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DOJ Role in Affirmative Suits

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					DOJ Role in Affirmative Suits
                John Fargo, Director
     Intellectual Property Staff, Civil Division
               Department of Justice
                    May 6
                    M 6, 2009
               john.fargo@usdoj.gov
  DOJ Role in Affirmative Suits
• Tech transfer involves licensing of
  intellectual property owned by a
                agency.
  government agency
• Effective licensing requires ability to
  enforce IP rights in order to preserve value
  of license.
          DOJ Statutory Role
                                              g
• 28 U.S.C. 517 reserves the conduct of litigation
  to the Attorney General, except where otherwise
  authorized by law.
      U.S.C.            i
• 28 U S C 519 requires the Ah Attorney G        l
                                         General to
  supervise all litigation to which the US or an
                party,
  agency is a party except where otherwise
  authorized by law.
• Together these provisions require DOJ to handle
  all actions involving infringement of IP rights to
  which the US, or an agency, is a party.
What is required for suit by DOJ
• Affirmative suit for infringement of a
  patent, copyright or trademark, like any
                      q       pp
  other civil suit, requires approval within the
  Civil Division of DOJ.
• My office would review request from
    y                         q
  agency General Counsel’s office that suit
  be filed, along with evidence supporting it,
     d determine whether t seek
  and d t      i      h th to     k
  authorization.
                          (cont d)
What is required for suit (cont’d)
• Items we need:
  – Copy of patent, prosecution history, prior art
    references and evidence indicating
    references,
    infringement with claims chart.
  – Copy of any licenses granted for the patent
    and some indication of the type of damages
    that may be recoverable.
                          (cont d)
What is required for suit (cont’d)
• Legal memo discussing where suit should
  be brought, and any expected issues
  (infringement, validity)
  (infringement validity).
• Validity search – can be conducted by
           counsel,              thorough,
  agency counsel but should be thorough
  mirroring the type of search we would do if
                  sued.
  we were being sued
           Preparation for Suit
• If authorization to file suit is granted, or
  sometimes while it is being considered, we will
  also want to interview the inventors and other
  likely witnesses, and review documents.
• If we are prepared to recommend authorization
  to file suit, agency needs to put a litigation hold
  on all potentially relevant documents, including
  e-mail
  e mail and other Electronically Stored
  Information (ESI).
                        (cont’d)
   Preparation for Suit (cont d)
• Role of Exclusive licensee
  – In the two instances in which the US has filed
    a patent infringement suit, it has been along
    with the agency’s exclusive licensee. Very
    often, the licensee has a better damage claim
                              agency.
    – lost profits – than the agency
  – This requires some interviews with the
                        ,
    exclusive licensee, as well as some common
    interest agreement with it in order to preserve
    privileges.
                        (cont d)
   Preparation for suit (cont’d)
• We will probably send a final cease and
  desist letter just prior to filing suit. We
  normally will not send out this type of letter
  unless we have already obtained
                         suit.
  authorization to file suit
  – We do not want to make “empty threats.”
                          suit
  – Letter may prompt DJ suit, raising issue of
    whether US is subject to DJ suit.
                        (cont’d)
   Preparation for Suit (cont d)
• We do not normally send cease and desist
  letters to mere customers.
  Rather,
• Rather cease and desist letters should be
  directed to manufacturer of allegedly
             product
  infringing product.
• Sending numerous letters to customers
       ld be i    d
  could b viewed as “         tactic.”
                       “scare t ti ”
     Suit – Role of the Agency
• Once suit is filed, we can expect an aggressive
  defense that will focus on the validity of the
  patent, and at times on whether an exclusive
  license was validly granted.
• If a suit is filed, it is a good idea to have all
  documents assembled for production, and
  perhaps have draft answers to the type of
                                      expect,
  interrogatories that we would expect at the time
  the Complaint is filed.
          Suit – Settlement
  Most,        all,
• Most if not all district courts have
  mandatory ADR programs.
• Need to carefully consider what agency
  wants. Where exclusive license is co-
  plaintiff,                  split.
  plaintiff probably have to split
• Sealing of settlements of litigation is
      i t           li   b    t      ti
  against DOJ policy absent exceptional   l
  circumstances. 28 C.F.R. § 50.23.
    Suit by Exclusive Licensee
• 35 U.S.C. 207(a)(2) permits a federal agency to
  grant a licensee the right of enforcement.
• Nutrition 21 v. United States, 930 F.2d 862 (Fed.
                                ,               (
  Cir. 1991). Held that section 207 permits an
  exclusive licensee who has been granted the
  right of enforcement to bring suit for patent
  infringement without the United States, or its
  agency,        party.
  agency as a party
                      (cont d)
     Suit by Licensee (cont’d)
                           licensee,
• Where suit is filed by a licensee the
  agency can expect substantial
  involvement:
  – Agency inventors will be deposed, and
    documents requested re making of the
    invention.
  – If inequitable conduct is alleged, defendant
    may seek to depose patent prosecution
    attorneys.
                      (cont d)
     Suit by Licensee (cont’d)
• Agency may need to consider requesting
  intervention by US.
  – An infringement suit will put the patent at risk
    for a challenge to validity. The agency may
    have a greater interest in p
             g                           g
                                preserving its
    validity in some cases than the licensee.
            g       q                    y p
  – A charge of inequitable conduct may implicate
    agency employees and make govt.
    intervention advisable.
                       (cont d)
      Suit by Licensee (cont’d)
• It is possible that infringer may attack the grant
  of the exclusive licensee as contrary to law.
   – Important in granting exclusive licenses to assure that
     the grant acts as a necessary incentive to bring forth
     risk capital to commercialize the invention.
                        suit,
   – In an infringement suit the infringer will scrutinize the
     application and knowledge of the agency as to
     whether the invention is already being practiced.
                       (cont d)
      Suit by Licensee (cont’d)
• 35 U.S.C. § 209(a) sets forth requirements for
  the grant of an exclusive license. While based
  on prior regulations, these are now statutory
  requirements.
• Subsections (a)(1) and (a)(2), taken together,
  express Congressional desire that exclusivity not
  be more than reasonably necessary to act as an
                     invention s
  incentive to bring invention’s benefits to the
  public.
                       (cont d)
      Suit by Licensee (cont’d)
• While we will have common interests with the
  licensee, there are instances in which they will
  diverge:
  – How to split any recovery. We are likely to deal at
    arms-length with licensee on this issue, so there may
    not be any privilege attached to those discussions
    other than FRE 408.
       y               g               y           g
  – Any possible infringement claim by licensee against
    govt. on its own patents. Has not occurred yet, but is
    possible.
                      (cont d)
     Suit by Licensee (cont’d)
• Subpoenas directed toward govt. agencies
  or employees will be subject to Touhy
                                         y
  limitations. United States ex rel. Touhy v.
  Ragen, 340 U.S. 462 (1951).
  – When served with a subpoena for govt.
    employee testimony, should contact my office    ff
    at DOJ.
  – Agency decisions on whether to permit a
    deposition at all, or to limit it, are subject to
    APA review.
                      (cont d)
     Suit by Licensee (cont’d)
• Since law relating to Touhy requests tends
  to vary somewhat among the regional
  circuits,
  circuits we should coordinate with the
  local US Attorneys office to assure that the
  agency’s position is defensible should an
  agency s             defensible,
  APA action be filed to challenge it.
     addition,
• In addition DOJ may want to defend any
  deposition of an agency employee.
                      (cont d)
     Suit by Licensee (cont’d)
• Just as in the case of planning for a suit by
  the govt., if an agency learns that a
  licensee with the right to enforce is
  planning to sue for infringement, it should
  gather all relevant documents and put a
  litigation hold on them.
    Again,              ESI,
  – Again this includes ESI which in turn
    includes e-mails.
                      (cont d)
     Suit by Licensee (cont’d)
• One of the daunting aspects of e- e
  discovery is determining where e-mail may
         (server computers). E-mail
  reside (server, computers) E mail is one
  form of ESI (electronically stored
  information) that is typically subject to
  deletion after a certain number of days,
          preserved.
  unless preserved
                      (cont d)
     Suit by Licensee (cont’d)
  E mail
• E-mail also may be stored on different
  servers for various organizations. It is rare
  that an agency will have a single server
  that houses all e-mail. Thus, in preparing
                 requests,
  for discovery requests the agency counsel
  may have to query IT professionals from
           locations,
  various locations within various
  commands or offices.
      Affirmative Patent Suits
  U.S. v. Telectronics,     F.2d
• U S v Telectronics 857 F 2d 758 (Fed(Fed.
  Cir. 1988).
• Suit on behalf of the Navy; exclusive
  licensee joined.
  Invention was bone growth stimulator –
• I     ti        b         th ti l t
  thought that it might speed healing from
       b ti j i
  combat injuries.
      Affirmative Patent Suits
                                 infringed,
• District court held patent not infringed
  based upon claim construction.
            rev d                 govt’s
• Fed Cir rev’d – agreeing with govt s claim
  construction and remanded for damages.
  Case settled with li
• C                               d Navy
            ttl d ith licensee and N
  splitting recovery.
    Affirmative Patent Suits
        v. Micrology, Labs., 09 CV 69 (N.D.
• EPA v Micrology Labs 09-CV-69 (N D
  Ind). On March 3, 2009, we filed suit
  against Micrology for infringement of 3
  patents owned by EPA on coliform
               water.
  detection in water
• EPA has several licenses on this patent,
  but Micrology had refused to enter into a
  license.
              Trademarks
• Another IP issue that occasionally arises is
  ownership and licensing of a trademark
                                 program.
  associated with a government program
• Trademarks are symbols of the goodwill
  and reputation of source of particular
  goods or services.
               Trademark
• Because of their function as symbolizing
  goodwill, issues can arise as to who owns
                  trademark,
  any particular trademark and whether it
  has been used in commerce.
• A certification mark is a particular type of
  trademark used to represent a “seal of
  approval
  approval” for goods or services provided
  by others. (E.g., the UL seal).
              Trademarks
• Because of their association with the
  reputation of a source of goods/services,
  trademarks cannot be simply licensed
  without retaining some control over the
  quality of goods/services provided by
  licensee.
   Naked license
• “Naked license” can invalidate a
  trademark.
              Trademarks
• Any licensing of a government owned
  trademark can raise other policy issues of
  whether this is an endorsement of a
  particular contractor, and if so, whether
  that would violate any policy against
  government agency endorsement.
             Trademarks
• We have both obtained trademark
  registrations for certain programs –
               logo,
  AmberAlert logo Citizen Corps – and have
  advised agencies in filing registrations.

				
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