What best practices have recently emerged for companies that engage in patent litigation? The latest trends in this area were the topic of a popular panel at DLA Piper's biannual Tech Summit, held in late September in Palo Alto. Here are the key issues the panel examined.
Patentable subject matter: One of the first questions sophisticated patent defendants consider is whether, under the recent Alice v. CLS Bank framework, the asserted patent(s) are potentially invalid for a lack of patentable subject matter. Courts around the country have recently been quite willing to invalidate patents on this basis at an early stage. Companies may bring motions to dismiss or motions for judgment on the pleadings, both of which can be filed early in the case, potentially resolving a matter before heavy litigation fees are incurred. In-house counsel often take into consideration which court and which judge are handling the case in order to evaluate the effectiveness of such a challenge.
Post-grant review proceedings:
The panel discussed the positives and negatives of covered business method petitions (CBMs) and inter partes reviews (IPRs), both of which enable a defendant to seek review of the asserted patents at the US Patent and Trademark Office. On the plus side, the panel viewed the Administrative Law Judges who handle such reviews as highly qualified, hard working and determined to reach the correct result. The perceived downside is that such petitions can extend the time to resolve a case and, if the patent survives such a challenge, the legal fees will only increase. Additionally, some panelists were concerned about the possibility that "what comes around, goes around" – such petitions might also become weapons against the companies' own patents. In going down this path, companies should carefully weigh whether each asserted patent is a good candidate.
Willful infringement: The discussion moved on to the Supreme Court's recent decisions in Stryker Corp. v. Zimmer, Inc., and Halo Electronics, Inc. v. Pulse Electronics, Inc. Panelists were eager to see whether companies will revert to the pre-Seagate view and receive an opinion of counsel to avoid the potential for willfulness allegations. The panel agreed that while it was too early to tell, conservative companies that worry about high damages exposures may want to take the proactive step now of obtaining such an opinion of counsel.
Practical considerations for structuring litigation: The panel discussed a number of factors that influence the course of litigation. Venue can inform how a case is handled internally. For example, the plaintiff's selection of a home jurisdiction can signify a more credible case; a plaintiff who is forum shopping may not have as strong a case. Litigation budgets are important to in-house counsel. Favored factors include budget predictability, as well as alternative fee arrangements and innovative strategies to address litigation involving a multitude of similarly situated companies. The panel also noted there is no current software solution that really allows in-house counsel to manage patent litigation and asked the tech-savvy crowd to work on that.
Key takeaways from this session: Company counsel are closely watching trends in patent litigation; meanwhile, they are thinking critically about how these trends affect their litigation strategies and the company's bottom line.
The panel was moderated by Mark Fowler (Global Co-Chair, Patents, and US Chair, Patent Litigation, DLA Piper), joined by Brian Fogarty (Senior Director, Global Intellectual Property Litigation, Nike), Julie Han (Senior Litigation Counsel, Samsung) and Peter O'Rourke (Managing Counsel, Oracle).