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April 5, 2021 |
Federal Circuit Update (March 2021)

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This edition of Gibson Dunn’s Federal Circuit Update summarizes key petitions for certiorari in cases originating in the Federal Circuit, addresses the Federal Circuit’s announcement that Judge Wallach will be taking senior status and the court’s updated Rules of Practice, and discusses recent Federal Circuit decisions concerning issue preclusion, Section 101, appellate procedure for PTAB appeals, and the latest mandamus petitions on motions to transfer from the Western District of Texas.

Federal Circuit News

Supreme Court:

Today, the Court decided Google LLC v. Oracle America, Inc. (U.S. No. 18-956).  In a 6-2 decision, the Court held that because Google “reimplemented” a user interface, “taking only what was needed to allow users to put their accrued talents to work in a new and transformative program,” Google’s copying of the Java API was a fair use of that material as a matter of law.  The Court did not decide the question whether the Copyright Act protects software interfaces.  “Given the rapidly changing technological, economic, and business-related circumstances,” the Court explained, “[the Court] should not answer more than is necessary to resolve the parties’ dispute.”  The Court therefore assumed, “purely for argument’s sake,” that the Java interface is protected by copyright.

This month, the Supreme Court did not add any new cases originating at the Federal Circuit.  As we summarized in our January and February updates, the Court has two such cases pending: United States v. Arthrex, Inc. (U.S. Nos. 19-1434, 19-1452, 19-1458); and Minerva Surgical Inc. v. Hologic Inc. (U.S. No. 20-440).

The Court will hear argument on the doctrine of assignor estoppel on Wednesday, April 21, 2021, in Minerva v. Hologic.

Noteworthy Petitions for a Writ of Certiorari:

There are three new potentially impactful certiorari petitions that are currently before the Supreme Court:

Ono Pharmaceutical v. Dana-Farber Cancer Institute (U.S. No. 20-1258):  “Whether the Federal Circuit erred in adopting a bright-line rule that the novelty and non-obviousness of an invention over alleged contributions that were already in the prior art are ‘not probative’ of whether those alleged contributions were significant to conception.”

Warsaw Orthopedic v. Sasso (U.S. No. 20-1284):  “Whether a federal court with exclusive jurisdiction over a claim may abstain in favor of a state court with no jurisdiction over that claim.”

Sandoz v. Immunex (U.S. No. 20-1110):  “May the patent owner avoid the rule against double patenting by buying all of the substantial rights to a second, later-expiring patent for essentially the same invention, so long as the seller retains nominal ownership and a theoretical secondary right to sue for infringement?”

The petitions in American Axle & Manufacturing, Inc. v. Neapco Holdings LLC (U.S. No. 20-891) and Ariosa Diagnostics, Inc. v. Illumina, Inc. (U.S. No. 20-892) are still pending.

After requesting a response, the Court denied Argentum’s petition in Argentum Pharmaceuticals LLC v. Novartis Pharmaceuticals Corporation (U.S. No. 20-779).  Gibson Dunn partners Mark Perry and Jane Love were counsel for Novartis.

Other Federal Circuit News:

Judge Wallach to Retire.  On March 16, 2021, the Federal Circuit announced that Judge Evan J. Wallach will retire from active service and assume senior status, effective May 31, 2021.  Judge Wallach served on the Federal Circuit for nearly 10 years and, prior to that, served on the U.S. Court of International Trade for 16 years.  Judge Wallach’s full biography is available on the court’s website.  On March 30, President Biden announced his intent to nominate Tiffany Cunningham for the empty seat.  Ms. Cunningham has been a partner in the Patent Litigation practice of Perkins Coie LLP since 2014, and serves on the 17-member Executive Committee of the firm.  She began her legal career as a law clerk to Judge Dyk.

Federal Circuit Practice Update

Updated Federal Circuit Rules.  Pursuant to the court’s December 9, 2020 public notice, the court has published an updated edition of the Federal Circuit Rules.  This edition incorporates the emergency amendment to Federal Circuit Rule 15(f) brought about by the court’s en banc decision in NOVA v. Secretary of Veterans Affairs (Fed. Cir. No. 20‑1321).

Upcoming Oral Argument Calendar

The list of upcoming arguments at the Federal Circuit are available on the court’s website.

Live streaming audio is available on the Federal Circuit’s new YouTube channel.  Connection information is posted on the court’s website.

Case of Interest:

New Vision Gaming & Development, Inc. v. SG Gaming, Inc. (Fed. Cir. No. 20‑1399):  This case concerns “[w]hether the unusual structure for instituting and funding AIA post-grant reviews violates the Due Process Clause in view of Tumey v. Ohio, 273 U.S. 510 (1927), and its progeny, which establish ‘structural bias’ as a violation of due process.”  It attracted an amicus brief from US Inventor in support of appellant, which argues that the administrative patent judges’ compensation and performance rating system affects their decision making.  Panel M will hear argument in New Vision Gaming on April 9, 2021, at 10:00 AM Eastern.

Key Case Summaries (March 2021)

SynQor, Inc. v. Vicor Corp. (Fed. Cir. No. 19-1704):  In an inter partes reexamination (“IPR”), the Patent Trial and Appeal Board (“PTAB”) found several claims of SynQor’s patent unpatentable over the prior art.  SynQor appealed, arguing that common law preclusion arising from a prior reexamination involving two related patents collaterally estopped the Board from finding a motivation to combine.

The Federal Circuit panel majority (Hughes, J., joined by Clevenger, J.) vacated and remanded, holding that common law issue preclusion can apply to IPRs.  Analyzing the statutory scheme, the majority determined that Congress did not intend to prevent application of common law estoppel.  Instead, the estoppel provisions of 35 U.S.C. §§ 315(c), 317(b) were more robust than common law collateral estoppel and fully consistent with allowing common law estoppel.  The majority also determined that IPRs satisfied the traditional elements of issue preclusion.  The majority explained that unlike an ex parte reexamination, Congress provided the third-party reexamination requestor the opportunity to fully participate in inter partes proceedings.  The majority also determined that inter partes reexaminations contained sufficient procedural elements necessary to invoke issue preclusion.  In an IPR, a party has the opportunity to respond to the other party’s evidence, challenge an expert’s credibility and submit its own expert opinions.  Thus, the majority found that the lack of cross-examination did not prevent common law issue preclusion from applying to IPRs.

Judge Dyk dissented, arguing that common law issue preclusion should not apply to inter partes reexaminations because of the lack of compulsory process and cross-examination.

In Re: Board of Trustees of the Leland Stanford Junior University (Fed. Cir. No. 20-1012):  The PTAB affirmed the examiner’s final rejection of Stanford’s claims directed to determining haplotype phase, on the basis that the claims were ineligible.  The process of haplotype phasing involves determining from which parent an allele was inherited.  The PTAB held that the claims were directed to “receiving and analyzing information,” which are “mental processes within the abstract idea category,” and that the claims lacked an inventive concept.

The Federal Circuit (Reyna, J., joined by Prost, C.J. and Lourie, J.) affirmed.  At step one, the court held that the claims were directed to the abstract idea of “mathematically calculating alleles’ haplotype phase.”  At step two, it held that the claims lacked an inventive concept, noting that the claims recited no steps that “practically apply the claimed mathematical algorithm.”  The court held that, instead, the claims merely stored the haplotype phase information, which could not transform the abstract idea into patent-eligible subject matter.  It further held that the dependent claims recited limitations amounting to no more than an instruction to apply that abstract idea.

Mylan Laboratories v. Janssen Pharmaceutica (Fed. Cir. No. 20-1071):  Mylan petitioned for IPR of Janssen’s patent.  Janssen opposed institution on the grounds that instituting the IPR would be an inefficient use of the PTAB’s resources because of two co-pending district court actions: one against Mylan and a second against Teva Pharmaceuticals that was set to go to trial soon after the institution decision.  The Board applied its six-factor standard articulated in Fintiv and denied institution.  Mylan appealed and requested mandamus relief; arguing that denying IPR based on litigation with a third party undermined Mylan’s constitutional and other due process rights, and that application of the six-factor standard violated congressional intent.

The Federal Circuit (Moore, J., joined by Newman, J. and Stoll, J.) granted Janssen’s motion to dismiss the appeal and denied Mylan’s petition for a writ of mandamus.  The court dismissed Mylan’s direct appeal and reiterated that the court lacks jurisdiction over appeals from decisions denying institution because Section 314(d) specifically makes institution decisions “nonappealable.”  The court noted that “judicial review [of institution decisions] is available in extraordinary circumstances by petition for mandamus,” even though “the mandamus standard will be especially difficult to satisfy” when challenging a decision denying institution of an IPR.  Indeed, the court noted that “it is difficult to imagine a mandamus petition that challenges a denial of institution and identifies a clear and indisputable right to relief.”  Considering the merits of Mylan’s petition, the court explained that “there is no reviewability of the Director’s exercise of his discretion to deny institution except for colorable constitutional claims,” which Mylan had failed to present.

Uniloc 2017 v. Facebook (Fed. Cir. No. 19-1688):  Uniloc appealed from a PTAB ruling that the petitioners were not estopped from challenging the claims and that the patents at issue were invalid as obvious.  Facebook filed two IPR petitions and then joined an IPR petition that had been previously filed by Apple, which challenged only a subset of the claims in the Facebook petitions.  LG then joined Facebook’s two petitions, but not Apple’s.  After instituting trial on Facebook’s two IPR petitions, the PTAB issued it final written decision in the Apple IPR, upholding the validity of Apple’s claims.  The PTAB determined that, as of the final written decision on the Apple IPR, Facebook was estopped from challenging the overlapping claims in its own IPR petitions under § 315 (e)(1).  LG, however, was not estopped from challenging the overlapping claims.

The Federal Circuit (Chen, J., joined by Lourie, J. and Wallach, J.) affirmed.  The panel first determined that it had jurisdiction to review the challenge because the final written decision in the Apple IPR did not issue until after the institution of trial on the Facebook petitions.  Next, the panel held that LG was not a real-party-at-interest or privy of Facebook because there was no evidence of any sort of preexisting, established relationship that indicates coordination related to the Apple IPR.  According to the panel, moreover, Facebook was not estopped from addressing the non-overlapping claims (even the claim that depended from an overlapping claim) because § 315 (e)(1) specifically applies to claims in a patent.  The panel then addressed the PTAB’s obviousness determination regarding the challenged claims and affirmed the Board’s obviousness findings as supported by substantial evidence.

In Re TracFone Wireless (Fed. Cir. No. 21-118): Precis Group sued TracFone in the Western District of Texas, alleging that venue was proper because TracFone has a store in San Antonio.  TracFone moved to transfer on the grounds that venue was inconvenient, as well as improper because it no longer has a branded store in the district.  For several months, the district court (Judge Albright) did not decide the motion, and instead kept the case moving towards trial.  After eight months, TracFone petitioned the Federal Circuit for a writ of mandamus.

In its decision granting mandamus, the Federal Circuit (Reyna, J., joined by Chen, J. and Hughes, J.) ordered Judge Albright to “issue its ruling on the motion to transfer within 30 days from the issuance of this order, and to provide a reasoned basis for its ruling that is capable of meaningful appellate review.”  It also ordered that all proceedings in the case be stayed until further notice.  Notably, the court explained “that any familiarity that [the district court] has gained with the underlying litigation due to the progress of the case since the filing of the complaint is irrelevant when considering the transfer motion and should not color its decision.”  Judge Albright denied the motion to transfer the day after the mandamus decision issued.

The Federal Circuit has recently denied two other petitions for mandamus involving cases before Judge Albright.  In In re Adtran, Inc. (Fed. Cir. No. 21-115), the court denied a petition for mandamus directing Judge Albright to stay all deadlines unrelated to venue pending a decision on transfer.  In In re True Chemical Solutions (Fed. Cir. No. 21-131), the court denied a petition for mandamus reversing Judge Albright’s grant of a motion for intra-division transfer.  Notably, Judge Albright now oversees 20% of new US patent cases (link).


Gibson Dunn’s lawyers are available to assist in addressing any questions you may have regarding developments at the Federal Circuit.  Please contact the Gibson Dunn lawyer with whom you usually work or the authors of this alert:

Blaine H. Evanson - Orange County (+1 949-451-3805, bevanson@gibsondunn.com) Jessica A. Hudak - Orange County (+1 949-451-3837, jhudak@gibsondunn.com)

Please also feel free to contact any of the following practice group co-chairs or any member of the firm’s Appellate and Constitutional Law or Intellectual Property practice groups:

Appellate and Constitutional Law Group: Allyson N. Ho - Dallas (+1 214-698-3233, aho@gibsondunn.com) Mark A. Perry - Washington, D.C. (+1 202-887-3667, mperry@gibsondunn.com)

Intellectual Property Group: Wayne Barsky - Los Angeles (+1 310-552-8500, wbarsky@gibsondunn.com) Josh Krevitt - New York (+1 212-351-4000, jkrevitt@gibsondunn.com) Mark Reiter - Dallas (+1 214-698-3100, mreiter@gibsondunn.com)

© 2021 Gibson, Dunn & Crutcher LLP

Attorney Advertising:  The enclosed materials have been prepared for general informational purposes only and are not intended as legal advice.

April 5, 2021 |
Supreme Court Holds That Google’s Use Of Oracle’s Java Software Interface Is Fair Use

Click for PDF Decided April 5, 2021 Google LLC v. Oracle America, Inc., No. 18-956

Today, the Supreme Court held 6-2 that Google’s use of the Java interface in the Android platform falls within the fair use doctrine. 

Background: Sun Microsystems launched the Java platform in the 1990s to allow software developers to write and run applications in the Java programming language. The Java platform includes pre-written code to perform a number of common functions (e.g., calculating an arithmetic mean), which software developers can incorporate directly into their own applications through the use of the Java software interface. By using Java’s software interface in their applications, developers avoid having to compose the underlying, functional code themselves.

Google launched its Android operating system in 2008. Like Java, Android includes pre-written code to perform certain common functions, making it easier for developers to create applications for Android. Although the code used by Android to perform these functions is entirely original, Android used portions of Java’s software interface. By doing so, Google allowed developers to create applications for Android using the same interface that they use to create applications for Java. In all, Android uses 11,330 lines (or 0.4 percent) of Java’s software interface.

After acquiring Java from Sun Microsystems, Oracle sued Google for copyright infringement based on Android’s use of the Java software interface. The district court concluded that copyright protection did not extend to the Java software interface, but the Federal Circuit reversed, concluding that Java’s software interface is protectable under copyright law and that the merger doctrine, which bars copyright protection when there are only a few ways to express a function, was inapplicable. On remand, a jury found that Google’s use of the Java software interface was protected under the fair use doctrine, but the Federal Circuit again reversed.

Issue: Does the Copyright Act protect a software interface and, if so, does Android’s use of the Java software interface constitute fair use?

Court's Holding: The Court assumed, “purely for argument’s sake,” that the Java interface is protected by copyright, and held that Google’s use of that interface in the Android platform falls within the fair use doctrine.

“We reach the conclusion that in this case, where Google reimplemented a user interface, taking only what was needed to allow users to put their accrued talents to work in a new and transformative program, Google’s copying of the Sun Java API was a fair use of that material as a matter of law.

Justice Breyer, writing for the Court

What It Means:
  • The Court clarified that “fair use” is a mixed question of law and fact. Reviewing courts should appropriately defer to the jury’s findings of underlying facts, but the ultimate question whether those facts show a fair use is a legal question for judges to decide de novo.
  • The Court explained that the fair use doctrine is particularly important when applying copyright law to computer programs because they almost always serve functional purposes and are bound up with uncopyrightable material. “[F]air use can play an important role in determining the lawful scope of a computer program copyright” because it provides a context-based check that can help to keep a copyright monopoly within its lawful bound.
  • The application of fair use in this case does not undermine the general copyright protection Congress provided for computer programs because the declaring code at issue, “if copyrightable at all,” is further than most computer programs are from “the core of copyright.”  This is because, as part of a user interface, the declaring code’s use “is inherently bound together with uncopyrightable ideas (general task division and organization) and new creative expression (Android’s implementing code).”  Moreover, its value (1) derives from the value that computer programmers invest of their own time and effort to learn the API’s system and (2) lies in its efforts to encourage programmers to learn and to use that system so that they will use Sun-related implementing programs.
  • Despite Google having copied portions of the Java interface “precisely,” the Court held that its use was nonetheless “transformative” because Google used the code to “create a new platform that could be readily used by programmers.” Google’s use was therefore “consistent with that creative ‘progress’ that is the basic constitutional objective of copyright itself.”
  • Commercial use does not necessarily tip the scales against fair use. The Court explained that, even though Google’s use was a commercial endeavor, that is not dispositive of the “purpose and character of use” factor, particularly because Google’s use was transformative.
  • The Court’s fair use ruling will make it easier for platform developers to reuse software interfaces when creating new platforms. This may lead to the development of less-expensive competing versions of applications, but may also disincentivize research and development of new software platforms or languages.
  • The question whether the Copyright Act protects software interfaces remains unanswered. “Given the rapidly changing technological, economic, and business-related circumstances,” the Court explained, “[the Court] should not answer more than is necessary to resolve the parties’ dispute.” The Court therefore assumed, “purely for argument’s sake,” that the Java interface is protected by copyright.

The Court's opinion is available here.

Gibson Dunn’s lawyers are available to assist in addressing any questions you may have regarding developments at the Supreme Court. Please feel free to contact the following practice leaders:

Appellate and Constitutional Law Practice

Allyson N. Ho +1 214.698.3233 aho@gibsondunn.com Mark A. Perry +1 202.887.3667 mperry@gibsondunn.com Blaine H. Evanson +1 949-451-3805 bevanson@gibsondunn.com
Lucas C. Townsend +1 202.887.3731 ltownsend@gibsondunn.com Bradley J. Hamburger +1 213.229.7658 bhamburger@gibsondunn.com

Related Practice: Intellectual Property

Wayne Barsky +1 310.552.8500 wbarsky@gibsondunn.com Josh Krevitt +1 212.351.4000, jkrevitt@gibsondunn.com Mark Reiter +1 214.698.3100 ,mreiter@gibsondunn.com
Howard S. Hogan +1 202.887.3640 hhogan@gibsondunn.com

April 5, 2021 |
Thomas Dupree Named Litigator of the Week

The Am Law Litigation Daily named Washington, D.C. partner Thomas Dupree a Litigator of the Week for successfully securing a California Court of Appeal ruling unanimously in favor of FCA US in a case involving California’s lemon law that was closely watched by the automobile industry. The profile was published on April 2, 2021. Tom Dupree is an experienced trial and appellate advocate. He has argued more than 80 appeals in the federal courts, including in all 13 circuits as well as the United States Supreme Court. He has represented clients throughout the country in a wide variety of trial and appellate matters, including cases involving punitive damages, class actions, product liability, arbitration, intellectual property, employment, and constitutional challenges to federal and state statutes.

April 5, 2021 |
Gibson Dunn Wins Six Awards at 2021 Benchmark Litigation US Awards Ceremony

Benchmark Litigation recognized Gibson Dunn at its 2021 Benchmark US awards ceremony with six awards. Gibson Dunn was named East Coast Appellate Firm of the Year, California Antitrust Firm of the Year and California Labor & Employment Firm of the Year.  Additionally, Los Angeles partner Theane Evangelis was named California Labor & Employment Litigator of the Year and Washington, D.C. partner Richard Parker was named East Coast Antitrust Litigator of the Year. Finally, Soundgarden et al. v. UMG Recordings, Inc, in which Gibson Dunn represented UMG, was named an Impact Case. The publication noted, “The firm continues to enjoy a coveted position as one of the nation’s strongest and most in-demand litigation institutions.” The awards were presented on March 31, 2021. Theane Evangelis serves as Co-Chair of the firm’s Class Actions Practice Group and as Vice Chair of the California Appellate Practice Group. She has played a lead role in a wide range of appellate, constitutional, media and entertainment, and crisis management matters, as well as a variety of employment, consumer and other class actions. Richard Parker is a leading antitrust lawyer who has successfully represented clients before both enforcement agencies and the courts. As an experienced antitrust trial and regulatory lawyer, Richard has been involved in many major antitrust representations, including merger clearance cases, cartel matters, class actions, and government civil investigations.  He has extensive experience representing clients in matters before the Federal Trade Commission (FTC)  and the U.S. Department of Justice Antitrust Division.

April 5, 2021 |
Former Solicitor General of Texas Kyle Hawkins Returns to Gibson Dunn

Gibson, Dunn & Crutcher LLP is pleased to announce that Kyle D. Hawkins has rejoined the firm as a partner in the Houston office.  Hawkins recently served as the Solicitor General of Texas and will focus on appellate and constitutional law, class actions and commercial litigation. “We are pleased to welcome Kyle back to the firm and to our Houston office,” said Ken Doran, Chairman and Managing Partner of Gibson Dunn.  “We have one of the top appellate practices in the U.S., and with his reputation as a highly skilled advocate at the state and national levels, Kyle will be a terrific addition to the practice.  His significant government experience and insight into Texas state agencies will greatly benefit our clients.” “Kyle is an experienced appellate advocate, who is widely respected for his integrity and oral advocacy,” said Allyson Ho, Co-Chair of the firm’s Appellate and Constitutional Law Practice Group.  “As the State of Texas’s most high-profile litigator, Kyle handled the state’s most important cases.  His profile and experience will enrich our Texas appellate team, and he is a natural fit to serve as the Houston office’s first litigation partner as we expand our presence throughout the state.” “I’m thrilled to return to Gibson Dunn,” said Hawkins.  “I look forward to working closely with the firm’s litigation and appellate teams to grow the firm’s offering in Texas and across the U.S.” About Kyle D. Hawkins Hawkins will practice in the areas of appellate and constitutional law, class actions and commercial litigation.  Prior to his return to the firm, he served as Solicitor General of Texas from 2018 to 2021 and as Assistant Solicitor General of Texas from 2017 to 2018.  As Solicitor General, he was responsible for supervising and approving all appellate litigation for the State of Texas.  He has presented 30 oral arguments, including four before the U.S. Supreme Court, six before the Texas Supreme Court, 17 before the U.S. Court of Appeals for the Fifth Circuit (including five before en banc panels), and three before the Texas Courts of Appeals in Austin, Dallas, and Fort Worth.  He also served as an adjunct professor at the University of Texas School of Law, teaching a course on U.S. Supreme Court practice. Prior, Hawkins practiced in Gibson Dunn’s Washington, D.C. office from 2011 to 2013 and from 2014 to 2017.  He clerked for U.S. Supreme Court Justice Samuel A. Alito, Jr. from 2013 to 2014 and for Judge Edith H. Jones of the U.S. Court of Appeals for the Fifth Circuit from 2010 to 2011. Hawkins graduated summa cum laude in 2009 from the University of Minnesota Law School, where he served as editor-in-chief of the Minnesota Law Review.  He graduated magna cum laude from Harvard College in 2002.

April 1, 2021 |
Supreme Court Declines To Extend Telephone Consumer Protection Act’s Coverage Of Automatic Telephone Dialing Systems

Click for PDF Decided April 1, 2021 Facebook, Inc. v. Duguid, No. 19-511

Today, the Supreme Court unanimously held that a device counts as an automatic telephone dialing system under the Telephone Consumer Protection Act only if it stores or produces telephone numbers using a random or sequential number generator. 

Background: Facebook users can provide a cell phone number that allows the company to send them a text message whenever someone attempts to access their account from an unknown device. Noah Duguid alleges that he has never used Facebook, yet received several of these login-notification text messages. Duguid brought a putative class action lawsuit against Facebook under the Telephone Consumer Protection Act (“TCPA”), claiming that each text message was a violation of the TCPA’s prohibitions on making calls using an automatic telephone dialing system (“autodialer”). The TCPA defines an autodialer as “equipment which has the capacity—(A) to store or produce telephone numbers to be called, using a random or sequential number generator; and (B) to dial such numbers.” 47 U.S.C. § 227(a)(1).

The Ninth Circuit held that Duguid had plausibly alleged violations of the TCPA, even if Facebook had not sent the texts using a random or sequential number generator. A device is an autodialer under the TCPA, the Ninth Circuit ruled, so long as it has the capacity to store and automatically dial numbers.

Issue: Whether the definition of an autodialer in the TCPA encompasses any device that can store and automatically dial telephone numbers, even if the device does not use a random or sequential number generator.

Court's Holding: No. A device is an autodialer under the TCPA only if it can store or produce telephone numbers using a random or sequential number generator. A device that merely stores and then automatically dials telephone numbers, but does not have the capacity to use a random or sequential number generator, is not an autodialer and is therefore not subject to the TCPA’s prohibitions.

“Because Facebook’s notification system neither stores nor produces numbers ‘using a random or sequential number generator,’ it is not an autodialer.

Justice Sotomayor, writing for the Court

What It Means:
  • Today’s ruling makes clear that a device is an autodialer only if it has the capacity to use a random or sequential number generator. Businesses with notification systems that do not have this capacity should be able to keep those systems in place without running afoul of the TCPA’s prohibitions on the use of autodialers.
  • The Court’s ruling may help reduce class-action litigation under the TCPA. However, the precise scope of the TCPA remains uncertain, as the Court left some important questions open—for example, what counts as a “random or sequential number generator,” and whether text messages are “calls” within the meaning of the TCPA. The Court’s opinion thus leaves the door open for the FCC to adopt regulations and guidance further limiting the TCPA’s scope.
  • In writing for the Court, Justice Sotomayor performed a close textual analysis of the TCPA’s autodialer definition. The Court’s opinion provides further confirmation that the Justices have embraced a method of statutory interpretation that concentrates on the text of statutes.
  • The Court’s decision is its second major ruling on the TCPA in the past year, following Barr v. American Association of Political Consultants, Inc., in which the Court left in place the TCPA’s ban on robocalls, while invalidating the federal-debt-collection exception.

The Court's opinion is available here.

Gibson Dunn’s lawyers are available to assist in addressing any questions you may have regarding developments at the Supreme Court. Please feel free to contact the following practice leaders:

Appellate and Constitutional Law Practice

Allyson N. Ho +1 214.698.3233 aho@gibsondunn.com Mark A. Perry +1 202.887.3667 mperry@gibsondunn.com Lucas C. Townsend +1 202.887.3731 ltownsend@gibsondunn.com
Bradley J. Hamburger +1 213.229.7658 bhamburger@gibsondunn.com

Related Practice: Litigation

Theodore J. Boutrous, Jr. +1 213.229.7804 tboutrous@gibsondunn.com Randy M. Mastro +1 212.351.3825 rmastro@gibsondunn.com

Related Practice: Privacy, Cybersecurity and Data Innovation

Ahmed Baladi +33 (0)1 56 43 13 50 abaladi@gibsondunn.com Alexander H. Southwell +1 212.351.3981 asouthwell@gibsondunn.com S. Ashlie Beringer +1 650.849.5327 aberinger@gibsondunn.com
Orin Snyder +1 212.351.2400 osnyder@gibsondunn.com Timothy W. Loose +1 213.229.7746 tloose@gibsondunn.com

April 1, 2021 |
Supreme Court Holds That FCC Permissibly Relaxed Media Ownership Limits

Click for PDF Decided April 1, 2021 FCC v. Prometheus Radio Project, No. 19 1231; and Nat’l Ass’n of Broadcasters v. Prometheus Radio Project, No. 19 1241 Today, the Supreme Court held 9-0 that the Federal Communications Commission (FCC) permissibly relaxed three decades-old rules limiting ownership of broadcast stations as part of its quadrennial regulatory review under § 202(h) of the Telecommunications Act. 

Background: Section 202(h) of the Telecommunications Act of 1996 directs the FCC to review its media ownership rules every four years and to “repeal” or “modify” any rule that is no longer “necessary in the public interest as the result of competition.” In the FCC’s most recent review, it modified or eliminated three decades-old restrictions on the ownership of radio stations, television stations, and newspapers because it concluded that substantial competitive changes had rendered the prior rules unnecessary. No party challenged that competition analysis, but the Third Circuit nonetheless vacated the FCC’s order because it concluded that the FCC had inadequately considered the effect of its rule changes on minority and female ownership, a factor that does not appear in Section 202(h).

Issue: Did the FCC permissibly relax its media ownership rules under Section 202(h) based on a finding that they were no longer necessary as the result of competition?

Court's Holding: The FCC permissibly relaxed its media ownership rules because it considered the record evidence and reasonably concluded that the rules no longer serve the public interest. The FCC further reasonably explained that its rule changes were not likely to harm minority and female ownership.

“[T]he FCC’s analysis was reasonable and reasonably explained for purposes of the APA’s deferential arbitrary-and-capricious standard.

Justice Kavanaugh, writing for the Court

What It Means:
  • The Court’s decision clears the way for consolidation in the broadcast and newspaper industry.  It also eases the FCC’s ability to further implement the deregulatory mandate of Section 202(h).  Congress enacted that mandate in 1996 to require the FCC to keep pace with industry developments.
  • The Court applied the normal arbitrary-and-capricious standard in reviewing the FCC’s order, despite the Solicitor General’s call for special deference to the FCC under Section 202(h).
  • The Court confirmed that the Administrative Procedure Act “imposes no general obligation on agencies to conduct or commission their own empirical or statistical studies.” It further made clear that “nothing in the Telecommunications Act (or any other statute) requires the FCC to conduct its own empirical or statistical studies before exercising its discretion under Section 202(h).” If agencies lack perfect empirical data—which is “not unusual”—they generally need only make a reasonable predictive judgment based on the evidence available.
  • Because the FCC reasonably assessed effects on minority and female ownership, the Court did not reach the alternative argument that Section 202(h) does not require the FCC to consider this factor at all. Justice Thomas wrote a separate concurrence to state his view that the FCC had no obligation to consider minority and female ownership.
  • The Court reversed without remanding the case to the Third Circuit, a panel of which had retained jurisdiction over the case for the last 17 years.

The Court's opinion is available here.

Gibson Dunn’s lawyers are available to assist in addressing any questions you may have regarding developments at the Supreme Court. Please feel free to contact the following practice leaders:

Appellate and Constitutional Law Practice

Allyson N. Ho +1 214.698.3233 aho@gibsondunn.com Mark A. Perry +1 202.887.3667 mperry@gibsondunn.com
Lucas C. Townsend +1 202.887.3731 ltownsend@gibsondunn.com Bradley J. Hamburger +1 213.229.7658 bhamburger@gibsondunn.com

Administrative Law and Regulatory Practice

Helgi C. Walker +1 202.887.3599 hwalker@gibsondunn.com

March 18, 2021 |
The Two Teds – Episode 2 – Bush v Gore and Election Litigation

When Ted Olson argued Bush v Gore before the Supreme Court, it was one of the most important and historic moments in recent legal history. On this episode of “The Two Teds,” Olson and Ted Boutrous take a deep dive and explain what it took to manage the sprawling legal team and prepare for arguments. They also tackle the most recent election and draw parallels – and differences – between the 2020 and 2000 elections.

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All episodes of The Two Teds are available on GibsonDunn.com and wherever you listen to podcasts. You can also subscribe to be notified of new episodes via e-mail.


HOSTS:

Ted Boutrous - Theodore J. Boutrous, Jr., a partner in the Los Angeles office of Gibson, Dunn & Crutcher LLP, is global Co-Chair of the firm’s Litigation Group and previously led the firm’s Appellate, Crisis Management, Transnational Litigation and Media groups.  He also is a member of the firm’s Executive and Management Committees.  Recognized for a decade of excellence in the legal profession, the Daily Journal in 2021 named Mr. Boutrous as a  Top Lawyer of the Decade for his victories. As a tireless advocate and leader for high-stakes and high-profile cases, Mr. Boutrous was also named the 2019 “Litigator of the Year, Grand Prize Winner” by The American Lawyer. Ted Olson - Theodore B. Olson is a Partner in Gibson, Dunn & Crutcher’s Washington, D.C. office; a founder of the Firm’s Crisis Management, Sports Law, and Appellate and Constitutional Law Practice Groups. Mr. Olson was Solicitor General of the United States during the period 2001-2004. From 1981-1984, he was Assistant Attorney General in charge of the Office of Legal Counsel in the U.S. Department of Justice. Except for those two intervals, he has been a lawyer with Gibson, Dunn & Crutcher in Los Angeles and Washington, D.C. since 1965.

March 18, 2021 |
The Two Teds – Episode 1 – Opening Statements

In this first episode of “The Two Teds,” Ted Boutrous and Ted Olson discuss the paths that led them to become two of America’s leading litigators. They delve into their backgrounds and what drove them to become lawyers. They also touch on legal cases they’ve worked on together and Ted Olson’s first Supreme Court case.

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All episodes of The Two Teds are available on GibsonDunn.com and wherever you listen to podcasts. You can also subscribe to be notified of new episodes via e-mail.


HOSTS:

Ted Boutrous - Theodore J. Boutrous, Jr., a partner in the Los Angeles office of Gibson, Dunn & Crutcher LLP, is global Co-Chair of the firm’s Litigation Group and previously led the firm’s Appellate, Crisis Management, Transnational Litigation and Media groups.  He also is a member of the firm’s Executive and Management Committees.  Recognized for a decade of excellence in the legal profession, the Daily Journal in 2021 named Mr. Boutrous as a  Top Lawyer of the Decade for his victories. As a tireless advocate and leader for high-stakes and high-profile cases, Mr. Boutrous was also named the 2019 “Litigator of the Year, Grand Prize Winner” by The American Lawyer. Ted Olson - Theodore B. Olson is a Partner in Gibson, Dunn & Crutcher’s Washington, D.C. office; a founder of the Firm’s Crisis Management, Sports Law, and Appellate and Constitutional Law Practice Groups. Mr. Olson was Solicitor General of the United States during the period 2001-2004. From 1981-1984, he was Assistant Attorney General in charge of the Office of Legal Counsel in the U.S. Department of Justice. Except for those two intervals, he has been a lawyer with Gibson, Dunn & Crutcher in Los Angeles and Washington, D.C. since 1965.

March 3, 2021 |
Federal Circuit Update (February 2021)

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This edition of Gibson Dunn’s Federal Circuit Update summarizes the three pending Supreme Court cases originating in the Federal Circuit and key filings for certiorari review.  We address the Federal Circuit’s announcement that it will now offer a live audio streaming program for oral argument.  And we discuss other recent Federal Circuit decisions concerning induced infringement via “skinny labels,” patent term adjustment, motions to transfer from the Western District of Texas, and whether anticipation is inherent in an obviousness theory.

Federal Circuit News

Supreme Court:

In February, the Supreme Court did not add any new cases originating in the Federal Circuit.  It has three such cases pending.

United States v. Arthrex, Inc. (U.S. Nos. 19-1434, 19-1452, 19-1458):  On Monday, March 1, the Court heard argument on the question of whether PTAB administrative patent judges are principal Officers and therefore unconstitutionally appointed in violation the Appointments Clause.  Gibson Dunn partner Mark Perry argued for Smith & Nephew.

Minerva Surgical Inc. v. Hologic Inc. (U.S. No. 20-440):  As we summarized in our January 2021 update, the Supreme Court granted certiorari to determine the viability of the assignor estoppel doctrine, which bars assignors from challenging the patent’s validity in district court.  Minerva Surgical filed its opening brief on the merits asking the Court to eliminate assignor estoppel.  Engine Advocacy filed a brief in support.  Hologic’s brief is due at the end of March.

Google LLC v. Oracle America, Inc. (U.S. No. 18-956):  As we summarized in our January 2021 update, the Court is considering whether copyright protection extends to a software interface and, if so, whether Google’s use constitutes fair use.  The Court heard argument on October 7, 2020.

Noteworthy Petitions for a Writ of Certiorari:

There are three potentially impactful petitions currently before the Supreme Court.

As we summarized in our January 2021 update, petitioners in American Axle & Manufacturing, Inc. v. Neapco Holdings LLC (U.S. No. 20-891) and Ariosa Diagnostics, Inc. v. Illumina, Inc. (U.S. No. 20-892) both raise questions related to patent eligibility under 35 U.S.C. § 101.  The Court has requested responses to both petitions, which are due March 21, 2021, and April 19, 2021, respectively.

The Court also requested a response in Argentum Pharmaceuticals LLC v. Novartis Pharmaceuticals Corporation (U.S. No. 20-779), which Novartis filed on February 16, 2021.  The question presented is whether the Federal Circuit correctly found that Argentum’s evidence of alleged injury was insufficient to establish Article III standing.  Gibson Dunn partners Mark Perry and Jane Love are counsel for Novartis.

Other Federal Circuit News:

In GlaxoSmithKline LLC v. Teva Pharmaceuticals USA, Inc. (Fed. Cir. No. 18-1976), on February 9, 2021, the panel granted panel rehearing, vacated the judgment, withdrew its October opinion, and ordered a second oral argument, which it held on February 23, 2021.  On October 2, 2020, a panel (Newman, J., joined by Moore, J.) vacated the district court’s grant of JMOL and reinstated the jury verdicts of infringement and damages.  Over Chief Judge Prost’s dissent, the panel majority held that Teva induced infringement of GSK’s patent by marketing its generic carvedilol, even though the “skinny label” carved out the infringing method.  Teva petitioned for rehearing on the question of whether a generic manufacturer can “be held liable for induced infringement based on evidence that would be available in every carve-out case.”  Three amicus briefs were filed before the panel’s initial decision, and eight amicus briefs were filed in support of rehearing.

Federal Circuit Practice Update

Live streaming audio of oral argument.  Beginning this week, as part of the Federal Circuit’s ongoing response to the COVID-19 pandemic, the court will offer a new live audio streaming program for oral argument panels.  For the March 2021 session, Panels B, E, H, K, and N will have daily live streaming audio on the Federal Circuit’s new YouTube channel.  Connection information is posted on the court’s website on the first day of the month’s session.  The court anticipates that, by the April session, all oral arguments will be live audio streamed online while the courthouse remains closed to the public.

Upcoming Oral Argument Calendar

The list of upcoming arguments at the Federal Circuit are available on the court’s website.

Key Case Summaries (February 2021)

Amgen, Inc. v. Sanofi (Fed. Cir. No. 20-1074):  Amgen appealed from the district court’s grant of JMOL of lack of enablement of its claims to antibodies that bind to a protein and block it from binding to low-density lipoprotein (“LDL”) receptors (elevated LDL cholesterol is linked to heart disease).  The claimed antibodies are defined by their function:  binding to a combination of sites on the protein and blocking the protein/LDL receptor interaction.  The district court concluded, based on the Wands factors, that the claims are not enabled because they require undue experimentation.

The panel (Lourie, J., joined by Prost, C.J., and Hughes, J.) affirmed.  The panel explained that, under the court’s precedents, “the enablement inquiry for claims that include functional requirements can be particularly focused on the breadth of those requirements, especially where predictability and guidance fall short.”  It further explained that “[w]hile functional claim limitations are not necessarily precluded in claims that meet the enablement requirement, such limitations pose high hurdles in fulfilling the enablement requirement for claims with broad functional language.”  The panel held that the claims were not enabled because undue experimentation would be required to practice the full scope of these claims.

In re: SK hynix Inc. (Fed. Cir. No. 21-113):  SK hynix petitioned for a writ of mandamus directing the district court (Judge Albright in the Western District of Texas) to transfer the underlying case to the Central District of California.  On May 4, 2020, SK hynix moved to transfer the case and, although briefing was complete by May 26, 2020, the court had yet to rule.  Meanwhile, Judge Albright ordered the parties to engage in extensive discovery and scheduled a Markman hearing for March 19, 2021.  After SK Hynix petitioned the Federal Circuit, on January 28, 2021, the district court issued an order setting a hearing on the transfer motion for the morning of February 2, 2021.

The panel (Moore, J., joined by Newman and Stoll, JJ.) granted the petition to the extent that the district court must stay all proceedings concerning the substantive issues of the case and all discovery until such time that it has issued a ruling on the transfer motion.  The panel agreed with SK hynix that the district court’s handling of the transfer motion “amounted to [an] egregious delay and blatant disregard for precedent,” and that disposing of transfer motions should “unquestionably take top priority.”

In re: SK hynix Inc. (Fed. Cir. No. 21-114):  The day after the court granted SK hynix’s petition, the district court denied its transfer motion and issued an opinion with its reasoning.  SK hynix petitioned for mandamus again.  The panel (Taranto, J., joined by Dyk and Bryson, JJ.) denied the petition, concluding that SK hynix had not shown that the district court clearly abused its discretion.

M & K Holdings, Inc. v. Samsung Electronics Co. (Fed. Cir. No. 20-1160):  M & K Holdings appealed from a Board decision in an IPR proceeding that all claims are unpatentable.  M&K argued that the Board erred by finding one claim anticipated when the petition for IPR asserted only obviousness as to that claim.  Although the Board stated it was holding that claim to be invalid as obvious, the Board’s analysis of the patentability of the claim was based on anticipation, not obviousness.

The panel (Bryson, J., joined by Moore and Chen, JJ.) vacated the Board’s holding that the claim is unpatentable, reasoning that the Board’s reliance on anticipation deprived M&K of the notice it was due.  The panel explained that the Board’s anticipation finding was “not inherent” in Samsung’s obviousness theory.  And, in fact, Samsung’s position before the Board contradicted such a conclusion.  M&K was not put on notice that the Board might find that the reference disclosed all of the claim limitations and might invalidate the claim based on anticipation.  That amounted to a “marked deviation” from the invalidity theory set forth in Samsung’s petition.

Chudik v. Hirshfeld (Fed. Cir. No. 20-1833):  Dr. Chudik’s patent issued eleven and a half years after the application was filed.  The PTO ultimately awarded Dr. Chudik a patent term adjustment of 2,066 days under 35 U.S.C. § 154(b), but it rejected Dr. Chudik’s argument that he was entitled to an additional 655 days, under 35 U.S.C. § 154(b)(1)(C)(iii) (C-delay), for the time his four notices of appeal were pending in the PTO.  The PTO concluded that the provision does not apply here because the examiner reopened prosecution during each of his four appeals so the Board never had jurisdiction.  The district court affirmed the PTO’s decision (35 U.S.C. § 154(b)(4)(A)).

The panel (Taranto, J., joined by Bryson and Hughes, JJ.) also affirmed.  The panel held that, under any framework (Chevron or not) and even without Skidmore deference, the best interpretation of the statutory language is the one the PTO adopted.


Gibson Dunn's lawyers are available to assist in addressing any questions you may have regarding developments at the Federal Circuit.  Please contact the Gibson Dunn lawyer with whom you usually work or the authors of this alert:

Blaine H. Evanson - Orange County (+1 949-451-3805, bevanson@gibsondunn.com) Jessica A. Hudak - Orange County (+1 949-451-3837, jhudak@gibsondunn.com)

Please also feel free to contact any of the following practice group co-chairs or any member of the firm's Appellate and Constitutional Law or Intellectual Property practice groups:

Appellate and Constitutional Law Group: Allyson N. Ho - Dallas (+1 214-698-3233, aho@gibsondunn.com) Mark A. Perry - Washington, D.C. (+1 202-887-3667, mperry@gibsondunn.com)

Intellectual Property Group: Wayne Barsky - Los Angeles (+1 310-552-8500, wbarsky@gibsondunn.com) Josh Krevitt - New York (+1 212-351-4000, jkrevitt@gibsondunn.com) Mark Reiter - Dallas (+1 214-698-3100, mreiter@gibsondunn.com)

© 2021 Gibson, Dunn & Crutcher LLP Attorney Advertising:  The enclosed materials have been prepared for general informational purposes only and are not intended as legal advice.

February 26, 2021 |
The Case of the Century – The French Administrative Court Issues a Groundbreaking Ruling on State Responsibility for Climate Change

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In response to a claim brought by several environmental advocacy groups (the Associations), which sought to obtain the recognition of the French State’s failure to act in response to climate change, the Administrative Court of Paris (the Court) ruled, for the first time in French law, in a judgment of February 3, 2021, that such a liability action against the State was admissible, that the ecological damage alleged by the Associations was established and that the French State was partially responsible for it. The Court ordered a further investigation in order to determine the measures that it could enjoin the French State to adopt to repair the highlighted damage and prevent its aggravation.

I. Context of the ruling rendered by the Court

The Court’s ruling comes in the wake of several rulings by the Conseil d’Etat, the French highest Administrative Court, which reveal an intensification of control and compliance with the State’s obligations in environmental matters in general, and in connection with climate change in particular.

In a ruling of July 10, 2020, the Conseil d’Etat found that the Government had not taken the measures requested to reduce air pollution in 8 areas in France, as the judge had ordered in a decision of July 12, 2017. To compel it to do so, the Conseil d’Etat imposed a penalty payment of 10 million euros for each semester of delay, the highest amount ever imposed to force the State to enforce a judgement taken by the Administrative judge (CE, Ass., 10 July 2020, Les Amis de la Terre, no. 428409).

In a Grande Synthe ruling of November 19, 2020, the Conseil d’Etat ruled for the first time on a case concerning compliance with commitments to reduce greenhouse gas emissions. Indeed, the city of Grande-Synthe referred the matter to the Conseil d’Etat after the refusal of the Government to comply with its request for additional measures to be taken to meet the goals resulting from the Paris Agreement. The Conseil d’Etat first ruled that the request of the city, a coastal city particularly exposed to the effects of climate change, was admissible. On the merits, the Conseil d’Etat noted, firstly, that although France has committed to reducing its emissions by 40% by 2030, in recent years it has regularly exceeded the emission ceilings it had set itself and, secondly, that the decree of April 21, 2020 postponed most of the reduction efforts beyond 2020. According to the High Administrative Court, it is not necessary to wait until the 2030 deadline to exercise control over the State’s actions since the control of the trajectory that the State has set itself is relevant in ecological matters. Before ruling definitively on the request, the Conseil d’Etat asked the Government to justify, within three months, that its refusal to take additional measures is compatible with compliance with the reduction trajectory chosen to achieve the objectives set for 2030. If the justifications provided by the Government are not sufficient, the Conseil d’Etat may then grant the municipality’s request and cancel the refusal to take additional measures to comply with the planned trajectory to achieve the -40% target by 2030 (EC, November 19, 2020, Commune de Grande-Synthe et al., no. 427301), or even impose obligations on the French State. According to the information provided by representatives of the Conseil d’Etat, the decision could be taken before Summer 2021.

Moreover, in a ruling of January 29, 2021, the Versailles Administrative Court of Appeal referred a question to the Court of Justice of the European Union to determine whether the rules of the European Union law should be interpreted as opening up to individuals, in the event of a sufficiently serious breach by a European Union Member State of the obligations resulting therefrom, a right to obtain from the Member State in question compensation for damage affecting their health that has a direct and certain causal link with the deterioration of air quality (CAA Versailles, January 29, 2021, no. 18VE01431).

II. Reasoning steps followed by the Court

First, the Court ruled on the admissibility of the action for compensation for ecological damage brought by the Associations against the French State. In order to recognize the Associations’ status as victims, the Court had to acknowledge the existence of a fault, damage and a causal link between the fault and the damage.

First of all, it recalled that in application of article 1246 of the French Civil Code “Any person responsible for ecological damage is required to repair it”. Implicitly, the Court considered that this provision is applicable to the State. Article 1248 of the French Civil Code provides that “The action for compensation for ecological damage is open to any person having the capacity and interest to act, [such as] associations approved or created for at least five years at the date of the institution of proceedings which have as their purpose the protection of nature and the defense of the environment”. After having examined the purpose in the Associations’ by-laws, which mention the environment protection and sometimes explicitly the fight against climate change, the Court considered that their liability action was admissible.

Second, the Court had to rule on the existence of ecological damage, bearing in mind that such damage consists of “a non-negligible damage to the elements or functions of ecosystems or to the collective benefits derived by mankind from the environment” (Article 1247 of the French Civil Code). In this respect, it should be emphasized that the Conseil Constitutionnel considered that the legislature could validly exclude from the set-up compensation mechanism, the compensation for negligible damage to the elements, functions and collective benefits derived by mankind from the environment (Decision no. 2020-881 QPC of February 5, 2021). Consequently, it is up to the courts to determine, on a case-by-case basis, according to the facts of the case, what the notion of “non-negligible damage” covers.

In order to characterize the existence of non-negligible damage, the Court first relied on the work of the Intergovernmental Panel on Climate Change (IPCC), from which it concluded “that the constant increase in the average global temperature of the Earth, which has now reached 1°C compared to the pre-industrial era, is due mainly to greenhouse gas emissions [resulting from human activity]. This increase, responsible for a modification of the atmosphere and its ecological functions, has already caused, among other things, the accelerated melting of continental ice and permafrost and the warming of the oceans, resulting in an accelerating rise in sea level”.

It also drew on the work of the National Observatory on the Effects of Global Warming, a body attached to the Ministry of Ecological Transition and responsible in particular for describing, through a certain number of indicators, the state of the climate and its impacts on the entire national territory. The Court found that “in France, the increase in average temperature, which for the 2000-2009 decade amounts to 1.14°C compared to the 1960-1990 period, is causing an acceleration in the loss of glacier mass, particularly since 2003, the aggravation of coastal erosion, which affects a quarter of French coasts, and the risk of submersion, which poses serious threats to the biodiversity of glaciers and the coastline, is leading to an increase in extreme climatic phenomena, such as heat waves, droughts, forest fires, extreme rainfalls, floods and hurricanes, which are risks to which 62% of the French population is highly exposed, and is contributing to the increase in ozone pollution and the spread of insects that are vectors of infectious agents such as dengue fever or chikungunya”.

In light of all these elements, the Court considered that the ecological damage claimed by the Associations had to be considered as established.

Third, the Court had to identify the obligations of the States in responding to climate change in order to, in a second stage, rule on possible breaches in relation to these obligations.

The Court considered that it arose in particular from the provisions of the Paris Agreement of December 12, 2015, as well as from European and national standards relating to the reduction of greenhouse gas emissions, that the French State had committed to take effective action against climate change in order to limit its causes and mitigate its harmful consequences. From this perspective, the Court recalled that the French State had chosen to exercise “its regulatory power, in particular by conducting a public policy to reduce greenhouse gas emissions emitted from the national territory, by which it undertook to achieve, at specific and successive deadlines, a certain number of objectives in this area”.

The Court then examined compliance with the greenhouse gas emission reduction trajectories that the State had set itself in order to determine whether it had failed to meet its obligations. To do so, it relied in particular on the annual reports published in June 2019 and July 2020 by the High Council for the Climate, an independent body whose mission is to issue opinions and recommendations on the implementation of public policies and measures to reduce greenhouse gas emissions of France. In its two reports, the High Council for the Climate noted that “the actions of France are not yet commensurate with the challenges and objectives it has set itself” and noted the lack of substantial reduction in all the economic sectors concerned, particularly in transportation, agriculture, construction and industry sectors.

The Court concluded that the French State should be regarded as having failed to carry out the actions that it had itself recognized as likely to reduce greenhouse gas emissions. The guilty failure to meet its commitments was thus characterized, as was the causal link between that failure and the ecological damage previously identified. The Court therefore considered that part of that damage was attributable to the failure of the French State to act.

Fourth, the Court had to rule on the modalities of reparation of the ecological damage. Under the terms of the law, this was to be carried out primarily in kind. It is only in the event of impossibility or inadequacy of the reparation measures that the judge sentences the liable person to pay damages to the plaintiff, such damage being allocated to the reparation of the environment.

The Court considered that in the state of the investigation of the case, it was not in a position to determine the measures “that must be ordered to the State” to repair the observed damage or to prevent its future aggravation. He therefore prescribed a further two-month investigation in order to identify the measures in question.

Fifth, it sentenced the State to pay each of the Associations a symbolic sum of one euro as compensation for the moral prejudice it had caused them by not respecting the goals of reducing greenhouse gas emissions.

III. Follow-up to the Court’s ruling

The Court’s ruling, which sentences the State for not having implemented the necessary measures to achieve the greenhouse gas emission reduction targets, is a landmark decision in French law.

The second ruling that will be rendered following the two-month additional investigation ordered by the Court could constitute another historic decision if the Court were to enjoin the State - as the terms of the Ruling seem to imply - to implement a number of specific measures aimed at achieving the expected reduction targets, if necessary within a set timeframe. When this judgment comes into effect, possibly before the 2021 Summer, it will then be necessary to examine the impact of the measures that would thus be ordered on the economic sectors and companies likely to be affected.

At this stage of the proceedings, it is not possible to determine whether or not the French State will decide to appeal the ruling rendered by the Court to the Administrative Court of Appeal of Paris. If the latter were to uphold the ruling, the French State could then appeal to the Conseil d’Etat. A final decision on the issue at stake in this case could thus only be made in several years’ time.

The Court’s ruling could also have the immediate effect of modifying the provisions of the “Bill to combat climate change and strengthen resilience to its effects” which will be debated in the French Parliament from the end of March 2021. During the discussion, parliamentarians in favor of strengthening the provisions of this law could rely on the Court's ruling to motivate and justify their position.


The following Gibson Dunn attorneys assisted in preparing this client update: Nicolas Autet and Gregory Marson.

Gibson Dunn’s lawyers are available to assist in addressing any questions you may have regarding these developments. Please contact the Gibson Dunn lawyer with whom you usually work, the authors, or any of the following lawyers in Paris by phone (+33 1 56 43 13 00) or by email:

Nicolas Autet (nautet@gibsondunn.com) Gregory Marson (gmarson@gibsondunn.com) Nicolas Baverez (nbaverez@gibsondunn.com) Maïwenn Béas (mbeas@gibsondunn.com)

© 2021 Gibson, Dunn & Crutcher LLP Attorney Advertising:  The enclosed materials have been prepared for general informational purposes only and are not intended as legal advice.

February 16, 2021 |
Three Gibson Dunn Cases Named Top Verdicts of the Year 2020

The Daily Journal recognized three Gibson Dunn wins in its annual feature on the top verdicts in California for 2020.  The publication named Judd v. Weinstein and Pico Neighborhood Association v. City of Santa Monica among its Top 5 Appellate Reversals and Kirkman et al. v. AMC Film Holdings et al. among its Top 20 Defense Results. The feature was published in the February 3, 2021 issue.

February 1, 2021 |
Federal Circuit Update (January 2021)

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This edition of Gibson Dunn’s Federal Circuit Update summarizes the three pending Supreme Court cases originating in the Federal Circuit and key filings for certiorari review. We address the Federal Circuit’s updates to its Oral Argument Guide and its new procedures for handling highly sensitive information.  And we discuss other recent Federal Circuit decisions concerning the validity of assignment agreements, motions to transfer from the Western District of Texas, waiver, forfeiture, and venue for ANDA cases.

In case you missed it, on January 11, 2021, Gibson Dunn published its eighth “Federal Circuit Year In Review,” providing a statistical overview and substantive summaries of the 130 precedential patent opinions issued by the Federal Circuit between August 1, 2019, and July 31, 2020.

Federal Circuit News

Supreme Court:

The Supreme Court has three pending cases originating in the Federal Circuit.

Minerva Surgical Inc. v. Hologic Inc. (U.S. No. 20-440): As we summarized in our May 2020 update, a Federal Circuit panel (Stoll, J., joined by Wallach and Clevenger, JJ.) held that, under Federal Circuit precedent, the doctrine of assignor estoppel barred Minerva, the original assignor of the asserted patents, from challenging invalidity of the asserted patents in the district court. The doctrine did not apply to IPRs, however, which allowed Minerva to challenge the validity of the asserted patents via an IPR. The Supreme Court granted certiorari on the following issue: “Whether a defendant in a patent infringement action who assigned the patent, or is in privity with an assignor of the patent, may have a defense of invalidity heard on the merits.” Briefing is complete, but oral argument has not yet been scheduled.

United States v. Arthrex, Inc. (U.S. Nos. 19-1434, 19-1452, 19-1458): As we summarized in our November 2019 update and in our November 5, 2019 alert, a panel of the Federal Circuit (Moore, J., joined by Reyna and Chen, JJ.) held that PTAB administrative patent judges (APJs) were improperly appointed principal Officers under the Appointments Clause. To cure this defect, the court ruled that the statutory provision of for-cause removal for PTO officials is unconstitutional as applied to APJs. In the Supreme Court, no party defends the Federal Circuit’s decision. The United States and Smith & Nephew argue that APJs are inferior Officers because, “from soup to nuts,” their work is supervised by principal Officers, such as the Director. By contrast, Arthrex maintains that APJs are principal Officers solely because the Director does not have the power to directly “review and modify” APJ decisions, which Arthrex claims is an “indispensable” component of supervision. Briefing is nearly complete (Arthrex will file its final brief in mid-February) and oral argument is calendared for March 1, 2021. Gibson Dunn partner Mark Perry is co-counsel for Smith & Nephew.

Google LLC v. Oracle America, Inc. (U.S. No. 18-956): As we summarized in our March 2018 update, our November 2019 update, and our May 2020 update, a Federal Circuit panel (O’Malley, J., joined by Plager and Taranto, JJ.) held in 2014 that a software interface comprising of declaring code for the Java programming language was copyrightable. The same panel of the Federal Circuit ruled in 2018 that Google’s use of the Java declaring code in its Android operating system was not fair use. The Supreme Court granted certiorari to consider two issues: “(1) Whether copyright protection extends to a software interface; and (2) whether, as the jury found, the petitioner’s use of a software interface in the context of creating a new computer program constitutes fair use.” On October 7, 2020, the Court heard oral argument in this case. On the first issue, the Court challenged both sides’ arguments concerning the applicability of the merger doctrine (under which there is no copyright protection if there is only one conceivable form of expression) in this case. The Court also questioned whether merger should be evaluated when the program was first written or when it was used, particularly if the use occurs well after the program becomes the accepted method in the industry. On the second issue, the Court was concerned that the Federal Circuit applied an incorrect standard of review and did not give the jury verdict of fair use sufficient deference. Gibson Dunn partners Mark Perry and Blaine Evanson serve as counsel for Amicus Curiae Rimini Street, Inc. supporting reversal.

Noteworthy Petitions for a Writ of Certiorari:

There are two potentially impactful petitions that are asking for clarification of Section 101 jurisprudence currently pending before the Supreme Court.

American Axle & Manufacturing, Inc. v. Neapco Holdings LLC (U.S. No. 20-891): “[1] What is the appropriate standard for determining whether a patent claim is ‘directed to’ a patent-ineligible concept under step 1 of the Court’s two-step framework for determining whether an invention is eligible for patenting under 35 U.S.C. § 101? [2] Is patent eligibility (at each step of the Court’s two-step framework) a question of law for the court based on the scope of the claims or a question of fact for the jury based on the state of art at the time of the patent?”

Ariosa Diagnostics, Inc. v. Illumina, Inc. (U.S. No. 20-892): “Whether a patent that claims nothing more than a method for separating smaller DNA fragments from larger ones, and analyzing the separated DNA for diagnostic purposes, using well-known laboratory techniques is unpatentable under Section 101 and Myriad.”

The Court will consider American Axle during its February 19 conference. Ariosa has not yet been scheduled for conference.

Noteworthy Federal Circuit En Banc Petitions:

This month we highlight the pending en banc petition in In re Apple Inc. (Fed. Cir. No. 20-135).

The panel majority, over Judge Moore’s dissent, granted Apple’s mandamus petition, finding that Judge Albright (Western District of Texas) clearly abused his discretion in denying Apple’s motion for transfer to the Northern District of California. The panel opinion is further summarized below. Uniloc 2017 (plaintiff in the district court) filed an en banc petition presenting the issues of the level of deference that should be afforded, on mandamus review, to discretionary transfer decisions, and the circumstances in which a clear abuse of discretion can occur. US Inventor, Inc., filed an amicus brief in support of rehearing. At the court’s invitation, Apple responded to Uniloc 2017’s petition on December 29, 2020.

Other Federal Circuit News:

Dan Bagatell published his fourth annual article, providing an empirical review of the Federal Circuit’s decisions in patent cases during calendar year 2020. Bagatell found that the Federal Circuit’s affirmance rate in PTAB appeals rose over 5% to nearly 86% in 2020. IPR appeals, specifically, were affirmed 83% of the time. Notably, appellants prevailed outright in only 6% of PTAB appeals and 7% of IPR appeals. Patent challenger appellants fared slightly better than patent owner appellants, prevailing outright 17% of the time as compared to only 10% for patent owner appellants.

Federal Circuit Practice Update

In response to recent disclosures of widespread breaches of both private sector and government computer systems, the Federal Circuit has adopted new procedures for the handling of highly sensitive documents outside of the court’s electronic case filing system (CM/ECF) as well as for documents already electronically filed in CM/ECF. The administrative order and new procedures go into effect immediately and are available on the court’s website here and here.

The Clerk’s Office has also updated the Federal Circuit’s Guide for Oral Argument, which includes minor procedural clarifications and designates new Access Coordinators responsible for coordinating auxiliary aids and services to participants in proceedings who have communication disabilities.

Our May 2020 update summarized the key rule changes the Federal Circuit first proposed last spring. The December 2020 updated rules have taken effect and are now available on the court’s website.

Upcoming Oral Argument Calendar

The list of upcoming arguments at the Federal Circuit are available on the court’s website.

The court is scheduled to hear argument in 52% of the cases on its February 2021 calendar. This is up from the early days of the pandemic when, for example, the court heard argument in only 29% of its April 2020 cases. The number of argued cases, however, is still dramatically lower than pre-pandemic numbers. For example, in February 2020, the court heard argument in 81% of its scheduled cases.

Case of Interest:

On Friday, February 12, the court will hear argument in Mylan Laboratories Ltd. v. Janssen Pharmaceutica, N.V. on Janssen’s motion to dismiss Mylan’s appeal. Janssen and the USPTO, as intervenor, argue that Mylan’s appeal should be dismissed for lack of jurisdiction because the Director’s institution decision is “final and nonappealable.” 35 U.S.C. § 314(d). Mylan maintains that judicial review remains available because the PTAB exceeded its congressional authority and violated Mylan’s due process rights by denying Mylan’s timely IPR petition based on the NHK/Fintiv rule.

Key Case Summaries (November 2020–January 2021)

Whitewater W. Indus., Ltd. v. Alleshouse, 981 F.3d 1045 (Fed. Cir. 2020): Alleshouse, while an employee of Whitewater, signed an agreement assigning to Whitewater, all of his rights or interests in any invention he “may make or conceive,” “whether solely or jointly with others,” if the invention is either “resulting from or suggested by” his “work for” Whitewater or “in any way connected to any subject matter within the existing or contemplated business of” Whitewater. Alleshouse left Whitewater to start his own venture, Pacific Surf. Alleshouse then began filing patent applications. Whitehouse sued, alleging breach of contract and that Alleshouse had to assign Pacific Surf’s patents to Whitehouse. The district court upheld the agreement as valid and determined that Alleshouse breached the contract by failing to assign the patents.

The Federal Circuit panel (Taranto, J., joined by Dyk and Moore, JJ.) reversed. The Federal Circuit held that the agreement’s assignment provision was invalid for violating California Business and Professions Code § 16600, which as applied by California courts, forbids employers from impairing post-employment liberties of former employees.

In re Google Tech. Holdings LLC, 980 F.3d 858 (Fed. Cir. 2020): Google appealed a PTAB decision that sustained the Examiner’s final rejection of certain claims for obviousness, arguing that the Board relied on incorrect claim constructions.

The Federal Circuit panel (Chen, J., joined by Taranto and Stoll, JJ.) affirmed, and found that Google had forfeited the claim construction arguments by not presenting them to the Board. The court also noted the distinction between forfeiture and waiver: “Whereas forfeiture is the failure to make the timely assertion of a right, waiver is the ‘intentional relinquishment or abandonment of a known right.’”

In re Apple Inc., 979 F.3d 1332 (Fed. Cir. 2020): Apple moved to transfer Uniloc 2017’s lawsuit from the Western District of Texas (“WDTX”) to the Northern District of California (“NDCA”). Judge Alan Albright held a hearing and stated that he would deny the motion to transfer, but did not enter an order. After holding a Markman hearing, issuing a claim construction order, holding a discovery hearing, and issuing a discovery order, Apple filed a writ of mandamus at the Federal Circuit. Judge Albright issued his order denying the transfer a week later.

The Federal Circuit (Prost, C.J., joined by Hughes, J.) granted Apple’s mandamus petition. The majority held that the district court made several errors in assessing whether the Fifth Circuit’s public and private factors favor transfer. First, the majority held that the factor dealing with the relative ease of access to sources of proof analyzes only non-witness evidence, such as documents and physical evidence. Second, the majority held that the district court erred by too rigidly applying the Fifth Circuit’s 100-mile rule regarding witness inconvenience. The majority found that New York–based witnesses will only be slightly more inconvenienced by having to travel to California than to Texas. Third, the district court erred by faulting Apple for the fact that significant steps, such as the Markman hearing, had occurred in the case because those steps occurred after Apple moved for a transfer. Fourth, the panel found that the district court erred in its analysis of court congestion and time to trial. The panel found that WDTX and NDCA have had comparable times to trial and that the district court cannot set an aggressive trial date and then conclude other forums are more congested. Fifth and finally, the panel held that the consideration of local interests analyzes whether there are significant connections between a particular venue and the events that gave rise to the suit and not the parties’ connections to each forum writ large.

Judge Moore dissented, emphasizing the deferential clear abuse of discretion standard of review.

Valeant Pharm. N. Am. LLC v. Mylan Pharm. Inc., 978 F.3d 1374 (Fed. Cir. 2020): Valeant filed a Hatch-Waxman action against Mylan Pharmaceuticals Inc. (“MPI”), a West Virginia corporation; Mylan Inc., a Pennsylvania Corporation; and Mylan Laboratories Ltd. (“MLL”), a foreign corporation based in India. The defendants moved to dismiss for improper venue under § 1400(b) because the only alleged act of infringement—submission of the ANDA—did not occur in New Jersey, and the defendants do not reside or have regular and established places of business in New Jersey. The district court granted the motion to dismiss.

The Federal Circuit (O’Malley, J., joined by Newman and Taranto, JJ.) affirmed-in-part, reversed-in-part, and remanded. The panel held that, in cases brought under 35 U.S.C. § 271(e)(2)(A), infringement occurs for venue purposes only in districts where actions related to the submission of the ANDA occur, and not in all locations where future distribution of the generic products specified in the ANDA is contemplated. The Federal Circuit therefore affirmed the district court’s dismissal of MPI and Mylan Inc. for improper venue. The Federal Circuit, however, reversed the venue-based dismissal against the foreign-based entity MLL, which is subject to venue in any district, and remanded for consideration of the failure to state a claim defense, based on whether MLL’s involvement in submission of the ANDA is sufficient for it to be considered a “submitter,” and thus amenable to suit.

The court denied Valeant’s petition for en banc rehearing on January 26, 2021.


Gibson Dunn's lawyers are available to assist in addressing any questions you may have regarding developments at the Federal Circuit.  Please contact the Gibson Dunn lawyer with whom you usually work or the authors of this alert:

Blaine H. Evanson - Orange County (+1 949-451-3805, bevanson@gibsondunn.com) Jessica A. Hudak - Orange County (+1 949-451-3837, jhudak@gibsondunn.com)

Please also feel free to contact any of the following practice group co-chairs or any member of the firm's Appellate and Constitutional Law or Intellectual Property practice groups:

Appellate and Constitutional Law Group: Allyson N. Ho - Dallas (+1 214-698-3233, aho@gibsondunn.com) Mark A. Perry - Washington, D.C. (+1 202-887-3667, mperry@gibsondunn.com)

Intellectual Property Group: Wayne Barsky - Los Angeles (+1 310-552-8500, wbarsky@gibsondunn.com) Josh Krevitt - New York (+1 212-351-4000, jkrevitt@gibsondunn.com) Mark Reiter - Dallas (+1 214-698-3100, mreiter@gibsondunn.com)

© 2021 Gibson, Dunn & Crutcher LLP

Attorney Advertising:  The enclosed materials have been prepared for general informational purposes only and are not intended as legal advice.

January 27, 2021 |
First Circuit Narrows Scope of the Wire Act, Reversing Office of Legal Counsel Opinion

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In a decision with far-reaching implications for the online gaming industry, on January 20, 2021, the U.S. Court of Appeals for the First Circuit held that the prohibition on the transmission of interstate wagers under the Wire Act, 28 U.S.C. § 1084, applies only to bets and wagers placed on sporting events, and not, as the Office of Legal Counsel within the United States Department of Justice had opined, to all types of bets and wagers. New Hampshire Lottery Comm’n v. Rosen, No. 19-1835 (1st Cir. Jan. 20, 2021). In this alert, we summarize (1) the background of the Wire Act, (2) the First Circuit’s decision, and (3) the potential impact of the ruling.

I. Overview of the Wire Act

The Wire Act, enacted in 1961 as part of Attorney General Robert F. Kennedy’s effort to crackdown on organized crime, provides, in relevant part:

Whoever being engaged in the business of betting or wagering knowingly uses a wire communication facility for the transmission in interstate or foreign commerce of bets or wagers or information assisting in the placing of bets or wagers on any sporting event or contest, or for the transmission of a wire communication which entitles the recipient to receive money or credit as a result of bets or wagers, or for information assisting in the placing of bets or wagers, shall be fined under this title or imprisoned not more than two years, or both.

18 U.S.C. § 1084(a). The legislative history surrounding the enactment of the statute makes clear that the intent was to target sports bookmakers who supplied an important stream of revenue for organized crime. For many years after its enactment, the Department of Justice took the view that the statute’s express reference to “bets or wagers on any sporting event or contest” meant that the statute prohibited only interstate bets or wagers on sporting events, and not other types of interstate gambling. Representatives of the Department expressly testified as much in hearings before Congress in the 1990s.

In the early 2000s, however, the Department began to take the position, in various informal letters to gaming commissions and state lottery operators, that interstate transmissions of non-sports wagers would also violate the Wire Act. That change in position prompted New York and Illinois—both of whom operated lotteries that relied in some part on interstate wire facilities—to seek clarification in 2009 from the Department as to the scope of the Wire Act.

In 2011, the Office of Legal Counsel (“OLC”) within the Department issued an opinion concluding that the Wire Act’s prohibitions with respect to the interstate transmission of bets and wagers apply only to those bets or wagers involving sporting events—meaning that sales of lottery tickets online were not covered by the statute. The OLC concluded as much by examining the text of the statute, and also by considering the absurd consequences that would follow if the statute were read to cover certain types of non-sports betting activities, but not others. In reliance on that opinion, States began moving their lottery systems online, taking full advantage of the freedom and certainty afforded by the OLC opinion.

In late 2018, however, the Trump Administration’s OLC issued a new opinion, reversing the interpretation adopted in the 2011 OLC opinion, and arguing that the Wire Act does extend beyond sports betting. The 2018 opinion concluded that the statute’s limiting language—“on any sporting event or contest”—applied only to the transmission of “information assisting in the placing of bets or wagers,” and not to the transmission of bets or wagers themselves, or to the transmission of information regarding payment on a bet or wager. As a result, the 2018 opinion called into question the legality of state lotteries that sold tickets online, or even those that simply used the Internet to facilitate their operations. The 2018 opinion expressly acknowledged that “some may have relied on the” 2011 opinion, including States that “began selling lottery tickets via the Internet after [its] issuance.”

Gibson Dunn filed suit in the U.S. District Court for the District of New Hampshire on behalf of NeoPollard Interactive LLC and Pollard Banknote Limited—a parent and subsidiary that provides lottery infrastructure for the New Hampshire Lottery Commission—arguing that the 2011 opinion was contrary to law and seeking declaratory relief. NeoPollard and Pollard joined their lawsuit with one filed the same day by the New Hampshire Lottery Commission, seeking the same relief. The Department opposed the lawsuit on the ground that in the absence of a pending or threatened prosecution, the dispute was not ripe for review, and that the 2018 interpretation was legally correct.

Judge Paul J. Barbadoro expedited the proceedings, and held in June 2019 that the 2011 OLC opinion was correct in holding that the Wire Act is limited in all respects to bets and wagers placed on sporting events, declaring the 2018 OLC opinion wrong as a matter of law and vacating the decision as contrary to law under the Administrative Procedure Act, 5 U.S.C. § 706. The Department appealed to the First Circuit.

II. The First Circuit’s Decision

On January 20, 2021, the First Circuit affirmed the district court’s decision in all relevant aspects. It agreed with the district court’s decision that the dispute was ripe for review and that the Wire Act is limited to sports betting. The Court departed from the district court only in that it did not believe vacatur under the Administrative Procedure Act was a necessary form of relief.

With respect to standing and ripeness, the Court explained that in the pre‑enforcement context, it is not necessary that there be an actual threatened prosecution against the specific plaintiff. Rather, it was sufficient that the government had declared that the conduct plaintiffs were engaged in was criminal. The Court pointed out that the Department had expressly warned at least one state lottery (Illinois) that its operations were in violation of the Wire Act as construed prior to 2011, and also that the Department had prosecuted non-sports-betting operations in the past.

The First Circuit rejected the Department’s argument that a memorandum released during the pendency of the proceedings—which purported to reserve decision on whether state lotteries, specifically, were subject to the prohibitions of the Wire Act—rendered the case moot or unripe. The new memorandum, the Court observed, did not disclaim that the Wire Act covered state lotteries, but rather offered only a temporary forbearance from prosecution.

On the merits, the First Circuit agreed with the district court that the plain text of the statute is not clear as to the scope of the prohibition. The Court thus focused instead principally on the structure and context of the statute, concluding that the Department’s proffered reading made no sense. The First Circuit observed, in particular, that reading the sports limitation to apply to only some of the prohibitions in the statute would be incongruent, as it would criminalize the transmission of any type of bet or wager, but would not reach the transmission of information with respect to bets or wagers other than those on sporting events. The Court also examined the history of the statute, agreeing with the district court that the history confirmed that the statute was directed at sports betting.

The Court thus affirmed the district court’s grant of declaratory relief, although it vacated the relief awarded under the Administrative Procedure Act on the ground that such relief was not necessary.

III. Implications of the Decision

The First Circuit’s decision gives some comfort and certainty to those state lotteries and other industry participants who relied on the 2011 opinion in taking their operations online. The decision restores the 2011 interpretation of the Wire Act, which was itself sought by state lotteries seeking to operate online facilities. It also has similar implications for gaming platforms other than state lotteries, who similarly faced a threat of prosecution as a result of the 2018 opinion if they used the Internet to process bets or wagers.

It is important to note, however, that as a formal matter, the First Circuit directly binds the Department only with respect to the named parties in the lawsuit. It also precludes, as a matter of binding precedent, any attempted prosecutions within the First Circuit that are based on the interpretation advanced in the 2018 opinion. The Department could, however, adhere to its 2018 interpretation in other federal circuits, and pursue prosecutions of online lotteries and other non-sports gambling operations in defiance of the First Circuit’s interpretation.

There is some indication, however, that the Biden Administration is not inclined to take such an aggressive stance. In July 2019, then former-Vice-President Biden stated his position that if elected, he “would reverse the White House opinion [on the Wire Act] that was then reversed and overruled by the [district] court. The court is correct. That should be the prevailing position.” Dustin Gouker, Should You Vote for Biden or Trump if You Want Legal Online Poker and Gambling?, Online Poker Report (Oct. 23, 2020), https://perma.cc/595G-2EVH. He later stated at an event in December 2019 that he did not “support adding unnecessary restrictions to the gaming industry like the Trump Administration has done.” Howard Stutz, Biden Says DOJ’s Wire Act Changes Add “Unnecessary Restrictions” to the Gaming Industry, CDC Gaming Reports (Dec. 16, 2019), https://perma.cc/R9XU-U6NX. The decision of the First Circuit may push the Biden Administration to make its stance on the statute clear right away, perhaps through a formal rescission of the 2018 opinion, or through a memo advising U.S. Attorneys to adhere to the First Circuit’s decision.

Even if the Biden Administration does not make a formal announcement, given the First Circuit’s decision and President Biden’s express opposition to the 2018 re-interpretation, it seems unlikely that the Department of Justice is poised to pursue an aggressive campaign to disobey or overturn the First Circuit’s decision. Indeed, the Department’s principal argument before the First Circuit was that the dispute was not ripe. Although the Department also defended the 2018 opinion on the merits, there may be little appetite for maintaining that position now that there has been a firm decision by a U.S. court of appeals and a change in administration.


Gibson Dunn’s lawyers are available to assist in addressing any questions you may have regarding these developments. Please feel free to contact the Gibson Dunn lawyer with whom you usually work, or the following authors:

Theodore B. Olson – Washington, D.C. (+1 202-955-8500, tolson@gibsondunn.com) Debra Wong Yang – Los Angeles (+1 213-229-7472, dwongyang@gibsondunn.com) Matthew D. McGill – Washington, D.C. (+1 202-887-3680, mmcgill@gibsondunn.com) Lochlan F. Shelfer – Washington, D.C. (+1 202-887-3641, lshelfer@gibsondunn.com) Joshua M. Wesneski – Washington, D.C. (+1 202-887-3598, jwesneski@gibsondunn.com)

© 2020 Gibson, Dunn & Crutcher LLP Attorney Advertising:  The enclosed materials have been prepared for general informational purposes only and are not intended as legal advice.

January 25, 2021 |
California Attorney General End of Term Update

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Introduction

In December 2020, California Attorney General Xavier Becerra was announced to be President-Elect Joseph R. Biden, Jr.’s pick to lead the Department of Health and Human Services. The California Attorney General’s Office is the second largest Justice Department in the United States, second only to the U.S. Department of Justice, and California Attorney General Xavier Becerra was the first Latino Attorney General in California’s history. Before becoming the Attorney General of California, Becerra had a 24-year career in the U.S. House of Representatives.[1] In 2017, Governor Jerry Brown appointed Becerra to the last two years of Kamala Harris’s term as Attorney General, after she won election to the United States Senate. Now, Governor Gavin Newsom will appoint a successor to complete the remaining two years of Becerra’s term, assuming he is confirmed by the U.S. Senate.[2]

In his time as California’s Attorney General, Becerra investigated and brought lawsuits against businesses across a wide range of industries, products, and practices, including over-the-counter medications, alleged wire fraud scams, for-profit colleges, alleged opioid abuse, oil and gas mergers, and contracting practices in the healthcare field.[3] Since winning his first statewide election at the end of 2018, AG Becerra and his Office have been particularly active in the following areas: antitrust, privacy, environmental, and consumer protection, and his Office’s stated priorities have also included the opioid epidemic, gun control and public safety, and challenging the Trump administration. Gibson Dunn provides this January 2021 end-of-term update summarizing the most significant recent work of AG Becerra’s elected term in office, and providing some initial thoughts about how his successor will deploy the Office’s resources in 2021 and beyond as California finds a new partner in the incoming Biden Administration.

Antitrust

AG Becerra’s antitrust section has investigated, litigated, and entered into settlements of multiple cases involving major healthcare and technology companies and generic drug manufacturers, and sought to enforce California’s primary antitrust statute (the Cartwright Act) and the Unfair Competition Law.

Healthcare Mergers

The California Department of Justice monitors and regulates healthcare mergers within California. AG Becerra highlighted this area in a recent tweet paired with the conditional approval of a merger between two hospitals in Los Angeles County, emphasizing his view that, “[a]s our hospital systems get bigger by affiliating with one another, it is critical that they continue to provide quality services at affordable prices to the families that count on them in times of crisis.”[4] In October 2019, the California Department of Justice issued a letter denying a proposed partnership between Adventist System/West and St. Joseph Health System on the grounds that the merger might increase costs or limit access to health care services.[5] Similarly, in August 2020, AG Becerra announced a settlement with Verity Health System of California, Inc., and Prime Healthcare Services, Inc., that imposed additional conditions on the sale of St. Francis Medical Center in Los Angeles.[6] The settlement required Prime to provide additional funding for charity care and community benefit services.[7] Aiming to expand his authority in this sphere, AG Becerra also supported SB 977, which would expand the Attorney General’s authority to review certain transactions, such as acquisitions or change-of-control transactions, involving health care facilities.[8] The bill, which has already passed the state Senate, also authorizes the Attorney General to file civil suits to slow hospital mergers under certain circumstances.

Sutter Health

This longstanding case, along with the parallel class action lawsuit on behalf of self-managed healthcare plans, against Sutter Health was announced to have reached a settlement on December 19, 2020.[9] Under the terms of the settlement, Sutter Health would pay $575 million to the plaintiff class and agreed to end practices that the private plaintiffs and California Attorney General alleged stifled competition, such as all-or-nothing contracting deals and patient steering practices. Sutter would also be required to limit what it charged patients for out-of-network services, increase its transparency on pricing information, and limit the bundling of certain services. A provision within the settlement required that a monitor be established to ensure Sutter abide by the settlement terms. In June 2020, Sutter Health attempted to delay final approval of the settlement due to catastrophic losses stemming from the COVID-19 pandemic.[10] On July 9, 2020, the court ultimately denied Sutter’s motion to delay the final settlement hearing, which would take place in August. As of the publishing of this alert, the court had rejected the proposed settlement and sent the proposal back to the parties in order to select a monitor with a more diverse background. This case is just one of the many now being handled by AG Becerra’s new Healthcare Rights and Access Section, which is charged with increasing and protecting the affordability, accessibility, and quality of healthcare in the State of California including healthcare and prescription drug marketing, nonprofit healthcare transactions, alleged violations of antitrust laws in the healthcare context, and healthcare privacy and healthcare civil rights, such as reproductive rights and LGBTQ healthcare-related rights.

Google

This year, in July 2020, it was reported that the Office had launched an antitrust investigation into Google—and had declined to join in either of the two ongoing investigations involving 48 other state attorneys general.[11] The investigation follows both the ongoing state AG investigations as well as other publicly announced investigations by federal prosecutors and Congressional subcommittees. On July 11, 2020, AG Becerra filed to join the Department of Justice’s antitrust suit against Google, which alleges that Google violated antitrust laws by entering into exclusionary business agreements that shut out competitors and suppressed innovation.[12]

While the various investigations have not concluded, this recent action may signal the Office’s further interest in policing alleged anticompetitive conduct under novel interpretations of the Cartwright Act and Unfair Competition Law.

Generic Drugs

AG Becerra reached settlement agreements with three pharmaceutical companies (Teva, Endo, and Teikoku) for allegedly entering into so-called “pay-for-delay agreements,” wherein brand-name drug companies compensate generic drug manufacturers for not introducing a generic version of a brand-name drug for some period of time in order to avoid unnecessary and burdensome litigation costs.[13] In addition to these alleged “pay for delay” and other price fixing conspiracies,[14] AG Becerra was instrumental in pushing through AB 824, which was signed into law by Governor Newsom in October 2019. The law increases antitrust scrutiny of patent settlement agreements between branded and generic pharmaceutical manufacturers. Not only does the law cover the traditional “pay-for-delay” agreement under the Hatch-Waxman Act, but it also covers settlements brought under the Biologics Price Competition and Innovation Act (BPCIA). The California Attorney General’s Office is granted specific enforcement capabilities under the new law but has yet to bring any enforcement action under AB 824. It has been reported that AG Becerra is investigating various pharmaceutical companies over a multitude of drugs.

For more information on AB 824, please find a detailed client alert prepared by Gibson Dunn here.

T-Mobile/Sprint Merger

Last year, AG Becerra, along with New York Attorney General Letitia James, led a coalition of fourteen states that unsuccessfully sued to enjoin the merger between T-Mobile and Sprint.[15] The trial was an uphill battle as the Department of Justice and the Federal Communications Commission approved the proposed merger, with qualifications, before the trial started. As part of the efforts to gain the federal government’s approval to the merger, T-Mobile and Sprint agreed to set up satellite TV company Dish as a new cellular competitor. The coalition of states, however, argued this was not an adequate replacement for Sprint. Additionally, the state AGs alleged that the merger would harm consumers by reducing competition in the shrinking wireless telecommunications market and result in higher prices and/or reduced services.[16] Ultimately, a New York federal judge disagreed with the states and allowed the merger to close.[17] Under previously agreed-to settlement terms with various states that individually settled, T-Mobile agreed to reimburse the state-led working group $15 million and agreed to provide various consumer benefits such as freezing prices in California for five years and offering free internet and Wi-Fi hot spots to low-income households.

In a statement made after the defense verdict was announced, one of the attorneys from the California Attorney General’s Office stated that moving forward, the Office may not “put too much faith in the economics,” noting that she believed the decision did not consider the complicated economic theory and models put forth by the States.[18] “The economics went out the window, so anyone that comes in to talk to [the California Attorney General] needs more than just an economic story.”[19]

Employment

The Office appeared as an amicus in support of employees in labor actions. In Bernstein v. Virgin America, Inc., the district court awarded a class of flight attendants $77 million.[20] The court found that Virgin America was subject to California’s labor laws, both as to work done in California and based on employment policies decided from Virgin’s California headquarters, and that the plaintiff flight attendants had been undercompensated.[21] (Virgin’s meal break policy was not centralized, so meal break violations that happened outside California were not covered.) The Office appeared when Virgin appealed to the Ninth Circuit. The Office’s amicus brief in support of the flight attendants focused on California’s state labor policy and laws and argued that certain aspects of California’s labor laws are not preempted by federal law. Although the Ninth Circuit has not yet issued its decision in this case, it offers yet another example of how AG Becerra, apart from his enforcement authority, inserted himself into private litigation to advance a regulatory agenda.

AG Becerra, however, has not limited himself to amicus briefs. Recently, the Office became involved in litigation related to employee classification. In December 2019, AG Becerra announced an $800,000 settlement with Infosys stemming out of allegations that Infosys claimed that some of its foreign workers were covered by B-1 visas as opposed to H-1B visas.[22] H-1B visas, unlike B-1 visas, are subject to payroll taxes and require employers to pay workers at the prevailing local wage. The suit, brought under both California’s False Claims Act and Unfair Competition Law, demonstrated the range of legal approaches that AG Becerra has been willing to deploy, by seeking to enforce California’s labor laws even though such laws are primarily the province of the Labor Commissioner.

AG Becerra also moved to enforce AB 5, a recently enacted California statute that codifies the so-called “ABC test” for determining whether a worker is an employee or an independent contractor.[23] On May 5, 2020, the Office, along with the City Attorneys of Los Angeles, San Diego, and San Francisco, filed suit against rideshare companies, alleging violations of both California’s Unfair Competition Law and the Labor Code, even though Labor Code enforcement is traditionally the province of the Labor Commissioner.[24] Becerra sought injunctive relief under AB 5, seeking reclassification of rideshare drivers as employees and not independent contractors.[25] Becerra also sought restitution for drivers and civil penalties for alleged violations under the Unfair Competition Law.

Despite these enforcement efforts, California voters overwhelmingly approved Proposition 22 in the November election, passing it by the largest margin of any ballot initiative that year. Proposition 22 exempts app-based workers from AB 5 and definitively classifies them as independent contractors so long as basic guarantees of driver independence are satisfied. Proposition 22 can be seen as a rebuke of the Attorney General and City Attorneys’ attempt to stifle worker independence, and the outcome of the Office’s and City Attorneys’ suit may serve as a bellwether for future enforcement as to workers who do not fall within the Prop 22 exemption. If AG Becerra’s successor succeeds in using the Unfair Competition Law to enforce Labor Code provisions he lacks authority to directly enforce, this may signal more aggressive enforcement of the labor laws in the future, including the provisions of Prop 22.

Beyond AB 5, AG Becerra also obtained several employment-related settlements. In March 2020, he, along with other state attorneys general, announced three agreements with Burger King, Popeyes, and Tim Hortons in which they agreed to stop including “no-poach” provisions in their U.S. franchise agreements.[26] These follow similar settlements with Arby’s, Dunkin’, Five Guys, and Little Caesars in 2019,[27] and were part of AG Becerra’s attack on non-competes and similar agreements.[28]

Environmental

Shortly after winning election, in 2018 AG Becerra announced the creation of an Environmental Justice Bureau within the Environment Section of the California Department of Justice.[29] Charged with “protect[ing] people and communities that endure a disproportionate share of environmental pollution and public health hazards,” the Bureau launched investigations and actions seeking to recover damages for and abatement of alleged violations, including allegedly contaminated drinking water, purported exposure to lead and other toxins in the environment and consumer products, and claimed discharges to air and water.

In addition to the Office’s wide-ranging challenges to Trump administration environmental policies, AG Becerra coordinated with local district and city attorneys to secure a settlement with Autozone over allegations of improper waste disposal.[30] The settlement required Autozone to submit to a range of audits of its trash receptacles, prohibited unlawful waste, and required payment of $11 million to dozens of district attorneys’ offices throughout the state, including nearly a million dollars directly to his own Office.[31]

AG Becerra also lent the support of his Office to municipalities’ ongoing lawsuits against energy companies through his amicus submissions. In March 2019, the Office filed an amicus brief in the Ninth Circuit supporting Oakland and San Francisco in their suit against several major energy companies.[32] Oakland and San Francisco had sued the defendant energy companies for alleged injuries from sea-level rise induced by global warming. Opposing federal removal, the Office’s brief emphasized the need for state courts to be able to adjudicate climate-change related claims brought by state political subdivisions.[33] Similarly in July 2020, the Office filed a brief in support of an Oakland ordinance prohibiting the storage and handling of coal and petroleum coke within city limits.[34] The Office brief claimed broad authority of the State and municipalities to regulate activities that may contribute to climate change.[35] While his Office supported these suits, the Attorney General did not bring any such suits himself.

False Claims Act

Under AG Becerra, the Office’s False Claims Unit has investigated and prosecuted alleged overcharges by private companies to State agencies and pension funds, with some actions dating back more than a decade. One area of particular False Claims Act focus over the past decade, which continued during AG Becerra’s term, has been the recovery of investment losses suffered by California’s public pension funds during the 2008 financial crisis. In December 2017, AG Becerra announced a $120 million settlement with Royal Bank of Scotland (RBS), over alleged misrepresentations about residential mortgage-backed securities sold to California’s public employee and teacher pension funds.[36] In April 2019, the Office announced a $150 million settlement with Morgan Stanley for allegedly failing to provide adequate disclosures for mortgage-backed securities sold to those same pensions from 2003 to 2007.[37] The Office has pursued other pension-related False Claims Act cases, including a recent $7 million settlement with HSBC for alleged foreign currency trading overcharges to the California Public Employees Retirement System (CalPERS) in 2008 and 2009.[38] The Office has also participated in multi-state and federal Medicaid-related False Claims Act cases, including most recently a $40 million dollar nationwide settlement with Apria Healthcare over Medicaid reimbursements for ventilation machines that allegedly were unnecessary.[39]

Other recent settlements include a $102 million settlement with BP Energy Company over alleged natural gas contract overcharges dating from 2003 to 2012, which originated as a qui tam suit brought by a former employee and in which the Office intervened[40]; and a $4 million settlement with VMware for alleged overcharges to the State and local governments for information technology software spanning a period of six years.[41] Finally, AG Becerra has been a vocal supporter of legislation that would broaden the scope of the False Claims Act. In 2019 and 2020, he sponsored legislation that would have expanded the statute to cover tax fraud—creating a whole new class of claims for which private plaintiffs could profit through qui tam actions and for which the Attorney General could obtain treble damages and civil penalties. Each attempt to date has failed to pass in the Legislature despite Democratic majorities in both the Assembly and the Senate, due to significant concerns about creating financial incentives for private plaintiffs to file predatory qui tam lawsuits against unsuspecting businesses, and the potentially devastating financial cost associated with responding to even frivolous claims. Nevertheless, the bills’ author, Assembly Member Mark Stone, is expected to continue to attempt to expand the statute to cover tax claims.[42]

Healthcare

In addition to the Office’s activity regulating healthcare mergers and alleged price-fixing agreements discussed above, AG Becerra obtained substantial awards based on allegedly deceptive marketing of certain health care products. In January 2019, AG Becerra announced a $120 million nationwide settlement—of which California will receive $8 million—with Johnson & Johnson related to purported misrepresentations as to the effectiveness and safety of hip implants devices.[43] In November 2019, the Office (along with the Los Angeles District Attorney and Los Angeles County Counsel) filed suit against JUUL Labs, for allegedly marketing and selling electronic cigarettes to minors.[44] And, in January 2020, the Office secured a $344 million judgment after a trial against Johnson & Johnson for deceptive marketing related to its pelvic mesh for women.[45]

Along the same lines, in late 2017, numerous pharmaceutical companies announced in public filings that the California Attorney General’s Office, along with other state attorneys general and federal prosecuting and enforcement agencies, were investigating the pricing and sales of insulin, which had increased in price over the preceding decade.[46] AG Becerra also recently announced a $11.8 million settlement with Novartis Pharmaceuticals, covering alleged violations of California’s False Claims Act as well as the federal False Claims Act and Anti-Kickback Statute related to the provision of various drugs to Medicare and Medi-Cal patients.[47]

Privacy and Cybersecurity

The Attorney General’s Office has long been active in investigating and prosecuting companies for data breaches that exposed consumers’ personally identifiable information. For example, over the last two years, the Office has announced various multi-million dollar settlements arising out of data breaches, including against large health insurance and retail companies for allegedly failing to maintain adequate data security measures.[48] In September 2020, the Attorney General’s Office also secured a settlement against an app developer in which no breach was alleged, but in which the design of the app was alleged to pose risks to the personal information of app users.[49]

During this time period, California’s privacy landscape also witnessed a sea change with the passage of two recent statutes: the California Consumer Privacy Act (“CCPA”), which went into effect on January 1, 2020 (and which the California Attorney General has been empowered to enforce as of July 1, 2020),[50] and the California Privacy Rights Act (“CPRA”), which California’s voters approved in the November 2020 general election. AG Becerra and his Office stand to play a pivotal role in their enforcement in the coming years.

Even before it was empowered to enforce the CCPA, the Office was vested with the duty under that statute to draft its implementing regulations—essentially, creating the regulations it would then enforce. The Office announced on June 1, 2020 that those regulations had been submitted to the California Office of Administrative Law,[51] which issued the final text of the regulations on August 14, 2020. At that time, the final regulations became enforceable.[52] To execute its enforcement power, the Office has the authority to bring a civil action for any violation of the CCPA, and can seek to impose civil penalties of up to $2,500 per violation or $7,500 per intentional violation (or violation involving a minor’s personal information). Beyond reports of compliance letters being issued by the Office, to date, no enforcement actions have been brought by the Office under the CCPA.

The CPRA is an initiative statute that was placed on the November 3, 2020 ballot and was passed by the voters. The CPRA amends the CCPA to clarify and broaden it, and imposes a January 1, 2023 deadline for businesses to come into compliance with the new CPRA provisions.[53] The Office preserves its authority to issue CCPA regulations during part of the time period before CPRA takes effect, until a new privacy agency, the California Privacy Protection Agency (“CPPA”)—the first enforcement agency in the United States focused solely on privacy—would be formed with its own rulemaking authority.[54] While the composition of the CPPA has not yet been announced, it is likely that at least some of its staff will come from the California Attorney General’s Office. The Office will continue to be tasked with enforcing the CCPA until January 1, 2023, at which time the California Privacy Protection Agency and the Office will have parallel authority to enforce the CPRA (CPPA from an administrative enforcement standpoint, and the Office maintaining its civil action enforcement authority). The CPRA contains various additional provisions governing the two enforcement bodies’ interactions and detailing their enforcement powers.

For more information on the CCPA or the CPRA, find Gibson Dunn Client Alerts here, here, and here.

Looking Forward Into 2021 and Beyond

California’s Constitution provides that the Governor fills any vacancy in the office of the Attorney General, to complete the remainder of the existing term, by nominating a candidate who must be confirmed by a majority of the state Assembly and state Senate.[55] Unlike other statewide offices such as Secretary of State, the Attorney General must be admitted to the California Bar, and for at least five years immediately preceding his or her appointment or election to that Office.[56] Numerous potential candidates have been named, and we expect Governor Newsom to consider carefully Becerra’s replacement as one piece of the larger reshuffling of California’s highest elected offices, which includes the appointment of Secretary of State Alex Padilla to replace Vice-President-Elect Harris in the U.S. Senate, and the appointment of Assemblywoman Shirley Weber to replace Padilla in his prior role. It is likely that Governor Newsom will announce his choice for Attorney General once Becerra is confirmed by the U.S. Senate.

Regardless of who Governor Newsom appoints to replace AG Becerra, we expect the next two years to look directionally similar to Becerra’s term. The incoming Biden Administration (including AG Becerra himself at the helm of the Department of Health and Human Services) will undoubtedly result in a shift in the Attorney General’s priorities. We expect to see litigation against the federal government to take a back burner as the Biden Administration rolls-back and ceases enforcement of Trump-era policies, and implements new policies that are more aligned with California’s elected officeholders. We also expect to see the Attorney General partner with federal agencies, including the Department of Justice, Federal Trade Commission, Environmental Protection Agency, and Consumer Financial Protection Bureau on various initiatives. As a result, the change in the occupant at the White House will likely shift the Attorney General’s focus away from challenging federal actions and toward greater litigation against private actors within California. The Office’s aggressive enforcement positions on antitrust, consumer protection, environmental, and labor issues, for example, are unlikely to change in the coming months and will require that companies pay careful attention to the incoming statements and actions of the new Attorney General—including the potential reshuffling of the Office’s senior leadership. The Office will likely continue to look for and seize upon opportunities in a broad range of areas.

______________________

[1] https://xavierbecerra.com/about/

[2] Numerous candidates have been mentioned in media reports as to possible replacements, and the potential field remains wide open. As of mid-January 2021, some of the reported potential candidates include Assembly member Rob Bonta, Contra Costa County District Attorney Diana Becton, San Francisco City Attorney Dennis Herrera, and California Supreme Court Justice Goodwin Liu.

[3] Id.

[4] @AGBecerra, Twitter, https://twitter.com/AGBecerra/status/1337180686810148867 (Dec. 10, 2020).

[5] Press Release, Cal. Attorney General, California Department of Justice Denies Transaction between Adventist Health and St. Joseph Health Systems (Oct. 31, 2019), available at https://oag.ca.gov/news/press-releases/california-department-justice-denies-transaction-between-adventist-health-and-st.

[6] Press Release, Cal. Attorney General, Attorney General Becerra Reaches Settlement with Verity Health on Conditions of Transfer of St. Francis Medical Center (Aug. 14, 2020), available at https://oag.ca.gov/news/press-releases/attorney-general-becerra-reaches-settlement-verity-health-conditions-transfer-st.

[7] In re Verity Health Sys. of Cal., Inc., No. 2:18-bk-20151-ER (C.D. Cal. Aug. 31, 2020) (Stipulation).

[8] Press Release, Cal. Attorney General, Attorney General Becerra and Senator Monning Announce That Legislation to Reduce Healthcare Costs, Increase Access to Affordable Care Passes Senate Health Committee (May 13, 2020), available at https://oag.ca.gov/news/press-releases/attorney-general-becerra-and-senator-monning-announce-legislation-reduce.

[9] Lesley Stahl, 60 Minutes, How a Hospital System Grew to Gain Market Power and Drove Up California Health Care Costs (December 13, 2020), available at https://www.cbsnews.com/news/california-sutter-health-hospital-chain-high-prices-lawsuit-60-minutes-2020-12-13/.

[10] Robert King, Fierce Healthcare, Sutter Health Seeks Delay of $575M Settlement to Assess Impact of COVID-19 (June 17, 2020), available at https://www.fiercehealthcare.com/hospitals/sutter-health-seeks-delay-575m-settlement-to-assess-impact-covid-19.

[11] Leah Nylen, Politico, California Investigating Google for Potential Antitrust Violations (July 9, 2020), available at https://www.politico.com/news/2020/07/09/california-google-anti-trust-investigation-355710.

[12] Press Release, Cal. Attorney General, Attorney General Becerra Moves to Join Federal Lawsuit Against Google for Anticompetitive Actions (December 11, 2020), available at https://oag.ca.gov/news/press-releases/attorney-general-becerra-moves-join-federal-lawsuit-against-google.

[13] Press Release, Cal. Attorney General, Attorney General Becerra Secures Nearly $70 Million against Several Drug Companies for Delaying Competition and Increasing Drug Prices (July 29, 2019), available at https://oag.ca.gov/news/press-releases/attorney-general-becerra-secures-nearly-70-million-against-several-drug.

[14] See Press Release, Cal. Attorney General, Attorney General Becerra Joins Price-Fixing Lawsuit Against Six Drug Companies (March 1, 2017), available at https://oag.ca.gov/news/press-releases/attorney-general-becerra-joins-price-fixing-lawsuit-against-six-drug-companies.

[15] State of New York et al. v. Deutsche Telekom AG et al., No. 1:19-cv-05434 (June 11, 2019 S.D.N.Y.)

[16] Id. (Complaint) at Dkt. 2.

[17] Id. (Complaint) at Dkt. 410.

[18] Matthew Perlman, Law360, Calif. Enforcer Sees Less Focus On Economics After T-Mobile (Sept. 10, 2020), available at https://www.law360.com/articles/1308930/calif-enforcer-sees-less-focus-on-economics-after-t-mobile.

[19] Id.

[20] Bernstein v. Virgin America, Inc., No. 15-cv-02277-JST, Doc. No. 365 (N.D. Cal. Jan. 16, 2019).

[21] Bernstein v. Virgin America, Inc., No. 15-cv-02277-JST, Doc. No. 97 (N.D. Cal. Jan. 5, 2017).

[22] Press Release, Cal. Attorney General, Attorney General Becerra Announces $800,000 Settlement Against Infosys for Misclassification of Foreign Workers and Tax Fraud (Dec. 17, 2019), available at https://oag.ca.gov/news/press-releases/attorney-general-becerra-announces-800000-settlement-against-infosys.

[23] Pursuant to AB5, Labor Code § 2750.3(a)(1) was amended to read:

[A] person providing labor or services for remuneration shall be considered an employee rather than an independent contractor unless the hiring entity demonstrates that all of the following conditions are satisfied:

(A) The person is free from the control and direction of the hiring entity in connection with the performance of the work, both under the contract for the performance of the work and in fact.

(B) The person performs work that is outside the usual course of the hiring entity’s business.

(C) The person is customarily engaged in an independently established trade, occupation, or business of the same nature as that involved in the work performed.

[24] People v. Uber Techs., Inc., No. CGC-20-584402 (Cal. Super. Ct., S.F. Cty. May 5, 2020) (Complaint).

[25] Labor Code § 2750.3(j).

[26] Press Release, Cal. Attorney General, Attorney General Becerra Announces Multistate Settlements to Block “No-Poach” Contract Provisions That Harm Fast Food Workers (Mar. 2, 2020), available at https://oag.ca.gov/news/press-releases/attorney-general-becerra-announces-multistate-settlements-block-%E2%80%9Cno-poach%E2%80%9D.

[27] Press Release, Cal. Attorney General, Attorney General Becerra Announces Multistate Settlements Targeting “No-Poach” Policies that Harm Workers (Mar. 12, 2019), available at https://oag.ca.gov/news/press-releases/attorney-general-becerra-announces-multistate-settlements-targeting-%E2%80%9Cno-poach%E2%80%9D.

[28] Press Release, Cal. Attorney General, Attorney General Becerra Calls for Nationwide Ban on Non-Compete Agreements, Reminds Businesses of Existing Prohibition in California (Nov. 15, 2019), available at https://oag.ca.gov/news/press-releases/attorney-general-becerra-calls-nationwide-ban-non-compete-agreements-reminds.

[29] Press Release, Cal. Attorney General, Attorney General Becerra Establishes Bureau of Environmental Justice (Feb. 22, 2018), available at https://oag.ca.gov/news/press-releases/attorney-general-becerra-establishes-bureau-environmental-justice.

[30] Press Release, Cal. Attorney General, Attorney General Becerra Announces $11 Million Settlement Against Autozone for Illegal Disposal of Hazardous Waste Statewide (June 18, 2019), available at https://oag.ca.gov/news/press-releases/attorney-general-becerra-announces-11-million-settlement-against-autozone.

[31] California v. Autozone, Inc., No. RG19019395 (Cal. Super. Ct., Alameda Cty. June 18, 2019) (Final Judgment and Permanent Injunction on Consent).

[32] Press Release, Cal. Attorney General, Attorney General Becerra Filed Brief in Support of Lawsuit by Oakland and San Francisco Communities to Hold Oil and Coal Companies Accountable for Costs of Sea-Level Rise (Mar. 20, 2019), available at https://oag.ca.gov/news/press-releases/attorney-general-becerra-files-brief-support-lawsuit-oakland-and-san-francisco.

[33] City of Oakland v. BP P.L.C., No. 18-16663 (9th Cir. Mar. 20, 2019) (Brief of Amici Curiae States of California, Connecticut, Maryland, Minnesota, New Jersey, New York, Oregon, Rhode Island, Vermont, and Washington, and the District of Columbia).

[34] Press Release, Cal. Attorney General, Attorney General Becerra Files Brief in Support of Oakland’s Authority to Protect Environmental Justice Communities (July 20, 2020), available at https://oag.ca.gov/news/press-releases/attorney-general-becerra-files-amicus-brief-support-oaklands-authority-protect.

[35] City of Oakland v. Oakland Bulk & Oversized Terminal, LLC, No. 18-16105 (9th Cir. July 20, 2020) (Brief of the State of California as Amicus Curiae)

[36] Press Release, Cal. Attorney General, Attorney General Xavier Becerra Announces $125 Million Settlement Against Royal Bank of Scotland For Misleading California’s Pension Funds (Dec. 22, 2017), available at https://oag.ca.gov/news/press-releases/attorney-general-xavier-becerra-announces-125-million-settlement-against-royal.

[37] Press Release, Cal. Attorney General, Attorney General Becerra Announces $150 Million Settlement Against Morgan Stanley for Misleading California’s Teachers and Workers with Pensions (April 25, 2019), available at https://oag.ca.gov/news/press-releases/attorney-general-becerra-announces-150-million-settlement-against-morgan-stanley.

[38] Press Release, Cal. Attorney General, Attorney General Becerra Announces $7 Million Settlement Against Multinational Bank HSBC for Overcharging CalPERS on Foreign Exchange Transactions (Sept. 24, 2020), available at https://oag.ca.gov/news/press-releases/attorney-general-becerra-announces-7-million-settlement-against-multinational.

[39] Press Release, Cal. Attorney General, Attorney General Becerra Announces $40 Million Nationwide Settlement with Apria Healthcare (January 22, 2021), available at https://oag.ca.gov/news/press-releases/attorney-general-becerra-announces-40-million-nationwide-settlement-apria.

[40] Press Release, Cal. Attorney General, Attorney General Becerra: BP Energy Company Pays $102 Million in Settlement for Overcharging Californians for Natural Gas (Jan. 11, 2018), available at https://oag.ca.gov/news/press-releases/attorney-general-becerra-bp-energy-company-pays-102-million-settlement.

[41] Press Release, Cal. Attorney General, Attorney General Becerra Announces Settlement Against Cloud Software Manufacturer VMware for Overcharging California (Oct. 23, 2020), available here.

[42] See AB 2570 False Claims Act (2019-2020), California Legislative Information, available here; AB 1270 False Claims Act (2019-2020), California Legislative Information, available at https://leginfo.legislature.ca.gov/faces/billStatusClient.xhtml?bill_id=201920200AB1270.

[43] Press Release, Cal. Attorney General, Attorney General Becerra Announces $120 Million Settlement against Johnson & Johnson for Deceptive Marketing of Hip Replacement Products (Jan. 21, 2019), available at https://oag.ca.gov/news/press-releases/attorney-general-becerra-announces-120-million-settlement-against-johnson.

[44] Press Release, Cal. Attorney General, Attorney General Becerra and Los Angeles Leaders Announce Lawsuit Against JUUL for Deceptive Marketing Practices Targeting Underage Californians and Endangering Users of Its Vaping Products (Nov. 18, 2019), available at https://oag.ca.gov/news/press-releases/attorney-general-becerra-and-los-angeles-leaders-announce-lawsuit-against-juul.

[45] Press Release, Cal. Attorney General, Attorney General Becerra Secures nearly $344 Million Judgment Against Johnson & Johnson for Endangering Patients through Deceptive Marketing of Pelvic Mesh Products (Jan. 30. 2020), available at https://oag.ca.gov/news/press-releases/attorney-general-becerra-secures-nearly-344-million-judgment-against-johnson.

[46] See, e.g., Sarah Jane Tribble, Kaiser Health News, Business Insider, States Are Investigating Drug Companies And Middlemen Involved In The Pricing Of A Key Diabetes Medicine (Oct. 30, 2017), available at https://www.businessinsider.com/federal-and-state-probes-target-insulin-drugmakers-and-middlemen-2017-10.

[47] See, e.g., Press Release, Cal. Attorney General, Attorney General Becerra Announces $11.8 Million Settlement Against Novartis Pharmaceuticals (Sept. 14, 2020), available here; Press Release, Cal. Attorney General, Attorney General Becerra Announces $17.5 Million Settlement Against Home Depot Over Credit Card Data Breach (November 24, 2020), available at https://oag.ca.gov/news/press-releases/attorney-general-becerra-announces-175-million-settlement-against-home-depot; Press Release, Cal. Attorney General, Attorney General Becerra Recovers Over $1 Million for California from Premera Blue Cross Health Records Data Breach (July 11, 2019), available at https://oag.ca.gov/news/press-releases/attorney-general-becerra-recovers-over-1-million-california-premera-blue-cross.

[48] Press Release, Cal. Attorney General, Attorney General Becerra Announces $8.69 Million Settlement Against Anthem, Inc., Over Failure to Protect Patients’ Personal Data (Sept. 30, 2020), available at https://oag.ca.gov/news/press-releases/attorney-general-becerra-announces-869-million-settlement-against-anthem-inc; Press Release, Cal. Attorney General, Attorney General Becerra Recovers Over $1 Million for California from Premera Blue Cross Health Records Data Breach (July 11, 2019), available at https://oag.ca.gov/news/press-releases/attorney-general-becerra-recovers-over-1-million-california-premera-blue-cross.

[49] Press Release, Cal. Attorney General, Attorney General Becerra Announces Landmark Settlement Against Glow, Inc. – Fertility App risks Exposing Millions of Women’s Personal and Medical Information (September 17, 2020), available at https://oag.ca.gov/news/press-releases/attorney-general-becerra-announces-landmark-settlement-against-glow-inc-%E2%80%93.

[50] Civ. Code § 1798.185(c).

[51] Cal. Attorney General, CCPA Regulations, available at https://www.oag.ca.gov/privacy/ccpa/regs.

[52] Id.

[53] Cal. Secretary of State, Official Voter Information Guide, Proposition 24, available at https://voterguide.sos.ca.gov/propositions/24/.

[54] Id.

[55] Cal. Const. Art. V, Sec. 5, subd. (b).

[56] Gov’t Code, § 12503. The Attorney General must also be a registered voter (Elections Code § 201), not been convicted of certain felonies (Elections Code § 20), and not already subject to term limits (Cal. Const. Art. V, Sec. 1).


The following Gibson Dunn lawyers assisted in the preparation of this client update: Victoria Weatherford, Abiel Garcia, Jacob Arber, Winston Chan, Benjamin Wagner, Alexander Southwell, Rachel Brass, Eric Vandevelde, Ryan Bergsieker, Cassandra Gaedt-Sheckter, and Katherine Warren Martin.

Gibson Dunn’s lawyers are available to assist with any questions you may have regarding these developments. For additional information, please feel free to contact the Gibson Dunn lawyer with whom you usually work, the authors, or the following lawyers in the firm's White Collar Defense and Investigations Practice Group with significant experience with the California Attorney General's Office:

San Francisco Rachel S. Brass – San Francisco (+1 415-393-8293, rbrass@gibsondunn.com) Winston Y. Chan – San Francisco (+1 415-393-8362, wchan@gibsondunn.com) Charles J. Stevens – San Francisco (+1 415-393-8391, cstevens@gibsondunn.com) Michael Li-Ming Wong – San Francisco (+1 415-393-8234, mwong@gibsondunn.com) Victoria L. Weatherford – San Francisco (+1 415-393-8265, vweatherford@gibsondunn.com)

Palo Alto Benjamin Wagner – Palo Alto (+1 650-849-5395, bwagner@gibsondunn.com) Cassandra L. Gaedt-Sheckter – Palo Alto (+1 650-849-5203, cgaedt-sheckter@gibsondunn.com)

Los Angeles Nicola T. Hanna – Los Angeles (+1 213-229-7269, nhanna@gibsondunn.com) Debra Wong Yang – Los Angeles (+1 213-229-7472, dwongyang@gibsondunn.com) Michael M. Farhang – Los Angeles (+1 213-229-7005, mfarhang@gibsondunn.com) Douglas Fuchs – Los Angeles (+1 213-229-7605, dfuchs@gibsondunn.com) Eric D. Vandevelde – Los Angeles (+1 213-229-7186, evandevelde@gibsondunn.com) James L. Zelenay Jr. – Los Angeles (+1 213-229-7449, jzelenay@gibsondunn.com)

New York Alexander H. Southwell – New York (+1 212-351-3981, asouthwell@gibsondunn.com)

Denver Ryan T. Bergsieker – Denver (+1 303-298-5774, rbergsieker@gibsondunn.com)

© 2021 Gibson, Dunn & Crutcher LLP Attorney Advertising:  The enclosed materials have been prepared for general informational purposes only and are not intended as legal advice.

January 22, 2021 |
Year-End and Fourth Quarter 2020 Update on Class Actions

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Our year-end 2020 report provides an update on the application of Article III in class and other complex litigation. First, we discuss the significance of the Supreme Court’s recent grant of certiorari in TransUnion LLC v. Ramirez, No. 20-297, __ S. Ct. __, 2020 WL 7366280 (U.S. Dec. 16, 2020), which concerns the propriety of certifying class actions with uninjured class members.

Second, we review recent cases in which courts have continued to grapple with issues of Article III standing in the wake of Spokeo, Inc. v. Robins, 136 S. Ct. 1540 (2016), often reaching divergent conclusions in similar cases involving claims under consumer credit, privacy, and related laws.

I. The Supreme Court Will Resolve Whether Uninjured Class Members Can Be Part of a Certified Class Action

On December 16, 2020, the Supreme Court granted certiorari in TransUnion LLC v. Ramirez to resolve a very important class action issue that has split the federal courts of appeals for years: “whether either Article III or Rule 23 permits a damages class action where the vast majority of the class suffered no actual injury, let alone an injury anything like what the class representative suffered.”

In Ramirez, the plaintiff asserted that TransUnion violated the Fair Credit Reporting Act (FCRA) by inaccurately labelling class members as potential terrorists, drug traffickers, and other threats to national security on their consumer credit reports. See Ramirez v. TransUnion LLC, 951 F.3d 1008, 1017 (9th Cir. 2020). After a jury awarded $60 million in damages, TransUnion appealed, arguing that the verdict “cannot stand because only Sergio Ramirez, the representative plaintiff, suffered a concrete and particularized injury as a result of TransUnion’s unlawful practice.” Id.

As discussed in a prior update, the Ninth Circuit agreed with TransUnion on this point and held that “each member of a class certified under Rule 23 must satisfy the bare minimum of Article III standing at the final judgment stage of a class action in order to recover monetary damages in federal court.” Id. at 1023. Citing Chief Justice Roberts’s observation that “‘Article III does not give federal courts the power to order relief to any uninjured plaintiff, class action or not,’” the Ninth Circuit reasoned that a contrary rule would “transform the class action—a mere procedural device—into a vehicle for individuals to obtain money judgments in federal court even though they could not show sufficient injury to recover those judgments individually.” Id. at 1023–24 (quoting Tyson Foods, Inc. v. Bouaphakeo, 136 S. Ct. 1036, 1053 (2016) (Roberts, C.J., concurring)); see also Castillo v. Bank of Am., NA, 980 F.3d 723, 730 (9th Cir. 2020) (reiterating that a district court has the duty to ensure that any proposed “class is not defined so broadly as to include a great number of members who for some reason could not have been harmed by the defendant’s allegedly unlawful conduct”).

Nonetheless, the Ninth Circuit upheld the verdict upon finding that each class member had Article III standing. Ramirez, 951 F.3d at 1017. The court reasoned that even though plaintiff had stipulated that more than 75% of the absent class members did not have a credit report disseminated to any third party during the class period, FCRA was enacted to protect consumers’ concrete interests and “the fact that TransUnion made the reports available to numerous potential creditors,” along with “the highly sensitive and distressing nature of the [Office of Foreign Assets Control] alerts,” was “sufficient to show a material risk of harm to the concrete interests of all class members.” Id. at 1027.

In a separate opinion, Judge McKeown disagreed with the certification of absent class members’ claims. In particular, she was troubled by the lack of evidence that any absent class members were injured at all: although the named plaintiff and “a limited number of class members” had their “credit report[s] disclosed to third parties, there was no evidence of any harm or damages to remaining class members.” Id. at 1038 (McKeown, J., concurring-in-part and dissenting-in-part). Thus, not only did the named plaintiff’s “stark atypicality as the lone class representative” “strain Rule 23’s typicality requirements,” but the absence of evidence regarding the actual experiences of the absent class members made the “harm as to the bulk of the class … conjectural,” and therefore falling far short of showing a constitutionally cognizable injury. Id. at 1038–40.

The disagreement between the majority panel’s decision in Ramirez and Judge McKeown’s dissent highlights an issue that frequently arises in class litigation: whether and to what extent (including at what stage of the case) absent class members must satisfy Article III standing requirements. Different courts have reached different conclusions on this question. Compare Denney v. Deutsche Bank AG, 443 F.3d 253, 264 (2d Cir. 2006) (“[N]o class may be certified that contains members lacking Article III standing.”), with Kohen v. Pac. Inv. Mgmt. Co., 571 F.3d 672, 676 (7th Cir. 2009) (“[A]s long as one member of a certified class has a plausible claim to have suffered damages, the requirement of standing is satisfied.”). By agreeing to review Ramirez, the Supreme Court will have an opportunity to address this important issue and provide guidance on whether uninjured class members can be part of a certified class action.

II. Courts Continue to Reach Diverging Results on What Constitutes a Concrete Injury Sufficient to Establish Standing Under Spokeo, Inc. v. Robins

As reported in our second quarter 2019 update, in Muransky v. Godiva Chocolatier, Inc., a three-judge panel of the Eleventh Circuit held that a retailer’s failure to truncate a credit card number on a receipt in violation of the Fair and Accurate Credit Transactions Act (FACTA) was sufficient to create standing. 922 F.3d 1175 (11th Cir. 2019). In October 2020, the Eleventh Circuit reversed that decision en banc, holding that a bare procedural violation of FACTA, devoid of any claim of individual injury, is insufficient to confer Article III standing. Muransky v. Godiva Chocolatier, 979 F.3d 917 (11th Cir. 2020) (en banc).

The panel had noted that Congress set forth the remedial procedures in FACTA to minimize a risk of harm to a concrete interest (namely, preventing identity theft), and held that any violation presenting even a marginal risk of harming that interest should be “sufficient to constitute a concrete injury.” 922 F.3d at 1188. The en banc Eleventh Circuit disagreed, and criticized the panel’s standard as essentially adopting a presumption that statutory injury alone can constitute Article III injury, which was what the Supreme Court had rejected in Spokeo. 979 F.3d at 930. Instead, the en banc court focused on whether the violation in question caused actual harm or posed a material risk of harm to the plaintiff.

The en banc court concluded that even though the plaintiff had received a noncompliant receipt that contained his private information, he had not alleged any actual harm more concrete than time spent “safeguarding” his receipt and experiencing a “breach of confidence.” Id. at 931. The court rejected both theories. As for “safeguarding” the receipt, the court noted that under Clapper v. Amnesty International USA, 568 U.S. 398, 416 (2013), self-inflicted harm alone cannot constitute injury under Article III. Id. at 931. As for the “breach of confidence,” the court was skeptical that the analogy to the common law breach of confidence was appropriate, and even if it were, it would require third-party disclosure of private information, and the plaintiff had not alleged that anyone else had seen the receipt. Id. at 931–32.

The Sixth Circuit took a markedly different approach when addressing similar facts in Donovan v. FirstCredit, Inc., 983 F.3d 246 (6th Cir. 2020). The plaintiff alleged that a creditor sent a letter inside an envelope with an envelope window that revealed language describing the plaintiff as a debtor. Id. at 249. The plaintiff sued under the Fair Debt Collection Practices Act’s (FDCPA) provisions regulating the language and symbols debt collectors may employ on envelopes when communicating with consumers, alleging that the letter had violated these provisions by revealing the plaintiff’s status as a debtor. Id.

The Sixth Circuit held that the exposure of information through an envelope window, even if “benign,” created a sufficient risk that the plaintiff’s status as a purported debtor would be disclosed, which established an injury-in-fact under the FDCPA. Id. at 252–53. The court reasoned that because the letter had actually been sent in the mail, and an invasion of privacy is a “harm that has traditionally been regarded as providing a basis for a lawsuit,” the mailing of the letter with the exposed information provided “a degree of risk sufficient to meet the concreteness requirement” under Spokeo. Id. at 253.

The Seventh and Ninth Circuits this past quarter also addressed standing in putative class actions. In Fox v. Dakkota Integrated Systems, LLC, 980 F.3d 1146 (7th Cir. 2020), the Seventh Circuit addressed allegations that the defendant had failed to develop, publicly disclose, and comply with a data-retention schedule and guidelines for the permanent destruction of biometric data under the Illinois Biometric Information Privacy Act (BIPA). In particular, the plaintiff alleged that the defendant had retained her biometric data after her employment ended, in violation of BIPA’s requirements. Id. at 1149.

The Seventh Circuit acknowledged that in a prior related case, it had held that merely alleging the non-disclosure of data-retention and data-destruction policies was insufficient to show injury-in-fact under Article III. Id. at 1153–54 (citing Bryant v. Compass Grp. US, Inc., 958 F.3d 617, 619 (7th Cir. 2020)). But the court noted that in this specific case, the defendant’s alleged failure to disclose those policies had led to an unlawful retention of the plaintiff’s handprint and also to her biometric data being unlawfully shared with a third party. Id. at 1154. Analogizing this unlawful retention of data to the unlawful collection of data (which the court had previously found conferred standing in Bryant), the court reasoned that “the invasion of a legally protected privacy right, though intangible, is personal and real,” and therefore sufficient to plead an injury in fact. Id. at 1155.

The Ninth Circuit addressed standing in McGee v. S-L Snacks National, 982 F.3d 700 (9th Cir. 2020), a putative consumer class action. The plaintiff alleged that she had purchased and consumed defendant’s popcorn containing trans fats, despite the FDA’s determination that trans fats are no longer “generally recognized as safe,” and she brought claims under both California’s Unfair Competition Law and for present and future physical injury from the ingestion of trans fats. Id. at 703. In support of her claim for physical injury, the plaintiff estimated that she had consumed 0.2 grams of trans fats per day, and cited studies showing a link between consuming trans fats and organ damage. Id. at 709.

The Ninth Circuit held that the plaintiff did not have standing to bring claims for her alleged physical injury. Id. at 710. Even though the plaintiff’s cited studies showed a connection between trans fats and organ damage, they did not show that the consumption of trans fats invariably lead to such damage, which is required to establish concrete injury without any individual medical evidence of harm. Id. at 708. As for future injury, the court noted that the plaintiff cited studies involving far greater levels of trans fats consumption, such that the plaintiff had alleged no substantial risk of future health consequences to her. Id. at 710.


The following Gibson Dunn lawyers contributed to this client update: Christopher Chorba, Theane Evangelis, Kahn Scolnick, Bradley Hamburger, Lauren Blas, Jillian London, Wesley Sze, Jessica Pearigen, and Jonathan Haderlein.

Gibson Dunn attorneys are available to assist in addressing any questions you may have regarding these developments.  Please contact the Gibson Dunn lawyer with whom you usually work in the firm’s Class Actions or Appellate and Constitutional Law practice groups, or any of the following lawyers:

Theodore J. Boutrous, Jr. – Co-Chair, Litigation Practice Group – Los Angeles (+1 213-229-7000, tboutrous@gibsondunn.com) Christopher Chorba – Co-Chair, Class Actions Practice Group – Los Angeles (+1 213-229-7396, cchorba@gibsondunn.com) Theane Evangelis – Co-Chair, Class Actions Practice Group – Los Angeles (+1 213-229-7726, tevangelis@gibsondunn.com) Kahn A. Scolnick – Los Angeles (+1 213-229-7656, kscolnick@gibsondunn.com) Bradley J. Hamburger – Los Angeles (+1 213-229-7658, bhamburger@gibsondunn.com) Lauren M. Blas – Los Angeles (+1 213-229-7503, lblas@gibsondunn.com)

© 2021 Gibson, Dunn & Crutcher LLP Attorney Advertising:  The enclosed materials have been prepared for general informational purposes only and are not intended as legal advice.

January 21, 2021 |
Five Gibson Dunn Attorneys Named Among Washingtonian Magazine’s 2020 Top Lawyers

Washingtonian magazine named five Washington, D.C. partners to its 2020 Top Lawyers, which features “Washington’s top legal talent,” in their respective practice areas:

  • Miguel Estrada was named a Top Lawyer in the Supreme Court category – Miguel has argued 24 cases before the United States Supreme Court, and briefed many others.
  • Theodore Olson was named a Top Lawyer in the Supreme Court category – Ted is one of the nation’s premier appellate and United States Supreme Court advocates. He has argued 65 cases in the Supreme Court and has prevailed in over 75% of those cases.
  • Jason Schwartz was named a Top Lawyer in the Employment Defense category – Jason is co-chair of the firm’s Labor & Employment Practice Group. His practice includes sensitive workplace investigations, high-profile trade secret and non-compete matters, wage-hour and discrimination class actions, Sarbanes-Oxley and other whistleblower protection claims, executive and other significant employment disputes, labor union controversies, and workplace safety litigation.
  • Patrick Stokes was named a Top Lawyer in the Criminal Defense-White Collar category – Patrick’s practice focuses on internal corporate investigations, compliance reviews, government investigations, and enforcement actions regarding corruption, securities fraud, and financial institutions fraud.
  • Joseph Warin was named a Top Lawyer in the Criminal Defense-White Collar category – Joe is co-chair of the firm’s global White Collar Defense and Investigations Practice Group. His practice includes representation of corporations in complex civil litigation, white collar crime, and regulatory and securities enforcement – including Foreign Corrupt Practices Act investigations, False Claims Act cases, special committee representations, compliance counseling and class action civil litigation.
The list was published in December 2020.

January 19, 2021 |
Webcast: Supreme Court Roundup

Summary and analysis of the significant and high-profile cases before the Supreme Court this Term, particularly those affecting the business community.

View Slides (PDF)

PANELISTS: Blaine Evanson & Lauren Blas
MCLE CREDIT INFORMATION: This program has been approved for credit in accordance with the requirements of the New York State Continuing Legal Education Board for a maximum of 1.0 credit hour, of which 1.0 credit hour may be applied toward the areas of professional practice requirement. This course is approved for transitional/non-transitional credit. Attorneys seeking New York credit must obtain an Affirmation Form prior to watching the archived version of this webcast. Please contact CLE@gibsondunn.com to request the MCLE form. Gibson, Dunn & Crutcher LLP certifies that this activity has been approved for MCLE credit by the State Bar of California in the amount of 1.0 hour. California attorneys may claim “self-study” credit for viewing the archived version of this webcast. No certificate of attendance is required for California “self-study” credit.

January 11, 2021 |
2019/2020 Federal Circuit Year in Review

We are pleased to present Gibson Dunn’s eighth “Federal Circuit Year In Review,” providing a statistical overview and substantive summaries of the 130 precedential patent opinions issued by the Federal Circuit between August 1, 2019 and July 31, 2020. This term was marked by significant panel decisions with regard to the constitutionality of the PTAB and its jurisdiction and procedures (Arthrex, Inc. v. Smith & Nephew, Inc., 941 F.3d 1320 (Fed. Cir. 2019), Samsung Electronics America, Inc. v. Prisua Engineering Corp., 948 F.3d 1342 (Fed. Cir. 2020), and Nike, Inc. v. Adidas AG, 955 F.3d 45 (Fed. Cir. 2020)), subject matter eligibility (American Axle & Manufacturing, Inc. v. Neapco Holdings LLC, 967 F.3d 1285 (Fed. Cir. 2020) and Illumina, Inc. v. Ariosa Diagnostics, Inc.,952 F.3d 1367 (Fed. Cir. 2020)), and venue (In re Google LLC). The issues most frequently addressed in precedential decisions by the Court were: obviousness (43 opinions); infringement (24 opinions); claim construction (22 opinions); PTO procedures (21 opinions); and Jurisdiction, Venue, and Standing (19 opinions).

Use the Federal Circuit Year In Review to find out:

  • The easy-to-use Table of Contents is organized by substantive issue, so that the reader can easily identify all of the relevant cases bearing on the issue of choice.
  • Which issues may have a better chance (or risk) on appeal based on the Federal Circuit’s history of affirming or reversing on those issues in the past.
  • The average length of time from issuance of a final decision in the district court and docketing at the Federal Circuit to issuance of a Federal Circuit opinion on appeal.
  • What the success rate has been at the Federal Circuit if you are a patentee or the opponent based on the issue being appealed.
  • The Federal Circuit’s history of affirming or reversing cases from a specific district court.
  • How likely a particular panel may be to render a unanimous opinion or a fractured decision with a majority, concurrence, or dissent.
  • The Federal Circuit’s affirmance/reversal rate in cases from the district court, ITC, and the PTO.

The Year In Review provides statistical analyses of how the Federal Circuit has been deciding precedential patent cases, such as affirmance and reversal rates (overall, by issue, and by District Court), average time from lower tribunal decision to key milestones (oral argument, decision), win rate for patentee versus opponent (overall, by issue, and by District Court), decision rate by Judge (number of unanimous, majority, plurality, concurring, or dissenting opinions), and other helpful metrics. The Year In Review is an ideal resource for participants in intellectual property litigation seeking an objective report on the Court’s decisions.

Gibson Dunn is nationally recognized for its premier practices in both Intellectual Property and Appellate litigation. Our lawyers work seamlessly together on all aspects of patent litigation, including appeals to the Federal Circuit from both district courts and the agencies.

Please click here to view the FEDERAL CIRCUIT YEAR IN REVIEW


Gibson Dunn's lawyers are available to assist in addressing any questions you may have regarding developments at the Federal Circuit. Please contact the Gibson Dunn lawyer with whom you usually work or the authors of this alert:

Mark A. Perry - Washington, D.C. (+1 202-887-3667, mperry@gibsondunn.com) Omar F. Amin - Washington, D.C. (+1 202-887-3710, oamin@gibsondunn.com) Nathan R. Curtis - Dallas (+1 214-698-3423, ncurtis@gibsondunn.com)

Please also feel free to contact any of the following practice group co-chairs or any member of the firm's Appellate and Constitutional Law or Intellectual Property practice groups:

Appellate and Constitutional Law Group: Allyson N. Ho - Dallas (+1 214-698-3233, aho@gibsondunn.com) Mark A. Perry - Washington, D.C. (+1 202-887-3667, mperry@gibsondunn.com)

Intellectual Property Group: Wayne Barsky - Los Angeles (+1 310-552-8500, wbarsky@gibsondunn.com) Josh Krevitt - New York (+1 212-351-4000, jkrevitt@gibsondunn.com) Mark Reiter - Dallas (+1 214-698-3100, mreiter@gibsondunn.com)

© 2020 Gibson, Dunn & Crutcher LLP Attorney Advertising:  The enclosed materials have been prepared for general informational purposes only and are not intended as legal advice.

January 7, 2021 |
Invalid appointments and the restoration of DACA

San Francisco partner Ethan Dettmer and Washington, D.C. associates Suria Bahadue and Matthew Rozen are the authors of "Invalid appointments and the restoration of DACA," [PDF] published by the Daily Journal on January 4, 2021.