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Insufficient enforcement activity in district by patentee leads to dismissal of DJ action

May 20, 2009
Post by Blog Staff

In a decision Monday, the Federal Circuit affirmed a district court's dismissal of a declaratory judgment action against a British patentee for lack of personal jurisdiction. The facts of the case are similar to the Avocent case decided a few months ago. Here, the patentee's only contacts with the district in which the action was brought were the sending of a cease and desist letter and non-exclusively licensing the patent in suit in the jurisdiction. Under Avocent, this was simply insufficient to support jurisdiction against the foreign declaratory judgment defendant.

As with Avocent, Judge Newman dissented. She cited many of the same reasons for her dissent as she did in her Avocent dissent and also observed that the trend should be to make declaratory judgments easier to obtain, not more difficult, particularly in light of the Supreme Court's decision in MedImmune.

Oxford Gene Technology owns several patents relating to oligonucleotide microarray technology, including the '270 patent at issue in this case. Autogenomics uses microarray technology in connection with its business. The parties engaged in licensing discussions for the '270 patent beginning in early 2006. The negotiations included various correspondence regarding the validity of the patent and representatives of Oxford traveling to Autogenomics in California for a meeting, but no agreement was reached.

Shortly after Oxford's representatives visited Autogenomics, Autogenomics filed a declaratory judgment action seeking a declaration that two claims of the '270 patent were invalid, unenforceable, and not infringed. Oxford moved to dismiss for lack of personal jurisdiction. In opposition, Autogenomics alleged six facts that it contended supported jurisdiction:

  1. The licensing negotiations between Oxford and Autogenomics that continued from February 2006 until the case was filed in July 2007
  2. License agreements: Oxford has about 10 nonexclusive licenses with California companies for the '270 patent and at least one exclusive license for another patent
  3. Oxford signed a collaborative agreement with Agilent (which has offices in California), but no evidence this has a relationship to the '270 patent
  4. Oxford representatives attended three conferences in California between 2003 and 2007, although not specifically related to the '270 patent
  5. In 2006, Oxford sold 20 microarrays to a California company
  6. Oxford published an "application note" at Nature.com describing one of its microarray products

The district court held these contacts in the aggregate were insufficient for general personal jurisdiction, noting these contacts were insufficient to be equivalent to having a physical presence in the state. Further, the district court held there was no specific personal jurisdiction because the declaratory judgment action did not arise out of most of the above-listed contacts, and those that did were insufficient to support jurisdiction under Red Wing Shoe. Autogenomics appealed.

The Federal Circuit first considered the question of general personal jurisdiction. The court agreed with the district court's conclusion that no general personal jurisdiction existed, noting that the defendant in Helicopteros had more contacts with the forum than Oxford, and the Supreme Court held general personal jurisdiction was lacking in Helicopteros.

The court next addressed the question of specific personal jurisdiction. While the appeal was pending, the Federal Circuit decided Avocent. As stated there, the only jurisdictional contacts relevant for specific personal jurisdiction are those that "relate in some material way to the enforcement or the defense of the patent." In light of this, the Federal Circuit asked the parties to submit briefs as to Avocent's effect on the case. In the supplemental briefing, Autogenomics admitted that all but two of its asserted contacts, specifically the license agreements and the Agilent agreement, were eliminated from consideration in the specific personal jurisdiction analysis by Avocent.

Analyzing these contacts, the Federal Circuit had little difficulty affirming the district court's determination that specific personal jurisdiction was also lacking. As to the Agilent agreement, there was simply no evidence, and it would not be a reasonable inference, that this agreement involves the '270 patent. Therefore, this contact was not relevant to the specific personal jurisdiction analysis. Autogenomics also asserted it should be inferred that Oxford granted an exclusive license to the '270 patent based on its grant of an exclusive license to another patent. The court held this was an unreasonable inference from the record, as it was undisputed Oxford had granted at least 10 nonexclusive licenses under the patent, which would make granting an exclusive license impossible. With these contacts eliminated from the analysis, there was nothing left to support personal jurisdiction, and the court therefore affirmed the district court's dismissal of the case.

Judge Newman dissented. She raised many of the same arguments she made in her Avocent dissent, decrying the combination of the two cases as adding confusion to the relevant law on the subject. She also observes that the trend is to be more permissive for parties to seek declaratory judgment, particularly in light of the Supreme Court's decision in MedImmune.

To read the full decision in Autogenomics, Inc. v. Oxford Gene Tech. Ltd., click here.


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