Judge Burke's decision in CosmoKey Solutions GmbH & Co. KG v. Duo Security, Inc., C.A. No. 18-1477-JLH-CJB (D. Del. Nov. 15, 2024) (Oral Order), deals with a stipulation that encompassed more than intended.
The case began life under the watchful gaze of Chief Judge Connolly. Like all patent cases assigned to him at the time, the scheduling order …
If law has one guiding principle, it is that words matter. The precise choice of verb or adjective can be the difference between friend and foe, peace and war, victory and defeat.
You've read Faust, you get it.
History's most famous lawyer?AI-Generated, displayed with permission
We saw a great example of this principle this week in I-Mab Biopharma, v. Inhibrx, Inc., C.A. No. 22-276-CJB (D. Del. Oct. 17, 2024) (Mem. Order). I-Mab was prought under the DTSA which allows damages to be calculated as either (1) damages for actual loss plus unjust enrichment or (2) a reasonable royalty. 18 U.S.C. § 1836(b)(3)(B).
The defendants—who unsurprisingly preferred a lower damages figure—served an expert damages report that noted that plaintiff's "actual damages" might be "zero." The plaintiff moved to exclude the opinion under Daubert, arguing that their damages theory was based on a reasonable royalty, and thus an opinion that their "actual damages" might be zero was neither here nor there, and was unduly prejudicial.
The defendant countered that the expert had meant that "Dr. Manning is 'not offering an opinion on actual losses, but instead references ‘actual damages’ as reflective of damages I-Mab may be awarded'—in other words, according to Defendants, the zero damages opinion is an opinion that Plaintiff’s reasonable royalty damages may be zero." Id. at 8 (quoting D.I. 364 at 23).
Judge Burke, however, found the expert's choice of words dispositive, and struck the so-called "zero damages opinion"
The Court agrees with Plaintiff that Defendants are ignoring the “actual words” that Dr. Manning used, as he did not opine in the zero damages opinion that Plaintiff’s “reasonable royalty damages” are zero (nor do Defendants point to anywhere else in Dr. Manning’s report where he opined that Plaintiff’s reasonable royalty damages should be zero). Nor do Defendants explain why an opinion that Plaintiff’s “actual damages . . . are zero” should be interpreted to actually mean that Plaintiff’s “reasonable royalty damages are zero.” Moreover, the Court agrees with Plaintiff that Dr. Manning does not seem to provide any facts or analysis in support of the zero damages opinion. Thus, Defendants have not sufficiently explained how, inter alia, Dr. Manning’s zero damages opinion is relevant in light of Plaintiff’s argument to the contrary; therefore it must be excluded.
Long answer - also yes, also obviously, but the timing is important.
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The issue came to the fore in I-Mab Biopharma v. Inhibrx, Inc., C.A. No. 22-276-CJB (D. Del. Sept. 19, 2024) (Mem. Ord.). I-mAB is a DTSA action alleging the theft of about a dozen separate trade secrets. A few months back, the plaintiff went through a restructuring that resulted in several related entities now owning some or all of the trade secrets. The plaintiff then moved to add these entities as co-plaintiffs. Judge Burke denied the motion due to the potential for delay, given that the case was scheduled for trial int he near future.
A perennial question in disputes about late disclosures is whether the demandingFRCP 16 "good cause" standard applies, which hinges on diligence, or whether the more forgivingPennypack factors apply.
When it comes to case narrowing, there seems to be a building trend that the good cause standard applies, not the Pennypack factors. We've seen that multipletimes when it comes to a plaintiff's decision to drop claims, and on Wednesday, Judge Burke issued a detailed opinion finding that good cause is likewise required to revise a defendant's election of prior art references.
In State Farm Mutual Automobile v. Amazon.com, Inc., C.A. No. 22-1447-CJB (D. Del.), the Court ordered the defendant to cut …
I hope the Third Circuit one day revisits the Pennypack factors, which are what it directs the lower courts to apply to determine whether late disclosures are subject to sanctions such as preclusion.
The factors can be lenient on parties that are very late in disclosing critical facts. Pennypack sets up a system where, oddly, the more critical the late-disclosed fact is, the later the party can be, and the less likely it is to be excluded. Isn't that backwards?
In practice, the factors often seem to turn on whether there is incurable prejudice, and that can be hard to establish. But a rule that "you …
It was tough to find an image for this. Just imagine each lego head is a proposed claim construction.Wu Yi, Unsplash
The District of Delaware supports contention interrogatories generally (but not contention 30(b)(6) topics). I remember that, back before the Court adopted the Default Standard in 2011, contention interrogatories were the main way to define and limit the scope of the case during fact discovery.
But contention interrogatories are not without limits. On Friday, in LeFebvre v. Extrabux, Inc., C.A. No. 23-167 (D. Del.), Judge Burke issued a decision on a discovery dispute about a contention interrogatory seeking claim construction positions. He held that a party can't just ask the opposing party for its …
I couldn't find a picture for this. Just imagine each leaf is an individual claim construction oral order.Erol Ahmed, Unsplash
I've noticed that, since November of last year, Judge Burke has been issuing claim construction opinions in some cases in the form of a series of oral orders on the docket, rather than a formal memorandum opinion or an order with footnotes. I thought I'd flag this so that people know what may happen if you have claim construction in a case before Judge Burke.
I first saw the Court construe terms via oral orders on the docket in November 2023, in The Nielsen Company (US), LLC v. TVision Insights, Inc., C.A. No. 22-057, D.I. 140-141 ( …
"By careful review of literally just the face of the patent, we have determined that the conception date is no later than the 2/3/2017 filing date. You're welcome."AI-Generated, displayed with permission
I admit, sometimes I write about things because I want to be able to find them next time I need them. This is one of those posts.
As we've discussed before, most patent cases involve an interrogatory to the patentee asking for the date of conception. Patentees often give a low-effort initial response along the lines of "no later than x," where x is the date of filing or some other easy-to-identify date. Then they wait to see whether they need an earlier date, and supplement if so.
This has two benefits for the patentee: (1) it makes it hard for the accused infringer to weigh the relative merits of the prior art, because it has to hit a moving target, and (2) it's super easy, because the patentee doesn't have to review any of the materials. Thus, it's a common response.
The Court has rejected this response in the past, including the idea that "[a patentee] has no obligation to investigate whether the patent-in-suit is entitled to an earlier priority date at least until Defendant has provided its invalidity contentions." The Court in that transcript forced the patentee to actually respond to the interrogatory—making it a handy transcript for accused infringers.
Bringing a discovery dispute is a bit of a 3-body problem. At any given time, you've probably got a half dozen complaints with what the other side is doing. When one boils over into a dispute you have to grapple with whether you should just bring all of them—and risk looking unreasonable—or just address the most pressing and risk having to raise serial disputes, which might look even worse. The push and pull can quickly become insoluble.
Luckily, we got an Order from Judge Burke this week that should make this calculus slightly easier going forward.
The defendants in Bardy Diagnostics, Inc. v. Vital Connect, Inc., C.A. No. 22-351-CFC-CJB, D.I. 97 (D. Del. June 11, 2024) (Oral Order) brought the first discovery dispute of the case (by either party) via judge Burkes usual procedure of filing a letter listing the disputes.
The disputes read as the usual humdrum list of custodians not searched and rogs insufficiently answered. The only thing out of the ordinary, is that there were 5 of them included in the letter.
Judge Burke responded to the request for a teleconference the next day with ...
We got an interesting Daubert opinion from judge Burke yesterday. It's actually not in a patent case, but the issue was neat enough that I'm willing to make an exception to our usual rule.
(Eds. note—I really hate that Daubert is always italicized because its a case name, but the pronunciation is not at all French. I see italics and I get all excited to roll some R's or whatever and then I just sound like the midwesterner I am).
The issue: can an expert report be too polite?
They've always struck me as a very polite-looking creature, despite the whole cannibalism thingDavid Clode, Unsplash
The case involved various disclosures in a business transaction, and the expert in question was an accounting professor opining on whether certain financial disclosures were deficient. Reading through the statements, they do strike me as unusual for an expert report:
“I am uneasy about the fact that there were no disclosures [in the financial statements] about Schratter’s ability to continue to operate as a going concern.”
“I was surprised that the financial statements did not make any mention of a possible impairment of goodwill. . . . Given the financial condition of Schratter in 2014 and its recent financial performance, I would have expected to see some disclosures about an impairment test for goodwill and why no impairment was recorded.”
ECB USA, Inc. v. Savencia, S.A., C.A. No. 19-731-GBW-CJB (D. Del. June 10, 2024) (Mem. Order) (quoting expert report of Ricky Lee Antle).
I mean, you see it right? This sort of language—both personal and measured—is the sort you might expect to hear from your own deeply disappointed accountant, rather than in an expert report. Still, it's tough to say what exactly would be objectionable about it.
The tack defendants chose was to challenge these statements as ...
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