Delaware Chief Judge Colm F. Connolly has dismissed a declaratory judgment action filed by Power Integrations against Texas monetization firm IP Edge LLC; its “consulting” arm MAVEXAR LLC; an IP Edge-tied plaintiff Waverly Licensing LLC; and an IP Edge-tied intermediary Array IP LLC. The court notes that the complaint in question contains only a claim for a declaratory judgment of noninfringement of a single wireless charging patent, a claim mooted by the pack of covenants not to sue granted to Power Integrations by the four named defendants. Given the language of the dismissal memorandum, had Power Integrations pleaded “a RICO count with mail or wire fraud predicates”, the outcome might have been different.

Delaware Chief Judge Colm F. Connolly ended 2023 in dramatic faction, detailing his findings that patent monetization firm IP Edge LLC, a related consulting firm, and the individuals behind them had together engaged in a sweeping “fraud” through their unusually structured patent assertion model. That order teed up various “consequences” for those involved, among them a set of disciplinary referrals for the attorneys representing the IP Edge-linked plaintiffs under scrutiny based on a variety of professional rule violations. Now, Judge Connolly has grilled the attorneys for two more of the plaintiffs in IP Edge’s web about whether they engaged in some of the same ethical violations—including one of the same litigators tagged in the court’s prior decision, Jimmy Chong (of Chong Firm PA), as well as his cocounsel David Bennett (of Direction IP Law). In a January 17 hearing, an increasingly irritated and incredulous Judge Connolly questioned their grasp of the legal and ethical issues at play, concluding that Chong had earned a second disciplinary referral, and ordering a conspicuously forgetful Bennett to produce documents in order to lay out some basic facts.

In a November 27, 2023 order, and a set of subsequent letters, Delaware Chief Judge Colm F. Connolly referred certain attorneys employed by Texas monetization operation IP Edge LLC (which is not a law firm) to a Texas disciplinary body for the unauthorized practice of law, also referring local and lead counsel for certain LLC plaintiffs before him to state disciplinary bodies for improperly treating IP Edge as their true client. Those LLC plaintiffs are Lamplight Licensing LLC, Mellaconic IP LLC, and Nimitz Technologies LLC. Now, one of the referred attorneys—Jimmy Chong of Chong Law Firm PA—has been ordered, alongside co-counsel (David Bennett of Direction IP Law), to appear next week before Judge Connolly. The court has warned that both attorneys must be “prepared to address the Court’s concern” that the “same improprieties” prompting the referrals “may have occurred in connection with the litigation” in additional IP Edge-linked cases, namely, those filed by Swirlate IP LLC and by Waverly Licensing LLC.

Last October, Waverly Licensing LLC, a plaintiff tied to formerly prolific patent monetization firm IP Edge LLC, sued Power Integrations in the Western District of Texas—just as the “Series of Extraordinary Events” developing in IP Edge cases assigned to the courtroom of Delaware Chief Judge Colm F. Connolly were coming to a head. Power Integrations responded with a motion to dismiss for improper venue in West Texas and with a new complaint, seeking a declaratory judgment of noninfringement from the District of Delaware, naming as defendants Waverly and IP Edge, together with Array IP LLC and MAVEXAR LLC. The Delaware case was assigned to Judge Connolly. Now, the four defendants have filed—in Delaware but not yet in Texas—separate covenants not to sue, indicating that doing so “divests the District of Delaware of jurisdiction over the Delaware Action”.

Last year, the Federal Circuit made waves with its June 2022 Centripetal Networks v. Cisco decision, which overturned a $2.7B judgment because the district judge discovered his wife’s ownership of stock in the defendant but failed to recuse himself. In recent weeks, some plaintiffs have tried to leverage that opinion in their own litigation—but now, two of those attempts have fallen flat. In the Northern District of California, Judge Yvonne Gonzalez Rogers rejected a motion for recusal from CellSpin Soft Inc., which she hit with a noninfringement ruling this past June, as a meritless “attack on the integrity of the judiciary” that showed a “measure of desperation”. The order came soon after the Patent Trial and Appeal Board (PTAB) denied another such recusal motion, this one from Centripetal Networks, as similarly “lacking in substance” and “baseless”—holding that an administrative patent judge (APJ) owned a small enough interest in joined copetitioner Cisco that he was not required to recuse himself under the applicable regulations.

Last June, the Federal Circuit overturned a bench trial infringement ruling that had led to a $2.7B judgment in Centripetal Networks v. Cisco. The appellate court held that the district judge was disqualified to hear the case after he learned that his wife owned of $5K in the stock of defendant Cisco but then failed to recuse himself. That decision now appears to be having a broader ripple effect: plaintiff Centripetal Networks has raised a similar issue before the Patent Trial and Appeal Board (PTAB), asserting that an inter partes review (IPR) against one of the tried patents has been “tainted” by an administrative patent judge’s (APJ’s) ownership of Cisco stock and other purported financial interests in the company. Meanwhile, in another campaign, plaintiff CellSpin Soft, Inc. has argued that a June 2022 summary judgment of noninfringement should be overturned due to a Northern District of California district judge’s alleged interest in Google, the parent of defendant Fitbit. The Centripetal decision has also been invoked in a closely watched fight over transparency in the courtroom of Delaware Chief Judge Colm F. Connolly, under which certain amici have contended that patent litigants must disclose their ownership/management and funding sources to allow judges to perform a proper conflicts check.

Last month, for the first time in seven years, not a single complaint was filed in any US federal court by a plaintiff obviously tied to Texas patent monetization firm IP Edge LLC, which had previously established a regular pattern of filing roughly 50 patent complaints per month. The “Series of Extraordinary Events” unfolding first before Delaware Chief Judge Colm F. Connolly, but also at the Federal Circuit, would appear to have had more than a little to do with this abrupt pause. Multiple IP Edge-associated plaintiffs saw their Delaware cases land before Judge Connolly, leading to evidentiary hearings and subsequent production orders that triggered four of those plaintiffs to file petitions for writs of mandamus, some asking the Federal Circuit to halt those production orders and others, to vacate—as acts of judicial overreach—Judge Connolly’s standing orders regarding heightened disclosure of party ownership and certain third-party litigation funding. Having previously turned away two of those petitions, this past week the Federal Circuit batted away the second two, as premature, through a pair of nonprecedential orders noting that neither petitioner showed that the Delaware court “has taken any action . . . that is so far outside its authority to warrant the extraordinary remedy of a writ of mandamus”.

As RPX previously reported, Power Integrations, a defendant in the litigation campaign of Waverly Licensing LLC, filed a declaratory judgment (DJ) action in the District of Delaware, naming as defendants Waverly and Texas monetization firm IP Edge LLC, as well as Array IP LLC, an IP Edge-associated entity that previously held the patents that Waverly has since litigated, and MAVEXAR LLC, a separate entity formed by the three attorney principals of IP Edge to act as a consulting “agent of the client” (i.e., of the litigating plaintiff LLC), to engage counsel, and to run subsequent litigation. The Waverly Licensing campaign has been in the headlines, given the “Series of Extraordinary Events” underway before Delaware Chief Judge Colm F. Connolly, and the DJ action, as seemed likely, has been assigned to Judge Connolly. There, just before the year-end holidays, Power Integrations amended its original complaint, augmenting prior allegations about Waverly’s filing practices with additional representations from Waverly’s various complaints, which appear either to reflect a find-and-replace run amok or to convey some Waverly confusion about the state of its own formation.

Power Integrations has attempted to turn the tables on Waverly Licensing LLC, suing the patent holder—together with Array IP LLC, IP Edge LLC, and MAVEXAR LLC—in a new Delaware complaint (1:22-cv-01554) roughly one month after Waverly Licensing affirmatively sued Power Integrations in the Western District of Texas. There, on the day of its Delaware complaint, Power Integrations filed a motion to dismiss for improper venue. Other Waverly Licensing cases have already been assigned to Delaware Chief Judge Colm F. Connolly; thus, the new action has been as well. Power Integrations seeks a judgment of noninfringement of Waverly’s asserted patent, which is generally related to charging a device if using an “authorized charger”, with its complaint drawing upon connections with and between the other declaratory judgment (DJ) defendants based on the recent “Series of Extraordinary Events” developing before Judge Connolly.

Three plaintiffs with apparent links to Texas monetization firm IP Edge LLC recently filed separate petitions for writs of mandamus, asking the Federal Circuit in the short term to order Delaware Chief Judge Colm F. Connolly to cancel evidentiary hearings that had been scheduled for December 10 to consider whether those plaintiffs have complied with the court’s April 2022 standing orders addressing disclosure of comprehensive ownership information, as well as certain third-party litigation funding. Judge Connolly, separately, canceled that evidentiary hearing, and the Federal Circuit has quickly denied one of those petitions. Meanwhile, the same three plaintiffs have continued to file cases in their respective campaigns, Creekview IP LLC hitting RadioShack Online (3:22-cv-02653); Swirlate IP LLC, RAB Lighting (1:22-cv-06660) and Schweitzer Engineering Labs (2:22-cv-00300); and Waverly Licensing LLC, Aukey (2:22-cv-08642) and Impero Electronics (VisionTek Products) (2:22-cv-08642), all outside Delaware. Each of those campaigns has included prior cases filed in other districts as well—districts that require the disclosure of nonparties having an interest in the outcome of the litigation. In the Aukey case, litigation counsel (Garteiser Honea, PLLC) has already (on November 30) had to update Waverly’s disclosure to the Central District of California because the prior version (filed two days earlier) omitted MAVEXAR LLC from the list of parties with a pecuniary interest there. MAVEXAR will by now be well known to those following the “Series of Extraordinary Events” arising out of Delaware. As those events unfold, other counsel for Creekview IP, Swirlate IP, and Waverly may have more due diligence—and cleanup—ahead.