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Cisco v. Arista: Just a Bad Dream

Do you remember a couple of years ago when Cisco Systems and Arista Networkshad that big copyright showdown in San Jose? Bob Van Nest faced off with David Nelson. Cisco's John Chambers and Arista's Jayshree Ullal testified. Silicon Valley media, including my ALM colleague Ross Todd, watched it all closely.

OK, now pretend none of that ever happened. Especially the jury's verdict finding that Arista infringed, but that external factors other than Cisco's creativity dictated the selection, arrangement and organization of phrases in Cisco's command line interface.

That's what Cisco and Arista are now asking U.S. District Judge Beth Labson Freeman and the Federal Circuit to do. It turns out that, as part of their $400 million settlement, the networking giants are seeking to vacate the judgment—one of the first to apply copyright's “scenes-a-faire” defense in the software context. On Wednesday, Freeman indicated she's willing to oblige.

The parties now have to persuade the Federal Circuit to send the case back to Freeman without issuing a ruling. The appellate court heard arguments in the case in June.

Quinn Emanuel Urquhart & Sullivan partner Kathleen Sullivan and Keker & Van Nest partner Steven Hirsch emphasized in their joint request to the Federal Circuit that the settlement resolves multiple disputes across district courts, the International Trade Commission and the Patent Trial and Appeal Board. “It is in the overall public interest for the court to support parties in negotiating and reaching settlement, including where vacatur is contemplated as part of a settlement, and especially where vacatur is part of a settlement that will resolve multiple pending disputes,” they wrote to the court.

Just to say it, this is a 100 percent about-face from the parties' initial public statement the day of the Aug. 6 settlement. “Arista and Cisco will continue to seek appellate court review of the scenes-a-faire verdict in the earlier trial regarding legal protection for user interfaces,” they said back then.

But seeking vacatur appears to have been the strategy all along. The parties' initial term sheet governing the deal, made public this week, states, “The Parties will jointly approach the District Court with legal grounds for vacatur to attempt to persuade the Court to vacate the judgment to facilitate a global settlement of all matters.'”

Who Got the Work? Pretrial Edition

➤ Bio-Rad Laboratories v. 10X Genomics. This case is shaping up as a rematch between Irell & Manella's David Gindler for 10X Genomics and Weil Gotshal's Ed Reines for Bio-Rad. The two squared off in January in a San Francisco trial between Ariosa Diagnostics and Illumina. 10X Genomics is also represented by Orrick, Herrington & Sutcliffe appellate guru Josh Rosenkranz and local counsel at Richards, Layton & Finger. But if that weren't enough of an embarrassment of riches, a Paul, Weiss, Rifkind, Wharton & Garrison team led by Nick Groombridge and a Tensegrity Law Group lineup featuring Matt Powers entered appearances for 10X last week. That's a lot of first-chair talent for one trial. Farnan is providing local counsel for Bio-Rad.

Who Got the Work? Post-Appeal Edition

➤ Applications in Internet Time v. RPX Corp. RPX Corp. has brought aboard Latham & Watkins to petition for en banc review of a Federal Circuit decision that tightened the rules governing real parties in PTAB proceedings. RPX appears to be looking at the Federal Circuit and beyond, as it's added Latham partner Gregory Garre, the former solicitor general and chair of the firm's Supreme Court practice, along with partner Gabriel Bell and associate Elana Nightingale Dawson. RPX's former counsel, Wolf Greenfield & Sacks, has formally withdrawn from the case, though it still appears to represent RPX in other matters before the PTAB. Steven Sereboff of SoCal IP Law Group represents patent owner Applications in Internet Time.

PTAB Time Limit Argument Craters

In a previous Skilled in the Art I wrote about Rob Greenspoon's novel challenge to IPR proceedings that follow an appeal. The Flachsbart & Greenspoon partner contends the Patent Trial and Appeal Board has no jurisdiction to conduct such proceedings because they inevitably occur after the America Invents Act's 18-month time limit has run.

I described this as a swing for the fences. But when the hearing in D'Agostino v. MasterCard rolled around Wednesday, Greenspoon left the bat on his shoulder.

He began by telling the court he was going to focus on two other issues. Judge Richard Taranto sounded surprised. “What about your '18 months is 18 months,'” he asked.

“I'm prepared to address that if it comes up, of course,” Greenspoon said.

“Not on my account,” Taranto clarified.

“Save your breath, in other words,” Judge Kathleen O'Malley chimed in.

Greenspoon took the hints and stuck to claim construction and PTAB's failure to adhere to a precedential opinion that was designated “informative.”

Those arguments didn't persuade either. The Federal Circuit panel summarily affirmed the PTAB's decision Thursday.

The win goes to Baker Botts partner Eliot Williams, who argued for MasterCard, and PTO Associate Solicitor Coke Stewart, who argued for the Patent Office.

Ruminations on Oil States Retroactivity

We all remember that the PTAB dodged a constitutional bullet in April when the Supreme Court rejected the Oil States challenge by a 7-2 vote. But the court emphasized that its holding was narrow. “Oil States does not challenge the retroactive application of inter partes review, even though that procedure was not in place when its patent issued,” Justice Clarence Thomas wrote.

The Federal Circuit hasn't addressed retroactivity yet, but it was clearly on the minds of a couple of judges Wednesday during the latest appeal involving Apple, VirnetXand virtual private network patents.

Patent owner VirnetX won a $500 million dollar verdict in the Eastern District of Texas in April, but PTAB has been chipping away at many of its patent claims. VirnetX is trying to bring an Oil States style challenge to the PTAB rulings on the ground that its patents predate the America Invents Act. But Apple attorney John O'Quinn argued—and Judge Raymond Chen sounded very much like he agreed—that VirnetX failed to preserve the retroactivity issue during its briefing.

Judge Pauline Newman spoke up toward the end of the hearing. “Let me ask you a question that's troubling me, that's peripheral to what we're saying,” she said to O'Quinn, of Kirkland & Ellis. “If in fact we thought there was a constitutional issue which has come to the surface now that the major issue in Oil States has been resolved, isn't there an obligation on all of us to assure that the Constitution is not violated?”

O'Quinn said he didn't believe the Supreme Court was “surfacing” the issue, but rather responding to Oil States amici curiae who had raised it. Judge Kathleen O'Malleyseemed to agree. “That's why the Supreme Court felt the need to say we're not reaching it,” she said.

In any event, Chen didn't sound eager to hash it out it in this case. “Do we have any case law or discussion or briefing in this appeal as to when is it constitutionally permissible to retroactively apply a new act of Congress?” he asked.

“None whatsoever,” O'Quinn replied.

That's all from Skilled in the Art for this week. I'll see you all again on Tuesday.