This week in Other Barks and Bites: the Government Accountability Office published its report on third-party funding for patent litigation showing mixed responses to proposed disclosure requirements; the Second Circuit affirms a lower ruling that copyright ownership claims to George Clinton sound recordings are time-barred; the U.S. Patent and Trademark Office withdraws controversial proposed rules over terminal disclaimer practice; a federal judge in Eastern Virginia district court ordered Patent Quality Assurance to disclose its membership in patent litigation challenging the validity of VLSI’s patent claims; medical device firm Insulet wins a $452 million jury verdict for EOFlow’s trade secret misappropriation; and the National Civil Liberties Alliance files the opening brief in the appeal of Judge Pauline Newman’s suspension, challenging the constitutionality of Disability Act provisions on judicial case assignment.

Bites

Federal Circuit Issues Two Precedential Decisions

The U.S. Court of Appeals for the Federal Circuit (CAFC) issued two precedential decisions on Friday, December 6. In Galderma Laboratories v. Lupin, the court affirmed a Delaware district court’s decision that Lupin Inc. and Lupin Ltd.’s abbreviated new drug application (ANDA) did not infringe Galderma’s U.S. Patent Nos. 7,749,532 and U.S. Patent No. 8,206,740, which encompass its branded doxycycline capsules. And in PS Products, Inc. v. Panther Trading Company, the Federal Circuit found U.S. District Court for the Eastern District of Arkansas did not err in awarding deterrence sanctions against PSP in the amount of $25,000, but denied Panther’s request for attorney fees.

NCLA Opening Brief in Judge Newman Appeal Challenges Constitutionality of Disability Act Suspension – On Thursday, December 5, the Honorable Pauline Newman, represented by the New Civil Liberties Alliance (NCLA), filed an opening brief in the U.S. Court of Appeals for the D.C. Circuit challenging a lower decision upholding Judge Newman’s suspension over contentious allegations that she is unfit to serve on the Federal Circuit’s bench. The NCLA’s brief argues that the Disability Act provisions under which Judge Newman is no longer being assigned cases is unconstitutional for allowing judicial councils to administratively deprive an Article III judge of the ability to perform judicial duties, or that Judge Newman’s suspension should have an end date to meet the statute’s requirements that the suspension be “temporary” and “for a time certain.”

GAO Report on Third-Party Litigation Funding Discusses Disclosure Requirements – On Thursday, December 5, the U.S. Government Accountability Office (GAO) published the results of a study into the impacts of third-party funding for patent infringement litigation noting that many stakeholders interviewed by GAO, including litigation funders, were open to requirements that would mandate disclosure of third-party financing. While such disclosures could help identify foreign involvement and facilitate case resolution, many stakeholders noted that such disclosures were irrelevant to the legal issues of patent cases and could potential bias litigation while burdening the court system.

Eleventh Circuit Affirms Injunction Against ‘KRANK3D’ Dietary Supplements – On Wednesday, December 4, the U.S. Court of Appeals for the Eleventh Circuit issued an unpublished decision in Hi-Tech Pharmaceuticals, Inc. v. Nutrition Resource Services, Inc. in which the appellate court affirmed the Northern District of Georgia’s preliminary injunction grant against Hi-Tech’s use of its “KRANK3D” trademark on branded dietary supplements. The appellate court found that the district court did not abuse its discretion in either finding that Nutrition Resource Services, doing business as JBN – Just Be Natural, had shown a likelihood of success on its trademark infringement claim, or in setting a $5,000 bond for JBN’s preliminary injunction.

USPTO Withdraws Terminal Disclaimer Rules Creating Industry Controversy – On Tuesday, December 3, the U.S. Patent and Trademark Office published a notice in the Federal Register indicating that the agency was officially withdrawing proposed rules requiring patentees to add terminal disclaimers to patents to overcome non-statutory obviousness-type double patenting, which had created controversy among a wide range of patent industry insiders for improperly targeting the biopharmaceutical industry and allegedly exceeding the agency’s rulemaking authority.

Second Circuit Finds Ownership Claim to George Clinton Songs is Time-Barred – On Monday, December 2, the U.S. Court of Appeals for the Second Circuit issued a summary order in Bridgeport Music Inc. v. TufAmerica Inc. affirming the Southern District of New York’s summary judgment ruling against parties claiming ownership to songs recorded by funk legend George Clinton under agreements with now-defunct record labels. The Second Circuit agreed with the district court that the copyright ownership claims were time-barred under the Copyright Act’s three-year statute of limitations as uncontroverted evidence showed the plaintiffs’ predecessor-in-interest was aware that Bridgeport Music was distributing the disputed Clinton songs without paying royalties in the 1970s.

EUIPO Study Shows Online Piracy Stabilizing Despite 10% Rise in IPTV Piracy Traffic – On Thursday, November 28, the European Union Intellectual Property Office (EUIPO) published a study on online copyright infringement in the EU showing that, although overall piracy among EU residents was stabilizing since late 2021 at about 10.2 accesses per Internet user per month, traffic to pirate IPTV websites increased by 10% in 2023 with 2.14% of EU Internet users accessing such websites each month.

Barks 

CRB Issues Cost of Living Adjustment to Statutory Royalty Rate for Webcasters – On Friday, December 6, the Copyright Royalty Board (CRB) published a final rule in the Federal Register announcing a cost of living adjustment in the royalty rates paid by noninteractive webcasters for transmissions eligible for statutory licenses under Sections 112 and 114 for sound recordings and making ephemeral records to facilitate transmission of those recordings.

PQA Must Identify Members in VLSI Patent Litigation to Comply With EDVA Local Rules – On Thursday, December 5, U.S. District Judge M. Hannah Lauck issued a memorandum opinion and order requiring Patent Quality Assurance (PQA), an entity sanctioned over its failure to make disclosures in mandatory discovery at the Patent Trial and Appeal Board (PTAB), to file a disclosure statement identifying all of its members to better determine whether there are conflicts requiring Judge Lauck’s recusal under the local rules of the Eastern District of Virginia.

Insulet Wins $452M Jury Verdict for Insulin Patch Trade Secret Misappropriation – On Thursday, December 5, a jury verdict  entered in the District of Massachusetts awarded medical device company Insulet Corporation $452 million in damages for unjust enrichment and willful trade secret misappropriation caused by rival firm EOFlow. The verdict comes months after the Federal Circuit reversed a preliminary injunction entered in the case by the district court for using an severely overbroad definition of “trade secret.”

Malawi Becomes First Nation to Ratify WIPO Treaty on Indigenous IP – On Thursday, December 5, the World Intellectual Property Organization (WIPO) announced that the East African country of Malawi became the first nation among 38 signatories to ratify the WIPO Treaty on Intellectual Property, Genetic Resources and Associated Traditional Knowledge, the first WIPO treaty specifically designed for the protection of IP created by indigenous peoples and local communities.

PCT Publishes Five-Millionth Patent Application – On Monday, December 2, WIPO announced that the organization’s international patent application system under the Patent Cooperation Treaty (PCT) had published its five-millionth patent application since the PCT system was first established in 1978.

This Week on Wall Street

China-U.S. Trade Tensions Escalate With Chinese Ban on Chip Raw Material Exports – On Tuesday, December 3, China’s Commerce Ministry announced that it is prohibiting exports to the United States for several raw materials involved in semiconductor production, including gallium and germanium, as a move seen as retaliatory against the U.S. for curbing exports of manufacturing equipment for computer chips to China.

Quarterly Earnings – The following firms identified among the IPO’s Top 300 Patent Recipients for 2023 are announcing quarterly earnings next week (2023 rank in parentheses):

• Monday: Oracle Corp. (48th)
• Tuesday: None
• Wednesday: Adobe Inc. (98th); Carl Zeiss Meditec AG (t-173rd)
• Thursday: Broadcom Inc. (40th)
• Friday: None