Virginia IP Law : Virginia Intellectual Property Lawyer & Attorney : Troutman Sanders Law Firm : Technology & Patent Litigation

            Hopefully you have already gotten a gift for that special IP litigant in your life this year.  If you’re thinking ahead to a 2010 wish list and have a preliminary injunction in mind, you may have noticed last month’s opinion by U.S. District Judge Henry E. Hudson in PRE Holding, Inc. v. Monaghan Medical Corp., no. 3:09CV458, 2009 U.S. Dist. LEXIS 107222 (E.D. Va. Nov. 17, 2009) (page citations to this opinion are to the version freely available from PACER/ECF).

            Other IP web news sources have questioned whether this opinion raises the bar for a preliminary injunction for patent litigants and whether it is consistent with case law from the U.S. Court of Appeals for the Federal Circuit.  (Federal Circuit law governs the issuance of injunctive relief under 35 U.S.C § 283 because the question “involves substantive matters unique to patent law.”  E.g., Hybritech, Inc. v. Abbott Labs, 849 F.2d 1446, 1451 n.12 (Fed. Cir. 1988).  “[P]urely procedural questions . . . are controlled by the law of the appropriate regional circuit.”  Id.

            In the post below, I conclude that debate over the PRE Holding opinion reflects the difficulties with the preliminary injunction standard and the hazards of not being concise, and that the PRE Holding opinion does not represent a change in the law.

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On Friday, the Board of Patent Appeals and Interferences rejected yet another of NTP’s patents, signaling further trouble for NTP’s pending patent lawsuits. 

Those who keep tabs on Virginia IP litigation know NTP as an active patent litigant who brought a high-profile patent infringement case against Research in Motion (RIM), makers of the popular Blackberry PDAs, in the United States District Court for the Eastern District of Virginia (case number 01-cv-00767). 

During the pendency of the litigation, the U.S. PTO began reexamination of five NTP patents, all of which relate to e-mail for mobile devices and all of which were at issue in the RIM suit. (Reexamination is a process where a person can have a patent reexamined by a patent examiner to verify a patent’s validity. To have a patent reexamined, a party must submit prior art that raises a “substantial new question of patentability.” See 35 U.S.C §§ 303 & 304.) 

RIM sought a stay in the litigation two months after the jury verdict in NTP’s favor, but reexamination came too late for RIM. Chief Judge James R. Spencer entered final judgment and ordered a permanent injunction, although he did stay the injunction pending appeal. See Final Order (entered August 5, 2003), available at 2003 U.S. Dist. LEXIS 26837. After a remand on RIM’s appeal, and with the threat of an injunction separating millions from their “Crackberrys,” NTP scored a $612.5 million settlement from RIM in March 2006.

Subsequently, NTP sued Palm, Inc. and AT&T Mobility LLC for patent infringement. Those cases are pending in the Eastern District (case numbers 06-cv-00836 and 07-cv-00550, respectively) but were stayed while reexamination proceedings were pending.

On November 10, the Board upheld the rejection of three of NTP’s patents, and Friday’s announcement spelled doom for a fourth. One patent remains before the Board on appeal. According to a Law360 article, NTP’s attorneys promise an appeal to the Federal Circuit.

Friday’s announcement reinforces that reexamination can be a decisive second-front in a patent litigation war. As the NTP litigation shows, however, the timing of reexamination can make all the difference.

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After an eight-day jury trial and a $13.5 million damages award last month in its favor, Chief Judge James R. Spencer this week granted PBM Products’ request for injunctive relief in PBM Products, LLC v. Mead Johnson Nutrition Company, et al., no. 3:09-cv-269 (E.D. Va., Richmond Div.). PBM, the maker of store-brand baby formula, had sued Mead Johnson for, among other things, false advertising. At the center of the dispute were Mead Johnson’s advertisements that its more expensive baby formula is clinically proven to improve brain and eye development, among other representations about the unique nutritional advantages of its formula in comparison to store brand formula. At trial, however, PBM was able to prove that its store-brand formula has the same nutritional values as Mead Johnson’s formula.

After the resolution of Mead Johnson’s laches defense and in light if the jury’s verdict in PBM’s favor, Judge Spencer granted PBM’s request for injunctive relief and enjoined Mead Johnson from publishing and circulating any advertisement or promotional material with any false representation about its formula and from making any false statement or representation about its formula, including “It may be tempting to try a less expensive store brand, but only Enfamil LIPIL is clinically proven to improve brain and eye development,” and “There are plenty of other ways to save on baby expenses without cutting back on nutrition.” Finally, the Court directed Mead Johnson to retrieve all advertisements, materials or literature with such claims already in the public forum.

While this may not be the last we hear of this case, the verdict is a warning to companies to be careful about comparative advertising claims that might leave a false impression even if they are not literally false.
 

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