

cost? What will be the

response?

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Keep senior lawyers involved Remember what goes around comes around Discovery is a means, not an end

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Must discuss: Preservation ESI and eDiscovery Proportionality and costs Search methods Phasing

Document production format Limits on discovery Privilege

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Joint Case Management Conference Statement – Rule 26(f)◦ Based on meet and confer

Initial Disclosures – Rule 26(a)◦ 14 days after Rule 26(f) conference

Case Management Conference – Rule 16(b)◦ Changes based on Local Rules?

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Initial Disclosures Protective order Contention interrogatories◦ Answer at the end of the case?◦ Answer in the expert reports?

Scope of electronic discovery

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What are the boundaries of discovery?◦ Information must be reasonably calculated to

lead to admissible evidence◦ Burden/expense◦ Time

What can further limit discovery?◦ Federal/Local Rules◦ The Court (standing orders)◦ Attorney/client privilege and work product ◦ Protective orders

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Foreign parties Third parties Parent/subsidiary/supplier/contractor Document control Electronic files Confidential material

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Interim coverage Levels of protection In-house counsel and prosecutors◦ “Competitive decision-making responsibility

Designation procedures Filings of designated materials Handling of disputes Third parties Termination

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Typical elements:◦ Disclosure of infringement contentions◦ Production of conception/reduction to practice/first

sale documents◦ Disclosure of invalidity contentions◦ Production of accused product documents

Good cause required to modify contentions Early claim construction

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Interrogatories - Rule 33 Document requests – Rule 34 Req. for admissions – Rule 36 Depositions – Rule 30◦ 30(b)(6) depositions

Third party discovery – Rule 45◦ Document production◦ Depositions

• Expert Reports - Rule 26

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What’s Missing From This List?

Limits on number and duration Location◦ General rules ◦ Third parties◦ Foreign witness

Videotaped depositions◦ May give the other side the option of not bringing

the witness to trial◦ What if the witness doesn’t appear at the trial?

Preparation Defending depositions 30(b)(6) issues Claim terms

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Think about why you are taking the deposition before you take it:◦ Find out the facts?◦ Witness likely to appear at trial? Develop material (sound bites) for cross

examination◦ Witness not likely to appear at trial? Develop a coherent story you can play at trial

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If the witness will appear at trial, set up the cross:◦ Start with key issues◦ Short Qs and As – “sound bites”◦ Follow up with rambling witnesses◦ So what you’re saying is _________, correct?◦ Play into your case themes◦ Make the witness look (and feel) foolish◦ Ask about the good documents without

showing them and if he disagrees, impeach◦ Save some surprises for trial

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If the witness will not appear at trial, develop the story:◦ Coherent, interesting and snappy one hour

video taken as if the jury were there◦ Don’t save anything for trial◦ Who? Third party witness out of subpoena range Adversary’s employee who helps you Adversary’s former employee? Beware! “Cross” your employee who won’t be at trial

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Duty to preserve ESI◦ Secure key players’ electronic documents◦ Meet with client IT personnel◦ Send a litigation hold notice

Duty to produce ESI◦ On motion to compel, party from whom discovery is

sought must show not reasonably accessible ◦ Court may nonetheless order discovery if the

requesting party shows good cause, and may specify conditions for the discovery FRCP 26(b)(2)(B)

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Mistaken production of privileged information is inevitable

Party claiming inadvertent production may notify receiving party

Receiving party:◦ Must promptly return, sequester, or destroy the information

and not use it until the claim is resolved◦ Must take reasonable steps to retrieve the information if

the party disclosed it before being notified◦ May present the information to the court under seal for

determination of the privilege claim. The producing party must preserve the information

until the claim is resolved FRCP 26(b)(5)(B)

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The Qualcomm Six (Six attorneys culpable in failure to produce may be reported to state bar for sanctions)

Micron v. Rambus, 253 F.R.D. 135 (D. Del. 2009) (Patents held unenforceable where evidence destroyed in anticipation of litigation)

Clear Value Inc. v. Pearl River Polymers, 2007 U.S. Dist LEXIS 46919 (E.D. Tex 2007) (Case dismissed when expert disclosed at trial that adverse evidence had not been produced)

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Attorney Client—protects communications between attorney and client for purpose of seeking legal advice

Work Product– governed by Rule 26◦ Protects materials prepared by attorney in

anticipation of litigation from discovery◦ Mental impressions, conclusions, opinions, or

legal theories◦ Includes materials prepared by others

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Burden/cost Privilege Obstruction Indifference Evasion

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Common sense Burdensome

procedures Sanctions (fines,

evidence preclusion, public embarrassment)

Discovery Masters Require attorneys to

play Rock, Paper and Scissors on the courthouse steps

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• PTO Procedures (cont.)• Discovery• Experts

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Kucala Enterprises v. Auto Wax Co., 2002 U.S. Dist. LEXIS 13147 (N.D. Ill. July 19, 2002)

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“[I]n a case involving complex technology, where the accused infringer offers expert testimony negating infringement, the patentee cannot satisfy its burden of proof by relying only on testimony from those who are admittedly not expert in the field. That is what happened here . . ..”

Centricut, LLC v. Esab Group, Inc. 390 F3d 1361, 1370 (Fed. Cir. 2004)

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•Honest•Somewhat independent•Communicator/teacher•Battle tested•Has time available•Willing to write a report•Knows the technology

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• Technical• Patent law• Damages

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Teach the technology in tutorials For the patent owner: explain why the

accused products infringe Establish the infringer’s defenses:◦ Non-infringement◦ Invalidity◦ Unenforceability

For the patent owner: rebut the defenses

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When should you select an expert? How many experts should you have? In house versus outside experts? What qualifications should the expert have?

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Professional Witness? Academic? Working in Field? Inventor or Employee?

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•Beware the novice expert•Explain the “real world”:

–Written report – who will prepare it?–Deposition techniques–Knowing when to hold ‘em and when to fold ‘em

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Entitlement or non-entitlement to lost profits Demand Absence of acceptable non-infringing

alternatives Or market share

Capacity Profit margin

Reasonable royalty base and rate Georgia-Pacific analysis

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Disclosure of identity of experts Written report required if expert retained or

specially employed to give expert testimony All opinions and bases for opinions Information considered by expert Exhibits used as a summary of opinions Qualifications/publications Compensation Prior engagements and testimony

Undisclosed testimony not allowed at trial

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• Rule 26• Consultant v. Witness• Providing Information• Writing the Report• Rebuttal Witness• Inventor as Expert

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Expert employed only for trial preparation generally immune from discovery

Exception: Discovery allowed “on showing exceptional circumstances under which it is impractable for the party to obtain facts or opinions on the same subject by other means” FRCP 26(b)(4)(D)

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Expert disclosure limited to “facts or data consideredby the expert in forming his opinion”

“Facts,” not counsel’s theories or impressions Drafts of expert opinion – not discoverable Communications with counsel – not discoverable

except relating to compensation, considered facts/data provided by counsel, assumptions provided by counsel.

(FRCP 26(a)(2)(B))

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• Deposition–Show your hand at deposition?–Save it for trial?

•Typical Themes–Agrees with us on key issues–False assumptions–Hired gun/professional witness–Prior inconsistent positions

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• Judge must exclude unreliable expert testimony

• Expert must have sufficient education or experience

• Opinions must be based on sound science

• Opinions must be based on evidence

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“[I]f a proposed expert is a ‘quintessential expert for hire,’ then it seems well within a trial judge’s discretion to apply the Daubert factors with greater rigor. . . .”

Johnson v. Manitowoc Boom Trucks Inc., 484 F.3d 426, 433 (6th Cir. 2007)

Judges look at the expert’s specific qualifications to ensure appropriate for the case

Damages experts are subject to particularly close scrutiny

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