Willful Infringement Center Stage at Federal Circuit

The United States Court of Appeals for the Federal Circuit recently issued a unanimous panel decision in Halo Electronics, Inc. v. Pulse Electronics, Inc. This decision may have more far-reaching implications for patent reform than any other decision reached by any court in recent memory. The issue of particular interest in this case was willful infringement, and in a concurring opinion, Judges O’Malley and Hughes wrote that the majority was constrained by the Federal Circuit’s precedent in In re Seagate and Bard Peripheral Vascular v. W.L. Gore, but that recent Supreme Court decisions call into question the continued viability of that precedent. As such, Judges O’Malley and Hughes urged the Federal Circuit to reconsider en banc the standard for awarding enhanced damages under 35 U.S.C. 284.

The case came to the Federal Circuit on an appeal by Halo Electronics, Inc. (“Halo”), who appealed from multiple decisions of the United States District Court for the District of Nevada. First, Halo appealed the granting of summary judgment that Pulse Electronics, Inc. and Pulse Electronics Corp. (collectively “Pulse”) did not sell or offer to sell within the United States the accused products they manufactured for delivery to buyers outside the United States. Second, Halo also appealed the granting of summary judgment that Pulse did not directly infringe Halo’s U.S. Patents 5,656,985 (the “’985 patent”), 6,297,720(the “’720 patent”), and 6,344,785 (the “’785 patent”) (collectively “the Halo patents”). Finally, Halo appealed the holding that Pulse’s infringement of the Halo patents with respect to certain accused products that Pulse sold and delivered in the United States was not willful.


Patent Reform Takes A Big Step Forward As The Senate Passes The America Invents Act

Jeanne Gills, Partner at Foley & Lardner and Practice Center Contributor, along with colleagues Courtenay C. Brinckerhoff and Liane M. Peterson, sent in this alert highlighting the key provisions of The America Invents Act.

On March 8, 2011, U.S. patent reform moved one step closer towards becoming a reality when the Senate passed the America Invents Act (S. 23) in a bipartisan, 95-5 vote. The bill includes some modification to the “first-to-file system” and removes the damages and venue provisions that were present in earlier versions of the bill.

Now the House of Representatives will have to craft its own version of patent reform, which is expected to have at least some differences vis-à-vis the Senate bill. If and when the House approves its patent reform bill, House and Senate leadership will have to reach a compromise. Although the House is expected to vote in support of a compromise bill, final passage could be blocked by a late-stage “hold” in the Senate. Thus, patent reform likely still has a long road ahead. (more…)

Foley & Lardner: Senate Introduces Patent Reform Act of 2011

On Tuesday, the Senate introduced the Patent Reform Act of 2011.  While the latest version is similar to previous patent reform bills, there are some significant changes made in the 2011 proposed legislation.  Our friends at Foley & Lardner sent in this alert discussing the new bill and how the House plans to address patent reform in 2011.

On January 25, 2011, Sens. Patrick Leahy (D-Vt.), Orrin Hatch (R-Utah), and Chuck Grassley (R-Iowa) introduced the latest bill on patent reform legislation—the Patent Reform Act of 2011.  According to Sen. Leahy, the new legislation is based on prior legislation introduced during the 109thCongress, as well as compromises reached in March 2010 (the Managers’ Amendment to S. 515). A January 20, 2011 press release on Sen. Leahy’s Web site states, “[p]romoting economic growth continues to be a top priority for both Democrats and Republicans, and patent reform is part of that effort.” When introducing the bill, Sen. Leahy explained that the new legislation is intended to accomplish three primary goals: (1) transition to a first-to-file system; (2) improve patent quality; and (3) provide more certainty in litigation. The Act also includes provisions to limit standing and damages in false patent marking actions. However, Sen. Leahy did not directly address how he intends to resolve key differences with the House that carry over from last year’s stalled bill (S. 515), which contains many of the same provisions as the new bill. Meanwhile, the House has announced a new hearing that it will conduct on the link between patent reform and job creation, suggesting that it intends to obtain more input before considering legislative changes. Several of the key provisions of the recently introduced Senate bill are discussed in more detail below. (more…)

Issuance Of Continuation Patents During Litigation Undermine Defense To Willful Infringement

The following post comes from Scott A. McKeown, partner at Oblon Spivak, Practice Center Contributor and writer for Patents Post Grant.

Texas Court Likens Issuance of Continuation Patents During Litigation to Patent Reexamination

[W]illful infringement exists where an accused infringer acted “despite an objectively high likelihood that its actions constituted infringement of a valid patent.” In re Seagate Technology, LLC, 497 F.3d 1360, 1371 (Fed. Cir. 2007). In assessing the propriety of a post-filing willfulness allegation (i.e., after the  complaint is filed with the court) Seagate is oft cited for the proposition that a plaintiff must seek injunctive relief (i.e., preliminary injunction). However, court’s have refused to impose such a wooden rule. Instead, court’s look to the totality of the circumstances, including factors such as the existence of concluded patent reexaminations. (more…)

Attorneys’ Fees Under Section 285: A Double Standard in Patent Litigation

By Brandon Baum ( Partner at Mayer Brown LLP and Practice Center Contributor) and Jonathan Helfgott[i]

Under 35 U.S.C. § 285 (“§ 285”), “[t]he court in exceptional cases may award attorney fees to the prevailing party.”  Although the statutory language does not differentiate between prevailing plaintiffs and defendants, the Federal Circuit has developed substantially different standards for determining whether a case is “exceptional” depending on which party prevails.

In the context of a prevailing plaintiff, a court may find a case “exceptional” by showing that the defendant engaged in “willful infringement.” Minks v. Polaris Indus., 546 F.3d 1364, 1375 (Fed. Cir. 2008) (upholding exceptional case determination and award of attorneys’ fees based on jury finding of willful infringement).  “An express finding of willful infringement is a sufficient basis for classifying a case as ‘exceptional,’ and indeed, when a trial court denies attorney fees in spite of a finding of willful infringement, the court must explain why the case is not ‘exceptional’ within the meaning of the statute.”  Modine Mfg. Co. v. Allen Group, Inc., 917 F.2d 538, 543 (Fed. Cir. 1990); Tate Access Floors, Inc. v. Maxcess Techs., Inc., 222 F.3d 958, 972 (Fed. Cir. 2000) (same).  To demonstrate willful infringement, the patentee must show “that the infringer acted despite an objectively high likelihood that its actions constituted infringement of a valid patent.” In re Seagate Technology, LLC, 497 F.3d 1360, 1371 (Fed. Cir. 2007).   As the Federal Circuit made clear in Seagate, this is an objective test under which an infringer may be found to have acted willfully when it knew or should have known of the risk. Id. (more…)