Monday, February 23, 2015 - Nearly 20 lawsuits involving Protegrity and patent infringement claims the company made against a number of tech companies have been consolidated into multidistrict litigation in the Northern District of California. Protegrity had pushing for the case to be consolidated, though were hoping the case would be transferred to Connecticut. Their arguments were met with substantial pushback from the defendants claiming Connecticut would only benefit Protegrity, and in the end the Judicial Panel on Multidistrict Litigation ruled in favor of transferring the cases to the Northern District Court of California.
The conflict at the heart of the lawsuits comes from accusations made by Protegrity claiming a number of companies including Informatica Corp., SkyHigh Networks Inc. and Square Inc. were guilty of infringing on patents originally filed by Protegrity. The two patents in question both concern the protection of information stored in databases. The patents were created and filed as improved encryption designs by Protegrity to protect information against unauthorized decryption.
Protegrity‘s motion to consolidate the lawsuits into an MDL was filed on November 7, 2014 and looked to combine 10 lawsuits pertaining to patents infringement and 8 related to declaratory judgement. The defendants in the MDL range over 15 different companies and focus on the the patents entitled "Data Security System for a Database" and "Data Security System for a Database Having Multiple Encryption levels Applicable on a Data Element Value Level."
Representatives for some of the defendants resisted consolidation for their cases because they believed that a number of the lawsuits were already nearing resolution. There are also claims that the consolidation effort put forth by Protegrity is in response to their displeasure with the direction the lawsuits were progressing below the federal level.
Other defendants were open to multidistrict litigation, naming the Northen District of California as their preferred location for centralization. Another group of defendants fell in the middle, arguing that although the patents in question are involved in their technologies, the diversity of those technologies are too varied to pursue multidistrict litigation. Some companies even claimed that the patents have nothing to do with their technologies and that the accusations were a result of accidental overlap.
The JPML found that centralizing the case in the Northern District of California will serve as a suitable location for both parties and witnesses involved in the case. The panel also rejected the proposition put forth by Protegrity that claim construction be the sole reason for centralization and left it to the recipient judge‘s discretion to decide the structure of the MDL.
The JPML‘s decision to centralize this case in the Northern District of California may be indicative of future plans for cases focusing on patent law. This particular court has been designated as a Patent Pilot Program Court, in large part because of its proximity to Silicon valley and the technological patents issues that arise in the area. The district court has thus become familiar with complex patent lawsuits and the transferring of the Protegrity lawsuits indicates that more will likely be sent its way in the future.