In the congressional report for the America Invents Act, two paragraphs relate to § 299. In the first paragraph, the report states that “[t]he Act also addresses problems occasioned by the joinder of defendants (sometimes numbering in the dozens) who have tenuous connections to the underlying disputes in patent infringement suits.”296 So Congress was concerned with a situation that defendants’
connections to the lawsuit were tenuous. In other words,
295 Id.
296 H.R. Rep. No. 112-98, pt.1, at 54 (2011).
Congress was not troubled with the joinder of defendants having only “certain” connections to the underlying disputes in patent infringement suits.
In the second paragraph, the report states,
[p]ursuant to [§ 299], parties who are accused infringers in most patent suits may be joined as defendants or counterclaim defendants only if: (1) relief is asserted against the parties, jointly, severally, or in the alternative, arising out of the same transaction regarding the manufacture, use, or importation of the accused product or process; and (2) questions of fact common to all of the defendants will arise in the action.297
The report does not tell us why there is the omission of “same” that is used to modify the phrase “accused product or process” in § 299. Assuming such omission is meaningful, the interpretation of § 299 should not be limited to a condition that the accused products or processes must be
“exactly” the same.
The second paragraph also states that “[n]ew § 299 also clarifies that joinder will not be available if it [is] based solely on allegations that a defendant has infringed the patent(s) in question.”298 The footnote 61 following the second paragraph shows Congress’s intent to abrogate several district court decisions that represent the minority view of permissive joinder in the context of patent infringement.299 Footnote 61 further instructs courts to follow the majority view and cites Rudd v. Lux Prods. Corp.
as a leading precedent.300
297 Id. at 54–55 (emphasis added).
298 Id. at 55 (emphasis added).
299 See id. at 55 n.61.
300 See id. (citing Rudd v. Lux Prods. Corp., No. 09-CV-6957, 2011 WL 148052 (N.D. Ill. Jan. 12, 2011)).
The abrogated cases can be categorized into two groups. The first group permits joinder merely because all defendants infringe the same patents.301 The second group touches on an additional fact related to the similarity of accused products or processes.302 The relevant statements include:
(1) “It is possible that severance could be appropriate if the defendants’ methods or products were dramatically different.”303
(2) “[T]he record before the Court does not show that the products or methods at issue are so different that determining infringement in one case is less proper or efficient than determining infringement in multiple cases.”304
(3) “The similarity of the defendants’ products is sufficient to satisfy the nucleus of fact or law test.”305
(4) “Even if the designs of each [product] may differ, the underlying issue is the same—patent infringement for the same patents. Thus, the reasoning of Guedry, MyMail, Ltd., and Mannatech, Inc.—
301 See, e.g., Sprint Commc’ns Co. v. Theglobe.com, Inc., 233 F.R.D.
615, 617 (D. Kan. 2006); Better Educ. Inc. v. Einstruction Corp., No.
2-08-CV-446-TJW-CE, 2010 WL 918307, at *1 (E.D. Tex. Mar. 10, 2010); Mannatech, Inc. v. Country Life, LLC, No. 3:10-CV-533-O, 2010 WL 2944574, at *1–2 (N.D. Tex. July 26, 2010).
302 See, e.g., MyMail, Ltd. v. Am. Online, Inc., 223 F.R.D. 455, 456–57 (E.D. Tex. 2004); Adrain v. Genetec Inc., No. 2:08-CV-423, 2009 WL 3063414, at *2 (E.D. Tex. Sept. 22, 2009); Alford Safety Servs., Inc., v. Hot-Hed, Inc., No. 10-1319, 2010 WL 3418233, at *9–10 (E.D. La.
Aug. 24, 2010); Eolas Techs., Inc. v. Adobe Sys., Inc., No. 6:09-CV-446, 2010 WL 3835762 (E.D. Tex. Sept. 28, 2010).
303 MyMail, Ltd., 223 F.R.D. at 457 (emphasis added).
304 MyMail, Ltd., 223 F.R.D. at 457 (emphasis added); Eolas Techs., Inc., 2010 WL 3835762, at *2 (emphasis added).
305 Adrain, 2009 WL 3063414, at *2 (emphasis added).
namely that patent infringement meets the permissive qualities of the joinder rule—can be applied here.”306
After Congress abrogated those minority cases, the above-listed four statements should be abrogated as well in light of the phrase “the same accused product or process” in § 299.
That is, to establish misjoinder, the independent defendants are not required to prove that the accused products or processes are “not similar,” “different,” or “dramatically different.”
But, in light of Rudd v. Lux Prods. Corp.,307 it is not to say that misjoinder must be found when the accused products or processes are merely similar. The Rudd court standard for the majority view of joinder under Rule 20 includes two aspects. First, the court stated that “a party fails to satisfy Rule 20(a)’s requirement of a common transaction or occurrence where unrelated defendants, based on different acts, are alleged to have infringed the same patent.”308 Second, the court states “allegations that unrelated defendants design, manufacture and sell similar products does not satisfy Rule 20(a)’s requirement.”309 The first proposition is now codified in § 299(b) while the second one is not. Because these two propositions only tell what cannot support joinder, they are not instructive in determining joinder. But, at least these propositions can confirm two minimum requirements of joinder in the context of patent lawsuits: (1) infringement of the same patent(s) and (2) similarity between the accused products or processes.
306 Alford Safety Servs., Inc., 2010 WL 3418233, at *10 (emphasis added).
307 Rudd v. Lux Prods. Corp., No. 09-CV-6957, 2011 WL 148052 (N.D. Ill. Jan. 12, 2011).
308 Id. at *3.
309 Id.
Rudd may indicate a third minimum requirement.
The Northern District of Illinois criticized that the plaintiff
“failed to demonstrate how Defendant [A’s] alleged acts of infringement are in any way related to Defendant [B’s]
alleged acts of infringement.”310 Therefore, permissive joinder requires that the infringement claim against one defendant must be in some way related to the infringement claim against another defendant.
The analysis of the Congressional report indicates that Congress required that to allow the joinder of defendants, courts must find something more than tenuous connections between the defendants and the underlying disputes in patent infringement suits. There are two examples of tenuous connections. First, the same patents are infringed. Second, the accused products or processes are similar. But, the congressional report and § 299 do not show how something more than tenuous connections is determined. Therefore, the question of what is “more than tenuous connections” is open for debate.
B. “The Same Accused Product or Process”
This article offers a “certain connection” approach to determine when “something more than tenuous connections” exists. The first question is whether “the same accused product or process” is a separate requirement under
§ 299.
Prof. David O. Taylor has provided two interpretations of “the same accused product or process.”311 The first interpretation is the “one thing” interpretation under which “same” means “one, and only one, thing.”312 Adopting the “one thing” interpretation, courts will permit joinder only if the defendants “are all responsible for
310 Id.
311 See Taylor, supra note 4, at 707.
312 See id.
infringement with respect to that one accused product or process.”313 Although this approach is within the scope of
“the same accused product or process,” it is so narrow that joinder is permissive only if the defendants are jointly liable for patent infringement.314 Strictly adopting the “one thing”
interpretation simply ignores that § 299(a)(1) allows any right to relief to be asserted against the parties severally.
The second interpretation is the indistinguishability interpretation under which different accused products or processes may be considered the same if they “so closely resemble one another or [] that they are indistinguishable in all relevant aspects.”315 Accused products of separate infringers may be “indistinguishable in their construction, operation, or both, depending on the asserted claim’s scope.”316 Accused processes may be “indistinguishable with respect to their steps,” depending on the asserted claim’s scope.317 Although the second interpretation covers more situations that may support joinder, the question is whether the connections of independent defendants to infringement claims are only the indistinguishable features of the accused products or processes. Because the indistinguishability depends on the asserted claim’s scope, Prof. Taylor’s approach merely relies on whether the accused products or processes infringe the same patent(s).
The term “the same accused product or process” is so ambiguous that district courts with a restrictive interpretation will always find improper joinder. For example, in Motorola Mobility, Inc. v. Apple Inc., the Southern District of Florida considered HTC’s and
313 Id.
314 See In re EMC Corp., 677 F.3d 1351, 1356 (Fed. Cir. 2012).
315 Taylor, supra note 4, at 707.
316 See id.
317 See id.
Motorola’s Android-based smartphones as different smartphones because their Android systems were modified from Google’s original version.318 To set aside the ambiguity, the “certain connection” approach takes a view that “sameness” should not be separated from the transaction-or-occurrence requirement. Rather, when determining whether the accused products or processes are the same, the inquiry should focus on the transaction or occurrence aspects of the case. That is, the “concern connection” approach focuses on the alleged similar
“transaction, occurrence, or series of transactions or occurrences” that causes the accused products or processes to be considered the same.
C. “Certain Connection” Approach
Although Prof. Taylor’s standard has some drawbacks, the proposed “certain connection” approach is inspired by Prof. Taylor’s indistinguishability interpretation.
Under the indistinguishability interpretation, whether accused products are the same depends on whether the construction, operation, or both of these accused products is indistinguishable. But the scope of an asserted patent claim is not a proper baseline for determining the indistinguishability of construction or operation. There should be something more than patent claims.
Before this article further explains the idea of the
“certain connection” approach, it is important to first discuss whether In re EMC should be part of the case law related to
§ 299. The Congressional report shows that the enactment of § 299 was intended to stop the minority’s practice of Rule 20.319 The report also shows that Congress mandated district
318 See Motorola Mobility, Inc. v. Apple Inc., No. 1:12-CV-20271-RNS, 1:10-CV-23580-1:12-CV-20271-RNS, 2012 WL 3113932, at *4 (S.D. Fla. Jul 31, 2012).
319 See H.R. Rep. No. 112-98, pt.1, at 55 n.61 (2011).
courts to follow the majority approach of Rule 20.320 So, § 299 should embrace the case law related to Rule 20 which is not inconsistent to the term “the same accused product or process” used in § 299. In re EMC should be included because In re EMC provides that “[j]oinder of independent defendants is only appropriate where the accused products or processes are the same in respects relevant to the patent.”321 But, the question is whether the analysis based on the six EMC factors is too arbitrary because it is unclear when one factor may outweigh another. However, some legal propositions made in In re EMC are still instructive and will be adopted by the “certain connection” approach.
In re EMC provides that “[u]nless 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.”322 The
“actual link” approach also requires “shared, overlapping facts that give rise to each cause of action, and not just distinct, albeit coincidentally identical, facts.”323 The
“actual link” approach echoes Congress’s intent to require something more than “tenuous connections to the underlying disputes in patent infringement suits.” Therefore, the
“certain connection” approach follows the “actual link”
approach. Then, the question is how to determine “an actual link” in light of “shared, overlapping facts.” The EMC factors are helpful.
If the accused subject matter is a product, the “certain connection” approach requires “the use of identically
320 See id. (citing Rudd v. Lux Prods. Corp., No. 09–cv–6957, 2011 WL 148052 (N.D. Ill. Jan. 12, 2011)).
321 See In re EMC Corp., 677 F.3d 1351, 1359 (Fed. Cir. 2012).
322 Id. (emphasis added).
323 Id. (emphasis added).
sourced components” (the third EMC factor) in the accused products of independent defendants. “Identically sourced components” serve as not only a connection among accused products but also a connection among the infringement claims against independent defendants. If a product claim is allegedly infringed, the alleged components should be covered by the product claim. If a process claim is allegedly infringed, the alleged components must be involved in performing the alleged infringing steps.
In re EMC does not interpret “identically sourced components,” so it is helpful to look to a dictionary.
According to the Merriam-Webster on-line dictionary,
“component” means “a constituent part.”324 The sentence or phrase examples accompanying “component” indicate that
“component” can be physical or intangible.325 Thus,
“component” should include a physical component or software component in a product. Second, “identically sourced” should be given its plain meaning as “being from an identical source.” Therefore, “the use of identically sourced components” can be interpreted as “using components which are from an identical source.” Then, the question becomes what constitutes “an identical source.”
Purchasing a component from the same supplier is not enough; otherwise, independent chemical manufacturers that use water from the same public water system may be joined in one lawsuit.326 The “certain connection” approach
324 Component definition, MERRIAM-WEBSTER, http://www.merriam-webster.com/dictionary/component [http://perma.cc/8FAS-DEK2], (last visited Sept. 25, 2015).
325 Id. (providing the examples “[h]e sells spare computer components”
(tangible) and “[t]he interview is a key component in the hiring process” (intangible)).
326 Cf. Mednovus, Inc. v. QinetiQ Group PLC, No. 2:12-CV-03487-ODW(JCx), 2012 WL 4513539, at *2 (C.D. Cal. Oct. 1, 2012) (holding that a manufacturer selling products to one distributor is a
requires that there must exist “shared, overlapping facts”
which constitute an “identical source.” The fifth EMC factor, “overlap of the products’ or processes’ development and manufacture,” is very helpful for determining such
“shared, overlapping facts.”327 Because independent defendants develop or manufacture the alleged components or whole accused products together, they may possess or share the technological information of the accused products.
The technological information is definitely related to the determination of infringement. So, there will be some
“shared, overlapping facts” that can support joinder.
Similarly, if the accused subject matter is a process, the “certain connection” approach requires the inclusion of
“identically sourced steps.” “Identically sourced steps” play a role of a connection among accused processes and also connect infringement claims against independent defendants. In addition, “identically sourced steps” can be interpreted as “steps which are from an identical source.”
Likewise, the determination of “an identical source” may rely on the fifth EMC factor for the same reason illustrated above.
To summarize, the “certain connection” approach focuses on something connecting the infringement claims against independent defendants. “Identically sourced components” used in accused products or “identically sourced steps” used in accused processes are such a connection which can lead to “shared, overlapping facts that give rise to each cause of action.” The determination of
different transaction from the same manufacturer selling to another distributor).
327 The fourth EMC factor “licensing or technology agreements between the defendants” is also helpful when one defendant supplies components to other defendants. But, this situation is unlikely to happen because competitor defendants usually won’t support each other.
“identically sourced” depends on whether there exists
“overlap of the products’ or processes’ development and manufacture.”
VII. CONCLUSION
To abrogate the minority view of joinder under Rule 20 and to stop joinder of independent defendants based merely on infringement of the same patents, Congress enacted 35 U.S.C. § 299. The Federal Circuit also created the six EMC factors for lower courts to determine whether
“an actual link between the facts underlying each claim of infringement” exists. But all efforts may be ignored by the Eastern District of Texas because its application of 35 U.S.C.
§ 299 and In re EMC are still patentee-friendly.
Many district courts focus more on business relationship between independent defendants and some even ask whether independent defendants have conspired or acted in concert. The Eastern District of Texas focuses more on the technology side of the infringement claims against different defendants. The use of identically sourced component parts alone may constitute an actual link.
The applications of § 299 by district courts to mobile device technology cases show that the In re EMC analysis has created inconsistency. The Eastern District of Texas remains a minority and is still more willing to permit joinder of independent defendants. However, the majority of district courts may have heightened the In re EMC analysis in a way, especially for the mobile device industry, such that no two products are the same because there are always some differences in the operating systems of each of the mobile devices. The Federal Circuit may have to revisit In re EMC and interpret 35 U.S.C. § 299 to fix the inconsistencies among district courts. Before that, this article proposes a
“certain connection” approach, which requires the use of identically sourced components in the accused products or
the inclusion of identically sourced steps in accused processes. The determination of “identically sourced”
components or processes relies on whether independent defendants jointly developed or manufactured the alleged components/steps or accused products/processes. Because these defendants possess or share information of the infringed technology, the “shared, overlapping facts” can support joinder.
Acknowledgement
This paper is from a research project financially supported by the Ministry of Science and Technology of the Taiwan Government (MOST 103-2410-H-027-002-).