Expert Report Cannot Be Used for Previously Undisclosed Invalidity Theories

The United States District Court for the Central District of California recently granted a plaintiff’s motion to strike portions of the defendant’s expert report for the untimely disclosure of new invalidity theories that were not previously disclosed in the defendant’s invalidity contentions. In Nichia Corporation v. Feit Electric Company, Inc., the plaintiff sought to strike from the defendant’s expert report: (1) an entirely new reference; (2) two new obviousness theories based on combinations of references not included in the defendant’s final invalidity contentions; and (3) a new written description argument.

In ruling, the court highlighted the district’s Standing Patent Rules’ emphasis on “early notice” of infringement and validity contentions, that amendments to contentions require diligence by the moving party and that new infringement and invalidity theories cannot be introduced through expert reports. The Standing Patent Rules that the parties were following were initially set forth by Judge Guilford of the Central District of California. It has been noted that “Judge Guilford’s Standing Patent Rules are similar to the Local Patent Rules adopted by the Northern District of California.” Mort. Grader, Inc. v. First Choice Loan Servs. Inc., 811 F.3d 1314, 1321(Fed. Cir. 2016). And, relatedly, the District of New Jersey “adopted verbatim [its] Local Patent Rules from the Northern District of California.” TFH Publ’n, Inc. v. Doskocil Mfg. Co., 705 F. Supp. 2d 361, 365 (D.N.J. 2010).

Addressing each argument in turn, the court granted the plaintiff’s motion in part. With respect to the entirely new reference, the court denied the plaintiff’s motion as unripe because the defendant agreed that it would not rely on any arguments regarding the reference without first seeking leave to amend its invalidity contentions. With respect to the new obviousness combinations, the court granted the motion because the expert had not expanded on disclosed theory, but instead presented two completely new combinations of references, despite the individual references being disclosed in the defendant’s invalidity contentions. The court also noted that the defendant’s attempt to reserve its rights to rely on any combination of references cited in its contentions, even if not explicitly set forth, failed to comply with the Standing Patent Rules. Finally, with respect to the new written description argument, the court agreed with the plaintiff and found that, when compared with the defendant’s invalidity contentions, the expert report disclosed a new theory.

Ultimately, the court concluded that adding these new theories would require a motion to amend the contentions showing both diligence and a lack of prejudice to the plaintiff.

Gibbons will continue to monitor and report developments in local patent rules.

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