Chief Judge Stark finds issue preclusion as to validity and direct infringement based on prior proceeding

In Fairchild Semiconductor Corporation, et al. v. Power Integrations, Inc., C.A. No. 12-540-LPS (D. Del. Apr. 23, 2015), Chief Judge Leonard P. Stark concluded that Defendant could not relitigate the validity and direct infringement of one of the patents asserted against it by Plaintiffs, due to prior proceedings in this Court between these parties, where a jury found infringement and no invalidity against Defendant (Fairchild II, C.A. No. 08-309-LPS).

Having concluded in a prior opinion that the accused products at issueas well as the scope of the asserted claims were essentially the same in the two actions, the Court now concluded that issue preclusion existed here.  As to infringement, Plaintiffs argued Defendant was precluded from re-litigating whether a certain product infringed “when used in power supplies with transformers.”  Id. at 2.  This “identical issue” had come before the jury in Fairchild II and the Court had upheld the verdict post-trial.  Id. at 2-3.  Defendant argued that Plaintiffs made “different and contradictory arguments . . . which purportedly raise new factual questions, but [the Court observed that] the scope of claims 6 and 18 as consistently construed by this Court have not changed . . . and the Court perceives no reason . . . why a new argument in this context should prevent application of issue preclusion.”  Id. at 4.

As to validity, “[t]he only dispute appear[ed] to be whether the identical issue of validity was adjudicated, given the ‘minor’ change in the Court’s claim construction.”  Id. at 5 (emphasis in original).  But the Court concluded that [i]n the present case, the issue of validity is necessarily identical to that in Fairchild II because [Defendant] has actually brought the same validity challenges, with the exception of an additional obviousness challenge (which cannot succeed as the claim scope has narrowed). Thus…[Plaintiffs have] met [their] burden to show that the identical issue of validity was previously adjudicated.”  Id.  Defendant countered that it was “was unfairly prejudiced by [Plaintiffs’] concealment of its presently asserted position [in Fairchild II based on its expert’s testimony] that the ‘972 invention does not, in fact, provide substantially constant current control.”  Id. at 5.  Defendant “support[ed] this argument by pointing out that the asserted claims have been finally rejected by the Examiner, and that in rejecting the asserted claims, the Examiner stated, ‘[a]ll we are doing is preventing the patent owner from making one argument to the court and making a different argument to the Office.’ . . . However . . . [Defendant] had every opportunity to try (and did try) to dissuade the jury in [Fairchild II] from relying on evidence [Defendant] contends has always been unreliable.” Id. at 5-6 (citations omitted).  Therefore, the Court disagreed that “preclusion is inappropriate here because otherwise [Defendant] will have been deprived of a full and fair opportunity to litigate.”  Id. at 5.

Having made the above conclusions, the Court did not reach whether claim preclusion existed, id. at 2, and itgranted Plaintiffs’ motion for judgment on the pleadings to the extent it sought to apply collateral estoppel to preclude Defendant from relitigating the above issues.

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