Court Finds Patent Infringement Action Moot Upon Filing of Covenant Not to Sue

In a December 19, 2013 ruling, Judge Coleen McMahon dismissed with prejudice plaintiff Commercial Recovery Corporation’s patent infringement claim against Bilateral Credit Corp., LLC upon Commercial Recovery’s filing of a covenant not to sue, and dismissed as moot Bilateral’s counterclaims of non-infringement and invalidity.  The covenant not to sue filed by Commercial Recovery “is unconditional and irrevocable, and reaches beyond Bilateral to protect Bilateral’s suppliers, distributors, customers, and partners.”  Judge McMahon found it “’hard to imagine a scenario’ under which Bilateral could infringe the [patent-in-suit] and yet not fall under [Commercial Recovery’s] covenant.”

Bilateral argued that the covenant was ineffective because Commercial Recovery was in receivership and held title to the patent only for purposes of the suit against Bilateral, so Bilateral remained exposed to claims from successors-in-title.  Judge McMahon rejected this argument, ruling that under 35 U.S.C. § 281, the term “patentee” includes “’not only the patentee to whom the patent was issued but also the successors in title to the patentee,’” so any successor-in-title would be bound by the covenant.

Bilateral also argued that the covenant was not necessarily broad enough to cover Bilateral’s future activities.  The Court held, however, that given the breadth of the covenant not to sue, it was incumbent upon Bilateral to proffer evidence of sufficiently concrete plans to engage in conduct not covered by the covenant.  Judge McMahon found that Bilateral had failed to provide any such evidence.

The Court also rejected Bilateral’s request to condition Commercial Recovery’s request for a voluntary dismissal with prejudice on the payment of Bilateral’s attorneys’ fees.  Judge McMahon noted that courts frequently condition requests for dismissal without prejudice on the payment of fees because plaintiffs can, and frequently do, refile such cases leading to duplicative expenses for the defendants, but that fees are rarely awarded for a dismissal with prejudice because there is no risk of duplicative work.  The Court also rejected Bilateral’s request for fees under 35 U.S.C. § 285 and 28 U.S.C. § 1927, finding no evidence that Commercial Recovery had engaged in objectively baseless litigation in bad faith.

Invalidity Counterclaims Dismissed as Moot After Summary Judgment of Non-Infringement

In a November 25, 2013 ruling, Judge Shira A. Scheindlin dismissed as moot the patent invalidity counterclaims of TNS Media Research LLC and other defendants in plaintiff TRA Global, Inc.'s patent infringement action.  After granting summary judgment of non-infringement, the Court noted that the defendants "raised their patent invalidity contentions as affirmative defenses to TRA's patent infringement claims, and the only affirmative relief they seek is a declaratory judgment of non-infringement."  Thus, Judge Scheindlin ruled that the "motion for summary judgment of invalidity is moot."

Court Grants Summary Judgment of Patent Non-Infringement and Denies Invalidity Motion as Moot

In an August 29, 2013 ruling, Judge P. Kevin Castel granted the motion of Google, Inc. and Facebook, Inc. for summary judgment of non-infringement, and denied their motions for summary judgment of invalidity.  The patents-in-suit "disclose methods and systems which allow users without web programming skills to create mobile websites with personally-authored content for display on mobile devices."  The plaintiff, Wireless Ink Corporation, sued for patent infringement over the Google and Facebook websites, alleging literal infringement and infringement under the doctrine of equivalents. 

With regard to literal infringement, the Court noted that it "requires that every limitation recited in the asserted claim appear in the accused device or method. . . . Therefore, if even one limitation is not present in the accused product, there is no literal infringement."  Judge Castel then reviewed the evidence of infringement proffered by Wireless Ink in response to the summary judgment motions, and concluded that Wireless Ink had failed to come forward with evidence from which a reasonable fact-finder could find that all the claim limitations in the asserted claims in the patents-in-suit are present in the Google and Facebook websites.  In response to several of Wireless Ink's infringement arguments, the Court noted that Wireless Ink did not dispute the facts proffered by defendants but merely argued claim interpretation and ruled that where "'as here, the parties do not dispute any relevant facts regarding the accused product but disagree over which of two possible meanings of Claim 1 is the proper one, the question of literal infringement collapses to one of claim construction ans id thus amenable to summary judgment.'"  The Court adhered to its original claim construction ruling, and granted judgment in favor of Google and Facebook.  Judge Castel also dismissed Wireless Ink's claims under the doctrine of equivalents, writing that Wireless Ink conceded that it had "offered no evidence to support a theory of infringement under the doctrine of equivalents."

Patent Infringement Claims Based on ANDA Filing Dismissed as Moot

In a July 18, 2013 ruling, Judge Sidney H. Stein dismissed the patent infringement claims of Purdue Pharma, L.P. against Mylan Pharmaceuticals Inc. and Impax Laboratories over their Abbreviated New Drug Application filings for generic versions of the original formulation of OxyContin.  After the actions were filed, the Food and Drug Administration determined "that original OxyContin had been withdrawn from sale for reasons of safety or effectiveness," eliminating the ability to file an ANDA to market the drug.  Judge Stein then ordered the defendants to show cause why the suits should not be dismissed as moot, and, after considering their perfunctory responses, ruled that there "can be no doubt that Purdue's infringement actions and defendants non-infringement counterclaims are moot."  The Court also considered whether to dismiss the defendants' invalidity claims, noting that the Court "has discretion to decline to exercise jurisdiction over" a declaratory judgment action, "even though the Court has constitutional jurisdiction over that action."  Since Purdue Pharma had already filed separate suits involving the same patents against the defendants over their ANDA's for a reformulated OxyContin, Judge Stein concluded that the defendants would have the opportunity to litigate the invalidity defenses in those actions.  The Court therefore dismissed the infringement counterclaims and declined to exercise jurisdiction over the invalidity claims.