Expanded Standing, or "Back to Basics"? Flash Memory Direct Purchasers Found to Have Standing to Assert Walker Process Claims

In Ritz Camera & Image, LLC v. SanDisk Corporation, et al., United States District Court, ND Cal., Case No. 5:10-CV02787-JF/HRL, the court denied a motion to dismiss in a Walker Process "fraud on patent office" case, and allowed standing to a direct purchaser. Is this an extension, or is it "business as usual"? A step by step analysis is in order.

Ritz Camera & Image, LLC ("Ritz") filed an action under Section 4 of the Clayton Act alleging that SanDisk Corp., ("SanDisk") and its founder, Harari, violated Section 2 of the Sherman Act. Ritz alleged that SanDisk and Harari conspired to monopolize, and actually monopolized the market for NAND/memory products, through the assertion of and prosecution of patents which were a fraud on the United States Patent and Trademark Office ("USPTO"). NAND/memory is a form of digital storage technology used in consumer electronics devices.

In a second amended complaint, ("SAC"), Ritz alleged that Harari tortiously converted flash memory technology owned by Harari's former employer, and then prosecuted fraudulent "crown jewel" patents. Allegedly, Harari intentionally failed to disclose invalidating prior art, and made affirmative misrepresentations to the USPTO. Further, defendants allegedly threatened competitors through harassing litigation and sales tactics, and caused the elimination of a major NAND competitor, in an anti-competitive settlement of bad faith litigation. Ritz alleged that it was injured in its "business or property" as a result. The defendants' overt acts allegedly reduced market competition, thus allowing for an increase in prices. Ritz was a direct purchaser of NAND/memory from defendants.

Please see full article below for more information.

LOADING PDF: If there are any problems, click here to download the file.

Written by:

Published In:

DISCLAIMER: Because of the generality of this update, the information provided herein may not be applicable in all situations and should not be acted upon without specific legal advice based on particular situations.

© Sheppard Mullin Richter & Hampton LLP | Attorney Advertising

Don't miss a thing! Build a custom news brief:

Read fresh new writing on compliance, cybersecurity, Dodd-Frank, whistleblowers, social media, hiring & firing, patent reform, the NLRB, Obamacare, the SEC…

…or whatever matters the most to you. Follow authors, firms, and topics on JD Supra.

Create your news brief now - it's free and easy »

All the intelligence you need, in one easy email:

Great! Your first step to building an email digest of JD Supra authors and topics. Log in with LinkedIn so we can start sending your digest...

Sign up for your custom alerts now, using LinkedIn ›

* With LinkedIn, you don't need to create a separate login to manage your free JD Supra account, and we can make suggestions based on your needs and interests. We will not post anything on LinkedIn in your name.