Order Granting Leave to Amend Invalidity Contentions, Richtek Technology Corp. v.. uPI Semiconductor Corp., et al., Case No. 09-cv-05659-WHA (Judge William Alsup)

Much can change procedurally while a patent case is stayed, especially if the parties continue to litigate the patent in other jurisdictions. In Richtek, the parties returned to district court after the conclusion of reexamination proceedings and two related ITC investigations. Defendant uPI moved to amend its invalidity contentions, originally served in December 2010, to account for claim interpretations that the plaintiff Richtek disclosed during reexamination. Judge Alsup permitted the amendment, which added new prior art references, while distinguishing a decision he had rendered a month earlier which precluded Richtek from adding new accused products.

The Richtek case accumulated a lot of baggage during its tortuous history: filed in 2009, it was quickly stayed pending a contemporaneously-filed ITC action. That first stay lifted in September 2010, and the parties exchanged infringement and invalidity contentions. Then, less than two months later, the case was stayed again – first pending reexamination and then pending a second ITC action. The case finally got moving again in January 2016. We previously reported on how the district court decided to handle the issue of previously-exchanged discovery. The parties also sought to update their respective contentions.

With respect to uPI’s motion to amend its invalidity contentions, Richtek argued that uPI should have discovered the prior art references and sought to amend during the brief periods of time that the case was not stayed. Judge Alsup found, however, that uPI could not have appreciated the importance of the new references – even references uPI was aware of in 2010 – until Richtek disclosed its interpretations of various claim limitations during reexamination proceedings. Judge Alsup considered this rationale analogous to Patent Local Rule 3-6’s express acknowledgement that an unexpected claim construction ruling may support good cause to amend contentions.

Richtek also argued that uPI could have conducted prior art searches while the case was stayed and brought its motion immediately once the stay was lifted. But Judge Alsup noted that “the stays were in place specifically to avoid expenses that might ultimately prove moot. This order will not hold uPI’s decision not to undertake such wasteful endeavors against them.” Judge Alsup also found uPI was reasonable to rely upon the court-ordered deadline to refile invalidity contentions as also serving as the deadline to pursue amendment.

Judge Alsup made short work of Richtek’s prejudice argument, noting that he does not construe claims until summary judgment (as opposed to a separate, earlier Markman hearing). He therefore accorded Richtek with more time to address the new prior art references.

At the end of his order, Judge Alsup noted that “uPI’s motion is distinct from Richtek’s recent motion to amend its infringement contentions to include new products.” Richtek sought to expand the scope of the case to include products released post-complaint, but such claims would require a supplemental pleading and moreover could be pursued in a separate suit. By contrast, uPI “has only one opportunity to raise their strongest invalidity defense” and so was afforded the opportunity to “shore up its defense to meet new arguments that arose during reexamination proceedings.” In a case set for trial this year, there remains time for some procedural changes, but not for others.