• CRIMINAL LAWS

United States Court of Appeals For The First Circuit

Frantz Depierre, Petitioner Vs. United States (Decided on 09.06.2011)

Illicit drugs - Crack cocaine - Interpretation of - §841(b)(1)(A)(iii) of the Anti-Drug Abuse Act of 1986 - First Circuit affirmed the District Court order holding  petitioner guilty of distribution of "cocaine base," and sentencing him to the 120 months in prison mandated by the statute - whether the term "cocaine base" as used in this statute refers generally to cocaine in its chemically basic form or exclusively to what is colloquially known as "crack cocaine."

Held, Subsection (b)(1)(A)(ii)(II) lists "cocaine," along with "its salts, optical and geometric isomers, and salts of isomers," as elements subject to clause (ii)'s higher quantity threshold - cocaine" and "cocaine base" both refer to chemically basic cocaine, offenses involving a substance containing such cocaine will always be penalized according to the lower quantity threshold of clause (iii), and never the higher threshold clause (ii) establishes for mixtures and substances containing "cocaine" - Clause (iii) penalizes offenses involving a mixture or substance "described in clause (ii) which contains cocaine base" - Thus, clause (ii) imposes a penalty for offenses involving cocaine-related substances generally, and clause (iii) imposes a higher penalty for a subset of those substances--the ones that "contain cocaine base" - Congress thus had good reason to include the term "cocaine" in clause (ii), and the slight inconsistency created by its use of "cocaine base" in clause (iii) is insufficient reason to adopt petitioner's interpretation

• INTELLECTUAL PROPERTY RIGHTS

United States Court of Appeals For The Federal Circuit

Microsoft corp. Vs. i4i limited partnership etal. (Decided on 09.06.2011)

Patent - Infringement - Invalidity defense - Presumption of patent validity - §282 of the Patent Act of 1952 - Respondents had sued petitioner for willful infringement of the impugned patent - Petitioners files a counterclaim contending that patent was invalid under §102(b)'s on-sale bar, which precludes patent protection for any "invention" that was "on sale in this country" more than one year prior to the filing of a patent application - Federal Circuit affirmed the District court decision that petitioner willfully infringed the i4i patent and had failed to prove the patent's invalidity - Whether §282 requires an invalidity defense to be proved by clear and convincing evidence

Held, While §282 includes no express articulation of the standard of proof, where Congress uses a common-law term in a statute, the Court assumes the "term ... comes with a common law meaning" - There is a presumption of patent validity that is not to be overthrown except by clear and cogent evidence - Presumption only allocates the burden of production or that it shifts both the burdens of production and persuasion - Nothing in §282's text suggests that Congress meant to depart from that understanding to enact a standard of proof that would rise and fall with the facts of each case - Congress specified the applicable standard of proof in 1952 when it codified the common-law presumption of patent validity - Congress has often amended §282 and other patent laws, but apparently has never considered any proposal to lower the standard of proof - Therefore, Section 282 requires an invalidity defense to be proved by clear and convincing evidence - Appeal fails

• CORPORATE LAWS

United States Court of Appeals For The Fourth Circuit

Janus capital group, inc., etal. Vs. First derivative traders (Decided on 13.06.2011)

Derivative Trading - Mutual fund prospectuses - False statements thereof - Securities and Exchange Commission (SEC) Rule 10b-5 - Respondent First Derivative Traders alleged that Petitioner and its wholly owned subsidiary made false statements in mutual fund prospectuses filed by Janus Investment Fund for which petitioner was the investment adviser and administrator - Whether Petitioner a mutual fund investment adviser, can be held liable in a private action under Securities and Exchange Commission (SEC) Rule 10b-5 for false statements included in its client mutual funds' prospectuses

Held, neither Rule 10b-5 nor the statute it interprets, §10(b) of the Act, expressly creates a private right of action, such an "action is implied under §10(b) - For Rule 10b-5 purposes, the maker of a statement is the person or entity with ultimate authority over the statement, including its content and whether and how to communicate it - Without control, a person or entity can merely suggest what to say, not "make" a statement in its own right - Reading "make" more broadly, to include persons or entities lacking ultimate control over a statement, would substantially undermine Central Bank by rendering aiders and abettors almost nonexistent - Petitioner may have been significantly involved in preparing the prospectuses, it did not itself "make" the statements at issue for Rule 10b-5 purposes and its assistance in crafting what was said was subject to Janus Investment Fund's ultimate control - Therefore, petitioner cannot be held liable in a private action under Rule 10b-5.