IP Law Daily, PATENT NEWS: Controversial personal jurisdiction case will not be reviewed by the Supreme Court, (Mar 24, 2025)
By Matthew Hersh, J.D.
The decision, involving Amazon’s patent evaluation program, is one of three Federal Circuit rulings that the Court leaves in place.
The Supreme Court will not review a so-called “bombshell ruling” over whether a patent holder can be subject to personal jurisdiction in the home state of an Amazon retailer if it sends a communication to Amazon’s Washington State headquarters complaining that the retailer is selling infringing products online, the Court has announced. The challenged ruling is one of three Federal Circuit opinions that the Court declined to hear, including one that challenged the Circuit Court’s application of collateral estoppel effect to post-Rule12(b)(6) stipulations to dismiss and its tendency to issue one-word affirmances of district court rulings (Lighting Defense Group LLC v. SnapRays, LLC d/b/a SnapPower, No. 24-524, Petition for Writ of Certiorari (U.S. filed Nov. 5, 2024)).
The personal jurisdiction decision, in SnapPower v. Lighting Def. Group, 100 F.4th 1371 (Fed. Cir. 2024), involves a procedure called the Amazon Patent Evaluation Express, or APEX. Under that program, a third-party determines whether a product sold on Amazon.com likely infringes a utility patent, and if so, Amazon removes the listing from Amazon.com. To initiate an evaluation under APEX, a patent owner submits a so-called APEX Agreement to Amazon which identifies one claim of a patent and up to 20 allegedly infringing listings. Amazon then sends the APEX Agreement to all identified sellers. Each seller has three options to avoid automatic removal of their accused listings: (1) opt into the APEX program and proceed with the third-party evaluation; (2) resolve the claim directly with the patent owner; or (3) file a lawsuit for declaratory judgment of noninfringement.
In this case, Lighting Defense Group, the Delaware-based owner of a patent directed at an electrical receptor used in lighting products, submitted an APEX Agreement alleging that certain products sold on Amazon by Utah-based SnapPower infringed its patent. The Utah company responded by bringing an action for declaratory judgment against the Delaware company in a Utah district court. The Utah court found that it lacked specific personal jurisdiction over the Delaware company, but the Federal Circuit reversed. By sending the APEX Agreement document to Amazon, the court found, the Delaware company “purposefully directed its activities at SnapPower in Utah, intending effects which would be felt in Utah.”
The Delaware company, citing a wide range of commentary in its favor, asked the Supreme Court to intervene. “All LDG did was send a communication to a third party, Amazon, in Washington asking Amazon to stop selling products infringing LDG’s patent,” the petition asserted. “That is it. Because LDG’s communication to Washington ‘aimed to affect marketing, sales, and other activities in Utah, the Federal Circuit concluded that LDG had sufficient ‘activities with the forum.’ The Federal Circuit’s broad approach conflicts with this Court’s decisions.”
The question presented was: “Whether a defendant subjects itself to personal jurisdiction anywhere a plaintiff operates simply because the defendant knows its out-of-forum conduct “would necessarily affect marketing, sales, and other activities” within the forum, Pet.App.11a—even though the defendant has no contacts with the plaintiff or the forum whatsoever.”
Cert denied in two other patent cases. The Supreme Court also turned down two other cases today:
In Koss Corp. v. Bose Corp., 107 F.4th 1363 (Fed. Cir. 2024), the owner of wireless earbud technology sued a company called Plantronics for patent infringement. After the district court decided on a Rule-12(b)(6) motion that certain of the patentholder’s claims were ineligible, the parties stipulated to dismiss the amended complaint with prejudice. When patent holder then sued a different defendant on the same patent, the Federal Circuit found that the Rule-12(b)(6) holding regarding the earlier complaint, while without prejudice, merged with the with-prejudice stipulation and thus collaterally estopped the patent holder from further enforcement of the patent. In doing so, the patentholder asserted in its petition, “the Federal Circuit precedentially adopted a novel and expansive rule of collateral estoppel (or issue preclusion) that bypasses key requirements this Court has established" (Koss Corp. v. Bose Corp., No. 24-916, Petition for Writ of Certiorari (U.S. filed Sept. 30, 2024)).
The question presented was: “When a district court grants a Rule-12(b)(6) motion to dismiss but does so without prejudice and with leave to amend, may that non-merits determination be given collateral-estoppel effect on the theory that it merged into a later with-prejudice dismissal stipulation?”
In Island Intellectual Prop. LLC v. TD Ameritrade, Inc., 2023-1318, 2024 WL 2207311 (Fed. Cir. May 16, 2024), which affirmed a district court decision from Texas, a company that provides cash-management and technology solutions provider to financial entities sued TD Ameritrade for patent infringement. After the district court found that certain of the patent claims were ineligible, the Federal Circuit affirmed in a one-word order (Island Intellectual Property LLC v. TD Ameritrade, Inc., No. 24-461 Petition for Writ of Certiorari (U.S. filed Oct. 21, 2024)).
The questions presented were:
Do the Federal Rules of Civil Procedure apply to patent cases like any other federal case, including in particular FRCP 56 and its prescription against granting summary judgment when the nonmoving party presents evidence that raises material facts in dispute?
Is it proper for the Federal Circuit to use its own unique Local Rule 36 to affirm district court rulings with one-word decisions lacking explanation or analysis, when the grounds for affirmance are unclear in view of the arguments made on appeal?
News: Patent GCNNews