Dominant Semiconductors Sdn. Bhd. v. Osram GmbH

524 F.3d 1254, 86 U.S.P.Q. 2d (BNA) 1480, 2008 U.S. App. LEXIS 8727, 2008 WL 1808336
CourtCourt of Appeals for the Federal Circuit
DecidedApril 23, 2008
Docket2007-1456
StatusPublished
Cited by50 cases

This text of 524 F.3d 1254 (Dominant Semiconductors Sdn. Bhd. v. Osram GmbH) is published on Counsel Stack Legal Research, covering Court of Appeals for the Federal Circuit primary law. Counsel Stack provides free access to over 12 million legal documents including statutes, case law, regulations, and constitutions.

Bluebook
Dominant Semiconductors Sdn. Bhd. v. Osram GmbH, 524 F.3d 1254, 86 U.S.P.Q. 2d (BNA) 1480, 2008 U.S. App. LEXIS 8727, 2008 WL 1808336 (Fed. Cir. 2008).

Opinion

KENNELLY, District Judge.

Dominant Semiconductors Sdn. Bhd. (“Dominant”) appeals from the decision of the United States District Court for the Northern District of California granting summary judgment in favor of OSRAM GmbH (“OSRAM”) on Dominant’s claims for unfair competition, intentional interference with contractual relations, interference with prospective economic advantage, and trade libel arising from OSRAM’s communications to its customers that *1256 Dominant infringed several of its patents. Because the district court correctly determined that OSRAM’s communications were not objectively baseless, we affirm.

BACKGROUND

OSRAM and Dominant are both manufacturers of small semiconductor devices known as light-emitting diodes (“LEDs”). OSRAM, a subsidiary of Siemens that was founded in Germany, holds a number of patents relating to LED technology. Dominant, a Malaysian company founded in 2000, is managed by one of OSRAM’s former production directors, Tay Kheng Chiong (“Tay”).

In the summer of 2001, Infineon Technologies/OSRAM Semiconductors (“Infi-neon”), another Siemens subsidiary, sent some of its customers a letter (“Property Rights Letter”) entitled “Re: Intellectual Property Rights.” Joint Appendix at 11. The letter stated that Infineon had received “information regarding possible infringement of [its] intellectual property rights” and that it would “not hesitate to undertake legal action in the event that any infringement ... has occurred or will take place.” Id. The letter further stated, “We expect you to respect our existing Non-Disclosure Agreements in their entirety and to ensure that our interests are fully protected at all times under the same.” Id.

OSRAM’s outside patent counsel, Richard Schachtner of the German law firm Epping Hermann Fisher, wrote an opinion letter (“Schachtner Letter”) on September 17, 2003, stating his opinion that several of Dominant’s LED products were infringing OSRAM patents. In the letter, Schacht-ner stated:

It is our opinion that according to the present information all DOMINANT LED products except colored Spice LEDs make unauthorized use of at least one most of them of at least two or more of OSRAM’s patent families directed to LED housings and white light emitting LEDs. All white light emitting LEDs of Dominant make use of at least three, most of them of even [sic] four respective OSRAM patent families. In our opinion it can be assumed, that with the help of the respective patents listed in the enclosed table in the most important countries the import, use and sale of most DOMINANT LED products can be stopped.
Finally we want to emphasize that we do not mean to imply by silence herein that there are not other OSRAM patents which are infringed by LED products manufactured and offered by DOMINANT.

Joint Appendix at 51. Schachtner attached to his letter a two-page table in which he compared Dominant LED products to OSRAM patents directed to LED housing and white light emitting LEDs. The table listed six types of Dominant LED products; their “Product Characteristics according to Dominant’s Catalogue Summary dated March 2003”; “Related OSRAM patent rights”; brief observations about the common features of the Dominant products and the OSRAM patents; and conclusions about infringement. Id. at 52. According to the table, Schachtner believed that Dominant was infringing the following United States patents: three particle size patents (the '247, '259, and '780 patents), four lead frame patents, three of which he believed Dominant might infringe “at least under doctrine of equivalents” (the '902, '321, '580 and '130 patents), a conversion principle patent (the '930 patent), and a mini sidelooker patent *1257 (the '745 patent). 1 Id. at 52-53.

Michael Wohs, OSRAM’s Director of Distribution in Europe and Emerging Markets, attached the Schachtner Letter to an email (“Wohs Email”) he sent on September 25, 2003 to the company’s “Colleagues, Sales and Distribution Partners.” Id. at 54. Wohs stated in the email that he was sending the “official statement of the OSRAM’s patent counsel concerning ‘DOMINANT’ products.” Id. He also suggested to the recipients of the email that they might wish to show the Schachtner Letter to their customers along with the following brief statement:

Dear Customer
attached You’ll find the official statement of the OSRAM’s patent counsel concerning potential infringement of several OSRAM patents with “DOMINANT” products. We therefore have the possibility (if necessary with the rulings of legal authorities) to stop the import, sale and use of the related “DOMINANT” products in the most important countries. In consequencies [sic] the final endproduct [sic] of your customers must be withdrawn from the market.

Id.

The following spring, in May 2004, OS-RAM filed a complaint against Dominant before the United States International Trade Commission (“ITC”), alleging that Dominant LED products infringed nine OSRAM patents in violation of section 337 of the Tariff Act of 1930 as amended, 19 U.S.C. § 1337. The accused products were Dominant’s white, power, super-small, nova, and bi-color LEDs. The patents OSRAM asserted included seven of the nine U.S. patents mentioned in the Schachtner Letter (the '247, '259, and '780 particle size patents; the '902, '321, and '580 lead frame patents; and the '930 conversion principle patent) and two additional particle size patents (the '861 and '301 patents). 2 OSRAM subsequently amended its ITC complaint in July 2004, eliminating its claims of infringement by Dominant’s bi-color LEDs and alleging that Dominant’s super-small LEDs additionally infringed a tenth OSRAM patent, the '673 patent. 3 The tenth asserted patent had not been referenced in the Schachtner Letter.

OSRAM issued two press releases (“the Press Releases”) shortly after it filed its ITC complaint. In the first, on June 8, 2004, OSRAM announced that it had filed the complaint, described the allegations of infringement, and stated that it was seeking injunctive relief to prevent the import into the United States of Dominant’s infringing LEDs and products containing them. In a second press release, on July 19, 2004, OSRAM announced that one of its American distributors had sent a declaration promising that it would not “import or market any LEDs that infringe on OS-RAM’s patent rights.” Id. at 257. The press release noted that the distributor’s declaration “relates in particular to products supplied by the manufacturer Dominant Semiconductors ... against whom OSRAM ... has filed a lawsuit with the ITC ... for infringement of patents.” Id.

In its answer to the amended ITC complaint, Dominant raised — and subsequently withdrew — a patent misuse affirmative defense based on the Schachtner Letter and the Wohs Email.

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524 F.3d 1254, 86 U.S.P.Q. 2d (BNA) 1480, 2008 U.S. App. LEXIS 8727, 2008 WL 1808336, Counsel Stack Legal Research, https://law.counselstack.com/opinion/dominant-semiconductors-sdn-bhd-v-osram-gmbh-cafc-2008.