IP UPDATE
Exploring the Latest in Intellectual Property Law
IP UPDATE
Exploring the Latest in Intellectual Property Law
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A Step Forward for Choreography and Copyright

by | Nov 16, 2023 |

In a rare ruling on infringement of a copyright on choreography, the US Court of Appeals for the Ninth Circuit reversed the dismissal of a copyright infringement action, holding that the district court erred in its application of the substantial similarity standard in terms of the line between animation and choreography, and remanded for further proceedings. Hanagami v. Epic Games, Inc., Case No. 22-55890 (9th Cir. Nov. 1, 2023) (Murguia, C.J.; Paez, Nguyen, JJ.)

Kyle Hanagami, a Los Angeles-based choreographer with a substantial social media following, brought this action against Epic Games, creator of the blockbuster video game Fortnite. Hanagami alleged that Epic infringed his copyrighted choreography by incorporating a portion of his dance work into a virtual animation, known as an “emote,” that players can purchase for video game avatars to perform. Hanagami has created choreography for famous pop stars and globally recognized brands. The five-minute choreographic work at issue in this action was originally published on YouTube in November 2017 and had received almost 36 million views as of Hanagami’s original March 2022 complaint.

In August 2020, Epic released a version of Fortnite that included a new emote called “It’s Complicated.” The allegedly copied choreography consisted of a two-second combination of eight bodily movements set to four beats of movement, which Hanagami alleged “contain[ed] the most recognizable portion” of his choreography. Hanagami brought federal claims alleging direct and contributory infringement of a copyright, as well as a state law unfair competition claim.

The district court granted Epic’s motion to dismiss wherein Epic asserted that Hanagami had not plausibly alleged that the Fortnite emote displayed “substantial similarity” to his choreographic work. Hanagami appealed.

At issue in this appeal was whether the district court had properly applied the Ninth Circuit’s two-part test for substantial similarity in assessing Hanagami’s infringement allegations. The first part, called the “extrinsic test,” focuses only on the protectable elements of the plaintiff’s expression and assesses the objective similarities between the original and the allegedly infringing work. The second part, referred to as the “intrinsic test,” gauges similarity of expression from the perspective of the ordinary reasonable observer and is reserved for the trier of fact. Hence, at the pleadings stage, only the extrinsic test is applied.

The Ninth Circuit concluded that the district court erred in its application of the extrinsic test in two ways. First, the district court incorrectly analyzed Hanagami’s choreography as a series of unprotectable “poses,” rather than as a movement sequence that includes expressive elements such as body position, timing, use of space, energy, pauses and repetition. The Court explained that when a dance work is properly analyzed as a selection and arrangement of movements, Hanagami “plausibly alleged that the creative choices he made in selecting and arranging elements . . . are substantially similar to the choices Epic made in creating the emote.” Second, the district court erred in dismissing Hanagami’s claim because the choreography in the emote was “short” and a “small component” of the original work. The Ninth Circuit [...]

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Resorting to Extrinsic Evidence Is Necessary When Intrinsic Evidence Is Muddied

by | Nov 16, 2023 |

The US Court of Appeals for the Federal Circuit determined that the limitation “a pH of 13 or higher” could not be construed using the asserted patents’ intrinsic evidence and therefore remanded to the district court with instructions to consider the extrinsic evidence and its impact on claim construction. Actelion Pharms. Ltd v. Mylan Pharms. Inc., Case No. 22-1889 (Fed. Cir. Nov. 6, 2023) (Reyna, Stoll, Stark, JJ.)

Mylan Pharmaceuticals sought market entry for its generic epoprostenol—a small molecule hypertension drug—via an abbreviated new drug application (ANDA). Mylan certified under Paragraph IV with respect to two Orange Book-listed patents that Actelion Pharmaceuticals owned. Actelion timely asserted both patents and achieved a favorable claim construction for the term “a pH of 13 or higher.” This limitation is central to the pharmaceutical breakthrough that the asserted patents disclose, which is stably solubilizing the otherwise unstable epoprostenol. The asserted patents teach that epoprostenol bulk solutions’ pH should preferably be adjusted to about 12.5 to 13.5. Mylan contended that this language meant the claim should not encompass anything below pH 13 (i.e., leaving only a fraction of the disclosure’s preferred range within the scope of the issued claims). The district court disagreed, adopting Actelion’s position that the limitation encompassed values that “rounded” to pH 13 (i.e., pH 12.5 and above). This prompted a stipulated infringement judgment. Mylan appealed.

The Federal Circuit reviewed the district court’s construction de novo, explaining that the district court’s construction was a ruling as a matter of law because no extrinsic evidence was considered. The Court then examined the claim language, specifications and prosecution histories in turn.

Regarding the claim language, the Federal Circuit rejected the parties’ invitations to acknowledge certain prior decisions as articulating bright-line rules. Instead, the Court appeared to endorse analyzing the intrinsic evidence on a case-by-case basis when construing similar range limitations. For example, the Court explained that “there is no blanket rule that ranges, or specifically open-ended ranges, must foreclose rounding.” The Court also rejected the following rules concerning range precision:

  • Avoiding rounding requires terms of precision, such as “precisely” or “exactly.”
  • The absence of approximation language dictates a precise value.

In contrast, the Federal Circuit signaled that district courts should properly account for a range’s technical implications (or at least ranges concerning the pH scale) even if that means looking to extrinsic evidence.

Regarding the specifications and prosecution histories, the Federal Circuit disagreed with the district court’s finding that both were inconsistent with Mylan’s position that the disputed limitation reflected a higher degree of precision. The Court concluded that there was little to glean from either, finding that the specifications were as clear as “muddied water” and the prosecution histories provided no insight into the relevant pH range—between pH 12 and pH 13.

The Federal Circuit ultimately concluded that this was an instance in which properly construing a claim limitation required the aid of extrinsic evidence, invoking the Supreme Court of the United States’ guidance from Teva v. Sandoz that extrinsic evidence [...]

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All the Way Up to the Second Circuit, and Back

by | Nov 16, 2023 |

The US Court of Appeals for the Second Circuit vacated a grant of summary judgment made prior to discovery, holding that the district court abused its discretion in finding a draft contract agreement admissible under Federal Rule of Evidence (FRE) 1003 notwithstanding sworn testimony questioning its contents. Eric A. Elliott, aka Fly Havana v. Joseph Anthony Cartagena et al., (2d. Cir. Oct. 17, 2023) (Merriam, Nardini, JJ.)

The dispute in this case centered on whether Eric Elliott was properly credited and compensated for his contribution in writing the song “All the Way Up.” Both Elliott and Joseph Anthony Cartagena (also known as “Fat Joe”) acknowledged that Elliott had signed an agreement regarding the song, but both parties were unable to locate the original agreement. Instead, Cartagena submitted a draft that he claimed was an authentic duplicate. This draft purported to assign all of Elliott’s rights to the song to an entity.

Elliott disputed the authenticity of the draft, claiming that there were numerous additional and different material terms in the agreement he signed. Nonetheless, the district court found the evidence admissible under FRE 1003 and 1004 and entered summary judgment in favor of defendants prior to discovery being conducted in the case. Elliot appealed.

The Second Circuit concluded that the district court abused its discretion and vacated. FRE 1002, also known as the “best evidence rule,” states that “[a]n original writing . . . is required in order to prove its content unless these rules or a federal statute provides otherwise.” If an original document is unavailable, a duplicate may still be admissible under FRE 1003, which states: “A duplicate is admissible to the same extent as the original unless a genuine question is raised about the original’s authenticity or the circumstances make it unfair to admit the duplicate.”

Here, the district court relied on Cartagena’s sworn testimony that he printed the draft at the complex where he lived and brought it with him to a meeting with Elliott. The district court disregarded Elliott’s sworn testimony in response to Cartagena, which suggested that the draft was not identical to the version Elliott signed. While the draft specified that the rights to the song would be assigned to an entity, Elliott averred that the version he signed “seemed to state that [he] was going to be compensated and credited as a writer.” Given this factual dispute, the Second Circuit held that the district court abused its discretion in admitting the draft as a duplicate under FRE 1003 and granting summary judgment, particularly without the benefit of discovery.

The Second Circuit concluded that there was a genuine factual dispute as to whether Elliott validly assigned all his rights and whether any such purported assignment precluded Elliott’s claims. Given the issues regarding the authenticity of the draft and the genuine dispute of material fact, the Court found summary judgment improper.

However, a duplicate may also be admissible under FRE 1004, which states: “[a]n original is not required and other evidence of the content [...]

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Still Exceptional: Fee-Shift Appropriate in View of Noninfringement Stipulation

by | Nov 16, 2023 |

In a split decision, the US Court of Appeals for the Federal Circuit affirmed a district court’s award of more than $5 million in attorneys’ fees, finding that the district court did not abuse its discretion in finding the underlying case “exceptional” under 35 U.S.C. § 285 or in calculating the total fees awarded. In re PersonalWeb Tech., Case No. 21-1858 (Fed. Cir. Nov. 3, 2023) (Reyna, Lourie, JJ.) (Dyk, J., dissenting).

Under 35 U.S.C. § 285, a “court in exceptional cases may award reasonable attorney fees to the prevailing party.” In Octane Fitness (2014), the Supreme Court of the United States held that an exceptional case is “simply one that stands out from others with respect to the substantive strength of a party’s litigating position (considering both the governing law and the facts of the case) or the unreasonable manner in which the case was litigated,” and the court considers the totality of the circumstances in making this determination.

PersonalWeb’s litigation positions at issue date back to 2011, when PersonalWeb first asserted five patents against an e-commerce company. After an unfavorable claim construction ruling, PersonalWeb stipulated to dismiss the action, and the district court entered the dismissal with prejudice.

In 2018, PersonalWeb asserted the patents against customers of the e-commerce company. The e-commerce company intervened and filed a new action against PersonalWeb seeking a declaratory judgment to bar the infringement actions against the customers based on the 2011 dismissal. Some of the cases proceeded while others were stayed. The district court granted summary judgment against PersonalWeb on claims directed to two allegedly infringing products for two separate reasons: because of the Kessler doctrine and claim preclusion, and because PersonalWeb conceded that it could not prevail after an unfavorable claim construction order.

The district court also entered an award of attorneys’ fees and costs against PersonalWeb, finding the case to be “exceptional” for the following reasons:

  • The infringement claims were “objectively baseless and not reasonable when brought because they were barred due to a final judgment in the [2011 action].”
  • PersonalWeb frequently changed its infringement positions to overcome the hurdle of the day.
  • PersonalWeb unnecessarily prolonged this litigation after claim construction foreclosed its infringement theories.
  • PersonalWeb’s conduct and positions regarding the customer cases were unreasonable.
  • PersonalWeb submitted declarations that it should have known were inaccurate.

The district court calculated the attorneys’ fees to be more than $5 million and costs to be more than $200,000. PersonalWeb appealed.

PersonalWeb argued that the district court erred in awarding fees and, even if fees were warranted, the court erred in assessing almost $2 million of the $5 million award. The Federal Circuit found that the district court did not abuse its discretion in any of its findings related to the fee grant, agreeing with the district court’s application of the Kessler doctrine. In Kessler, the Supreme Court ruled that after a final judgment of noninfringement, follow-up suits by the same patentee over the same non-infringing product against customers of the party [...]

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See Here: No Standing Based on Vague Future Plans or Adverse Priority Findings

by | Nov 16, 2023 |

The US Court of Appeals for the Federal Circuit dismissed an appeal from a final written decision in an inter partes review (IPR) proceeding, finding that the petitioner lacked standing because it suffered no injury in fact. Allgenesis Biotherapeutics Inc. v. Cloudbreak Therapeutics, LLC, Case No. 22-1706 (Fed. Cir. Nov. 7, 2023) (Moore, Stoll, Cunningham, JJ.)

Allgenesis Biotherapeutics filed an IPR petition challenging a patent owned by Cloudbreak Therapeutics. The challenged patent discloses compositions and methods for treating the eye condition pterygium. During the IPR proceeding, Cloudbreak disclaimed all but two of the claims. The Patent Trial & Appeal Board issued a final written decision finding that Allgenesis failed to show that the remaining two claims were unpatentable. As part of its decision, the Board made a priority decision that a Patent Cooperation Treaty (PCT) application belonging to Allgenesis was not prior art to Cloudbreak’s patent. Allgenesis appealed.

Article III of the US Constitution limits the Federal Circuit’s jurisdiction to adjudication of “cases” or “controversies,” which means the appellant must have (1) suffered an injury in fact (2) that is fairly traceable to the challenged conduct of the defendant and (3) likely to be redressed by a favorable judicial decision.

Allgenesis attempted to establish Article III standing based on two separate arguments. First, Allgenesis argued that it had standing based on potential infringement liability. To support that argument, Allgenesis offered a declaration by its vice president of finance that included information about a Phase II trial completed three years prior and a related 2020 publication. That declaration, however, did not identify any specific plan to conduct a Phase III trial or to seek US Food and Drug Administration (FDA) approval, and instead only contained generic statements that the project was not abandoned. While Allgenesis’s briefing and oral argument included statements that it planned to engage in a Phase III trial, the Federal Circuit determined that there was no record support for this claim. The Court found that the evidence before it did not constitute the necessary concrete plans to convey standing to appeal the final written decision. Allgenesis also attempted to rely on its own failed attempts at seeking a settlement from Cloudbreak, but the Court concluded that this was insufficient to show a substantial risk of infringement.

Allgenesis’s second argument was that the Board’s priority decision created an injury in fact. Allgenesis argued that the Board’s determination about the priority date of Cloudbreak’s patent affected Allgenesis’s patent rights because it would have a preclusive effect on Allgenesis’s pending applications. The Federal Circuit was unpersuaded and explained that collateral estoppel does not attach to a non-appeal priority decision from an IPR decision. To the extent that an examiner did reach the same conclusion as the Board, Allgenesis would be free to appeal that decision.

Practice Note: For Board petitioners seeking to establish standing to appeal unfavorable final written decisions, it is necessary to develop sufficient support to show standing in fact. For life sciences companies working in drug development, declarations [...]

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Unfair Play: Unjust Enrichment for Copying and Using Non-Trade-Secret Spreadsheet

by | Nov 9, 2023 |

The US Court of Appeals for the Second Circuit reversed a district court’s dismissal of an unjust enrichment claim, finding that unjust enrichment claims do not necessarily rise or fall with trade secret misappropriation claims and may be advanced where there is a dispute as to whether a contract’s scope covers the parties’ disagreement. Pauwels v. Deloitte LLP, Case No. 22-21 (2d Cir. Oct. 6, 2023) (Sacks, Robinson, JJ.) (Jacobs, J., dissenting in part).

Andre Pauwels is a contractor who was retained without written agreement by The Bank of New York Mellon and its parent company (collectively, BNYM) to work on investment valuation. In 2014, while working for BNYM, Pauwels developed the “Pauwels Model” for valuation, which was implemented in Excel spreadsheets. Pauwels typically would send BNYM only the outputs from the Pauwels Model. According to Pauwels, the Pauwels Model and spreadsheets were confidential and proprietary, although the spreadsheets were not password-protected, encrypted or labeled confidential, and Pauwels sometimes shared the spreadsheets with BNYM.

In 2016, BNYM engaged Deloitte and related entities (collectively, Deloitte) to take over Pauwels’s duties. Pauwels never authorized BNYM to share the Pauwels Model spreadsheets with Deloitte, and BNYM assured Pauwels that Deloitte was not using those spreadsheets. In April 2018, Pauwels discovered that BNYM had given Deloitte the spreadsheets and that Deloitte had copied the Pauwels Model. BNYM terminated its relationship with Pauwels in May 2018.

In March 2019, Pauwels sued BNYM and Deloitte for trade secret misappropriation, unfair competition and unjust enrichment and further alleged that BNYM committed fraud and negligent misrepresentation. After BNYM and Deloitte moved to dismiss, the district court granted the motion in relevant part. The district court dismissed the unjust enrichment claim as duplicative of the trade secret misappropriation claim, citing the 2009 Second Circuit case Faiveley Transp. Malmo v. Wabtec for the proposition that “where an unfair competition claim, and a misappropriation claim arise from the same factual predicate . . . the two claims generally rise or fall together.” The district court dismissed the remainder of the claims for failure to plausibly allege the existence of trade secrets, that BNYM and Deloitte had “misappropriated” anything, or that Pauwels suffered damages. Pauwels appealed.

The Second Circuit reversed the dismissal of Pauwels’s unjust enrichment claim as to BNYM. Initially, the Court found that Pauwels’s unjust enrichment claim was not duplicative of his trade secret misappropriation claim, distinguishing Faiveley Transp. and explaining that misappropriation is not an element of unjust enrichment claims. The Court rejected BNYM’s argument that Pauwels’s unjust enrichment claim was precluded by the contract between the parties. The Court found that Pauwels could maintain his claim because there was “a bona fide dispute . . . whether the scope of an existing contract covers the disagreement between the parties.” According to Pauwels, he was engaged and paid for his advice and expertise only, meaning that BNYM had no right to benefit from the Pauwels Model spreadsheets by sharing them with Deloitte. According to BNYM, [...]

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No Fifth Chances: Ignoring Court’s Warning Leads to Terminal Sanctions

by | Nov 9, 2023 |

In an appeal from litigation-ending sanctions, the US Court of Appeals for the Fifth Circuit held that misconduct in the face of judicial warnings supports the use of litigation-ending sanctions and that evidence a party forgot about does not count as “new” evidence when remembered for the purpose of a motion for reconsideration. Calsep A/S v. Ashish Dabral, Case No. 22-20440 (5th Cir. Oct. 11, 2023) (Clement, Elrod, Willett, JJ.)

Insights Reservoir Consulting (IRC), a company owned by Ashish Dabral, was hired to make a computer program that assesses oil-well efficiency. To develop that software, Dabral turned to his college friend who worked at Calsep A/S, a software company that designs and sells oil-well assessment software. Dabral hired his friend away from Calsep, and IRC subsequently developed and sold its own oil-well efficiency software.

Surprised at the sudden appearance of a competitor, Calsep investigated and found that IRC had recently hired one of its former employees. Calsep conducted an internal audit and found that its former employee had absconded with trade secrets just before leaving. Calsep sued Dabral and IRC.

In discovery, Calsep requested the complete development history of IRC’s new software. Dabral resisted such disclosure as “overbroad,” but the district court ordered production of the requested materials. Shortly thereafter, the district court further entered an order specifically enjoining the parties from the “destr[uction] of any potentially relevant evidence, including electronically stored information.”

In response to the discovery request, Dabral only produced portions of the development history, and its produced history included sections that were either incomplete or manipulated. In response, Calsep filed another motion to compel. The district court ordered Dabral to “come clean” and comply “voluntarily” before the court resorted to sanctions. Dabral represented that the entire history had been produced and that it was missing only portions deleted before the lawsuit.

The district court held an evidentiary hearing, and Dabral admitted that many of the deletions actually occurred during the lawsuit. The district court levied terminal sanctions based on Dabral’s violation of four separate court orders and serial discovery misconduct. Seven months later, Dabral filed a motion for reconsideration based on new information he found in his storage unit in India. The district court denied the motion. Dabral appealed both the sanctions ruling and the denial of the motion for reconsideration.

The Fifth Circuit first analyzed the sanctions. It limited its analysis to sanctions under Rule 37, which (in the Fifth Circuit) requires four specific findings before terminal sanctions can be levied:

  1. The violation was willful or bad faith.
  2. The client was responsible.
  3. The violation caused substantial prejudice.
  4. A lesser sanction would not have the desired deterrent effect.

The Fifth Circuit held that Dabral’s pattern of conduct supported a finding of bad faith. Dabral admittedly deleted evidence, delayed discovery and ignored several court orders. And when the district court gave him a last chance to “come clean,” he instead deleted more data and made a false representation.

The Fifth Circuit also held that Dabral’s conduct [...]

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Sorry—No Finality, No Injunction, No Appellate Jurisdiction

by | Nov 9, 2023 |

The US Court of Appeals for the Third Circuit dismissed an appeal from the denial of a motion under the Defend Trade Secrets Act (DTSA) for an ex parte seizure order, explaining that such orders are not final, not effectively injunctive and that the DTSA does not independently provide appellate jurisdiction to review such orders. Janssen Prod., L.P. v. eVenus Pharms. Lab’ys Inc., Case No. 22-2426 (3d Cir. Oct. 17, 2023) (Porter, Freeman, Fisher, JJ.)

In 2015, the US Food & Drug Administration (FDA) approved Janssen’s drug Yondelis—a stable, injectable version of the cancer drug trabectedin—for use in certain cancer patients. Janssen asserts that its data, specifications and methods for manufacturing Yondelis are trade secrets. After Janssen received FDA approval for Yondelis, eVenus sought FDA approval for a generic version of Yondelis. Janssen filed a lawsuit against eVenus (under the Hatch-Waxman Act) for patent infringement. During discovery, Janssen obtained documents that allegedly demonstrated that eVenus misappropriated Janssen’s trade secrets. Janssen then filed the current lawsuit against eVenus seeking relief for eVenus’s alleged trade secret misappropriation under the DTSA.

During discovery, Janssen found that eVenus spoliated evidence. In response, Janssen filed a motion for an ex parte seizure under the DTSA, requesting that the district court order the seizure of eVenus’ network servers and stored data, and the laptops and cell phones of certain eVenus employees and ex-employees. The district court denied Janssen’s ex parte seizure motion. Janssen appealed.

The Third Circuit dismissed the appeal, concluding that it lacked jurisdiction over Janssen’s appeal for two reasons.

First, the Third Circuit found that it lacked appellate jurisdiction because the district court’s denial of Janssen’s ex parte seizure motion was not a final judgment and did not meet any of the limited exceptions to the final judgment rule.

One limited exception to appellate jurisdiction under the final judgment rule is review of a lower court’s refusal to order injunctive relief. However, as the Third Circuit explained, an ex parte seizure order under the DTSA is not effectively injunctive and therefore does not fall under the injunction exception. The Court explained that refusal to grant an ex parte seizure order does not satisfy the first two prongs of the Court’s three-part functional injunction test, which require that an order be “directed to a party” and may be enforced by contempt. Regarding the first prong, the Court noted that DTSA seizure orders are not “directed to a party” because the DTSA requires law enforcement officials—and not a party—to execute any ex parte seizure order. Regarding the second prong, no party can be held in contempt for failing to comply with an order that does not direct it to do anything. Therefore, the district court’s order did not effectively deny an injunction.

Second, the Third Circuit analogized DTSA seizure orders with seizure orders under the Lanham Act in terms of statutory construction. As the Court explained, in the Lanham Act, ex parte seizure provisions are part of its “injunctive relief” section. In contradistinction, Congress did not [...]

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Statements in Unrelated Application Don’t Narrow Claim Term

by | Nov 9, 2023 |

The US Court of Appeals for the Federal Circuit vacated a stipulated judgment of noninfringement in a patent infringement dispute after construing a disputed claim term, taking a more literal approach than the district court based on the meanings of the individual words of the claim language. Malvern Panalytical Inc. v. TA Instruments-Waters LLC, Case No. 22-1439 (Fed. Cir. Nov. 1, 2023) (Prost, Hughes, Cunningham, JJ.)

The dispute involved a suit brought by Malvern against TA Instruments-Waters and Waters Technologies Corporation (collectively, Waters) alleging infringement of two patents. Both asserted patents disclose microcalorimeters for measuring the amount of energy absorbed or released during a chemical reaction between two compounds and include independent claims directed to “a micro titration calorimetry system” having several elements, including an automatic pipette assembly that is guided into at least two positions via another component—namely, the disputed “pipette guiding mechanism.”

The pre-grant publication of a commonly assigned but unrelated patent was cited during the prosecution of an unrelated Malvern patent because the examiner understood the disclosure of that patent to recite an automated pipette guiding mechanism. The applicant initially tried to rebut the rejections by arguing that the disclosure of that patent recited a “purely passive [pipette] guiding mechanism.” However, after the examiner found the arguments unpersuasive, the applicant simply changed course and argued that the cited reference was not prior art because the publication and unrelated patent had a common assignee.

Malvern then requested supplemental examination of the now asserted patent under 35 U.S.C. § 257. In connection with the supplemental examination, Malvern filed an information disclosure statement (IDS) that included 154 documents, seven of which were office actions from the prosecution of the unrelated patent. Malvern did not describe or characterize the office actions in any way.

Turning back to the litigation, during claim construction proceedings, Malvern argued that “pipette guiding mechanism” should mean a “mechanism that guides the pipette assembly” while Waters argued that it should mean a “mechanism that manually guides the pipette assembly.” The district court concluded that the term “pipette guiding mechanism” was a coined term because Malvern presented no evidence that a “pipette guiding mechanism” was known or readily understandable to a person of ordinary skill in the art. Based on that determination, the district court relied on intrinsic evidence to determine the objective boundaries of the term.

The district court found that the statement made during the prosecution of the unrelated patent was relevant to the claim construction because the asserted and unrelated patents were assigned to Malvern. The district court also considered these statements as having been incorporated into the intrinsic record of the asserted patent because it concluded that Malvern agreed to incorporate the statements when it cited the office actions filed during supplemental examination of the asserted patent. Malvern appealed.

The Federal Circuit explained that it was appropriate to construe the term “pipette guiding mechanism” by looking into the individual meanings of the words “pipette,” “guiding” and “mechanism.” The Court indicated that when the patentee [...]

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Tenth Circuit Contributes Clarity to Contributory Liability in Copyright Infringement

by | Nov 9, 2023 |

Addressing the elements of contributory copyright infringement, the US Court of Appeals for the Tenth Circuit found that a plaintiff had plausibly alleged contributory copyright infringement when he alleged that the defendants had “caused, materially contributed to, or authorized the direct infringement” of his copyrights. Greer v. Moon, et al., Case No. 21-4128 (10th Cir. Oct. 16, 2023) (Bachrach, Moritz, Rossman, JJ.)

Joshua Moon owns and operates the controversial website, Kiwi Farms, “a site ‘built to exploit and showcase those Moon and his users have deemed to be eccentric and weird,’ [m]any of [whom] are physically or mentally disabled.” Russell Greer, who suffers from a form of facial paralysis, was targeted by Kiwi Farms users after Greer sued Taylor Swift in 2016. In 2017, Greer wrote a book to “explain his side of things,” titled “Why I Sued Taylor Swift and How I Became Falsely Known as Frivolous, Litigious and Crazy,” which he published and copyrighted. In 2019, Greer registered his copyright for his song, “I Don’t Get You, Taylor Swift.” Greer alleged that Kiwi Farms users infringed both works by creating and uploading unauthorized audio recordings of the book, posting links to a full copy of the book on the Kiwi Farms platform and uploading his song to the Kiwi Farms website.

Pursuant to the Digital Millennium Copyright Act, Greer sent Moon a takedown notice, identifying the infringing materials and the location of those unauthorized copies. In response, Moon published the takedown notice and Greer’s contact information on Kiwi Farms and responded to Greer via an email in which Moon “derid[ed]” Greer and refused to remove the copyrighted materials. Shortly thereafter, Greer sued Moon and Kiwi Farms for contributory copyright infringement, among other things. The district court granted the defendants’ motion to dismiss for failure to state a claim, and Greer appealed.

The Tenth Circuit explained that there are “three flavors of secondary liability for copyright infringement”:

  1. Vicarious liability, when a secondary infringer has a financial interest in the exploitation of the copyrighted materials and the ability to supervise the direct infringer
  2. The inducement rule, when the secondary infringer distributes a device that is intended to be used for copyright infringement
  3. Contributory liability, when the secondary infringer “causes or materially contributes to” the direct infringer’s activities.

Greer’s claims were based on contributory liability, which occurs when there is direct infringement of a plaintiff’s copyrighted material(s), the defendant had knowledge of the direct infringement and the defendant “intentionally caused, induced, or materially contributed to the direct infringement.”

There was no dispute that Greer’s pro se complaint met the first two prongs of the test. The district court granted the defendants’ motion to dismiss because it found that Greer failed to plausibly plead the third element of contributory infringement: “It is not enough for contributory liability for a defendant to have merely permitted the infringing material to remain on the website, without having induced or encouraged the initial infringement” (internal quotations omitted).

The Tenth Circuit dismissed the district court’s [...]

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