Friday, May 18, 2018

Endo mainly prevails at CAFC in case related to painkiller opioid oxymorphone



The result of this Hatch-Waxman case was mainly a victory for the patent holder Endo:


The generic drug manufacturers argued generally that
the asserted patents’ claims were invalid or not infringed.
The district court rejected those arguments and found all
asserted claims of the ’122 and ’216 patents not invalid,
and all but two asserted claims infringed. Because there
is no reversible error in the district court’s findings, we
affirm.



Of details of the district court decision:


The district court concluded that the generic drug
manufacturers failed to show that the asserted claims of
the two patents are invalid. J.A. 128–29. Specifically, the
court found that the asserted claims of the two patents
are not invalid for obviousness; that the asserted claims
with the dissolution limitations are not invalid for lack of
written description; and that the asserted claims reciting
the multiple peaks limitations are not invalid for indefiniteness.
The court also found that Endo carried its
burden to show that defendants infringe or will infringe
all but two of the asserted claims of the ’122 and ’216
patents. J.A. 72–73. The court then issued a permanent
injunction against Actavis’s manufacture, use, offer to
sell, or sale of its generic version of OPANA®ER prior to
the expiration of the ’122 and ’216 patents. J.A. 182.



Of teaching away:


Amneal contends that the court erred by finding that
oxymorphone’s low bioavailability teaches away from
attempting a controlled release formulation. Overwhelming
evidence at trial, however, supports that factual
finding. Expert testimony showed that a skilled artisan
would not have been motivated to select oxymorphone for
use in a controlled release setting because of its “exceptionally
low bioavailability.” J.A. 98. As the district court
noted, the Oshlack reference also taught that “bioavailability
is a significant, even crucial, factor in evaluating a
drug’s suitability for placement in a controlled release
vehicle.” J.A. 92. The court also observed that “[t]he
notion that low-bioavailability drugs were considered
unsuitable for extended-release formulation is reinforced
by the fact that, until Endo’s development of OPANA®ER,
there were remarkably few such examples.” J.A. 94. For
example, the existence of another low-bioavailability
drug, oxybutynin—a non-opioid analgesic, unlike oxymorphone—which
had previously been developed into a
controlled release formulation, served to underscore “the
fact that low bioavailability drugs were remarkably rare
in controlled-release settings.” J.A. 95. Indeed, “its total
absence from the expert reports of both sides, impressed
on the court that low-bioavailability drugs were, at the
time of the invention, perceived as unsuited for development
into controlled release forms.” Id. Tellingly, Appellants’
own expert maintained the view that active
ingredients with poor bioavailability would not be good
candidates for controlled release dose forms. J.A. 2769.
Appellants contend that the low bioavailability of oxymorphone
could be addressed by increasing the dosage.
The district court did not err in rejecting that argument.
The court found, based on published research, that such
an approach “risk[ed] toxicity.”

(...)

Oxymorphone’s inclusion in Maloney’s and Oshlack’s
lists of candidate molecules does not alter this conclusion.
Those lists mention oxymorphone among a vast number of
other molecules, including drugs such as heroin, opium,
and fentanyl, so the district court doubted that the lists
would be taken seriously as indicating suitability for
controlled release treatment. J.A. 96–98. The court
noted, for example, that fentanyl was widely understood
as suitable only for transdermal, not oral, delivery. J.A.
96–97. Given that context, the district court reasonably
found that a skilled artisan would not have viewed oxymorphone
as suitable for a controlled release setting.
Moreover, neither Penwest S-1 nor Cleary discloses any
technical details, such as dosing interval or twelve-hour
efficacy, for achieving the claimed inventions. J.A. 3144–
45. Accordingly, a person of ordinary skill, upon reading
those references, would have been strongly discouraged
from using oxymorphone in a controlled release setting.
The district court did not clearly err in finding that the
references taught away from the claimed invention.


Of written description


The written description requirement provides that a
patentee’s application for a patent must “clearly allow
persons of ordinary skill in the art to recognize that [he]
invented what is claimed.” Ariad Pharm., Inc. v. Eli Lilly
& Co., 598 F.3d 1336, 1351 (Fed. Cir. 2010) (en banc)
(quoting Vas-Cath Inc. v. Mahurkar, 935 F.2d 1555, 1563
(Fed. Cir. 1991)). “[T]he test for sufficiency is whether the
disclosure of the application relied upon reasonably
conveys to those skilled in the art that the inventor had
possession of the claimed subject matter as of the filing
date.” Id.



Of injunction and irreparable harm:


Endo relatedly demonstrated, mainly through trial
testimony, that it had to lay off its sales force, which may
damage its reputation in the market segment and make
the company less attractive to potential new hires. The
court found that such irreparable harm cannot be adequately
addressed without an injunction.

Anacor loses in appeal of result of IPR decision coming from petition of Coalition for Affordable Drugs





In 2015, the Coalition for Affordable Drugs X LLC
filed a petition requesting inter partes review of all 12
claims of the ’621 patent. The Board instituted review
and found that the claims would have been obvious in
light of the combination of Int’l Pat. Appl. No.
PCT/GB95/01206 (“Austin”) and U.S. Pat. Appl. No.
10/077,521 (“Brehove”). Both Austin and Brehove teach
the use of boron heterocycles as antifungal agents that
inhibit C. albicans, among other fungi. Boron heterocy-
cles are organic compounds that contain both boron and
carbon in a ring structure.2
Austin teaches the use of oxaboroles—boron heterocycles
that include a five-member ring containing three
carbon atoms, one oxygen atom, and one boron atom—as
fungicides. Austin discloses tavaborole as one of a small
group of oxaboroles that were tested for antifungal activity
and teaches that tavaborole is a highly effective agent
that inhibits a variety of fungi, including C. albicans.



Footnote 4:


Dr. Stephen Kahl, another of the petitioner’s experts,
testified to the same effect. He stated, “I think a
[person of ordinary skill] would presume that if a compound
showed significant antifungal activity against any
of a variety of fungi, would have reasonable reason to look
at those against a specific fungus and expect some success.
. . . [F]ungi are rather simple organisms. And it’s
not unusual that a compound that . . . has antifungal
activity in one fungus, might be expected or at least
evaluated in another fungus.”




Of Anacor's arguments:



On appeal, Anacor first argues that the Board violated
due process and the procedural requirements of the
Administrative Procedure Act (“APA”) by failing to provide
Anacor with adequate notice of, and an opportunity
to respond to, the grounds of rejection ultimately adopted
by the Board.
Under the APA, a patent owner involved in an inter
partes review is entitled to notice of and a fair opportunity
to address the grounds of rejection. 5 U.S.C. §§ 554(b)–
(c), 557(c); Dell Inc. v. Acceleron, LLC, 818 F.3d 1293,
1301 (Fed. Cir. 2016). Therefore, an agency “may not
change theories in midstream without giving respondents
reasonable notice of the change and the opportunity to
present argument under the new theory.” Genzyme
Therapeutic Prod. Ltd. P’ship v. Biomarin Pharm. Inc.,
825 F.3d 1360, 1366 (Fed. Cir. 2016) (quoting Belden Inc.
v. Berk-Tek LLC, 805 F.3d 1064, 1080 (Fed. Cir. 2015)).

Anacor argues that the Board’s decision violated the
APA and due process in two related ways. First, Anacor
contends that the petitioner abandoned one prior art
reference in its reply (Brehove) and shifted to a new
theory of invalidity (relying on Austin in light of Segal
and Mertin), and that the Board adopted that new theory
without giving Anacor proper notice or an opportunity to
respond to it. Second, Anacor argues that, in bolstering
this new theory of obviousness, the petitioner impermissibly
relied on new evidence, not included in the petition, to
satisfy its burden of showing a prima facie case of obviousness.
We reject Anacor’s argument that the Board violated
the APA or due process by adopting a new theory of
obviousness not presented in the petition. Unlike in In re
NuVasive, Inc., 841 F.3d 966 (Fed. Cir. 2016), on which
Anacor relies, the Board’s final written decision was
based on the same combination of references—Austin and
Brehove—and the same series of inferences that the
petition proposed.

(...)

We also reject Anacor’s argument that the Board improperly
relied on new evidence to which Anacor did not
have an opportunity to respond. Anacor argues that the
Board improperly cited two references—Mertin and
Segal—that were not cited in the petition. There is,
however, no blanket prohibition against the introduction
of new evidence during an inter partes review proceeding.
In fact, “the introduction of new evidence in the course of
the trial is to be expected in inter partes review trial
proceedings and, as long as the opposing party is given
notice of the evidence and an opportunity to respond to it,
the introduction of such evidence is perfectly permissible
under the APA.” Genzyme, 825 F.3d at 1366; see also
Novartis AG v. Torrent Pharm. Ltd., 853 F.3d 1316, 1325–
26 (Fed. Cir. 2017) (finding no APA violation because
patent owner was not “surprised” where a reference was
discussed in patent owner’s response, in depositions, and
at the hearing, because “it is quite clear that [the patentee]
had more than sufficient notice and opportunity to be
heard on [the reference’s] potential relevance”).

In addition, the petitioner in an inter partes review
proceeding may introduce new evidence after the petition
stage if the evidence is a legitimate reply to evidence
introduced by the patent owner, or if it is used “to document
the knowledge that skilled artisans would bring to
bear in reading the prior art identified as producing
obviousness.” Genzyme, 825 F.3d at 1369 (quoting Ariosa
Diagnostics v. Verinata Health, Inc., 805 F.3d 1359, 1365
(Fed. Cir. 2015)).8
It was not improper for the Board to cite Segal and
Mertin (along with Nimura) as evidence of the knowledge
that a skilled artisan would bring to bear in reading
Austin and Brehove, even though those references were
not cited in the petition. Anacor argues that Segal, Mertin,
and Nimura “surfaced for the first time in Petitioner’s
Reply,” but that is not so. Anacor discussed both Nimura
and Segal in its patent owner’s response and related
submissions; indeed, Anacor spent three pages of its
patent owner’s response addressing Segal. For that
reason, it was not improper for the Board to rely on those
references to show what a person of skill in the art would
believe about whether a compound effective against a
yeast such as C. albicans would be likely to be effective
against a dermatophyte.


Also



Anacor next argues that the Board improperly shifted
the burden of proof by requiring the patent owner to
disprove obviousness. Relying on In re Magnum Oil Tools
International, Ltd., 829 F.3d 1364 (Fed. Cir. 2016), Anacor
contends that the record provides no basis to conclude
that tavaborole’s activity against dermatophytes would be
expected and that, in adopting the petitioner’s position
without supporting evidence, the Board necessarily shifted
the burden of proof to Anacor.
Unlike in In re Magnum, nothing in the Board’s final
written decision suggests that the Board improperly
shifted the burden to the patent owner to disprove obviousness.
To the contrary, the Board expressly and repeatedly
stated that it was the petitioner’s burden to
“show[] by a preponderance of the evidence that claims 1–
12 of the ’521 patent are unpatentable.” Final Written
Decision, at 3; see also id. at 9, 10, 18, 22, 23, 37, 42

Notwithstanding those statements, Anacor argues
that the Board effectively shifted the burden of proof to
the patent owner because the Board’s conclusions rested
not on the petitioner’s presentation of evidence in support
of an argument, but rather on whether Anacor had sufficiently
disproved that argument. In particular, Anacor
contends that the Board failed to require proof from the
petitioner as to the mechanism of action that would lead
to the conclusion that tavaborole would kill both C. albicans
and dermatophytes, and that the Board did not
explain why the evidence that dermatophytes are usually
more sensitive than yeasts to antimycotics applies to
tavaborole.
In substance, Anacor’s argument is not that the Board
shifted the burden of proof to Anacor, but that the Board
improperly relaxed the burden on the petitioner to prove
its case. That argument, however, does not suggest that
the Board shifted the burden of proof to Anacor, but
instead is directed to the question whether there was
substantial evidence to support the Board’s finding of
obviousness.



Praxaire wins at CAFC



The outcome was that Praxaire won its appeal as to claim 9:



Praxair Distribution, Inc. (“Praxair”) appeals from the
inter partes review decision of the United States Patent
and Trademark Office Patent Trial and Appeal Board
(“the Board”) holding claim 9 of U.S. Patent 8,846,112
(the “’112 patent”) not unpatentable as obvious under 35
U.S.C. § 103 (2006).1 Praxair Distrib., Inc. v. Mallinckrodt
Hosp. Prods. IP Ltd., No. IPR2015-00529, 2016 WL
3648375 (P.T.A.B. July 7, 2016) (“Decision”). Mallinckrodt
Hospital Products IP Ltd. (“Mallinckrodt”) crossappeals
from the same decision holding, inter alia, claims
1–8 and 10–11 unpatentable as obvious. Because we
conclude that the Board did not err in its conclusions as to
claims 1–8 and 10–11, but did err with respect to claim 9,
we affirm the Board’s decision in part and reverse it in
part.



Of the review by the CAFC of a PTAB ruling:


Our review of a Board decision is limited. In re Baxter
Int’l, Inc. 678 F.3d 1357, 1361 (Fed. Cir. 2012). We review
the Board’s legal determinations de novo, In re Elsner,
381 F.3d 1125, 1127 (Fed. Cir. 2004), but we review the
Board’s factual findings underlying those determinations
for substantial evidence, In re Gartside, 203 F.3d 1305,
1316 (Fed. Cir. 2000). A finding is supported by substantial
evidence if a reasonable mind might accept the evidence
as adequate to support the finding. Consol. Edison
Co. v. NLRB, 305 U.S. 197, 229 (1938).



As to claim 9:



That does not end the inquiry, however, as we must
still consider whether claim 9 as a whole would have been
obvious to a person of ordinary skill at the time of the
invention. In assessing obviousness, the Board found that
Bernasconi taught that inhaled nitric oxide may lead to
pulmonary edema in patients with LVD, and emphasized
the “need for careful observation and intensive monitoring
during [nitric oxide] inhalation” in patients with LVD.
Decision, 2016 WL 3648375, at *13. Nonetheless, the
Board held that Bernasconi did not render claim 9 obvious
for two reasons, both of which we reject.
First, in addressing the differences between the prior
art and claim 9, the Board found that Bernasconi did not
“teach[] or suggest[] that treatment with [nitric oxide]
should be discontinued in pediatric patients with LVD
that experience pulmonary edema,” as required by
claim 9. Id. at *19. Rather, the Board found Bernasconi
to be “contrary to [its] interpretation of the claim language”
because Bernasconi taught “that [nitric oxide] may
be given to patients with LVD, as long as those patients
are monitored carefully during treatment.” Id. (emphasis
added). The Board’s finding is premised on an incorrect
reading of claim 9, and under the correct reading Bernasconi
is not “contrary to” claim 9. The Board conflated
excluding a patient with LVD from nitric oxide treatment
and discontinuing nitric oxide treatment in a patient with
LVD after that patient experiences a pulmonary edema.
But claim 9 does not permit, let alone require, excluding
patients with LVD from nitric oxide treatment. Instead,
claim 9 recites that nitric oxide be given to patients with
LVD, and be discontinued if a pulmonary edema occurs.
Thus Bernasconi’s teaching that patients with LVD could
be treated with nitric oxide if carefully monitored is not
contrary to the claim language, and the Board erred by
interpreting claim 9 otherwise.
Second, the Board found “compelling” Mallinckrodt’s
evidence of secondary considerations that “patients were
not excluded” from the INOT22 study, despite the known
relationship between nitric oxide treatment and pulmonary
edema for patients with LVD. Decision, 2016 WL
3648375, at *19. The Board found persuasive the inference
that “if it were obvious to a person of ordinary skill
in the art to exclude” such patients from the study, the
researchers conducting the INOT22 study would have
done so. Id. The Board’s secondary considerations analysis
also rested on its “excluding” interpretation of claim 9.
But, because we conclude that claim 9 requires administering
nitric oxide to patients with LVD, Mallinckrodt’s
evidence of secondary considerations regarding the failure
of researchers to exclude such patients from the INOT22
study lacks sufficient nexus to the claim. See Classco, Inc.
v. Apple, Inc., 838 F.3d 1214, 1220 (Fed. Cir. 2016).

In sum, both the Board’s findings regarding the differences
between the prior art and claim 9 and its findings
on secondary considerations depended on an
incorrect interpretation of that claim, and we therefore
hold that they are not supported by substantial evidence.
See In re Smith Int’l, Inc., 871 F.3d 1375, 1384 (Fed. Cir.
2017).
We also conclude that remand is unnecessary. The
Board’s uncontested findings regarding Bernasconi render
claim 9 obvious under the proper reading of the claim.


Thursday, May 17, 2018

On ending disputes prematurely. Baseball and university professors.

On Wednesday, May 16, 2018, Jorge Ortiz of USAToday headlined that Brandon Belt of the San Francisco Giants
questioned the integrity of an umpire and wrote:


On Wednesday it was the San Francisco first baseman [Belt] who expressed his frustration, in
clear and accusatory terms against home plate umpire Doug Eddings.

Belt, who took a questionable third strike for the game’s final out in the Giants’ 6-3 loss
to the Reds, said Eddings has previously expressed a desire to end games quickly and reiterated
that notion on Wednesday.

(...)

Reds closer Raisel Iglesias got the call on a 3-2 fastball that MLB.com’s Gameday showed was clearly outside.




Giants slugger Brandon Belt questions umpire's integrity after questionable call ends game


Video of call at
https://www.mlb.com/gameday/reds-vs-giants/2018/05/16/530041#game_state=final,lock_state=final,game_tab=videos,game=530041

ESPN reported:



Belt stepped to the plate with a runner on second base and two outs in the bottom of the ninth inning
at AT&T Park. Facing closer Raisel Iglesias, Belt worked the count full before plate umpire Doug
Eddings called a third strike on a fastball just off the plate to end the game .

Afterward, Belt said there was no question he got cheated on the call and insinuated that
Eddings made it to get a matinee that lasted 2 hours, 41 minutes over with.



link: http://www.espn.com/mlb/story/_/id/23524777/brandon-belt-san-francisco-giants-raw-plate-umpire-loss-vs-cincinnati-reds

Neither post went into great detail about "how far off the plate" the pitch was. The video does suggest it was not a strike. The story was the call-out of the umpire for "ending the game" prematurely.

Also of possible relevance to ending the game prematurely is the case Kenny v. Denbo, CA3, No. 17-2342, which involves themes of plagiarism, intellectual property, Blackboard software, and arbitration.

The short description given by CA3:


Adjunct Professor Robert Kenny substituted for Professor Susan Denbo while she was
on sabbatical. After an arbitration, he was suspended for borrowing her syllabus. Kenny’s
borrowing resulted from an excusable misunderstanding. Only later did evidence come out
that Denbo had passed along that syllabus specifically for the adjunct to use. But the unavailability
of certain evidence at the arbitration does not justify rescinding his settlement.



Of "ending the game prematurely," CA3 wrote of the arbitration:


After Rider’s opening statement, and ten minutes into the Union’s opening, the arbitrator
cut off the Union’s lawyer and held a sidebar conference
. When the Union’s lawyer
returned from that conference, he relayed to Kenny and to the Rider faculty’s Union representative
that the arbitrator “wanted to see a settlement,” and “gave a broad outline” of
the sort of agreement the arbitrator had in mind. DA 277. According to the Union’s lawyer,
the arbitrator felt that any settlement “needed to include [Kenny’s] suspension.” Id.
The Union’s lawyer came back to Kenny with a proposed settlement and presented it
as a fait accompli
. Kenny signed it. As part of the settlement, he apologized in writing to
Denbo and accepted a suspension for the fall of 2012. Neither side admitted wrongdoing.
Since then, Rider has not offered Kenny any teaching assignments. When Kenny applied
for unemployment compensation, Rider told the state authorities that Kenny had been suspended
for misconduct. So his application was denied.



Of plagiarism and intellectual property, CA3 wrote



Denbo sincerely believed that Kenny’s conduct amounted to
plagiarism, so her statement was not knowingly false. And her mistake about Kenny’s permission
does not amount to reckless disregard of the truth. See id. at 777. She did not give
the syllabus directly to him and was not completely unreasonable in believing that passing
it along to Sprotzer did not authorize verbatim copying. That is particularly true because
the Collective Bargaining Agreement recognized syllabi as intellectual property. No reasonable
juror could find otherwise. So the statements are privileged, not libelous



Plagiarism is copying (basically anything) without attribution. Whether or not the the Agreement recognized
syllabi as intellectual property is not relevant to the charge of plagiarism (AND there is no federal/state cause of action
for "plagiarism" AND see below about custom and practice at this school, Rider University).
CA3 did not mention who was the owner/author of the syllabi intellectual property. One might
infer, in context, that the professor owns the intellectual property of the syllabus because of the Agreement, but otherwise one might be
in a "work for hire" context. One might also suspect that there is a lot of copying of syllabi going on.

Of Blackboard, CA3 wrote:



Kenny also visited Rider’s Blackboard website, where faculty post course materials,
and downloaded a copy of the syllabus from Denbo’s web page. Denbo’s Blackboard settings,
which were not the default, let guests access her other course materials as well, including
student resources and assignments. But Kenny did not download or share them. He
tweaked the syllabus’s grading scale, but otherwise kept the readings, sequence, and assignments
verbatim. Then he uploaded the syllabus to the spring 2012 course module

(...)

Nonetheless, Denbo was “outraged!!!!!” by all this. DA 86. In a series of emails to
Rider administrators, she accused Kenny of “EXTREME unethical behavior,” fuming that
he had accessed “MY ENTIRE BLACKBOARD!!!” using the guest access permitted by
her Blackboard privacy settings. DA 99. Denbo also fulminated that Kenny’s syllabus “is
IDENTICAL to my syllabus and references all of my Blackboard materials.” Id. In followup
emails, she continued her tirade, deploying such punctuation-peppered interjections as
“UGH!!!!” and “REALLY?????????” DA 102, 105. Even though she conceded that “he
assured me that he had not posted anything yet,” she suggested that Kenny never teach at
Rider again. DA 99-100



Somewhat related to the Rutgers/San Filippo case (but with a different outcome):


Rider acceded to Denbo’s request. For the first time at Rider (as far as we know), an adjunct professor was
disciplined for using a syllabus given to him by his department chair for a course that he
was hired to substitute teach. As the Union grievance officer testified, in his thirty-eight
years at Rider, he had never seen syllabi posted with attribution. And Sprotzer conceded
that he had never heard of any university where adjuncts were given syllabi but needed to
seek further permission to use them. App. 315-16. He also admitted that Rider developed
its unwritten policy against such borrowing only after Kenny’s arbitration.



[The San Filippo case involved 14th Amendment issues. See

Flipping Filippo, Batman, Gunasekera files federal suit against Ohio U./officials
]

Initially, Kenny's defense related to his access using Blackboard:


As the Union’s letter explained, Kenny had “reasonabl[y] but inaccurate[ly] assum[ed]”
that, because Denbo made her course materials available to guests on Blackboard, she had
given implied permission to use them. DA 61. The Provost rejected these arguments and
sustained the discipline


Of the summary judgment on libel:


The District Court arguably erred in finding
that Denbo’s statements were mere opinion rather than factual. But “[w]e can affirm
the District Court’s grant of summary judgment on any basis supported by the record.”
United States ex rel. Spay v. CVS Caremark Corp., 875 F.3d 746, 753 (3d Cir. 2017)



Of the discovery issue, CA3 wrote


The Union
was not allowed to depose witnesses, but it asked for all materials collected during the
Provost’s investigation, including correspondence, emails, and Blackboard records



The interpretation of this was that if emails were not collected, they were not within the scope.
By this logic, the recipient of a discovery request could choose not to collect certain emails during
the investigation, and they would not fall within the scope of discovery.

CA3 wrote of duty to disclose:


But Kenny has produced no evidence that could justify a jury in finding a misrepresentation
here. Not turning over the three emails in question could amount to one only if Rider had
an obligation to do so. And while New Jersey does recognize that “[s]ilence in the face of
a duty to disclose may constitute a fraudulent concealment,” it imposes such a duty only in
limited circumstances. See United Jersey Bank v. Kensey, 704 A.2d 38, 43 (N.J. Super. Ct.
App. Div. 1997). This is not a case involving—at least as between Kenny and his employer—“fiduciary
relationships such as principal and agent.” Id. at 44.

Nor are settlement negotiations the kind of “transactions which in their essential nature,
are intrinsically fiduciary, and necessarily call for perfect good faith and full disclosure.”

Id. (internal quotation marks and alteration omitted). In other circumstances, the New Jersey
courts have declined to find a quasi-fiduciary relationship when the parties act “at armslength,
... in their own interest,” and stand in “essentially adversarial” positions. Id. at 44-
45 (discussing lender-borrower negotiations). All of these qualities are present in a labor
arbitration conducted, like this one, between sophisticated parties represented by counsel.




**Separately


Professor who punished plagiarists fired over FERPA>



Newark Star-Ledger does Rutgers plagiarism case on 4 Dec 2011


Trademark cancelled for failure to respond in discovery

**See especially


Harsh penalty dealt to student copying from wikipedia


which references the PatentlyO post
Plagiarism Actions

as to text


(3) “failing to consider Dr. Adames’ [own] plagiarism” (he had copied portions
of his syllabus from another professor without attribution);



AND


We may affirm the trial court's judgment after a bench trial on any basis in the record,
regardless of whether the trial court relied on that basis or whether the trial court's reasoning was
correct. Northwestern Memorial Hospital v. Sharif, 2014 IL App (1st) 133008, ¶ 25. We affirm
the trial court's judgment in favor of defendant on plaintiff's breach of contract action, not on the
grounds stated by the court (which were based solely on plaintiff's failure to appeal her dismissal
to the dean of academic affairs and on the lack of proof of damages) but rather on plaintiff's
failure to meet her heavy burden of proving that defendant acted in an arbitrary, capricious, or
bad-faith manner by dismissing her without any discernible rational basis.




concerning Drobetsky v. Chicago School of Prof. Psych.

Saturday, May 12, 2018

Plagiarism in a high school yearbook in Pensacola?



From the Pensacola News Journal article titled Escambia High rewrites yearbook page on school's racial history, claims student plagiarized :



Escambia High School administrators removed and rewrote a page from this year's student yearbook that contained information about the school's origin and race-related issues, claiming the student who wrote the page plagiarized information from the internet.

But the student, 18-year-old yearbook co-editor Sasha Slack, believes the school rewrote the page because they are "trying to change the history of Escambia High School because they’re too ashamed to admit that our school was founded as an all-white school."

In the 60th anniversary edition of the yearbook, Slack wrote about the school's pre-segregated era and the on-campus race riots of 1976. The senior said she researched multiple websites and wrote a long paragraph titled "Escambia's Past" in her own words, which the school claims to be false. [emphasis added]

(...)

Murphy said that ultimately, he did not want Slack's original writing to reflect poorly on the school.

"I just feel that we cannot allowed plagiarized work to be presented in a journalism class," Murphy said. "That is the issue here. That's the only issue here, is the plagiarism." [emphasis added]



There are several issues here

was there plagiarism? [copying without attribution]

if no plagiarism, was the motivation of the school an unfavorable portrayal in the yearbook? Was the portrayal false?

was the plagiarism claim a pretextual makeweight argument or a reasonable response to a concern about bad journalism?

Rensselaer Polytechnic Institute sues Amazon in ND NY over US Patent 7,177,798


The co-plaintiff is the exclusive licensee Dynamic Advances, a Delaware corporation whose principal
place of business is located at 1345 Avenue of the Americas, 46th Floor, New York, NY.

Paragraph 41 of the complaint refers to patent citation:



The ’798 Patent has been repeatedly cited in subsequent patent
applications filed by leading technology companies. The ’798 Patent, its published
application, or other patents within the same family, have been cited in patent
applications filed by Hewlett-Packard, Microsoft, IBM, Sony, Google, and Apple.


Complaint available at:
https://regmedia.co.uk/2018/05/11/alexapatentcomplaint.pdf

Altaire wins on evidentiary issues at CAFC; a split vote on standing, and injury-in-fact


The case is nominally an appeal of a PTAB decision:


Appellant Altaire Pharmaceuticals, Inc. (“Altaire”)
sought post-grant review of claims 1–13 (“the Asserted
Claims”) of Appellee Paragon Bioteck, Inc.’s (“Paragon”)
U.S. Patent No. 8,859,623 (“the ’623 patent”). The U.S.
Patent and Trademark Office’s Patent Trial and Appeal
Board (“PTAB”) issued a final written decision determining
that Altaire failed to prove that the Asserted Claims
were unpatentable for obviousness over two production
lots of Altaire’s phenylephrine hydrochloride ophthalmic
solution products, Lots #11578 and #11581,


There is much more going on here; from the dissent:


The undisputed facts are these: In 2011, Altaire and
Paragon entered into an agreement to pursue U.S. Food
and Drug Administration (“FDA”) approval for Altaire’s
phenylephrine hydrochloride products (the “Agreement”).
By its terms, the Agreement terminates on May 30, 2021.
See Joint Appendix (“J.A.”) 1909. Subsequently, a dispute
arose between the parties, which apparently led Altaire to
file two lawsuits in federal court in the Eastern District of
New York. In the first suit, Altaire Pharmaceuticals, Inc.
v. Paragon BioTeck, Inc., Case No. 2:15-cv-02416
(E.D.N.Y.) (“the breach of contract suit”), Altaire alleges
that Paragon breached the Agreement by, among other
things, disclosing Altaire’s confidential and proprietary
product information in its patent application and in its
resulting U.S. Patent No. 8,859,623 (“the ’623 patent”).
See Complaint and Jury Demand at 7 (No. 2:15-cv-02416)
(E.D.N.Y. April 28, 2015). P



BUT the issues decided are evidentiary in nature.


There was an initial standing issue, which was a basis for the dissent
opinion; the majority noted:


We recently “established the legal standard for
demonstrating standing in an appeal from a final agency
action,” including “the burden of production[,] the evidence
an appellant must produce to meet that burden[,]
and when an appellant must produce that evidence.”
Phigenix, Inc. v. Immunogen, Inc., 845 F.3d 1168, 1172
(Fed. Cir. 2017) (footnote omitted). We explained that
“[a]n appellant’s obligation to establish injury in fact
remains firm even though it need not meet all the normal
standards for redressability and immediacy when, as
here, a statute provides that appellant with a right to
appeal.” Id. at 1172 n.2 (internal quotation marks and
citation omitted); see 35 U.S.C. § 141(c).

(...)

While we recognize that “[a] claim is not ripe for adjudication
if it rests upon contingent future events that may
not occur as anticipated, or indeed may not occur at all,”
Texas v. United States, 523 U.S. 296, 300 (1998) (internal
quotation marks and citation omitted), we conclude that,
under these circumstances, Altaire’s injury is inevitable.
Therefore, Altaire has satisfied its burden of production
by producing sufficient evidence that the threat of infringement
litigation is an injury that is “real” and “imminent.”
Prasco, 537 F.3d at 1339.

Having determined that Altaire faces imminent injury,
we next must determine whether that injury is concrete
and particularized. See Spokeo, 136 S. Ct. at 1548
(“Particularization is necessary to establish injury in
fact . . . .”); id. (“Concreteness . . . is quite different from
particularization.”).




Graver Tank is cited:


First, § 42.65(b) does not require that the affidavit
corroborating the technical test or data be submitted by
an expert. Cf. Graver Tank & Mfg. Co. v. Linde Air
Prods. Co., 339 U.S. 605, 609 (1950) (stating that, in the
context of the doctrine of equivalents, “[p]roof can be
made in any form,” including “through testimony of
experts or others versed in the technology” (emphasis
added)).



Of evidentiary issues:


Although the PTAB “has broad discretion to regulate
the presentation of evidence,” Belden, 805 F.3d at 1081,
that discretion is not without limits, see Ultratec, Inc. v.
CaptionCall, LLC, 872 F.3d 1267, 1274 (Fed. Cir. 2017)
(stating that “[t]he agency does not have unfettered
discretion in [evidentiary] matters”). The PTAB’s decision
to assign no weight to Mr. Al Sawaya’s testimony was an
abuse of discretion. See id. at 1275 (holding that the
PTAB “abused its discretion when it refused to admit and
consider . . . trial testimony”); cf. Aqua Prods., Inc. v.
Matal, 872 F.3d 1290, 1325 (Fed. Cir. 2017) (en banc)
(plurality opinion) (“[A]n agency’s refusal to consider
evidence bearing on the issue before it is, by definition,
arbitrary and capricious within the meaning of 5 U.S.C.
§ 706, which governs review of agency adjudications.
That means that the agency must take account of all the
evidence of record, including that which detracts from the
conclusion the agency ultimately reaches.” (citations
omitted)).
(...)
On remand, the PTAB must consider Mr. Al Sawaya’s testimony when
evaluating the reliability of the TMQC-247 and optical
rotation test data.



As to evidence in a reply:


After Paragon unexpectedly challenged Altaire’s
TMQC-247 test data for failure to comply with § 42.65(b)
in its Patent Owner Response, see J.A. 1112–15, Altaire
submitted its Reply, appending additional information on
the TMQC-247 test, see J.A. 1418–25, 1505–606. This
included Exhibits 1027 and 1028. See J.A. 1505–32.
Similar to the Second Al Sawaya Declaration, Altaire
properly “respond[ed] to [those] arguments raised in
[Paragon’s Patent Owner R]esponse” by submitting additional
evidence demonstrating the reliability of the
TMQC-247 testing method. 37 C.F.R. § 42.23(b); see 5
U.S.C. § 556(d); see also Belden, 805 F.3d at 1078. To the
extent Paragon wished to contest this additional evidence,
the PTAB could have permitted Paragon to file a surreply.
See Belden, 805 at 1081.
In light of Paragon’s past reliance on the TMQC-247
test data, we conclude that the PTAB abused its discretion
by “refus[ing] to consider evidence” regarding the
reliability of the TMQC-247 testing method. Aqua, 872
F.3d at 1325 (citation omitted); see Ultratec, 872 F.3d at
1275. On remand, the PTAB shall consider all relevant
TMQC-247 information in determining whether Altaire
satisfied the requirements of § 42.65(b) and, if it did,
whether the TMQC-247 test data render obvious the
Asserted Claims.



Some odd arguments:



Finally, regarding the optical rotation test, the PTAB
determined that Paragon “presented sufficient evidence to
challenge the accuracy of estimating enantiomer purity
based on the specific rotation,” such that it “[was] not
persuaded that [Altaire]’s optical-rotation data amount to
a preponderance of the evidence to show that Altaire’s
[p]roduct[s] meet[] the chiral-purity limitations of the
[Asserted C]laims.”
J.A. 19, 20. As with the TMQC-247
test data, Paragon relied upon this optical rotation test
data before the FDA. See J.A. 783–91. Indeed, the ’623
patent itself recognizes that the optical rotation test can
be used to determine chiral purity.
See ’623 patent col. 4
ll. 33–34.

Nevertheless, the PTAB rejected the data, stating
that, “for the optical rotation data, as for the [TMQC-247]
data, [Altaire] has not provided any affidavit in compliance
with . . . § 42.65(b).” J.A. 19. However, as explained
above, see supra Section II.B–C, the PTAB abused its
discretion by refusing to consider Mr. Al Sawaya’s testimony
and the additional information on the TMQC-247
test data. To the extent the PTAB’s decision to reject as
unpersuasive the optical rotation test data rested upon
these erroneous determinations, the PTAB must reconsider
the reliability of the optical rotation test data pursuant
to § 42.65(b) on remand.




The dissent as to standing:


I start from the premise that the standing issue in
this case turns entirely on the pending litigation in the
Eastern District of New York. I say that because, although
both Altaire and the majority point to the Agreement’s
2021 termination date, Appellant’s Br. 47–48,
Majority Op. at 12, I am unable to see how the fact that
the Agreement is scheduled to terminate in 2021 supports
standing at this point. Put most simply, what we have is
a situation in which the parties to a contract that is due to
terminate in approximately three years are in a dispute.
At the same time, in view of the terms of the Agreement,
Altaire cannot infringe the ’623 patent while the Agreement
is in effect. These circumstances, it seems to me,
come nowhere near providing Altaire with grounds for
claiming that it is subject to imminent harm. Timing is
important for a showing of imminence, or immediacy.

The longer the time between when suit is initiated and
when potential infringement may occur, “the more likely
the case lacks the requisite immediacy.” Sierra Applied
Scis., Inc. v. Advanced Energy Indus., Inc., 363 F.3d 1361,
1379 (Fed. Cir. 2004).





***In passing, this is a case about enantiomers.

AIDS HEALTHCARE FOUNDATION loses appeal at CAFC


An attempt by AIDS HEALTHCARE FOUNDATION at a DJ against Gilead failed:


Healthcare argued that in view of the lengthy time
consumed by litigating patent validity, such litigation
needed to start well in advance of expiration of the fiveyear
exclusivity period. See, e.g., AHF Br. 5; Dist. Ct. Op.
at *4–5. Healthcare filed this declaratory action in January
2016, two months after the FDA approved Genvoya®—the
first TAF-containing product to receive FDA
approval.



The outcome


This appeal is from the dismissal of a declaratory
judgment action filed by AIDS Healthcare Foundation,
Inc. (“Healthcare” or “AHF”) against Gilead Sciences, Inc.
et al. (“Defendants”) in the United States District Court
for the Northern District of California.1 On appellate
review, we conclude that this action does not meet the
requirements of the Declaratory Judgment Act.




The CAFC began its discussion:



Exercise of the Constitution’s judicial power is limited
to actual cases and immediate controversies. Muskrat v.
United States, 219 U.S. 346, 356 (1911). When this constitutional
requirement is not met, a court has no authority
to decide the issues presented, whatever the
“convenience and efficiency” of such judicial action.
Hollingsworth v. Perry, 133 S. Ct. 2652, 2661 (2013)
(quoting Raines v. Byrd, 521 U.S. 811, 820 (1997)); see
Muskrat, 219 U.S. at 356 (“[U]nless [the exercise of the
judicial power] is asserted in a case or controversy within
the meaning of the Constitution, the power to exercise it
is nowhere conferred.”).



Some of the issues in this case


The existence of a patent, without more, does not create
a case of actual controversy. See Prasco, LLC v.
Medicis Pharm. Corp., 537 F.3d 1329, 1339 (Fed. Cir.
2008) (“[J]urisdiction generally will not arise merely on
the basis that a party learns of the existence of a patent
owned by another or even perceives such a patent to pose
a risk of infringement, without some affirmative act by
the patentee.” (quoting SanDisk Corp. v. STMicroelectronics,
Inc., 480 F.3d 1372, 1380–81 (Fed. Cir. 2007))).

Healthcare presents several additional arguments for
declaratory jurisdiction, including that (1) Healthcare is
an indirect infringer of the TAF patents based on its
requests to potential producers to provide the patented
products; (2) Gilead’s non-response to Healthcare’s request
for a covenant not to sue created a present controversy;
and (3) public policy favors invalidation of invalid
patents and thus the testing of “weak” patents. The
district court, receiving all of Healthcare’s arguments,
correctly held that the declaratory judgment criteria were
not met.



No immediacy here:


Healthcare argues that it meets this requirement because
of the lengthy time required for patent litigation,
such that an immediate start is needed. However, the
time consumed by litigation of a speculative future controversy
does not provide the “immediacy and reality”
required for declaratory judgment actions
; nor is a declaratory
tribunal precluded from providing expedited relief
when such is warranted. In this case, where there is no
present infringement, no threat of or possibility of infringement
litigation, and no meaningful preparation to
infringe, the “immediacy and reality” criteria are not met.
See, e.g., Prasco, 537 F.3d at 1338–39

(...)

The district court observed the absence of evidence of
preparation to produce a product covered by any of the
TAF patents, and found “significant uncertainty about the
nature of any hypothetical product.” Dist. Ct. Op. at *5.
The uncertainty of whether future infringement might
occur at all weighs against the immediacy and reality
requirement of declaratory action. Matthews, 695 F.3d at
1328–29. In addition, precedent illustrates that the mere
possibility of future infringement does not meet the
immediacy and reality criteria, for “[a] party may not
obtain a declaratory judgment merely because it would
like an advisory opinion,” id. at 1329 (quoting Cat Tech,
528 F.3d at 881). For example, in Benitec Australia, Ltd.
v. Nucleonics, Inc., 495 F.3d 1340, 1349 (Fed. Cir. 2007),
this court held that a representation that the declaratory
plaintiff “expects to begin work shortly” on “potentially
infringing” activities was of insufficient immediacy to
support a declaratory action.



Also


Liability for induced infringement requires that some
other entity is directly infringing the patent. Power
Integrations, Inc. v. Fairchild Semiconductor Int’l, Inc.,
843 F.3d 1315, 1331 (Fed. Cir. 2016).



Fina was distinguished


In Fina Research, the declaratory plaintiff was a foreign
entity that was manufacturing and selling an ingredient
of drilling mud abroad; the holder of United States
patents on compositions containing the drilling mud had
sent letters to the foreign producer, stating that the
patentee would sue for infringement if the ingredient
were introduced in the United States. The court held that
such a direct threat of suit against an existing product
and its producer established declaratory jurisdiction.
Fina Research, 141 F.3d at 1482–84; see also SanDisk,
480 F.3d at 1382 (describing how the presentation of “a
thorough infringement analysis” and “element-byelement”
product analyses created a case or controversy
supporting declaratory judgment jurisdiction). In contrast,
here the record does not refer to threats of litigation
on importation of existing product, or even an identification
of any product whose importation may violate Gilead’s
patent rights. No such TAF-containing products are
reported to exist.



As to policy arguments:


Healthcare argues that public policy is served by invalidation
of invalid patents, and thus supports immediate
challenge to the “weak” TAF patents. Yet the HatchWaxman
Act is already a balance of several policy interests,
seeking to preserve the patent incentive to invent
new drugs, while enabling validity challenge by ANDA
filers before actual infringement occurs. Andrx Pharm.,
Inc. v. Biovail Corp., 276 F.3d 1368, 1371 (Fed. Cir. 2002).
The present policy reflects a balance of several factors
and public interests; any policy change would require reexploration
of all aspects. Healthcare’s proposal of a
change in policy to facilitate challenge to drug patents
would warrant legislative consideration, not departure
from precedent. SAS Inst., Inc. v. Iancu, 138 S. Ct. 1348,
1358 (2018) (“Policy arguments are properly addressed to
Congress, not this Court.”)


Thursday, May 10, 2018

2018 article in Slate re-cycles "secret" inventions


Back in 2009, IPBiz had a post titled
The "patent control policy" of World War II and US 2,852,687
which in part related to "secret" patents
and included the text:


Fortunately for [Vannevar] Bush, however, U.S. patent law had been specifically amended so as to permit patent applications to be ordered held in secret in extraordinary circumstances. The original legislation had been passed during World War I to allow patents with military implications to be declared “secret” during wartime, and in 1940 and 1941 the statute had been revised to apply during peacetime as well and to have stiffer penalties associated with the violation of secrecy orders (the original penalty having been simply loss of patent title).33 The result of this legislative action was Public Law No. 700, a bill that allowed the Patent Office (via the authority of the Commissioner of Patents) to declare patent applications secret, preventing both their publication and access in the United States and
also blocking their filing outside of the country. The question of whether the application would be granted was put on hold until the secrecy order had been lifted. If the patent was eventually granted, the inventor could then work out problems of interference with subsequently granted patents and could sue for compensation if the government had used the patent in the interim.



Fast forward to the year 2018, and ARVIND DILAWAR has a post at Slate titled The U.S. Government’s Secret Inventions which included the text


Invention secrecy in the U.S. dates back to at least the 1930s, but it really took off in the ’40s, when the development of nuclear weapons was shrouded in classification.



See also the post in the July 2009 issue of Inventors Digest The government is classifying more innovations as secret in the name of national security.

The 2018 article in Slate is treading old ground

Wednesday, May 09, 2018

Did "60 Minutes" mislead viewers about the drug Acthar on May 6, 2018?

CBS "60 Minutes" on May 6, 2018 aired a piece which was critical of the company Mallinckrodt in its handling of the drug Acthar, which drug comprises an adrenocorticotropic hormone. There has been some push-back, in part about the way "60 Minutes" suggested that Mallinckrodt bought out a company with a competing drug Synacthen, and then deep-sixed the drug. If it is true, as the push-back states, that -- Synacthen has never been approved by the FDA for use in the U.S. for any indication and it is not an alternative treatment for IS in the U.S. --, then "60 Minutes" has some explaining to do.

The StreetInsider quoted the Mallinckrodt website as to the "60 Minutes" segment which aired on 6 May 2018:


On Sunday, May 6, 2018 CBS' 60 Minutes aired a segment entitled “Why Does Your Prescription Cost So Much?”, or “The Rockford File”, centered on claims made in a lawsuit brought by the City of Rockford, Illinois, alleging among other things, wrongdoing by Mallinckrodt and other companies related to the price and distribution of one of Mallinckrodt’s prescription medications, H.P. Acthar Gel, in the United States.

Prior to its airing, we communicated extensively with the producer of the segment and provided 60 Minutes with detailed and factual responses to their questions. It is unfortunate that 60 Minutes did not provide a full, balanced counterpoint to the claims made about Mallinckrodt and H.P. Acthar Gel.




Also, within the StreetInsider piece:


Synacthen is not a generic competitor to H.P. Acthar Gel. While the two drugs may share mechanistic effects through the ACTH component, H.P. Acthar Gel is much more. H.P. Acthar Gel is a biologically derived corticotropin drug – not a steroid – and amongst its many components includes a 1-39 peptide chain, meaning it includes more than simply ACTH. Synacthen is a synthetic ACTH 24-peptide chain. The two products are very different drugs.

Mallinckrodt did not pursue commercialization of Synacthen for IS, as the barriers to completion were, in our view, virtually impossible to overcome.

Synacthen has never been approved by the FDA for use in the U.S. for any indication and it is not an alternative treatment for IS in the U.S.
In all the time that Synacthen has been commercially available in select foreign countries, it has never been commercialized in the U.S. and no owner of Synacthen (including the owner prior to Questcor) ever undertook U.S. development of the drug in IS or any other indication.
Even in Canada, where Synacthen is approved and used in certain indications, it is not approved for use in IS patients. In fact, in Canada, the label contains a warning against use in infants or children under 3 years old due to the product containing benzyl alcohol.
Mallinckrodt is developing the drug (MNK-1411) in an indication where there is both high unmet medical need and, if successful, potential for greatest impact for patients – Duchenne Muscular Dystrophy.



link: https://www.streetinsider.com/Corporate+News/Mallinckrodt+%28MNK%29+Provides+Facts+on+H.P.+Acthar+Gel+in+Resonse+to+CBS+60+Minutes/14151942.html


Although not mentioned in the "60 Minutes" piece, Acthar is used in dealing with exacerbations in multiple sclerosis. From the National MS website:


H.P. Acthar Gel is a highly purified preparation of adrenocorticotropic hormone (ACTH) in a gel that is designed to provide extended release of the ACTH following injection. ACTH stimulates the adrenal cortex gland to secrete cortisol, corticosterone, and aldosterone.

ACTH was approved in 1978 by the U.S. Food and Drug Administration (FDA) as a short-term treatment for acute exacerbations of MS. According to its FDA labeling, corticosteroids (such as methylprednisolone or dexamethasone) are considered the treatment of choice for acute exacerbations.


link: https://www.nationalmssociety.org/Treating-MS/Medications/H-P-Acthar%C2%AE

In this MS example, there are available alternatives to Acthar.

WesternGeco, winner in court, loses at PTAB, CAFC. Exxon v. Lubrizol cited.



In WesternGeco v. Ion Geophysical:



The Board issued six final written decisions, finding
all of the instituted claims in the six proceedings to be
unpatentable as anticipated or obvious. It also rejected
WesternGeco’s arguments that the IPR proceedings were
time-barred under 35 U.S.C. § 315(b). We conclude that
substantial evidence supports the Board’s unpatentability
determinations, as well as its conclusion that the proceedings
were not time-barred. We thus affirm the Board’s
decisions.



The business involved:


WesternGeco, PGS, and ION are all participants in
the marine seismic survey industry. WesternGeco
launched its commercial steerable streamer system, the
Q-Marine, in 2000. J.A. 4794. Subsequently, PGS commissioned
ION to design and build a competing commercial
streamer system, the DigiFIN, which launched
several years later. Id.



In court, the WesternGeco patents were found infringed and VALID:


In August 2012, a jury
returned a verdict finding ION had infringed all four
patents asserted and that ION had failed to prove that
any of the asserted patents were invalid. On appeal, this
court affirmed all aspects of the District Court’s judgment
except for willful infringement and damages.



BUT, later at PTAB:


The Board issued six final written decisions (two decisions
per patent), finding that various claims were either
anticipated by or would have been obvious over several
prior art references. See generally Petroleum Geo-Servs.,
Inc. v. WesternGeco L.L.C. (PGS I), No. IPR2014-00687,
2015 WL 10378275 (P.T.A.B. Dec. 15, 2015)



The legal issues before the CAFC in 2018:


WesternGeco contends that the Board’s decisions invalidating
claims of the WesternGeco Patents are wrong
on the merits and should be reversed. But WesternGeco
argues we need not reach the merits because Wi-Fi One
has made time-bar decisions under § 315(b) judicially
reviewable, and, as a threshold matter, we should vacate
and dismiss the petitions as time-barred. In WesternGeco’s
view, (1) ION was served with a patent infringement
complaint well over a year before the IPR petitions
were filed and unquestionably would have been timebarred
from filing any petitions challenging the WesternGeco
Patents had it not been joined with PGS’s petitions;
and (2) PGS’s petitions should be time-barred because
ION was a “real party in interest,” or “privy” of PGS.
Consequently, WesternGeco argues that the Board never
should have instituted the requested IPRs because no
party timely filed the petitions



An interesting issue as to the meaning of "privy":


Neither the AIA nor the Patent Act defines the statutory
term “privy.” But “privy” is a well-established common-law
term, and it is a “cardinal rule of statutory
construction” that where Congress adopts a common-law
term without supplying a definition, courts presume that
Congress “knows and adopts the cluster of ideas that were
attached” to the term. FAA v. Cooper, 566 U.S. 284, 291–
92 (2012); Microsoft Corp. v. i4i P’ship Ltd., 564 U.S. 91,
103–04 (2011). Where Congress adopts a term that is
used in common law across multiple legal subjects, courts
“cannot rely on any all-purpose definition but must con-
sider the particular context in which the term appears.”
Cooper, 566 U.S. at 294.5

The AIA’s legislative history supports adopting the
common law meaning of privity. The proposed administrative
review procedures, including IPR, were intended
to provide “quick and cost effective alternatives to litigation.”
H. REP. NO. 112-98, at 48 (2011). Another expressed
congressional goal was to “establish a more
efficient and streamlined patent system that will improve
patent quality[.]” Id. at 40. At the same time, Congress
recognized the importance of protecting patent owners
from patent challengers who could use the new administrative
review procedures as “tools for harassment.” Id.
(“While this amendment is intended to remove current
disincentives to current administrative processes, the
changes made by it are not to be used as tools for harassment
or a means to prevent market entry through repeated
litigation and administrative attacks on the validity of
a patent.”).

(...)

But, importantly, the reach of privity cannot extend
beyond the limits of due process. In Taylor v. Sturgell,
the Supreme Court observed that a person who was not a
party to a suit generally has not had a “full and fair
opportunity to litigate” the claims and issues settled in
that suit. 553 U.S. at 894. Because nonparty preclusion
risks binding those who have not had a full and fair
opportunity to litigate, the Supreme Court has cautioned
that there is a general rule against nonparty preclusion,
subject to certain exceptions. Id. at 892–93; see Aspex
Eyewear, Inc. v. Zenni Optical, Inc., 713 F.3d 1377, 1382
(Fed. Cir. 2013) (“A full and fair opportunity to litigate is
the touchstone of any preclusion analysis.”); see also Cal.
Physicians’ Serv., 163 Cal. App. 4th at 1522 (“Notions of
privity have been expanded to the limits of due process.”).



IN THIS CASE:


Substantial evidence supports the Board’s finding
that ION lacked the opportunity to control PGS’s IPR
petitions. See Taylor, 553 U.S. at 894; Wi-Fi One, LLC v.
Broadcom Corp., No. 2015-1944, 2018 WL 1882911, at *8
(noting control as a factor to determine privity). The
Board found no evidence to suggest that ION directed,
funded, controlled, or influenced the PGS IPR petitions.
See J.A. 35–38, 198–99, 204–06. Nor is there evidence
supporting WesternGeco’s contention that ION used PGS
as a proxy. Id. The litigation history suggests that PGS
filed its IPRs as a defensive measure in response to WesternGeco’s
lawsuit against PGS, rather than at ION’s
instruction. When ION tried to join the IPRs, PGS actively
opposed the attempted joinder. Even when ION was
joined, the PTO gave ION only spectator status. Moreover,
ION did not disclose any prior art references to PGS
in connection with the IPR proceedings, nor did it pay for
PGS’s IPRs. The Board reasonably found that ION did
not control or direct the IPR petitions.

(...)

For these reasons, we affirm the Board’s conclusion
that PGS and ION are not privies within the meaning of
§ 315(b).8 Substantial evidence supports the Board’s
conclusion that ION’s relationship with PGS is not sufficiently
close such that the ION proceeding would have
given PGS a full and fair opportunity to litigate the
validity of the claims of the WesternGeco Patents. Accordingly,
the petitions are not barred under 35 U.S.C.
§ 315(b).



As to the merits of the validity issue for the '607 patent:


The only merits issue on appeal for the ’607 Patent is
the construction of the claim term “predicting positions.”
The Board construed this term to mean “estimating the
actual locations” of streamer positioning devices. J.A. 54–
60, 226–32. By contrast, WesternGeco’s proposed construction
requires the prediction to be performed in a
particular way—using “behavior-predictive model-based
control logic.” Id. After considering the intrinsic evidence,
we agree with the Board’s construction.



Of a hindsight argument:



WesternGeco objects to the Board’s conclusion as impermissible
hindsight. That argument lacks force in this
case. PGS’s expert testified from the perspective of one of
ordinary skill in the art as of the priority date, and WesternGeco
identifies nothing to suggest that his testimony
or the other evidence cited by the Board invoked facts
unavailable to the skilled artisan as of the priority date.
J.A. 11107, 20340–61. As discussed, substantial evidence
before the Board shows that one of ordinary skill would
have been motivated to modify Workman to attempt to
keep streamers straight and parallel, whether in a zero or
non-zero feather angle mode, with a reasonable expectation
of success.
The Board appropriately relied on the prior art and
expert testimony about how the skilled artisan would
have modified the prior art. Substantial evidence supports
its obviousness determination.


Exxon v. Lubrizol is cited:


Contrary to WesternGeco’s argument, the Board was
permitted to issue a new construction in the final written
decision given that claim construction was a disputed
issue during the proceedings. See Intellectual Ventures II
LLC v. Ericsson Inc., 686 F. App’x 900, 905 (Fed. Cir.
2017). Moreover, the Board is not bound to adopt either
party’s preferred articulated construction of a disputed
claim term. See Exxon Chem. Patents, Inc. v. Lubrizol
Corp., 64 F.3d 1553, 1556 (Fed. Cir. 1995); see also Homeland
Housewares, LLC v. Whirlpool Corp., 865 F.3d 1372,
1376 (Fed. Cir. 2017).

The facts in this case can be distinguished from SAS
Institute, Inc. v. ComplementSoft, LLC, 825 F.3d 1341,
1351 (Fed. Cir. 2016), rev’d and remanded on other
grounds, SAS Institute, Inc. v. Iancu, --- S. Ct. ---, No. 16-
969 (Apr. 24, 2018), on which WesternGeco relies. In
SAS, the Board construed the relevant term in its institution
decision, but in the final written decision sua sponte
issued and adopted a significantly different construction,
even though neither party had disputed the Board’s
original construction and premised their arguments in the
proceeding on that construction. Because the appellant
had no notice that the Board’s construction could change
or an opportunity to address the new construction, this
court vacated the decision and remanded on that issue.
Id. at 1351–53.



One notes that Exxon v. Lubrizol had nothing to do with a
Board decision:


The central issue in this appeal is claim interpretation. Exxon's claims are to a lubricating oil composition suitable for use as a crankcase lubricant in internal combustion engines. The claimed composition is defined as comprising--meaning containing at least--five specific ingredients. Exxon contends that its patent claims a "recipe" of ingredients that extends to any product made by using the claimed ingredients, even if the product itself--as a result of chemical complexing--fails to include one of the claimed ingredients. Lubrizol argues that since Exxon claims a composition product--not a process for making a product or a product made by a claimed process--the '890 patent only extends to final products that include the specified claimed ingredients.

4
The trial judge, candidly expressing considerable difficulty in understanding the chemistry and law involved in the case, treated the issue of claim interpretation as a matter of deciding which of the two parties offered the correct meaning of the claims. The jury was charged according to Exxon's preferred claim interpretation.

(...)

More often, however, it is likely that the adversaries will offer claim interpretations arguably consistent with the claims, the specification and the prosecution history that produce victory for their side. In any event, the judge's task is not to decide which of the adversaries is correct. Instead the judge must independently assess the claims, the specification, and if necessary the prosecution history, and relevant extrinsic evidence, and declare the meaning of the claims. No matter when or how a judge performs the Markman task, on appeal we review the issue of claim interpretation independently without deference to the trial judge.

(...)

We thus hold that the judge erred as a matter of law in giving Exxon's preferred claim interpretation to the jury, and in using that interpretation in ruling on Lubrizol's post trial motion. Under the proper charge, the jury would not have been asked if Lubrizol used Exxon's starting ingredients. Instead, the jury would have been asked to find whether Exxon had proved by a preponderance of the evidence that Lubrizol's products at some time contained each of the claimed recipe ingredients in the amounts specifically claimed.

(...)

Because Lubrizol is entitled to a judgment of noninfringement as a matter of law and thus to vacation of the order awarding Exxon its attorneys' fees and costs and of the injunction entered against Lubrizol, we need not reach the other grounds asserted by Lubrizol for reversal of the judgment of infringement or in the alternative for a new trial. Because there is no basis for a damage award against Lubrizol, we vacate the damage award in appeal No. 94-1309.

CAFC rules "a change in shading" is a change in shape in Valmont case


The outcome of an appeal of a PTAB inter partes review decision :


Valmont Industries, Inc. (“Valmont”) appeals from the
final decision of the Patent Trial and Appeal Board (“the
Board”) in an inter partes review, finding claims 1–10,
12–15, 17, and 18 of U.S. Patent No. 7,003,357 B1 (“the
’357 patent”) unpatentable as obvious. Lindsay Corp.
(“Lindsay”) cross-appeals the Board’s determination that
claim 11 was not obvious. We affirm the Board’s determination
of obviousness with respect to claims 1–10, 12–15,
17, and 18 and reverse as to claim 11.



As to evidentiary issues:


No statutes or rules prohibit a petitioner from submitting
additional evidence after the petition, and § 42.23(b)
specifically permits it. Our case law makes clear that a
petitioner may submit additional evidence in the reply in
response to the patent owner response. In Belden Inc. v.
Berk-Tek LLC, 805 F.3d 1064, 1080 (Fed. Cir. 2015), we
held that a patent owner “ha[d] not established that it
was denied its procedural rights” when a petitioner submitted
a new declaration with its reply. See also Altaire
Pharms., Inc. v. Paragon Bioteck, Inc., No. 2017-1487, Slip
Op. at 14–17 (Fed. Cir. Apr. 25, 2018) (finding an abuse of
discretion when the Board failed to consider a second
declaration submitted with a reply that responded to
arguments raised in the corresponding patent owner
response); Genzyme Therapeutic Prod. Ltd. P'ship v.
Biomarin Pharm. Inc., 825 F.3d 1360, 1364–69 (Fed. Cir.
2016) (finding it permissible for the petitioner to cite two
references in the reply that were not cited in the petition
to show the state of the art at the time). Thus, the Board
did not violate its rules or due process requirements in
concluding that the second Rosenberg declaration fairly
responds only to arguments made in Dr. Mercer’s declaration
and Valmont’s response.

The Board’s procedures in IPR proceedings provide
the patent owner with notice and opportunity to respond
as required by due process and the Administrative Procedure
Act. See 5 U.S.C. § 554(b)(3), (c), (d); In re Biedermann,
733 F.3d 329, 336–37 (Fed. Cir. 2013); Abbott Labs.
v. Cordis Corp., 710 F.3d 1318, 1328 (Fed. Cir. 2013).



Of claim 11:


The first question is whether shading constitutes a
change in “shape.” In matters of claim construction before
the Board as to unexpired patents, we apply the broadest
reasonable construction standard. Cuozzo, 136 S. Ct. at
2144–45. The Board concluded that “shading within the
original GUI does not change the shape of the GUI.” J.A.
36. However, we conclude that a change in shape occurs
when there is a change in pattern, such as through shading.




The CAFC then stated:


Webster’s dictionary defines “shape” as “the visible
makeup characteristic of a particular item or kind of
item.” Webster’s Third International Dictionary 2087
(2002). A change in shading falls within this definition as
it is a change in the visible makeup characteristics of the
circle.

(...)

Under the broadest reasonable construction standard,
a change in shape occurs when there is a change in shading.




The CAFC disagreed with PTAB:


The Board also determined that Abts did not disclose
GUIs shaped to identify an irrigation pattern. However,
we conclude that the circle-shaped GUIs in Abts are
shaped to identify an irrigation pattern. The Board’s
contrary decision is not supported by substantial evidence.


CAFC disputes Wright, Federal Practice & Procedure in In re: HTC CORPORATION



**

Given the availability
of adequate relief on appeal, mandamus review of improper-venue
decisions is generally inappropriate. See
Bankers Life & Cas. Co. v. Holland, 346 U.S. 379, 379–84
(1953) (holding that mandamus review of an impropervenue
decision was inappropriate and noting it was not
clear that an adequate remedy could not be afforded);

**

As to an argument about the inefficiency of having to go
to final judgment before being heard as to improper venue:


Although Petitioner argues that it should “not be
forced to litigate this case in an improper venue through a
final judgment before it can contest venue via appeal,”
Pet’r’s Br. 6, the Supreme Court rejected this same argument
in Bankers Life, explaining that “the extraordinary
writs cannot be used as substitutes for appeals, even
though hardship may result from delay and perhaps
unnecessary trial.” Bankers Life, 346 U.S. at 383 (citations
omitted); see also Comfort Equip., 212 F.2d at 375
(“If the correctness of [the judge’s] ruling on the [improper-venue]
motions to dismiss must await an appeal from
the final disposition of the case on its merits in the district
court, there is no unusual inconvenience or hardship.”).
Decisions of this court and the Third Circuit
reflect that reasoning. See In re BP Lubricants USA Inc.,
637 F.3d 1307, 1313 (Fed. Cir. 2011) (“To issue a writ [of
mandamus] solely for th[e] reasons [that a defendant will
be forced to undergo the cost of discovery and trial] would
undermine the rare nature of its form of relief and make a
large class of interlocutory orders routinely reviewable.”
(citing Bankers Life, 346 U.S. at 383)); Gulf Research, 193
F.2d at 304–05 (“The mere fact that the petitioners will be
put to the inconvenience and expense of what may prove
to be a wholly abortive trial is an argument which might
be addressed to Congress in support of legislation authorizing
interlocutory appeals but does not constitute ground
for invoking mandamus power.”)



Thus, the CAFC stated


, there may be circumstances in
which it is inadequate. We need not articulate such
circumstances here, as Petitioner’s only argument is that
it should be able to avoid the inconvenience of litigation
by having this issue decided at the outset of its case. This
is insufficient, and there is no other indication that Petitioner
cannot be afforded adequate relief on appeal.



A separate part of the case involved aliens and venue statutes:


the “long-established rule that suits
against aliens are wholly outside the operation of all the
federal venue laws, general and special.” Id. at 714. The
Court thus upheld the alien-venue rule and held that the
Canadian corporation defendant in that case, Brunette
Machine Works, Ltd., could not rely on § 1400(b) as a
“shield” against suit in a particular district. Id.




Note footnote 9


For all of the reasons we have recited, including
the TC Heartland decision, we do not think that the
statute is properly read to adopt the view on this point
expressed by the American Law Institute Federal Judicial
Code Revision Project 146–47, 200–01 (2004), from which
the 2011 legislation derived through a process that
changed the ALI’s proposal (which included repeal of
§ 1400) and produced a quite different congressional
committee explanation. We also do not adopt the brief
statement on the issue in Wright, Federal Practice &
Procedure § 3810 (“Because nothing in the statute limits
the application of Section 1391(c)(2) to entities formed in
the United States, the provision governs venue in cases
involving entities formed in foreign countries.” (citing
Poliseno v. Credit Suisse Secs. (USA), LLC, 2013 WL
499509 (D. Mont. Feb. 8, 2013), report & recommendation
adopted, 2013 WL 1767951 (D. Mont. Apr. 24, 2013))).

Wednesday, May 02, 2018

Companies in CRISPR


Celgene is selling part of its share in CRISPR Therapeutics.


From FiercePharma:




Bill Lundberg, M.D., has stepped down as CSO of CRISPR Therapeutics. News of Lundberg’s departure emerged on the same day
Celgene revealed it has sold another chunk of its once-double-digit stake in the CRISPR/Cas9 gene editing startup.

Lundberg landed at CRISPR in 2015 with a brief to lead the establishment of its R&D operation. With the Cambridge, MA
facility ticking over and the most advanced candidates developed at the site on the cusp of the clinic,
Lundeberg is moving on. Lundberg’s departure is immediate but the ex-Alexion VP will continue to help CRISPR as a senior advisor and as head of its scientific advisory board.

The departure leaves CRISPR without a CSO. In the absence of Lundberg, Tony Ho, M.D., will oversee CRISPR’s R&D activities.
CRISPR appointed Ho, who previously worked at AstraZeneca and Merck, as its head of R&D in August. Ho inherits a broad
preclinical pipeline of ex vivo and in vivo CRISPR/Cas9 programs CRISPR hopes will quell doubts about whether the technology is ready for prime time.



link: https://www.fiercebiotech.com/biotech/crispr-cso-departs-as-celgene-continues-to-sell-stock.


Delgene has a tie-in to Editas:



Editas is partnering with Juno Therapeutics, which was acquired by Celgene earlier this year, on use of CRISPR
to engineer T cells for treating cancer. The company thinks its technology could significantly expand the types of cancer that can be treated by CAR-T.


Taken from Motley Fool, https://www.fool.com/investing/2018/05/01/top-gene-editing-stocks-for-long-term-investors.aspx

CAFC shuffles from mootness to lack of jurisdiction


The technology involved card shufflers for gaming:



SHFL supplies gaming products, such as automatic
card shufflers used in casinos. It owns the ’935 and ’982
patents, which share a common specification that discloses
card shuffling devices and methods of randomizing
cards using the shuffling devices. DigiDeal similarly
manufactures and markets gaming equipment, including
an automatic single deck card shuffler known as the
DigiShuffleTM (DigiShuffle).



An issue was the distinction in dismissal for mootness vs.
lack of jurisdiction:



Suits based on cancelled claims must be dismissed for
lack of jurisdiction, however. Foster v. Carson, 347 F.3d
742, 745 (9th Cir. 2003) (“Mootness is a jurisdictional
issue, and federal courts have no jurisdiction to hear a
case that is moot, that is, where no actual or live controversy
exists. If there is no longer a possibility that an
appellant can obtain relief for his claim, that claim is
moot and must be dismissed for lack of jurisdiction.”
(citations and quotation marks omitted)); see also Target
Training Int’l, Ltd. v. Extended Disc N. Am., Inc., 645 F.
App’x 1018, 1023 (Fed. Cir. 2016) (upholding the district
court’s dismissal for lack of jurisdiction because Fresenius
rendered the suit moot as to the claims cancelled after
reexamination). Accordingly, we vacate the entry of
summary judgment as to the cancelled claims of the ’935
patent, and remand for the district court to dismiss the
claims from the action for lack of jurisdiction.



AND


SHFL Entertainment, Inc. sued DigiDeal Corporation
in the U.S. District Court for the District of Nevada for
infringement of U.S. Patent Nos. 6,651,982 and 7,523,935.
While the litigation was pending, the U.S. Patent and
Trademark Office reexamined the patents, cancelling all
originally asserted claims of the ’935 patent and confirming
a new claim as patentable, and confirming all originally
asserted claims of the ’982 patent in their amended
form and two new claims as patentable. Based on the
results of the reexaminations, the court found the entire
suit moot and entered summary judgment against SHFL.
The district court correctly found the case moot as to
the cancelled claims of the ’935 patent. Suits based on
cancelled claims must be dismissed for lack of jurisdiction,
however. We thus vacate the entry of summary judgment
as to the cancelled claims, and remand for the court to
dismiss that part of the action for lack of jurisdiction.
In addition, the court failed to determine whether the
new and amended claims that emerged from the reexaminations
of the two patents are substantially identical to
the claims originally asserted in the action. We therefore
vacate the grant of summary judgment as to those claims,
and remand for the court to make that determination.


Tuesday, May 01, 2018

CAFC reverses MD Ga on "failure to state a claim" in Disc Disease Solutions; form 18 and Iqbal/Twombly


The outcome:



The district court erred when it
dismissed the complaint for failure to state a claim. We
reverse the district court’s grant of the motion to dismiss
and remand for further proceedings.


This case, in part, relates to "Form 18":


On November 30, 2015, Disc Disease Solutions Inc.
(“Disc Disease”) filed a complaint for patent infringement
alleging that VGH Solutions’ products infringe the ’113
and ’509 patents. The complaint specifically identified
VGH Solutions’ products and alleged that the products
meet “each and every element of at least one claim of the
’113 [or ’509] Patent, either literally or equivalently.” J.A.
54–55. Disc Disease attached to the complaint the asserted
patents and photographs of the accused products.

The following day, on December 1, 2015, amendments
to the Federal Rules of Civil Procedure took effect, abrogating
Rule 84 and Form 18. Supreme Court of the
United States, Order Regarding Amendments to the
Federal Rules of Civil Procedure (U.S. Apr. 29, 2015).1
The Supreme Court’s abrogation order states that the
amendments “shall govern in all proceedings in civil cases
thereafter commenced and, insofar as just and practicable,
all proceedings then pending.” Id. Rule 84 provided
that “[t]he Forms in the Appendix suffice under these
rules and illustrate the simplicity and brevity that these
rules contemplate.” Fed. R. Civ. P. 84 (2007) (abrogated,
eff. Dec. 1, 2015). Form 18 in the Appendix of Forms
provided a form adequate to plead a direct infringement
patent claim



The CAFC wrote:


The district court determined that Disc Disease failed
to “explain how Defendants’ products infringe on any of
Plaintiff’s claims” because it “merely alleges that certain
of Defendants’ products ‘meet each and every element of
at least one claim’ of Plaintiff’s patents.” Disc Disease,
2016 WL 6561566, at *3. We disagree. Disc Disease’s
allegations are sufficient under the plausibility standard
of Iqbal/Twombly. This case involves a simple technology.
The asserted patents, which were attached to the
complaint, consist of only four independent claims. The
complaint specifically identified the three accused products—by
name and by attaching photos of the product
packaging as exhibits—and alleged that the accused
products meet “each and every element of at least one
claim of the ’113 [or ’509] Patent, either literally or equivalently.”
J.A. 54–55. These disclosures and allegations
are enough to provide VGH Solutions fair notice of infringement
of the asserted patents. The district court,
therefore, erred in dismissing Disc Disease’s complaint for
failure to state a claim.



It is important to read footnote 3:


We do not address the question of whether the
Form 18 or the Iqbal/Twombly pleading standard applies
in this case as we conclude that Disc Disease’s claims of
patent infringement were sufficiently pleaded under the
latter. See Lifetime Indus., Inc. v. Trim-Lok, Inc., 869
F.3d 1372, 1377 (Fed. Cir. 2017) (“The parties assume
that there is a difference between the requirements of
Form 18 and Iqbal/Twombly; however, we have never
recognized such a distinction. In any event, we need not
resolve the question whether there is a difference between
the two standards here because, as we explain, the [complaint]
met the Iqbal/Twombly standard.” (citation omitted).

TAOS wins on liability, but damages have to be re-assessed. A case of multiple trade secrets.



In a mixed decision, plaintiff TAOS won on liabilty but the monetary award decision was vacated:


We now affirm in part, reverse in part, vacate in part,
and remand. Among our rulings, we affirm liability for
trade secret misappropriation, though on a more limited
basis than TAOS presented to the jury, and we affirm
liability for infringement of the asserted apparatus claims
of the patent at issue. But we vacate the monetary
awards, and we remand for further proceedings.



The basis of decision was modified


[Defendant] Intersil argues that we must reverse the jury verdict
of liability for trade secret misappropriation. We disagree,
although we agree that the verdict cannot properly
rest on some of the bases TAOS presented to the jury.

(...)

Intersil has persuasively shown that the misappropriation
verdict cannot properly rest on two of TAOS’s theories—the
theory that Intersil’s packaging choice was the
result of misappropriated information, and the theory
that Intersil misused the financial information for a Build
vs. Buy analysis. Nevertheless, Intersil has not shown
that the liability verdict should be set aside. Intersil does
not specifically contend that the submission of the first
(glass packaging) theory to the jury now requires vacating
the liability verdict. And though Intersil does make such
a contention based on the submission of the second (Build
vs. Buy) theory to the jury, we find vacatur on that
ground unjustified even if we assume (without deciding)
that Intersil is correct in viewing the second theory as not
merely unsupported by sufficient evidence but as “legally”
erroneous.

The general rule is that “if a jury could find liability
according to multiple theories, and one of them is [legally]
erroneous, we reverse unless we can tell that the jury
came to its decision using only correct legal theories. If it
is impossible to tell whether a correct theory has been
used, we reverse for a new trial.” Rodriguez v. Riddell
Sports, Inc., 242 F.3d 567, 577 (5th Cir. 2001) (citations
omitted); see McCaig v. Wells Fargo Bank (Tex.), N.A., 788
F.3d 463, 476 (5th Cir. 2015). But the verdict will stand if
the legal error is harmless. See Skilling v. United States,
561 U.S. 358, 414 & n.46 (2010); Hedgpeth v. Pulido, 555
U.S. 57, 60–61 (2008) (per curiam); United States v.
Skilling, 638 F.3d 480, 481–82 (5th Cir. 2011). An error is
harmless if it did not affect Intersil’s “substantial rights.”
28 U.S.C. § 2111; Fed. R. Civ. P. 61; see also Shinseki v.
Sanders, 556 U.S. 396, 407–08 (2009). Harmless-error
review is a flexible one in which we “determin[e] whether
[the] error is harmless through the . . . case-specific
application of judgment, based upon examination of the
record.” Shinseki, 556 U.S. at 407. Unless prejudice is
clear even without any explanation, “the party seeking
reversal normally must explain why the erroneous ruling
caused harm.” Id. at 410.

(...)

Both parties’
experts testified that there was no evidence of Intersil’s
independent design of that structure. J.A. 20867;
J.A. 21961. Intersil has not provided any explanation as
to why the error at issue is harmful in light of this evidence.

In these circumstances, we affirm the verdict of Intersil’s
liability for trade secret misappropriation, limited to
Intersil’s use of the photodiode array structure
.



As to the monetary award:


Intersil challenges the amount of the monetary award
for trade secret misappropriation on several grounds,
including that the absence of liability on at least the
“Build vs. Buy” trade secret requires vacatur of the award
and that the award encompassed damages attributable to
sales that occurred long after the 1:1 interleaved photodiode
array structure was no longer a trade secret.6 We
agree as to both and vacate the award.

The monetary award for trade secret misappropriation
must be vacated because we have determined that
misappropriation liability here can properly rest on only
one of the three grounds that TAOS presented to the jury.
TAOS’s calculation of monetary relief did not distinguish
among those grounds. TAOS’s expert testified that the
“trade secrets [were] the – the drivers of sales.”
J.A. 21137–38. But he did not explain which of the trade
secrets contributed to what amount of profit to be disgorged;
he assigned all profits to the misappropriation of
all trade secrets. On this record, we have no basis to
conclude that the remaining ground for liability—the
photodiode structure trade secret—supports the entire
award. This is one reason for vacating the award.

There is a second, independent reason. As to the loss
of trade secret status, the unrebutted evidence at trial
showed that TAOS’s 1:1 interleaved photodiode array was
accessible to Intersil by proper means long before the time
of many of the sales included in TAOS’s request for monetary
relief. Such accessibility existed no later than January
2006, when Intersil successfully reverse-engineered
the TSL2560, and perhaps as early as February 2005,
when TAOS “released” the TSL2560.8 We need not pinpoint
the date to know that it predated many of the sales
included in the calculation of monetary relief put before
the jury by TAOS’s expert.
Accessibility by proper means rendered the photodiode
array structure no longer a protected secret. See E.I.
duPont deNemours & Co. v. Christopher, 431 F.2d 1012,
1015 (5th Cir. 1970)

(...)

Here, the jury awarded disgorgement of profits in the
exact amount TAOS’s expert proposed, based on sales
from April 2006 through March 2014. More than 90% of
that award was attributable to sales that occurred between
January 2008 and March 2014. TAOS’s evidence
supporting its claim to monetary relief for trade secret
misappropriation did not limit the covered sales to a
head-start period, and that omission cannot be deemed
harmless. The jury awarded what TAOS sought, and
given the timing of the sales on which the relief sought
was based, the absence of any limitation to a head-start
period might have had large consequences. A head-start
period of less than two years, which Intersil has suggested,
would seem to require exclusion of the lion’s share of
the sales covered by the award on appeal. Oral Argument
at 7:05–17 (Intersil counsel representing that the headstart
period would be 22 months); see J.A. 19455 (TAOS,
in its opening statement to the jury, asserting a similar
head-start period).
For those reasons, we vacate the jury’s monetary
award for misappropriation of trade secrets.