Lodsys Update

From time to time, we like to check in on the Lodsys lawsuit - which, if you'll recall, was one of the most high-profile patent infringement suits filed in 2011. So what's new with Lodsys and the dozens of app developers and big tech companies it sued? Looks like they're still duking it out - and some defendants are using the anti-joinder provision in the America Invents Act (AIA) to try to extract themselves from the lawsuit.

The AIA made it much more difficult for one company to sue a gaggle of infringers all at once, unless the individual acts of infringement were part of the same transaction. And the anti-joinder provision was one of the sections of the AIA that took effect upon its passage in September 2011. Thus, in the weeks leading up to the bill becoming law, a flurry of multi-defendant patent lawsuits were filed.

Unfortunately for the many app makers and IT firms targeted by the Lodsys lawsuit, they were sued before the anti-joinder provision took effect. But then came a glimmer of hope in the form of In re EMC.

In that case, the Court of Appeals for the Federal Circuit (CAFC) required that a lower court reconsider a defendant's motion for severance in a lawsuit filed pre-AIA. In its May 2012 ruling, the CAFC held that "joinder is not appropriate where different products or processes are involved. Joinder of independent defendants is only appropriate where the accused products or processes are the same in respects relevant to the patent. But the sameness of the accused products or processes is not sufficient. Claims against independent defendants (i.e., situations in which the defendants are not acting in concert) cannot be joined under Rule 20’s transaction-or-occurrence test unless the facts underlying the claim of infringement asserted against each defendant share an aggregate of operative facts. To be part of the 'same transaction' requires shared, overlapping facts that give rise to each cause of action, and not just distinct, albeit coincidentally identical, facts. The sameness of the accused products is not enough to establish that claims of infringement arise from the 'same transaction.' Unless there is an actual link between the facts underlying each claim of infringement, independently developed products using differently sourced parts are not part of the same transaction, even if they are otherwise coincidentally identical.”

With that newly-set precedent in mind, Lodsys defendants Hewlett Packard and Lexmark each filed motions to sever Lodsys' claims against them, citing In re EMC and pointing to the difficulty of mounting a successful defense as one of many defendants.

"Surrounded by a circus of other, competing interests, Lexmark's ability to develop an individual defense is being frustrated," Lexmark's attorneys argued in their motion.

It will be interesting to see how strong a precedent In re EMC will become, and it's early days yet. But we'll keep returning to the Lodsys case as long as its multi-ring circus continues.