Dino-Lite Put Under the Microscope
Computer Stores Northwest, Inc. (CSNW), based in Oregon, and Scalar Corporation (Scalar), a Japanese corporation, have sued Dunwell Tech, Inc. (Dunwell) for infringing U.S. Patent No. 5,442,489 [PDF] (the ’489 patent). The amended complaint [PDF] identifies Scalar as the owner of the ’489 patent and CSNW as the exclusive licensee.
The ’489 patent is directed to a magnifying observation device that captures an image of an object and displays the image on a monitor. CSNW and Scalar claim that the “Dino-Lite” series microscopes sold by Dunwell infringe the ’489 patent.
Reexamination
As noted in CSNW and Scalar’s amended complaint, eight claims the ’489 patent underwent reexamination at the request of Scalar in view of prior art references that surfaced during examination of Korean and Japanese counterpart patent applications. In the reexamination proceeding, the U.S. Patent and Trademark Office confirmed the patentability of one independent claim, and Scalar amended the remaining seven claims and added 18 new claims. The reexamination certificate issued on March 30, 2010, 14 days after the original complaint [PDF] was filed. In its answer to the amended complaint [PDF], Dunwell alleges that it has preclusive rights, intervening rights, or both under 35 U.S.C. §§ 252 and 307.
Marshall, Schmarshall! Bring Your Patent Cases to Portland
Or Eugene, Medford or Pendleton -- the four divisions of the U.S. District Court for the District of Oregon. The Eastern District of Texas has become a tremendously popular venue for patent owners wishing to bring suit, but, surprisingly, it is not the district where patent owners have the greatest percentage of prevailing.
As reported by Patently-O, a draft paper entitled "Where to File Your Patent Case" by Stanford Professor Mark A. Lemley reports that the patentee win rate in the Eastern District of Texas is 40.3%, whereas it is 45.3% in the District of Oregon. That puts the District of Oregon in an approximate tie for the second best patent win rate (a four-way near tie with Nevada, Middle Florida, and Delaware) among districts with a statistically significant number of patent cases. Only the Northern District of Texas had an appreciably higher patentee win rate (55.1%).
So why file your patent infringement case in Marshall, Texas, when you are likely to fare better in Portland, or Eugene, or Medford, or Pendleton?
Of course, there is more to choosing a venue than just the odds of prevailing. A couple other important factors are (1) the size of jury verdicts and (2) the likelihood of a stay pending reexamination
Large Jury Verdicts in Oregon.
Texas jurors are famous -- some would say infamous -- for handing out large verdicts . . . like it was somebody else's money. Well, there have been large verdicts in Oregon too. Although this has nothing to do with patent law, a Portland jury very recently handed out an $18.4 million punitive award against Boy Scouts of America in a sexual abuse case, as reported in the Oregonian. That was the largest verdict -- by far -- of that type against the Boy Scouts.
Another largest-of-its-kind verdict was the $304.6 million verdict that a Portland jury awarded to Adidas two years ago in its trademark infringement case against Payless Shoes. (Reported here by the Oregonian).
Back in the patent world, there have certainly been some large verdicts against infringers in Oregon. For example, Translogic won a verdict of about $86 million a few years ago, although that was reversed on appeal because a parallel reexamination killed the patent (which the Portland jury had upheld in view of the same prior art).
Stays Pending Reexamination
Speaking of reexamination, it is becoming increasingly common for a defendant to request reexamination and then seek a stay of the district court litigation. According to LegalMetric's "Stay Pending Reexamination" Reports (which is an invaluable resource, by the way), defendants' win rate for contested stay motions in the District of Oregon are less than the nationwide average, with some judges in the district granting those motions sparingly or never.
As I said, Marshall schmarshall. Patent owners would be wise to at least consider bringing their patent cases in Oregon.
Arthrex Sued Again for Infringement
Smith & Nephew, Inc.and John O. Hayhurst, M.D. sued Arthrex, Inc. for a second time in the U.S. District Court for the District of Oregon alleging that Arthrex infringed the claims of U.S. Patent No. 5,601,557 (the ’557 patent) by marketing and selling various suture anchors used to attach soft tissue to bone (e.g., during arthroscopic shoulder reconstruction).
This lawsuit, assigned case no. 3:08-cv-00714-MO (“second lawsuit”), is closely related to a lawsuit plaintiffs filed in 2004, assigned case no. 3:04-cv-00029-MO (“first lawsuit”), for which a $20 million judgment was entered on January 21, 2009 in favor of plaintiffs on a jury verdict of infringement.
However, as we described in a previous post, Anthrex Springs Back from Infringement Ruling, the Federal Circuit recently reversed the judgment of infringement against Arthrex and remanded for a new trial. See Smith & Nephew, Inc. v. Arthrex, Inc., 2009 U.S. App. LEXIS 26268 (Fed. Cir. Dec. 2, 2009).
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The alleged infringement in the second lawsuit relates to products not litigated in the first lawsuit. Apparently, at around the time of the original trial in the first lawsuit, Arthrex began introducing a few new versions of its SutureTak and PushLock anchors. According to the plaintiffs the new versions fall into three categories:
- BioComposite Bio-SutureTak – These anchors, according to the plaintiffs, are similar to the Bio-SutureTak anchor that was found by the jury to infringe, but include a small amount of a chemical called β-TCP (Beta-TriCalcium Phosphate) in the plastic material in the anchor, which is intended to promote bone growth as the plastic material biodegrades;
- PushLock anchors in different sizes (e.g., 4.5 mm) that, according to the plaintiffs, appear to be otherwise identical to the 3.5 mm PushLock anchors that were found by the jury to infringe (e.g., same material, same geometry, same resilience); and
- PushLock anchors that have so-called “large eyelets,” which, according to the plaintiffs, are too large to fit within the body member of the anchor, but otherwise are the same as, and work the same way as, the 3.5 mm PushLock anchors that were found by the jury to infringe.
Because the new versions of the anchors were similar to those at issue in the first lawsuit, the plaintiffs tried to include the new versions in the first lawsuit. However, the district court ruled that the new versions would be excluded from the first lawsuit, so the plaintiffs brought the second lawsuit after the jury returned a verdict of infringement in the first lawsuit.
As of June 1, 2009, the second lawsuit was proceeding with regard to discovery of documents and things only. All other aspects of the second lawsuit were stayed pending the appeal in the first lawsuit.
On June 9, 2009 the Patent Office issued an Ex-Parte Reexamination Certificate [PDF], terminating the two reexaminations initiated by Arthrex. The first request (assigned Control No. 90/008,603) alleged that the ’557 patent was invalid for double patenting. The second request (assigned Control No. 90/010,029) alleged that the ’557 patent was invalid based on prior art. In the Reexamination Certificate, the Patent Office confirmed the validity of original claims 1-7 of the ’557 patent and determined that new claims 8-68 were also patentable.
Accordingly, the plaintiffs filed a first amended complaint [PDF] on June 25, 2009 that includes allegations directed to Arthrex’s infringement of the reexamined ’557 patent, including infringement of new claims 8-68.
Judge Mosman ordered a status report to be entered by April 5, 2010.
