Amendments To Federal Rules Of Civil Procedure Announced – Effective December 1, 2015, the Federal Rules of Civil Procedure (“FRCP”) have been amended with respect to pleading requirements and discovery. Notably, the FRCP do not apply in Section 337 investigations before the International Trade Commission (“ITC”), although the ITC can look to the FRCP for guidance. These changes, however, may ensure more uniform procedures in district court patent litigation and Section 337 investigations.

Pleading Requirements. The amended FRCP abrogated Rule 84 and the forms in the Appendix to Rule 84, including Form 18 applicable to patent infringement complaints. Although it is unclear whether the standard for pleading patent infringement cases has changed as a result of this abrogation, certain commentators have posited that the pleading standards under Bell Atlantic Corp. v. Twombly and Ashcroft v. Iqbal now apply. See Iqbal, 556 U.S. 662, 663 (2009) (citing Twombly, 550 U.S. 544, 556 (2007)) (“[a] claim has facial plausibility when the plaintiff pleads factual content that allows the court to draw the reasonable inference that the defendant is liable” ); Iqbal, 556 U.S. 662, 678 (2009) (“[t]o survive a motion to dismiss, a complaint must contain sufficient factual matter, accepted as true, to state a claim for relief that is plausible on its face.”). If Twombly and Iqbal now apply, the pleading standards applicable to patent infringement cases filed in the district courts will be more aligned with the fact-based pleading standards applicable in Section 337 investigations at the ITC. See 19 C.F.R. § 210.12.

Discovery.  Rule 26(b)(1) has been amended to revise the standard for discoverable evidence from information that is “reasonably calculated to lead to the discovery of admissible evidence” to information that is “proportional” to the needs of the case, “considering the importance of the issues at stake in the action, the amount in controversy, the parties’ relative access to relevant information, the parties’ resources, the importance of discovery in resolving the issues, and whether the burden or expense of the proposed discovery outweighs its likely benefit.” The Advisory Committee on Civil Rules stated that this language is not designed to articulate a new standard for discovery, but is intended to emphasize the parties’ obligation to consider whether the discovery request is proportional to the needs of the case.

Rule 34(b)(2) has been amended to require that objections to document requests be specific and that they state “whether any responsive materials are being withheld on the basis of that objection.”

Rule 26(d)(2) has been amended to allow parties to serve document requests 21 days after the summons and complaint are filed, and they are deemed to be served at the first Rule 26(f) conference. This change is consistent with Rule 210.30 of the ITC’s Rules Of Adjudication and Enforcement, which permit document requests to be served after the date of publication in the Federal Register of the ITC’s Notice Of Institution of the investigation.

Rule 37(e) has been amended to provide specific sanctions on parties for losing electronically stored information (“ESI”). The severity of the sanctions depends on whether the ESI was inadvertently or intentionally lost.

Additional changes were made to Rules 4, 16, 26, and 34 that are designed to eliminate litigation delays. 

ITC Finds Violation In 921 Investigation – On December 1, 2015, the International Trade Commission issued a Final Determination in Certain Marine Sonar Imaging Devices, Inv. No. 337-TA-921, in which it found a violation of Section 337 under modified constructions of certain claim terms. As previously reported, the investigation was instituted in July 2014 upon a Complaint by Navico Holdings AS and Navico, Inc. (“Navico”) alleging that underwater imaging devices using “DownScan” sonar technology imported and sold by Garmin International, Inc. and certain affiliates (“Garmin”) infringed US. Patent Nos. 8,305,840; 8,605,550; and 8,300,499. In his Initial Determination, Administrative Law Judge Shaw found that Garmin’s products did not infringe any of the asserted patents, which were not shown to be invalid, and that the economic prong of the domestic industry requirement was not satisfied with respect to the ’550 patent. After review, the ITC adopted a modified construction for certain claim terms, including “single linear downscan transducer element,” and determined that Navico proved infringement of certain claims of the ’840 and ’550 patents. The ITC found that Garmin had proved some, but not all, of the asserted claims of the ’550 patent invalid and that Navico had proved that a domestic industry existed with respect to the ’550 patent. The ITC affirmed, on modified grounds, the ID’s finding that the ’499 patent is not infringed. Finding a violation of Section 337 with respect to the ’840 and ’550 patents, the ITC determined that a limited exclusion order and cease and desist order should issue.

ITC Affirms Violation In 926 Investigation – On November 18, 2015, the International Trade Commission issued a Final Determination in Certain Marine Sonar Imaging Systems, Inv. No. 337-TA-926, in which it modified the construction of a disputed claim term but otherwise affirmed the Initial Determination (“ID”) findings. The investigation was instituted on August 21, 2014, upon a complaint filed by Johnson Outdoors Inc. and Johnson Outdoors Marine Electronics, Inc. (“Johnson”) alleging that the importation and sale by Garmin International Inc. and certain affiliates (“Garmin”) of DownVü/SideVü transducers and associated products or components infringed U.S. Patent Nos. 7,652,952; 7,710,825; and 7,755,974. On July 13, 2015, Administrative Law Judge Essex issued his Initial Determination finding a violation of Section 337 because the accused products infringed certain claims of the ’974 patent, but finding no infringement of the ’952 or ’825 patents. The ITC determined to review the ID on all issues petitioned and asked the parties to brief the impact on the ID’s findings if the ITC were to construe the claim term “mounted to a boat” to mean “proximately secured to the boat in a fixed manner,” as proposed by Johnson, rather than adopting the ID’s construction “attached to the bottom surface of the boat.” The ITC’s Final Determination adopted Johnson’s construction, but found that the evidence supported the ID’s findings under the modified construction. The ITC also affirmed the ID’s findings that the asserted patents were valid and not unenforceable. The ITC determined a limited exclusion order and cease and desist order were appropriate relief.

Chief ALJ Bullock Releases Public Version Of Initial Determination In - 936 Investigation Finding Violation Of Converse’s Trademark Rights – Chief Administrative Law Judge Charles E. Bullock released the public version of his Initial Determination in Certain Footwear Products, Inv. No. 337-TA-936, in which he found a Section 337 violation with respect to certain trademarks pertaining to the Chuck Taylor All Star sneaker. Chief Judge Bullock had previously issued the confidential version of his Initial Determination and Notice Regarding Initial Determination reported in this Update on November 18. The Chief Judge determined that a violation had occurred with respect to U.S. Trademark Registration Nos. 3,258,103; 1,588,960; and 4,398,753, but not as to the common law trademarks asserted in the complaint. The complaint was filed by Converse Inc. in October 2014, alleging a violation of Section 337 by the import and sale of certain shoes. The remaining active respondents are Skechers, Walmart, Highline, and New Balance. In his Initial Determination, Chief Judge Bullock found that:

• Certain Sketchers, Walmart, Highline, and New Balance shoes infringe the ’753 trademark registration. The defaulting respondents’ accused products also infringe this trademark registration;
• The common law trademark is not distinctive and is invalid. The Respondents do not infringe the common law trademark;
• The common law trademark is not famous, and the Respondents do not dilute the common law trademark;
• Foreversun infringes the ’103 and ’960 trademark registrations.

Judge Bullock recommended that a general exclusion order be issued, and that a cease and desist order be issued to those Respondents found to be infringing. Finally, the Chief Judge found that a bond based on price differential is appropriate in this case, and recommends a bond of 100% of entered value for the defaulting Respondents.