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February 2015
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Exela Pharma Sciences, LLC v. Lee

This appeal presents the question of whether a third party has the right to challenge, by way of the Administrative Procedure Act (APA), a ruling of the Patent and Trademark Office reviving a patent application that had become abandoned by failure to meet a filing schedule established by the Patent Cooperation Treaty and its implementing statute. The challengers are Exela Pharma Sciences, LLC; Exela Pharmsci, Inc.; and Exela Holdings, Inc. (collectively “Exela”). Exela petitioned the PTO to “reconsider and withdraw” its revival of the national stage application and to cancel the issued patent. The patent is United States Patent No. 6,992,218 (“the ’218 patent”), assigned to SCR Pharmatop.

The PTO declined to consider Exela’s petition, stating that no law or regulation authorizes non-party challenge to a PTO ruling to accept a tardy filing. Exela then brought suit under the APA in the United States District Court for the Eastern District of Virginia, arguing that the PTO’s action was ultra vires and that Exela’s petition should have been considered and favorably decided. The PTO moved to dismiss Exela’s complaint on several grounds.

The district court initially held that Exela was entitled to challenge the PTO’s decision under the APA, but on reconsideration and in view of new Fourth Circuit precedent, the district court dismissed Exela’s complaint for failing to meet the statute of limitations for claims filed against the United States, including APA claims.

We affirm the dismissal, on the ground that PTO revival rulings are not subject to third party collateral challenge, thereby precluding review regardless of whether Exela’s claims were time-barred.

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Kennametal, Inc. v. Ingersoll Cutting Tool Co.

Kennametal, Inc. (“Kennametal”) appeals the decision of the Patent Trial and Appeal Board (the “Board”) in an inter partes reexamination of U.S. Patent No. 7,244,519 (the “’519 patent”) in which the Board: (a) entered a new anticipation ground of rejection asserted by Ingersoll Cutting Tool Co. (“Ingersoll”) against certain of the pending claims; and (b) affirmed the Examiner’s obviousness rejection of certain remaining claims. See Ingersoll Cutting Tool Co. v. TDY Indus., Reexamination Ctrl. No. 95/001,417, available at 2013 WL 6039030 (P.T.A.B. Nov. 12, 2013) (“Board Decision on Rehearing”); Ingersoll, available at 2013 WL 3294868 (P.T.A.B. May 6, 2013) (“Initial Board Decision”). Because substantial evidence supports the Board’s determinations of anticipation and obviousness and because we see no error in the Board’s legal conclusion of obviousness, we affirm.

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Cadence Pharma, Inc. v. Exela Pharma Sciences, LLC

In this Hatch-Waxman Act litigation, Exela PharmSci Inc., Exela Holdings, Inc. and Exela Pharm Sciences, LLC (collectively “Exela”) appeal the district court’s construction of certain claim terms of U.S. Patents No. 6,028,222 (the “’222 patent”) and No. 6,992,218 (the “’218 patent”), Cadence Pharm., Inc. v. Paddock Labs. Inc., 886 F. Supp. 2d 445 (D. Del. 2012), and its rulings that Exela infringed certain asserted claims of both patents and failed to prove invalidity as to the ’218 patent. Cadence Pharm., Inc. v. Exela Pharma Scis., LLC, No. 11-733-LPS, 2013 U.S. Dist. LEXIS 166097 (D. Del. Nov. 14, 2013). For the reasons set forth infra, we affirm.

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Senju Pharma. Co. v. Lupin, Ltd.

This is a patent case brought under the HatchWaxman Act, Pub. L. No. 98-417, 98 Stat. 1585 (“the Act”), on appeal from the United States District Court for the District of Delaware. Pursuant to the Act, plaintiffsappellants Senju Pharmaceutical Co., Ltd., Kyorin Pharmaceutical Co., Ltd., and Allergan, Inc. (collectively “Senju”) sued defendants-appellees Lupin Limited and Lupin Pharmaceuticals, Inc. (collectively “Lupin”) and HiTech Pharmacal Co., Inc. (“Hi-Tech”) for infringement of asserted claims 6 and 12-16 of reexamined U.S. Patent No. 6,333,045 (“the ’045 patent”). Defendants counterclaimed seeking a declaratory judgment of noninfringement and invalidity. The district court, Judge Sue L. Robinson, adjudged the claims infringed but invalid for obviousness. Plaintiffs appeal the invalidity judgment.

. . .

We conclude that the district court properly considered evidence of unexpected results, J.A. 32-34, and did not err in finding that, based on the record and testimony offered, the increase in corneal permeability shown by plaintiffs using a 0.01 w/v% EDTA is not unexpected or surprising, but is a product of routine optimization that would have been obvious to one of skill in the art. J.A. 33- 34. These determinations, much like many of the obviousness determinations, were based on credibility judgments on which, on the evidence before us, we defer to the district court. See Celsis In Vitro, 664 F.3d at 929.

We further conclude that the district court properly applied a presumption of validity, considering both the evidence of obviousness and the evidence of unexpected results, to find that appellees set forth clear and convincing evidence of invalidity in this case. See Sciele Pharma Inc., 684 F.3d at 1260. We agree that it was not clear error for the district court to conclude that the unexpected results evidence that Senju relied upon during reexamination, J.A. 2692, did not withstand scrutiny by Lupin’s experts and the district court. Ultimately, the district court properly concluded that the theories presented during reexamination proved too weak when challenged in a judicial forum to rise to the level of unexpected results sufficient to rebut a strong case of obviousness. See Proctor & Gamble Co. v. Teva Pharms. USA, Inc., 566 F.3d 989, 994 (Fed. Cir. 2009). We have considered and find unpersuasive the remainder of appellants’ arguments. Concluding that the district court did not err in its judgment that the reexamined claims at issue are invalid for obviousness, we need not reach the issues of infringement and estoppel.

III. CONCLUSION The judgment of the district court is affirmed. AFFIRMED

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Selective Ins. Co. v. Smart Candle, LLC

Smart Candle, LLC, sells light-emitting diode (LED) flameless candles and commercial lighting systems internationally. On October 31, 2011, Excell Consumer Products sued Smart Candle under the LanhamAct alleging that, among other things, Smart Candle’s use of the trade name and trademark “Smart Candle” infringed rights that Excell had over use of that name and trademark. Excell sought a permanent injunction against Smart Candle’s use of the name, trademark, and domain name “smartcandle.com."

Selective Insurance Company insured SmartCandle between October 18, 2010, and October 18, 2012, and during that period the Excell suit had commenced. Smart Candle requested that Selective defend Smart Candle in that suit, but Selective disclaimed coverage under the policy. Selective pointed to relevant portions of the policy that cover “personal and advertising injury,” which the policy defines asinjury resulting from, among other things, “Infringing upon another’s copyright, trade dress or slogan in your ‘advertisement.’” Excluded from that coverage of “personal and advertising injury,” however, is any injury “arising out of the infringement of copyright, patent, trademark, trade secret or other intellectual property rights.” The exclusion clarifies that it “does not apply to infringement in your ‘advertisement’ of copyright, trade dress or slogan.” Because the policy required Selective to defend only suits claiming infringement of “copyright, trade dress[,] or slogan,” Selective insisted, Selective had no duty to defend Smart Candle against Excell’s suit for infringement of the “Smart Candle” trademark.

. . .

Smart Candle argues that it is entitled to indemnification for its costs to defend against Excell’s claims because, Smart Candle insists, Excell’s lawsuit was arguably based on Smart Candle’s use of the phrase “Smart Candle” as a slogan or as both a trademark and a slogan. Smart Candle asserts that the record contains ample evidence of its use of that phrase as a slogan: “Smart Candle” (the phrase) purportedly was used to “educate[] its customers” that Smart Candle (the company) “expresses a characteristic, position or stand, or goal to be achieved.” That goal, Smart Candle urges, is “to promote a line of battery-operated candles as a safe, economical alternative to a real wax candle.”

We disagree with Smart Candle. . . .

Smart Candle also asserts that Selective was required to look beyond Excell’s complaint to determine whether there was an “arguable” claimofslogan infringement before denying coverage. Smart Candle says Selective admitted it reviewed Smart Candle’s website before denying coverage when Selective denied an allegation in Smart Candle’s counter-complaint that Selective did not conduct any investigation.

This secondary argument deserves little attention. . . .

We affirm the district court’s grant ofsummary judgment in favor of Selective.

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Marcel Fashions v. Lucky Brand Dungarees

Plaintiff appeals from a grant of summary judgment by the United States District Court for the Southern District of New York (Swain, J.), dismissing claims of trademark infringement, false designation of origin and unfair competition under the doctrine of res judicata. Plaintiff appeals also from the district court’s denial of Plaintiff’s motions for leave to file an amended complaint and to hold the Defendants in contempt. The Court of Appeals (Leval, J.) concludes that the district court erred in granting summary judgment, as well as in denying Plaintiff’s motion for leave to file an amended complaint, as res judicata does not bar these claims. The denial of contempt sanctions is affirmed. Accordingly, the judgment is AFFIRMED IN PART and VACATED IN PART. 

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Fifty-Six Hope Road Music v. A.V.E.L.A.

The panel affirmed the district court’s judgment after a jury trial on claims under the Lanham Act and Nevada state law regarding the use of Bob Marley images on apparel and other merchandise.

Affirming the denial of defendants’ post-trial motion for judgment as a matter of law on a false endorsement claim, the panel held that sufficient evidence supported the jury’s finding that defendants violated the Lanham Act because they (a) used Marley’s image (b) on their t-shirts and other merchandise, (c) in a manner likely to cause confusion as to plaintiffs’ sponsorship or approval of these t-shirts and other merchandise. The panel held that defendants waived several defenses. It rejected the argument that allowing a plaintiff to vindicate a false endorsement claim based on the use of a deceased celebrity’s persona essentially creates a federal right of publicity.

The panel held that the district court did not abuse its broad discretion in determining the profits for three defendants. There was sufficient evidence to find that defendant Freeze willfully infringed plaintiffs’ rights. The Seventh Amendment did not require that a jury calculate these profits. The panel held that the district court did not abuse its discretion by ordering three defendants to pay attorneys’ fees to plaintiffs because (1) plaintiffs were prevailing parties, and (2) the case was exceptional, as these defendants’ conduct was willful.

The panel affirmed the district court’s grant of summary judgment to defendants on a right of publicity claim under Nevada law.

The panel held that there was sufficient evidence to support the jury’s finding that three defendants interfered with plaintiffs’ prospective economic advantage.

The panel held that the district court did not err in granting defendants’ motion for judgment as a matter of law on the issue of punitive damages.

Concurring in part and dissenting in part, Judge Christen concurred in the result but did not join the reasoning in Subsection I.B.2 of the majority’s opinion, addressing likelihood of confusion. Judge Christen wrote that the narrow holding in Part I, concluding that the evidence presented at trial was sufficient for the jury to find that defendants violated the Lanham Act by using Marley’s likeness, was dictated by the standard of review on appeal, and by the defenses actually pursued by defendants.

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Pennzoil-Quaker State v. Miller Oil and Gas

The holder of a trademark has certain rights, among them the power to prohibit another entity from using its mark without its consent. Those rights are subject to equitable defenses, including acquiescence, where the markholder affirmatively represents to another that it may use its mark, who then relies on that representation to its prejudice. This case requires us to clarify the role that undue prejudice plays in the analysis of acquiescence. Concluding that the defendant here failed to demonstrate that it was unduly prejudiced by any representations made by the markholder, we reverse.

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Gilead Sciences, Inc. v. Lee

Gilead Sciences, Inc. (“Gilead”) appeals the decision of the United States District Court for the Eastern District of Virginia granting summary judgment to the Director of the United States Patent and Trademark Office (“PTO”) on whether it properly calculated the Patent Term Adjustment (“PTA”) period for U.S. Patent No. 8,148,374 (“the ’374 patent”). See Gilead Scis., Inc., v. Rea, 976 F.Supp.2d 833 (2013) (“Gilead I”). Because the district court properly granted the director’s motion for summary judgment, this court affirms.

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Yazdianpour v. Safeblood Techs., Inc.

Hamid Yazdianpour and Faisal Ali Mousa al Naqbi (Licensees), along with their limited liability company (the LLC), entered into a licensing agreement with Safeblood Technologies, Inc. (Safeblood Tech) for the exclusive rights to market patented technology overseas. Licensees later sued Safeblood Tech for breach of contract. Licensees also brought suit against Safeblood Tech and its officers Charles Worden, Jr. (Worden Jr.), and Jim Limbird (collectively, Safeblood Group) and against patent inventor Charles Worden, Sr. (Worden Sr.), for fraud, constructive fraud, and violations of the Arkansas Deceptive Trade Practices Act (ADTPA), Ark. Code Ann. §§ 4-88-101 to -115. The district court dismissed the fraud claims at summary judgment. The remaining claims proceeded to trial and a jury found for Licensees, awarding them $786,000 in contract damages and no damages for violations of the ADTPA.  The district court awarded Licensees an additional $144,150.40 in prejudgment interest.

Licensees appeal, arguing that the district court erred in dismissing their fraud claims at summary judgment, that a jury instruction on the ADTPA claim was erroneous, and that the jury returned an inconsistent verdict on the ADTPA claim. Safeblood Group cross-appeals, arguing that Licensees lack standing, that the district court should have granted judgment as a matter of law on the ADTPA claim and the entire case, and that prejudgment interest should not have been awarded. Worden Sr. filed a conditional cross-appeal, arguing that the district court should have granted his motion for judgment as a matter of law on the ADTPA claim. We reverse the grant of summary judgment on the common-law fraud claim and the award of prejudgment interest, and we affirm in all other respects.

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