Summary
In Kewazinga Corp. v. Microsoft Corp., No. 1:18-CV-4500-GHW, 2021 WL 4066597 (S.D.N.Y. Sept. 1, 2021) (“Kewazinga II”), the Court evaluated Ms. Riley's proposed testimony regarding damages, which relied on her opinion of the appropriate royalty rate.
Summary of this case from Kewazinga Corp. v. Microsoft Corp.Opinion
1:18-cv-4500-GHW
2021-09-01
KEWAZINGA CORP., Plaintiff, v. MICROSOFT CORPORATION, Defendant.
Kenneth Lawrence Stein, Ian Gregg DiBernardo, Brown Rudnick LLP, Saunak Kirti Desai, Associate, Timothy Kelso Gilman, Stroock & Stroock & LaVan LLP, Gregory Springsted, New York, NY, for Plaintiff. Andrew Bruce Lachow, Lachowlaw, Larchmont, NY, James DeRouin, John Christopher Carraway, Kristin Cleveland, Ryan Frei, Todd M. Siegel, John D. Vandenberg, Klarquist Sparkman LLP, Portland, OR, for Defendant.
Kenneth Lawrence Stein, Ian Gregg DiBernardo, Brown Rudnick LLP, Saunak Kirti Desai, Associate, Timothy Kelso Gilman, Stroock & Stroock & LaVan LLP, Gregory Springsted, New York, NY, for Plaintiff.
Andrew Bruce Lachow, Lachowlaw, Larchmont, NY, James DeRouin, John Christopher Carraway, Kristin Cleveland, Ryan Frei, Todd M. Siegel, John D. Vandenberg, Klarquist Sparkman LLP, Portland, OR, for Defendant.
MEMORANDUM OPINION & ORDER
GREGORY H. WOODS, United States District Judge:
For some, it is difficult to remember a time before interactive street-level maps were available. Gone are the days of relying on unwieldy giant paper maps and pulling over on the side of the road to squint at street signs. In this modern age, one merely needs access to the internet to navigate unfamiliar cities without revealing her status as a tourist. With street-level imagery, would-be travelers can familiarize themselves with locations prior to venturing out into the great unknown, providing some sense of comfort and safety. Or, one can use interactive street-level maps to virtually wander the hills of San Francisco, the skyscraper-lined streets of New York, or the famous French Quarter in New Orleans from the comfort of her own home. These virtual trips have been a refreshing escape for some during the recent pandemic, when travel and contact with the outside world has been scarce.
Microsoft is one company that offers this technology. Streetside provides users a street-level view of various locations. Plaintiff Kewazinga asserts that Streetside infringes on its patents for navigable, telepresence technology. Before the Court are the parties’ motions for summary judgment. For the reasons set forth below, Kewazinga's motion is granted in part and denied in part, Microsoft's cross-motion for summary judgment is denied, and Microsoft's motion for summary judgment is granted in part and denied in part.
The Court has issued its opinion on the parties’ respective motions to exclude testimony from the other's experts. Portions of that opinion are relevant to this decision.
The parties have submitted comprehensive statements of fact in support of their motions for summary judgment, pursuant to Fed. R. Civ. P. 56.1. Dkt. Nos. 195, 200, 234-35, 251, 277-78. The statements of fact, though presented in several different documents, are consecutively numbered. Therefore, the Court will refer to documents together as the Statement of Facts ("SOF"). Unless otherwise stated, the facts below are undisputed.
The three patents at issue in this action are (1) the February 18, 2003 patent numbered 6,522,325 (the "’325 Patent"); (2) the March 18, 2003 patent numbered 6,535,226 (the "’226 Patent"); and (3) the June 9, 2015 patent numbered 9,055,234 (the "’234 Patent," and collectively, the "Asserted Patents"). The ’325 and ’226 Patents are both titled "Navigable Telepresence Method and System Utilizing an Array of Cameras." The ’234 Patent is titled "Navigable Telepresence Method and System." The patents teach telepresence systems, devices, and methods that enable one or more users to navigate imagery through a remote environment.
Defendant Microsoft Corporation ("Microsoft") offers navigable street-level imagery through its "Streetside" functionality, which is currently available through Microsoft's Bing Maps and was previously available through Microsoft's Bing Maps Preview App and Maps App. Microsoft has been providing the accused Streetside functionality to the public since December 2009. On December 5, 2013, Microsoft released a version of the Bing Maps Preview App, which allowed users who were running the Windows 8.1 operating system to view Streetside imagery. This app worked only for users who were running the Windows 8.1 operating system and is one of the instrumentalities accused of infringement in this lawsuit. In 2015, Microsoft released the Maps App, which allowed users who were running the Windows 10 operating system to view Streetside imagery. The Maps App was shipped on devices that had that operating system. The Maps App is also accused of infringement in this lawsuit. Microsoft released the current version of its Bing Maps website (also called "V8") in 2015, the third and final product accused of infringement in this lawsuit. Prior to the release of the current version of the Bing Maps website, a user of the previous Bing Maps website who wished to use Streetside features was required to download plugin software known as Silverlight to her computer. The current Bing Maps website version does not use Silverlight, and users of the current website are not required to download the Silverlight plugin to access Streetside functionality.
SOF ¶¶ 658-59.
SOF ¶ 660.
SOF ¶ 662.
SOF ¶ 664-65.
SOF ¶ 666.
SOF ¶ 668.
The parties’ history is long, spanning well over a decade. Kewazinga asserts that over the course of about six months in 2006, Kewazinga communicated with several senior Microsoft employees, providing significant confidential business ideas and notice of its patents, including the ’325 and ’226 patents at issue in this suit.
In December 2009, Microsoft launched the Silverlight website (the first accused Streetside website). On June 27, 2013, Kewazinga filed a complaint against Microsoft in the District of Delaware (the "2013 Lawsuit"), asserting that that "Streetside and Bing Maps with Streetside" infringed the ’226 and ’325 patents. At that point, Microsoft had been providing the accused Streetside functionality to the public for approximately three years and seven months, since December 2009. On August 22, 2013, representatives of Microsoft and Kewazinga met in Redmond, Washington to discuss Kewazinga's allegations. During that meeting, Kewazinga asserted that Streetside infringed the ’226 and ’325 patents, which Microsoft denied, arguing that Streetside did not use an "array of cameras" to capture images and identified prior art to the patents. Following that meeting, Kewazinga's and Microsoft's respective attorneys had a phone call regarding Kewazinga's allegations, during which Microsoft reiterated its position that it did not infringe the ’226 and ’325 patents because it did not use an "array of cameras" to capture images. On October 21, 2013, Kewazinga voluntarily dismissed the 2013 Lawsuit without prejudice, without having ever served the 2013 complaint on Microsoft or alerting Microsoft that it would be dismissing the complaint. Kewazinga claims that it opted to dismiss the 2013 Lawsuit because it did not have enough funds to pursue its case against Microsoft. Microsoft and Kewazinga did not communicate until this suit was filed; specifically, Kewazinga did not inform Microsoft of its reasons for dismissing the case or its intention to later continue its pursuit against Microsoft for infringement.
SOF ¶ 602.
SOF ¶ 604
SOF ¶ 669.
SOF ¶ 605.
SOF ¶¶ 606-607.
SOF ¶ 608.
SOF ¶¶ 609-611.
SOF ¶ 613.
SOF ¶¶ 614-618.
On May 14, 2013, Kewazinga initiated a lawsuit against Google, Inc., asserting that Google infringed the ’226 and ’325 patents by providing street-level imagery through its Street View function. Google moved to dismiss the complaint against it. Kewazinga filed a response and a non-opposition, noting that the parties were engaged in settlement discussions and that it did not oppose dismissal of the action without prejudice. Accordingly, the complaint was dismissed without prejudice on November 14, 2013.
SOF ¶ 619.
SOF ¶ 620.
Id.
Id.
According to Microsoft, based on those events, it assumed that Kewazinga was no longer interested in asserting that Microsoft infringed the ’226 and ’325 patents. Ms. Quan, Microsoft's former in-house counsel, further asserted that she believed that Kewazinga was no longer interested in asserting its ’226 and ’325 patents against companies that used moving cameras to capture street-level imagery, a belief that was reinforced by the dismissal of Kewazinga's separate suit against Google. Ms. Quan further asserted that Microsoft thereafter disengaged the defense counsel it had retained to work on the Kewazinga dispute or patents, and released its document preservation holds. Microsoft did not seek a declaratory judgment against Kewazinga.
SOF ¶ 621; Dkt. No. 230, (Quan Decl.) ¶ 8.
SOF ¶ 622; Quan Decl. ¶ 9.
SOF ¶¶ 624, 627-628; Quan Decl. ¶ 11.
SOF ¶¶ 625-626; Quan Decl. ¶ 11.
Kewazinga commenced this action against Microsoft on May 21, 2018. Compl., Dkt No. 1. Kewazinga has accused the Bing Maps Preview App, the Maps App, and the current version of the Bing Maps website of infringement of its patents. Plaintiff asserts that Microsoft has infringed, and continues to infringe, the ’226, ’325, and ’234 patents. On July 30, 2018, Microsoft answered the complaint and brought six counterclaims against Kewazinga, seeking declaratory judgments of invalidity and non-infringement for each of the three patents. Dkt. No. 15. On July 18, 2019, the Court held a Markman hearing, and on July 29, 2019, issued its claim construction order. Dkt. No. 53. On July 17, 2020, the parties each moved for summary judgment. Dkt. Nos. 187, 190. On August 20, 2020, the parties opposed the motions for summary judgment and Microsoft additionally cross-moved for summary judgment. Dkt. Nos. 226, 228, 246. On September 3 and 4, 2020, the parties replied. Dkt. Nos. 265, 290. Plaintiff filed its sur-reply on October 2, 2020, and Defendant filed its sur-sur-reply on October 9, 2020. Dkt. Nos. 309, 315.
II. LEGAL STANDARD
Under Federal Rule of Civil Procedure 56, the Court "shall grant summary judgment if the movant shows that there is no genuine dispute as to any material fact and the movant is entitled to judgment as a matter of law." The moving party must show that "under the governing law, there can be but one reasonable conclusion as to the verdict." The moving party bears the initial burden of establishing that there are no material facts in dispute and must provide "affirmative evidence" from which a factfinder could return a verdict in its favor. Then "the burden shifts to the nonmovant to point to record evidence creating a genuine issue of material fact." The "trial court's task at the summary judgment motion stage of the litigation is carefully limited to discerning whether there are any genuine issues of material fact to be tried, not deciding them. Its duty, in short, is confined at this point to issue-finding; it does not extend to issue-resolution." In determining whether summary judgment is appropriate, the Court must resolve all ambiguities and draw all reasonable inferences in the light most favorable to the non-moving party. Summary judgment is improper if "there is any evidence in the record from any source from which a reasonable inference could be drawn in favor of the nonmoving party ...." To create a disputed fact sufficient to deny summary judgment, the non-moving party must produce evidence in the record and "may not rely simply on conclusory statements or on contentions that the affidavits supporting the motion are not credible ...." Instead, the response "must set forth specific facts demonstrating that there is a genuine issue for trial."
Fed. R. Civ. P. 56(a) ; see Celotex Corp. v. Catrett , 477 U.S. 317, 322-23, 106 S.Ct. 2548, 91 L.Ed.2d 265 (1986).
Anderson v. Liberty Lobby, Inc., 477 U.S. 242, 250, 106 S.Ct. 2505, 91 L.Ed.2d 202 (1986).
Id. at 257, 106 S.Ct. 2505.
Salahuddin v. Goord , 467 F.3d 263, 273 (2d Cir. 2006).
Gallo v. Prudential Residential Servs. , L.P. , 22 F.3d 1219, 1224 (2d Cir. 1994).
See Scott v. Harris , 550 U.S. 372, 378, 127 S.Ct. 1769, 167 L.Ed.2d 686 (2007).
Chambers v. TRM Copy Ctrs. Corp. , 43 F.3d 29, 37 (2d Cir. 1994).
Ying Jing Gan v. City of New York , 996 F.2d 522, 532 (2d Cir. 1993).
Wright v. Goord , 554 F.3d 255, 266 (2d Cir. 2009) (citation and internal quotation marks omitted).
"The court applies the same summary judgment standards to patent infringement matters as it does to motions involving other types of claims." While patent infringement is generally a question of fact, a court may grant summary judgment if it concludes that no reasonable jury could find infringement.
Mich & Mich. TGR, Inc. v. Brazabra, Corp. , 128 F. Supp. 3d 621, 629 (E.D.N.Y. 2015) (collecting cases).
See Biogen Int'l GmbH v. Banner Life Scis. LLC , 956 F.3d 1351, 1355 (Fed. Cir. 2020)
See Warner–Jenkinson Co. v. Hilton Davis Chem. Co. , 520 U.S. 17, 39 n.8, 117 S.Ct. 1040, 137 L.Ed.2d 146 (1997) ; accord Ave. Innovations, Inc. v. E. Mishan & Sons Inc. , 16 Civ. 3086, 2019 WL 4857468, at *6 (S.D.N.Y. Oct. 2, 2019).
III. Discussion
A. Plaintiff's Motion for Summary Judgment and Defendant's Cross-Motion for Summary Judgment
1. Tweening
First, Kewazinga asserts that it is entitled to partial summary judgment that the accused instrumentalities satisfy the "tweening limitations" as construed by the Court. In its claim construction opinion, the Court construed "tweening" as "generating synthetic imagery from acquired imagery, and utilizing that synthetic imagery between the acquired imagery, in order to show movement and transition between the acquired imagery."
SOF ¶ 1.
Kewazinga's motion for partial summary judgment on this issue is based on its motion to exclude the opinions of Microsoft's technical expert, Dr. Forsyth. Kewazinga asserts that Dr. Forsyth improperly narrowed the Court's construction of tweening by requiring that tweening "(i) depict viewpoints in-between the real camera viewpoints, (ii) generate synthetic imagery that realistically depict the environment from those viewpoints, and (iii) perform ‘warping’ " which was not required by the Court's construction, and for those reasons, his opinions cannot create a genuine issue of material fact. Kewazinga asserts that without Dr. Forsyth's opinions, there is no factual dispute that the Windows Maps App and Silverlight client "tween" during the bubble-to-bubble transitions. Notably, the only tweening process disclosed by Kewazinga's infringement contentions is one that required "warping" imagery.
Opening Mot. at 4.
For the reasons explained in the Court's opinion on the parties’ respective Daubert motions, Kewazinga's motion to exclude Dr. Forsyth's opinions on tweening are granted in part and denied in part. And while the Court excluded Dr. Forsyth's opinions on the first two issues described above, the Court denied Kewazinga's motion to exclude Dr. Forsyth's opinions as to whether the Silverlight client and the Windows Maps App satisfied the tweening limitations because they do not perform a warping process. As the Court explained in its Daubert opinion, although the Court's construction of tweening did not require warping, warping does appear in the specification in the ’325 Patent as a part of the tweening process. Thus, Dr. Forsyth's opinions were not inconsistent with the Court's construction, as Kewazinga frames it.
See Claim Constr. Op. at 26; ’325 Patent, 14:18-20.
Because Dr. Forsyth's opinions are admissible, there is a disputed issue of material fact as to whether the instrumentalities meet the tweening limitations disclosed by Kewazinga. Accordingly, Kewazinga's motion for partial summary judgment on whether the accused instrumentalities satisfy the tweening limitations is denied.
2. Mosaicing
Next, Kewazinga moves for summary judgment as to whether the accused instrumentalities satisfy the mosaicing limitations as construed by the Court. Here too, Kewazinga argues that Dr. Forsyth did not properly apply Court's construction of the term mosaicing. Microsoft likewise moved for summary judgment, asserting that Kewazinga has failed to produce evidence that Microsoft infringed the asserted claims requiring mosaicing. However, for the reasons explained in the Court's Daubert opinion, the parties are permitted to submit supplemental briefing on the composition process that occurs during the mosaicing. Accordingly, the Court cannot determine at this time that there is no genuine dispute of material fact as to whether the accused instrumentalities satisfy the mosaicing limitations and will reserve judgment on this issue.
3. Seamless View
Kewazinga further argues that it is entitled to summary judgment on whether the accused instrumentalities satisfy claim language reciting a seamless view and judgment on Microsoft's invalidity defense as to claims reciting a seamless view.
By way of background, during the claim construction process, Microsoft proposed that "mosaicing" be construed as resulting in a seamless image. The Court, after reviewing the intrinsic and extrinsic evidence, declined to impose an outcome-based requirement, and concluded that mosaicing need not be seamless. In doing so, the Court noted that while there are multiple references to seamlessness in the intrinsic evidence, Microsoft's proposal of a perfect seamlessness requirement "cut too broadly." Kewazinga's present request is related to those references. Certain of the claims in the ’325 patent include references to a display of the images so obtain or provide the user with a "seamless view through the environment." Dr. Forsyth has opined that the accused instrumentalities do not provide a "seamless view" because certain redundancies and gaps are displayed. Dr. Forsyth contends those redundancies and gaps were intentional, and the software aimed to "not to create a seamless view so that the user is provided a cue that the view is changing to a new location."
’325 Patent, Claims 5, 6, 14, 15; see also SOF ¶¶ 72-75.
Forsyth Rebuttal ¶ 355, 384; SOF ¶ 334.
Now, Kewazinga asserts that it is entitled to summary judgment because in rendering his infringement and invalidity opinions, Dr. Forsyth relied on two different definitions for what constitutes a "seamless view." At the outset, the parties have not requested that the Court construe the term "seamless view." Kewazinga relies on its motion to exclude Dr. Forsyth's allegedly inconsistent testimony as the basis for its summary judgment application. For the reasons explained in the Court's Daubert opinion, the Court did not agree that there were inconsistencies in Dr. Forsyth's opinions regarding what constitutes a seamless view and denied Kewazinga's motion to exclude those opinions. Indeed, any inconsistencies would not be adequate grounds for the exclusion of his testimony. The Second Circuit has instructed that "gaps or inconsistencies in the reasoning leading to [the expert's] opinion ... go to the weight of the evidence, not to its admissibility." Accordingly, because Kewazinga's motion to exclude Dr. Forsyth's opinions regarding a "seamless view" was denied, there is admissible evidence that raises a genuine issue material fact as to whether the "seamless view" claims have been violated. Kewazinga's motion for summary judgment on this issue is denied.
Restivo v. Hessemann , 846 F.3d 547, 577 (2d Cir. 2017) (citing Campbell ex rel. Campbell v. Metro. Prop. & Cas. Ins. Co. , 239 F.3d 179, 186 (2d Cir. 2001) ).
4. Standing
Kewazinga moves for partial summary judgment, seeking a ruling that it has standing, and Microsoft cross-moves for summary judgment that Kewazinga does not have standing. Microsoft's challenge to Kewazinga's standing is based on an argument that a non-party, Sarnoff, is a co-owner of the patents-in-suit with licensing rights. For the following reasons, Kewazinga's motion is granted and Microsoft's motion is denied.
Before a court may exercise jurisdiction over a patent infringement action, it must be satisfied that, "in addition to Article III standing, the plaintiff also possesse[s] standing as defined by § 281 of the Patent Act." Under § 281, "[a] patentee shall have remedy by civil action for infringement of his patent." A "patentee" is not limited to the person to whom the patent issued, but also includes "successors in title to the patentee." A party may become the successor in title to the original patentee by assignment, and then may sue for infringement in its own name.
Alps S., LLC v. Ohio Willow Wood Co. , 787 F.3d 1379, 1382 (Fed. Cir. 2015).
35 U.S.C. § 281 (2012) (emphasis added).
35 U.S.C. § 100(d) (2012) (emphasis added); see also H.R. Techs., Inc. v. Astechnologies, Inc., 275 F.3d 1378, 1384 (Fed. Cir. 2002) ("In order to have standing, the plaintiff in an action for patent infringement must be a ‘patentee’ pursuant to 35 U.S.C. §§ 100(d) and 281 ....").
35 U.S.C. § 261 at ¶ 2 ("[P]atents, or any interest therein, shall be assignable in law by an instrument in writing."),
Propat Int'l Corp. v. RPost, Inc. , 473 F.3d 1187, 1189 (Fed. Cir. 2007)
As the Federal Circuit has explained:
[w]here one co-owner possesses an undivided part of the entire patent, that joint owner must join all the other co-owners to establish standing. IBEP v. Amgen, Inc., 401 F.3d 1299, 1305 (Fed. Cir. 2005) (citing Prima Tek, II LLC v. A-Roo Co., 222 F.3d 1372, 1377 (Fed. Cir. 2000) ). With certain exceptions ... one co-owner has the right to limit the other co-owner's ability to sue infringers by refusing to join voluntarily in the patent infringement suit. Ethicon, 135 F.3d at 1468 (holding "as a matter of substantive patent law, all co-owners must ordinarily consent to join as plaintiffs in an infringement suit"); see also Schering Corp. v. Roussel–UCLAF SA, 104 F.3d 341, 345 (Fed. Cir. 1997) ("One co-owner has the right to impede the other co-owner's ability to sue infringers by refusing to voluntarily join in such a suit."). Absent the voluntary joinder of all co-owners of a patent, a co-owner acting alone will lack standing. Prima Tek II, 222 F.3d at 1377 (recognizing that the general rule that "a patentee should be joined, either voluntarily or involuntarily, in any infringement suit
brought by an exclusive licensee" was "prudential rather than constitutional in nature.").
Israel Bio-Engr. Project v. Amgen, Inc. , 475 F.3d 1256, 1264–65 (Fed. Cir. 2007) ; see also Adv. Video Techs. LLC v. HTC Corp. , 879 F.3d 1314, 1319 (Fed. Cir. 2018) (holding that the plaintiff did not have standing because it did not have full ownership of the patent-in-suit, and the co-owner of the patent was neither a party to the suit nor consented to the suit).
Here, the named inventors of the patents assigned the patents directly to Kewazinga. Kewazinga subsequently entered into development contracts with non-party Sarnoff which granted Kewazinga and Sarnoff joint ownership over certain intellectual property interests. The question raised here is whether the patents-in-suit fall within the scope of these development contracts; Microsoft argues that they do and that therefore, a reasonable jury could only conclude that each patent-in-suit is co-owned by Sarnoff. In response, Kewazinga argues that the inventions in the patents-in-suit were invented prior to Kewazinga and Sarnoff entering into the development contracts; and that even if the inventions were invented after that time, ownership rights under the contracts are premised on inventorship.
SOF ¶¶ 95-96, 101-102, 105-106.
SOF ¶ 112-16
Israel Bio-Engr. Project v. Amgen, Inc. , 475 F.3d 1256, 1268 (Fed. Cir. 2007) ("Without a complete ownership interest or the voluntary joinder of [the non-party co-owner], [the plaintiff] lacks standing to sue for infringement.").
At base, this issue is one of pure contract interpretation, and Microsoft's argument is contradicted by the plain language of the agreements. The operative language is the contracts’ variations of the following terms: "Sarnoff and Kewazinga will jointly own all other intellectual property invented [either by Sarnoff employees or] jointly by Sarnoff and Kewazinga employees under this Agreement, ‘Foreground Intellectual Property’ or ‘FIP’." Kewazinga focuses on the fact that joint ownership appears to be limited to inventions that were jointly invented (where the asserted patents do not list Sarnoff inventors), and Microsoft's reading focuses on the fact that joint ownership is conferred for inventions under the Agreement. As seen from the plain text of the agreement, ownership of the patents is clearly premised on inventorship. And here, the parties do not dispute that inventorship of the patents-in-suit lies exclusively with Kewazinga. Accordingly, Kewazinga is entitled to summary judgment on the issue of standing, and Microsoft's cross-motion is denied.
See Dkt. No. 213 at 24.
5. Written Description Defense
Kewazinga seeks summary judgment on Microsoft's written description defense. Under the Patent Act, the written description of a patent must be definite enough "so that the public will know what it is and that he or she has truly made the claimed invention." To satisfy the written description requirement, the specification "must clearly allow persons of ordinary skill in the art to recognize that the inventor invented what is claimed." "Written description is a question of fact[.]" As the party challenging validity, Microsoft has the burden to prove by clear and convincing evidence that the written description requirement was not met.
Abbvie Deutschland GmbH & Co. v. Janssen Biotech, Inc. , 759 F.3d 1285, 1298 (Fed. Cir. 2014) (citation omitted).
In re Oxycontin Antitrust Litig., 994 F. Supp. 2d 367, 382 (S.D.N.Y. 2014) (quoting Ariad Pharms., Inc. v. Eli Lilly & Co. , 598 F.3d 1336, 1351 (Fed. Cir. 2010) (en banc)).
WBIP, LLC v. Kohler Co. , 829 F.3d 1317, 1337 (Fed. Cir. 2016) (citing Ariad Pharms. , 598 F.3d at 1351, 1355 ).
Id. at 1338 (citing Abbott Labs. v. Syntron Bioresearch, Inc. , 334 F.3d 1343, 1356 (Fed. Cir. 2003) ).
a) Mosaicing
First, Kewazinga seeks judgment on Microsoft's claim that the Mosaicing Claims lack adequate written description because the ’325 and ’234 patent disclosures do not describe specific details of "merging" such that a person of ordinary skill in the art (a "POSITA") would understand it could be employed in mosaicing. Kewazinga asserts that it had no obligation to do so, and that there is no dispute that a POSITA would have understood that the patents expressly refer and incorporate references that teach merging. The ’234 and ’325 Patents incorporate the Burt Patent, which teaches a "system for automatically generating a mosaic" by reference. In its claim construction opinion, the Court explained that after incorporating the Burt Patent, the patents describe mosaicing as using a selection process and a combination process, applying "various output processing techniques, such as merging, fusing, filtering, output enhancement, and the like, to achieve a seamless combination of the outputs."
As stated above, a written description argument is an intensely factual question. Here, that question is whether a POSITA would understand that the October 1999 application shows that the applicants invented what is claimed. For the reasons stated in the Court's Daubert motion, the Court declined to exclude certain of Dr. Forsyth's opinions regarding the written description requirement, concluding that Kewazinga could challenge Dr. Forsyth's testimony at trial. Thus, Microsoft has presented admissible evidence as to this issue. In contrast, Kewazinga has not made the "point so strongly and overwhelmingly in favor of [it]" that a reasonable jury could not have reached the opposite conclusion, warranting summary judgment. Thus, Kewazinga's motion for summary judgment as to this issue is denied.
Id. at 1339 (citing Marine Polymer Techs., Inc. v. HemCon, Inc. , 672 F.3d 1350, 1357–58 (Fed. Cir. 2012) ).
b) Tweening
Second, Kewazinga seeks judgment on Microsoft's asserted defense that the patents are invalid because they do not provide an adequate written description for "tweening" without using "local scene characteristics."
Some background information is necessary to evaluate that request. The term "tweening" appears in the claims of the ’325 and the ’234 Patents. Neither patent articulates a system or process for "tweening" within the body of the patents, but they do incorporate by reference another patent, U.S. Patent No. 5,529,040 (the "Hanna Patent") as an example of a tweening methodology. Claim 7 of the ’234 patent discloses a method of tweening that uses local scene characteristics of the environment. During the claim construction process, Microsoft's proposed requirement that "local scene characteristics" be utilized in the "tweening" process, which the Court rejected based on the intrinsic evidence described above.
’234 Patent 17:64-18:2; ’325 Patent 13:50-56.
Microsoft's defense is based on the premise that "local scene characteristics" include "information about the environment" which in turn, encompasses "techniques that depend on scene imagery and light measurements taken at the individual pixels of a scene's imagery." Kewazinga asserts that Microsoft's only evidence in support of its argument that the patents do not provide a written description for tweening is Dr. Forsyth's testimony, which should be excluded because he failed to apply the Court's construction of "local scene characteristics."
Microsoft's Opp. at 48.
For the reasons explained in the Court's Daubert opinion, the Court excluded Dr. Forsyth's opinions regarding the relationship between "local scene characteristics" and "information about the environment." Accordingly, the Court granted Kewazinga's motion to exclude Dr. Forsyth's opinions regarding the written description requirement of tweening. While a written description defense presents a question of fact, Microsoft, who bears the burden of establishing by clear and convincing evidence that the written description requirement was not satisfied, has provided no evidence other than Dr. Forsyth's excluded opinions to support its position. Because Microsoft has failed to present competent evidence to support its position and no genuine dispute of material fact otherwise exists, Kewazinga is entitled to summary judgment as to this defense.
See Intirtool, Ltd. v. Texar Corp. , 369 F.3d 1289, 1294 (Fed. Cir. 2004) ("A party alleging that a patent is invalid for failure to comply with the written description requirement has the burden of establishing by clear and convincing evidence that the requirement was not met, in light of the presumption of validity.")
6. Equitable Estoppel
For the following reasons, Kewazinga's motion and Microsoft's cross-motion for summary judgment on Microsoft's equitable estoppel defense are denied. Kewazinga argues that it is entitled to summary judgment because Microsoft cannot establish its equitable estoppel defense. In response, Microsoft has cross-moved for summary judgment that Kewazinga's assertions of the ’226 and ’325 patents are foreclosed due to equitable estoppel. Microsoft does not assert that the ’234 patent is unenforceable due to equitable estoppel.
SOF ¶ 146.
An equitable estoppel defense "serves as an absolute bar to a patentee's infringement action." Three elements are required to prevail on an equitable estoppel defense:
John Bean Techs. Corp. v. Morris & Assocs., Inc. , 887 F.3d 1322, 1327 (Fed. Cir. 2018) (citing A.C. Aukerman Co. v. R.L. Chaides Constr. Co. , 960 F.2d 1020, 1041 (Fed. Cir. 1992) (en banc), abrogated on other grounds by SCA Hygiene Prods. Aktiebolag v. First Quality Baby Prods., LLC , ––– U.S. ––––, 137 S. Ct. 954, 197 L.Ed.2d 292 (2017) ).
(1) the patentee engages in misleading conduct that leads the accused infringer to reasonably infer that the patentee does not intend to assert its patent against the accused infringer; (2) the accused infringer relies on that conduct; and (3) as a result of that reliance, the accused infringer would be materially prejudiced if the patentee is allowed to proceed with its infringement action.
Id. (citing Scholle Corp. v. Blackhawk Molding Co. , 133 F.3d 1469, 1471 (Fed. Cir. 1998) ).
"Misleading conduct may include the patentee's ‘specific statements, action, inaction, or silence where there was an obligation to speak.’ " "[S]ilence alone will not create an estoppel unless there was a clear duty to speak, or somehow the patentee's continued silence reenforces the defendant's inference from the plaintiff's known acquiescence that the defendant will be unmolested. Finally, on summary judgment, such inference must be the only possible inference from the evidence." Inversely, the party seeking to bar the defense on summary judgment must demonstrate that no reasonable factfinder could find for the non-movant. "In the ‘most common situation’ giving rise to equitable estoppel, ‘the patentee specifically objects to the activities currently asserted as infringement in the suit and then does not follow up for years.’ " " ‘[T]he trial court must, even where the three elements of equitable estoppel are established, take into consideration any other evidence and facts respecting the equities of the parties in exercising its discretion and deciding whether to allow the defense of equitable estoppel to bar the suit.’ Indeed, ‘equitable estoppel is not limited to a particular factual situation nor subject to resolution by simple or hard and fast rules.’ " Id. at 857 (quoting Aukerman , 960 F.2d at 1041, 1043 ).
Id. (quoting Scholle , 133 F.3d at 1471 ).
A.C. Aukerman Co. v. R.L. Chaides Const. Co. , 960 F.2d 1020, 1043–44 (Fed. Cir. 1992) (emphasis in original).
Compare id. with Ferring B.V. v. Allergan, Inc. , 980 F.3d 841, 856 (Fed. Cir. 2020) (vacating summary judgment of equitable estoppel because "the district court's interpretation of the [evidence] is not the only reasonable one" and a "reasonable factfinder could conclude" differently); see also Kewazinga Corp. v. Google LLC , No. 20 CIV. 1106 (LGS), 2021 WL 466877, at *6 (S.D.N.Y. Feb. 9, 2021) (granting the plaintiff's motion for summary judgment on an equitable estoppel defense, reasoning that because "no reasonable finder of fact could conclude that Plaintiff engaged in misleading conduct.").
Ferring , 980 F.3d at 853 (citing Aukerman , 960 F.2d at 1042 ).
The first element of the equitable estoppel defense is that "patentee engage[d] in misleading conduct that [led] the accused infringer to reasonably infer that the patentee does not intend to assert its patent against the accused infringer." Such conduct "may include the patentee's specific statements, action, inaction, or silence where there was an obligation to speak" or "somehow the patentee's continued silence reenforces the defendant's inference from the plaintiff's known acquiescence that the defendant will be unmolested." "If the record indicates silence alone, mere silence must be accompanied by some other factor which indicates that the silence was sufficiently misleading as to amount to bad faith."
John Bean Techs. Corp. , 887 F.3d at 1327 ; accord Rsch. Frontiers Inc. v. Prelco Inc. , No. 18 Civ. 2939, 2020 WL 6746730, at *5 (E.D.N.Y. Nov. 17, 2020).
Id.
Aukerman , 960 F.2d at 1043–44.
High Point SARL v. Sprint Nextel Corp. , 817 F.3d 1325, 1330-31 (Fed. Cir. 2016) (internal citation and quotation marks omitted).
Kewazinga argues that its conduct was not misleading because it never represented a belief that Microsoft did not infringe on its patents, nor represented that it acquiesced in Microsoft's infringement. However, a reasonable finder of fact could find for Microsoft as to this element. The evidence in the record demonstrates that Kewazinga met with the alleged infringer, understood that Microsoft was firmly rooted in its position that Streetside was not infringing, and still chose to dismiss the suit—likely knowing that without the threat of litigation, Microsoft would not modify its behavior. Therefore, a reasonable finder of fact could find that Kewazinga's voluntary dismissal of the 2013 lawsuit and the silence that followed reenforced a belief by Microsoft that it had successfully persuaded Kewazinga to abandon its claims.
In contrast, to prevail on its cross-motion, Microsoft must demonstrate that "any inference that a patentee made a misleading communication by omission or acquiescence ‘must be the only possible inference from the evidence.’ " As explained above, a reasonable finder of fact could determine that Microsoft's asserted interpretation of Kewazinga's actions was reasonable, it is not the "only possible inference" from the evidence. Microsoft asserts that Kewazinga should have informed it that it would pursue its infringement claims in the future or provided it with the reasons for its dismissal, given that the parties had an open line of communication. But Microsoft has not established that such a duty to speak existed, or that "some other factor which indicates that the silence was sufficiently misleading as to amount to bad faith." High Point SARL , 817 F.3d at 1330 (internal citation and emphasis omitted). Indeed, the parties’ Statements of Fact and the record demonstrate that Kewazinga's communications with Microsoft after the August 2013 meeting were consistent with Kewazinga's initial position that Microsoft had infringed on its patents. Furthermore, Kewazinga unequivocally dismissed its claims without prejudice. Therefore, another reasonable inference could be drawn from the evidence, namely that Kewazinga was temporarily shelving its infringement suit against Microsoft. Accordingly, Microsoft has also failed to demonstrate that it is entitled to summary judgment as to this element.
Ferring , 980 F.3d at 853 (quoting SCA Hygiene Prods. , 767 F.3d at 1350 ).
Because equitable estoppel requires a showing of all three elements, and Microsoft has failed to demonstrate that its version of events is the only possible inference to be drawn from the evidence as to the first element—that is, that Kewazinga engaged in misleading conduct that led it to reasonably infer that Kewazinga did not intend to assert its patents against Microsoft—the Court's need not reach Microsoft's reliance and prejudice arguments. In contrast, Kewazinga must show that a reasonable jury could not find for Microsoft on any one of the elements.
The Court now turns to the second element of equitable estoppel. Kewazinga must demonstrate that "must show that, in fact, it substantially relied on the misleading conduct of the patentee in connection with taking some action." "To show reliance, the infringer must have had a relationship or communication with the plaintiff which lulls the infringer into a sense of security in going ahead with [its investments]." In other words, Microsoft must show that it substantially relied on the misleading conduct of Kewazinga in taking some action. "[T]o show reliance on [the patentee's] silence and inaction, [the alleged infringer] need not prove precisely what alternative paths it would have taken, or that every ... decision was based on reliance on [the patentee's] silence."
Aukerman , 960 F.2d at 1042–43.
Gasser Chair Co. v. Infanti Chair Mfg. Corp. , 60 F.3d 770, 776 (Fed. Cir. 1995).
Aspex Eyewear Inc. v. Clariti Eyewear, Inc. , 605 F.3d 1305, 1312 (Fed. Cir. 2010)
A reasonable finder of fact could determine that based on those communications and Kewazinga's subsequent abandonment of its suit, Microsoft was lulled into continuing its work on Streetside. Microsoft and Kewazinga were in communication prior to the filing of the 2013 Lawsuit and again prior to Kewazinga's voluntary dismissal of the 2013 Lawsuit. Throughout those communications, Microsoft maintained that Streetside did not infringe Kewazinga's patents. Microsoft asserts that in reliance on Kewazinga's dismissal of the 2013 Lawsuit, it disengaged its outside counsel from working on the Kewazinga dispute or patents and released its document preservation holds. Microsoft further asserts that its decision to not pursue a declaratory judgment action against Kewazinga was prompted by Kewazinga's dismissal.
SOF ¶ 624, 627-28; Quan Decl. ¶ 11-12; Gogerty Decl. ¶ 2.
SOF ¶ 625; Quan Decl. ¶ 11.
Microsoft's failure to maintain its armor against a lawsuit by Kewazinga for patent infringement—and now must defend against—is evidence of its reliance. The facts here are substantially similar to those in Wafer Shave, Inc. v. Gillette Co. , 857 F. Supp. 112, 124 (D. Mass. 1993), aff'd, 26 F.3d 140 (Fed. Cir. 1994). In that case, the district court found that "a reasonable factfinder could only infer that [the defendant] actually relied on plaintiff's misleading conduct" because "the fact that Gillette failed to take affirmative actions to protect itself from a lawsuit seeking many millions of dollars in damages, such as the one it is facing now, is evidence of its reliance. After Mrs. Jennings failed to respond to the suggestion of a non-exclusive license, Gillette dismantled its legal efforts concerning the Jennings patent. It also did not try to mitigate possible damages by effecting a quick settlement or initiating a declaratory judgment action." Id. The court also found persuasive the fact that defendant no longer considered the infringement claim active and therefore "did not preserve documentary or testimonial evidence necessary for litigation of the infringement claim ... believing that it would never have to litigate a claim that it had infringed the Jennings patent."). Here too, based on similar actions by Microsoft, a reasonable fact finder could infer that Microsoft relied Kewazinga's actions when opting to desert its defense efforts. Thus, Kewazinga has failed to demonstrate that it is entitled to summary judgment based on the second element.
Id.
Turning finally to the third element, Microsoft will be required to show that "[d]ue to its reliance, the alleged infringer will be materially prejudiced if the patentee is allowed to proceed with its claim." "Such prejudice may be economic or evidentiary." In Aukerman, the court stated that:
Aukerman , 960 F.2d at 1028.
Id. at 1033.
Evidentiary, or "defense" prejudice, may arise by reason of a defendant's inability to present a full and fair defense on the merits due to the loss of records, the death of a witness, or the unreliability of memories of long past events, thereby undermining the court's ability to judge the facts.
Id.
Here, a reasonable factfinder could find that Microsoft suffered material evidentiary prejudice. If Microsoft had known that Kewazinga intended to pursue its infringement claims after dismissing the 2013 Lawsuit, it could have taken steps to preserve documentary evidence and the testimony of important witnesses who died during the time frame after Kewazinga's dismissal of the 2013 Lawsuit and before the filing of this action (the "delay period").
For example, Microsoft was unable to preserve the testimony of Andrew Weber, a named inventor on the ’226 and ’325 patents, and a co-founder, vice chairman, and a director of technologies of Kewazinga. Mr. Weber died on October 10, 2014 during the delay period. Scott Sorokin, one of the remaining inventors admitted to having a poor memory and testified that Mr. Weber by comparison, "had a brilliant mind around names and recollections." The parties do not dispute that Mr. Weber sent emails regarding Kewazinga business from his personal account, nor that Kewazinga does not have access to the Kewazinga business emails sent from that account. David Worley, the other remaining inventor, testified that it was "unlikely" that Mr. Weber might have sent an email that he didn't forward to or copy on others at Kewazinga; he did not say that such a scenario was impossible, only that Kewazinga "certainly ha[s] access to everything [Mr. Weber] would have forwarded or copied others on."
SOF ¶ 630-31.
SOF ¶ 629.
SOF ¶ 638.
SOF ¶ 637.
SOF ¶ 632-33.
Dkt. No. 233-5 (Worley Google Tr.) at 95:6-19.
And, as described above, Microsoft no longer has certain documentary evidence because it lifted the litigation hold put in place for the 2013 Lawsuit. In removing the hold, certain emails of engineers who worked on Streetside were released and deleted. Kewazinga later sought documents from those very individuals in the discovery phase of this case. Microsoft's internal legal team has testified that but for the dismissal of the 2013 Lawsuit and lack of subsequent communication, Microsoft would have continued to retain its outside counsel assigned to the Kewazinga litigation and patents, considered filing a declaratory judgment action as it has done in other infringement actions, and continued to implement its document preservation hold. Instead, Microsoft was unable to preserve relevant testimony and documents and a reasonable factfinder could find that Microsoft suffered prejudice due to its "lost opportunity to take these actions." Because Kewazinga has failed to demonstrate that no reasonable factfinder could find for Microsoft on any of the elements required for equitable estoppel, the Court will not bar Microsoft from presenting its defense at trial.
Dkt. No. 229 (Gogerty Decl.) ¶¶ 1-3.
Dkt. No. 233-11.
Quan Decl. ¶¶ 11-12.
See Wafer Shave, Inc. v. Gillette Co. , 857 F. Supp. 112, 126 (D. Mass. 1993), aff'd , 26 F.3d 140 (Fed. Cir. 1994)
Accordingly, the parties’ motions are denied as to Microsoft's equitable estoppel defense.
7. Ensnarement
Kewazinga asserts that, to the extent Streetside does not literally meet the ’226 patent and ’325 patent claim limitations reciting an "array of cameras," it meets those limitations under the doctrine of equivalents. Specifically, Kewazinga's doctrine of equivalents theory is that "acquiring imagery using cameras mounted on automobiles" is equivalent to "acquiring imagery by placing cameras at successive locations to capture image." "Ensnarement ... limits the scope of equivalency that a patentee is allowed to assert." In essence, "[a] patentee may not assert ‘a scope of equivalency that would encompass, or ensnare, the prior art.’ " "To test this limit, the notion of a hypothetical claim may be useful. A hypothetical claim may be constructed to literally cover the accused device. If such a claim would be unpatentable under 35 U.S.C. §§ 102 or 103, then the patentee has overreached, and the accused device is noninfringing as a matter of law. The burden of producing evidence of prior art to challenge a hypothetical claim rests with an accused infringer, but the burden of proving patentability of the hypothetical claim rests with the patentee.
SOF ¶ 161.
DePuy Spine, Inc. v. Medtronic Sofamor Danek, Inc., 567 F.3d 1314, 1323 (Fed. Cir. 2009).
Intendis GMBH v. Glenmark Pharm. Inc., USA , 822 F.3d 1355, 1363 (Fed. Cir. 2016) (citation omitted).
Interactive Pictures Corp. v. Infinite Pictures, Inc., 274 F.3d 1371, 1380 (Fed. Cir. 2001) (internal citations omitted).
For the reasons discussed below, the Court has concluded that Microsoft is entitled to summary judgment for non-infringement under Kewazinga's doctrine of equivalents theory. Although "[t]he ensnarement inquiry is separate and distinct from the jury's element-by-element equivalence analysis," ensnarement is a defense asserted to limit the reach of the doctrine of equivalents doctrine. Because the Court has determined that Kewazinga's doctrine of equivalents theory is untenable, it need not discuss the viability of Microsoft's ensnarement defense, as the issue is moot.
DePuy Spine, Inc. , 567 F.3d at 1323.
8. Reverse Doctrine of Equivalents
Kewazinga asserts that it is entitled to summary judgment on Microsoft's reverse doctrine of equivalents defense. "The reverse doctrine of equivalents is an equitable doctrine designed ‘to prevent unwarranted extension of the claims beyond a fair scope of the patentee's invention.’ " "Under the reverse doctrine of equivalents, an accused product or process that falls within the literal words of a claim nevertheless may not infringe if the product or process ‘is so far changed in principle from a patented article that it performs the same or a similar function in a substantially different way.’ " In such a case, the reverse doctrine of equivalents "may be used to restrict the claim and defeat the patentee's action for infringement." "Because the reverse doctrine of equivalents requires a fundamental change in the basic principle by which the device operates, the doctrine is rarely invoked and virtually never sustained." The reverse doctrine of equivalents, like the doctrine of equivalents, is applied to individual limitations of a claim. "The reverse doctrine of equivalents comes into consideration only when literal infringement is apparent." Unless the relevant claims have been literally infringed, "the reverse doctrine of equivalents does not apply."
Roche Palo Alto LLC v. Apotex, Inc. , 531 F.3d 1372, 1377 (Fed. Cir. 2008) (quoting Scripps Clinic & Research Found. v. Genentech, Inc. , 927 F.2d 1565, 1581 (Fed. Cir. 1991) ).
Amgen Inc. v. Hoechst Marion Roussel, Inc. , 314 F.3d 1313, 1351 (Fed. Cir. 2003) (quoting Graver Tank & Mfg. Co. v. Linde Air Prod. Co. , 339 U.S. 605, 608–09, 70 S.Ct. 854, 94 L.Ed. 1097, 85 U.S.P.Q. 328, 330 (1950) ).
Roche Palo Alto LLC v. Apotex, Inc. , 526 F. Supp. 2d 985, 991 (N.D. Cal. 2007).
DePuy Spine, Inc. v. Medtronic Sofamor Danek, Inc. , 567 F.3d 1314, 1338 (Fed. Cir. 2009) (citing Roche, 531 F.3d at 1378 ("[T]his court has never affirmed a finding of non-infringement under the reverse doctrine of equivalents.") and Leesona Corp. v. United States, 208 Ct. Cl. 871, 530 F.2d 896, 906 (1976) (predecessor court finding no infringement despite the fact that the accused structure, "in a very loose sense ," could be said to fall within the literal words of the claim) (emphasis added)).
DePuy Spine , 567 F.3d at 1338–39 ; see also Warner–Jenkinson , 520 U.S. at 29, 117 S. Ct. 1040 ("[T]he doctrine of equivalents must be applied to individual elements of the claim, not to the invention as a whole.").
Texas Instruments, Inc. v. U.S. Intern. Trade Commn. , 846 F.2d 1369, 1372 (Fed. Cir. 1988).
Id.
Here, Microsoft raises the reverse doctrine of equivalents defense as to two limitations. First, Microsoft asserts the defense as to how images are captured, specifically, with regard to the "array of cameras." The Court has determined that Microsoft did not literally infringe the "array of cameras" limitation. Therefore, Kewazinga's motion for summary judgment as to that limitation is denied as moot.
See Microsoft Opp. at 43.
Second, Microsoft raises the defense with regard to how the images are combined, through "mosaicing, tweening, or other smoothing or mixing." A determination on literal infringement has yet to be made as to those limitations. Accordingly, Kewazinga's motion for summary judgment as to those limitations is denied without prejudice.
Id.
9. Failure to Mitigate Damages
Next, Kewazinga seeks summary judgment as to Microsoft's assertion that Kewazinga had a duty to mitigate damages and failed to do so. Kewazinga argues that "the concept of mitigation of damages has [no] relevance" here because Kewazinga is seeking damages in the form of reasonable royalties. The parties agree that there exists no dispute of material facts on this issue, and that this is a legal issue that should be resolved.
A failure to mitigate defense "is most commonly applied in breach of contract and tort actions." Microsoft cites no applicable precedent for its application in patent infringement cases. Instead, it heavily relies on one out-of-Circuit case, IMX, Inc. v. E-Loan, Inc. , 748 F. Supp. 2d 1354, 1361 (S.D. Fla. 2010), for its position that a defendant may assert a failure to mitigate damages defense in cases such as this one. In any event, the defense is not applicable in royalty cases, such as this one. Indeed, in another case affirmed by the Federal Circuit, IMX was found to be distinguishable from cases "where Plaintiff seeks a reasonable royalty, rather than compensatory damages." Thus, IMX's theory, "would seem to only apply to lost profit damages since that measure of damages looks to the harm the patentee personally sustains from infringement" and that a mitigation defense would not apply to a reasonable royalty damage award because such an award "determines compensation to the patentee based on the infringer's use of the patented invention, not ‘harm’ suffered by the patentee."
Coach, Inc. v. Kmart Corp. , 756 F.Supp.2d 421, 430 n. 5 (S.D.N.Y. 2010).
Romag Fasteners, Inc. v. Fossil, Inc. , 29 F. Supp. 3d 85, 103 (D. Conn. 2014), aff'd, 817 F.3d 782 (Fed. Cir. 2016), cert. granted, judgment vacated, ––– U.S. ––––, 137 S. Ct. 1373, 197 L.Ed.2d 550 (2017), and vacated in part, 686 Fed. App'x. 889 (Fed. Cir. 2017) (citing Robert A. Matthews, Jr., 4 Annotated Patent Digest § 30:6.100).
Robert A. Matthews, Jr., 4 Annotated Patent Digest § 30:6.100.
Microsoft further argues that Kewazinga could have mitigated its damages by providing Microsoft notice that it still thought Microsoft infringed on its patents even after Kewazinga voluntarily dismissed the 2013 Lawsuit. However, as discussed above, Kewazinga was under no obligation to do so, as it dismissed the 2013 Lawsuit without prejudice and the last communications from Kewazinga to Microsoft consistently reflect Kewazinga's belief that Microsoft infringed on its patents. Microsoft has not satisfied its burden to show that its mitigation of damages defense is viable. Accordingly, Kewazinga's motion for summary judgment as to this issue is granted.
B. Defendant's Motion for Summary Judgment
1. Non-Infringement
a) Array of Cameras
Microsoft seeks summary judgment that it has not infringed on the patents-in-suit as to the "array of cameras" theory. Specifically, Microsoft asserts that Kewazinga's theory of how the "array of cameras" were allegedly formed in the accused instrumentalities is inconsistent with the Court's construction of the term. The Court agrees and for the following reasons, Microsoft's motion is granted as to this issue.
The Court construed "array of cameras" as meaning "a set of multiple cameras, each fixed in relation to each other." In doing so, the Court explained that "[t]he fixed geometric relationship between the cameras in the array is central to the use of the array—indeed that geometric relationship is how a path through the array of cameras can be defined." Microsoft gathers images through the use of vehicles that drive through the target location and capture images using a set of cameras mounted on the top of the vehicle. Here, Kewazinga's theory of how an "array of cameras" was allegedly formed is based on Microsoft's use of a pre-determined capture route triggered by time or distance, in which the camera system mounted on the vehicle is activated based on fixed intervals. In contrast, Microsoft asserts that a camera at its one position cannot create an array with a different camera at the next location because the distance between where the images are taken changes based on the path chosen by the driver, and therefore, the locations are not fixed in relationship to one another. Regardless of whether the capture locations are predetermined, a time or distance-based system does not necessarily result in the cameras in the array being in a "fixed geometric relationship" to one another. The Court construed "array of cameras" to mean that within the array, the cameras remain in fixed location to one another. Kewazinga relies heavily on Figure 11 of the ’325 patent:Kewazinga asserts that in this figure, each of the rings forms an array of cameras that moves through the environment to capture different locations at different times, attempting to liken it to the capture method used by Streetside. Kewazinga correctly asserts that the Court rejected Microsoft's proposal that the array of cameras remain stationary. However, the Court did require that the multiple cameras in the array maintain a fixed geometric relationship. Thus, the Court's construction did not include an array of cameras being formed by a single camera moving through space. The Court disagrees with Kewazinga's assertion that the Figure 11 embodiment includes a single array formed over time, and Kewazinga's assertion that "there is no requirement that the distance between cameras be uniform or precise in the overall array" reveals the flaws in its argument. That argument raises the question of whether each of the rings above forms an array, or the figure itself is one array. But it is of little matter. Regardless of which construction of array is used, the Court explicitly held that an array of cameras requires a fixed relationship between the cameras.
Claim Construction Op. at 27-33.
Id. at 30-31.
Kewazinga focuses on Microsoft's method of capturing images, arguing that the evidence shows that drivers did not have discretion as to where the images were captured because they were pre-determined. But even if the Streetside drivers did not have discretion as to where to take the image-capturing vehicle, the fact that the vehicles must remain on driving paths limits the ability of the cameras to maintain a fixed geometric relationship at the time of capture. Furthermore, even if the Court accepted Kewazinga's "array created through time" proposal, for the reasons explained below, Kewazinga's "trigger-rate" theory has been excluded as untimely. Because there is no dispute of material fact as to this issue, Microsoft's motion for summary judgment of no infringement as to the "array of cameras" limitation of claims 55 and 119 of the ’226 patent and claims 1, 5, 6, 10, 14, and 15 of the ’325 patent, is granted.
b) Trigger Rate Theory
Furthermore, Kewazinga's "trigger rate theory" has already been excluded by the Court and therefore, it cannot serve as a basis for infringement. The trigger rate theory asserts that an array of cameras is created when cameras are moved from location to location in equal, predetermined distances, capturing images in each location. For the reasons explained in the Court's Daubert opinion, Kewazinga cannot assert this trigger rate theory because it is untimely. Accordingly, Microsoft's motion is granted as to this issue.
c) Doctrine of Equivalents
Kewazinga asserts that even if the "array of cameras" limitation is not literally met by Streetside, it is met under the doctrine of equivalents. Microsoft asserts that it is entitled to summary judgment because Kewazinga has failed to satisfy its burden to prove infringement under that theory. For the reasons that follow, no reasonable jury could find equivalence to the "array of cameras" limitation.
"Infringement under the doctrine of equivalents requires that the accused product contain each limitation of the claim or its equivalent." The doctrine of equivalents standard requires that the function, way, and result be substantially similar. "A claim element is equivalently present in an accused device if only ‘insubstantial differences’ distinguish the missing claim element from the corresponding aspects of the accused device." "The determination of equivalence depends ... on the proper assessment of the language of the claimed limitation and the substantiality of whatever relevant differences may exist in the accused structure." In other words, "[t]he proper test [for determining whether an accused product meets the means-plus-function limitation] is whether the differences between the structure in the accused device and any disclosed in the specification are insubstantial." "Under the doctrine of equivalents, an infringement theory ... fails if it renders a claim limitation inconsequential or ineffective."
Leggett & Platt, Inc. v. Hickory Springs Mfg. Co. , 285 F.3d 1353, 1358–59 (Fed. Cir. 2002) (citation omitted).
Odetics, Inc. v. Storage Tech. Corp. , 185 F.3d 1259, 1267 (Fed. Cir. 1999).
Leggett & Platt , 285 F.3d at 1358–59 (citation omitted).
Cadence Pharms. Inc. v. Exela PharmSci Inc. , 780 F.3d 1364, 1372 (Fed. Cir. 2015).
Chiuminatta Concrete Concepts, Inc. v. Cardinal Indus. , Inc., 145 F.3d 1303, 1309 (Fed. Cir. 1998).
UCB, Inc. v. Watson Lab'ys Inc. , 927 F.3d 1272, 1282 (Fed. Cir. 2019) (quoting Akzo Nobel Coatings, Inc. v. Dow Chem. Co. , 811 F.3d 1334, 1342 (Fed. Cir. 2016) ).
"Infringement under the doctrine of equivalents requires an intensely factual inquiry." Summary judgment is warranted on "non-infringement under the doctrine of equivalents, where that doctrine is legally applicable, only if it discerns no genuine issues of material fact and that no reasonable jury could find equivalence." "Because infringement under the doctrine of equivalents often presents difficult factual determinations, a summary conclusion that a reasonable jury could not find infringement is often illusive."
Vehicular Techs. Corp. v. Titan Wheel Int'l, Inc. , 212 F.3d 1377, 1381 (Fed. Cir. 2000).
Id.
Leggett & Platt, Inc. v. Hickory Springs Mfg. Co. , 285 F.3d 1353, 1360 (Fed. Cir. 2002).
Kewazinga's equivalence theory is that Microsoft uses cameras "mounted on automobiles capturing images at sequential points as the automobile proceeds along a street through those points" which constitutes an "array of cameras" used to capture images. Kewazinga further asserts that the "relationships between locations of successive capture events at sequential points along a street define a path through the array of cameras in Streetside. The cameras at these sequential points constitute a series of cameras." Dr. Hanna's testimony during his deposition regarding the formation of an array is also relevant to this issue. He testified that if you take a "single camera, move [it] to a different place, acquire, and then stop, so it no longer acquires and then move over into a different set of processing, then what you acquired was an array of cameras." In essence, Kewazinga's infringement theory under the doctrine of equivalent relies on the theory that movement of the camera (or cameras) on top of the automobile forms the array. It equates that method of capturing images to cameras placed at successive locations to capture images for the same array. Dr. Hanna argues that the geometric relationship requirement is satisfied because the cameras are activated by the DMI, which is programmed in advance to activate the cameras at sequential points in fixed intervals along the street.
Dkt. No. 202-1 ¶ 297.
Id. ¶ 301.
Dkt. No. 192-4 at 157:24-158:6.
Dkt. No. 249-3 ¶ 94.
Dkt. No. 249-3 ¶ 96.
Here, Microsoft argues that Kewazinga's doctrine of equivalents infringement theory fails because it vitiates the Court's construction of "array of cameras." The difference between the "ways" of the patented and accused systems is substantial and rests on the parties’ arguments on how the array is created. During claim construction, the Court construed "array of cameras" as a "set of multiple cameras, each fixed in relation to each other." Although the patents teach that the array can be arranged in nearly any configuration, they are clear that there must be multiple cameras in the array, which together define a path of progressively different perspectives. During claim construction, the Court rejected Microsoft's proposal that the cameras be fixed at specific locations; instead, it determined that the arrays could be moved, as shown in Claim 22 of the ’325 Patent. However, the Court also took issue with Kewazinga's proposed construction, stating that it "reject[ed] Plaintiff's contention that a camera within an array can be moved and still constitute the same array as it is divorced from the intrinsic evidence." The Court similarly rejected Plaintiff's proposed construction that "a camera can be reused within an array ... as overbroad and likely to cause juror confusion."
Claim Construction Op. at 36.
See, e.g. , Claim 1 of the ’325 and ’226 Patents.
Claim Constr. Op. at 32-33.
Id. at 33-34 ("On the other hand, Plaintiff's contention that the cameras can be moved or reused also goes too far and lacks intrinsic support.").
Id. at 34.
Kewazinga's theory of how the array is formed—with a single camera moved through space, rather than fixed in relation to others—is plainly inconsistent with the Court's construction of "array of cameras" and the patents themselves. At base, Kewazinga's equivalents theory relies on a single camera being moved to form the array, a position that was excluded during claim construction and vitiates the requirement that multiple cameras form the array, which in turn, allows a user to navigate a path through the environment. "[T]he concept of equivalency cannot embrace a structure that is specifically excluded from the scope of the claims." Indeed, the Federal Circuit has "found ‘specific exclusion’ where the patentee seeks to encompass a structural feature that is the opposite of, or inconsistent with, the recited limitation." That is the case with Kewazing's proposal. Therefore, no reasonable jury could find that the accused instrumentalities infringe the "array of cameras" limitation under the doctrine of equivalents. Furthermore, for the reasons explained by the Court in its Daubert opinion, Kewazinga cannot rely on Dr. Hanna's opinions regarding the trigger rate theory. Accordingly, the accused instrumentalities do not infringe the array of cameras limitation under the doctrine of equivalents.
Augme Techs., Inc. v. Yahoo! Inc. , 755 F.3d 1326, 1335 (Fed. Cir. 2014) (quoting Dolly, Inc. v. Spalding & Evenflo Cos. , 16 F.3d 394, 400 (Fed. Cir. 1994) ).
Id. (citing SciMed Life Sys., Inc. v. Advanced Cardiovascular Sys., Inc. , 242 F.3d 1337, 1346–47 (Fed. Cir. 2001) ).
d) Claim 29 of the ’325 Patents
Claim 29 of the ’325 patent requires that images captured from two arrays be mixed to provide the user with an experience of moving backward and forward through the environment. Microsoft asserts that Kewazinga has not provided any evidence that Microsoft provided a user with images mixed from two adjacent images captured by two different car systems. The basis for Microsoft's argument is that Dr. Hanna's opinions as to this issue should be excluded. For the reasons explained in the Court's Daubert opinion, Microsoft's motion to exclude Dr. Hanna's opinions on this issue is denied. Accordingly, Kewazinga has provided admissible evidence to support its argument that Microsoft infringed on Claim 29 of the ’325 Patent. For that reason, there exists a dispute of material fact and Microsoft's motion for summary judgment is denied.
2. Willful Infringement
Microsoft's motion for summary judgment on the issue of willful infringement is granted in part. Microsoft asserts that it cannot have willfully infringed the ’234 patent because it had no pre-suit knowledge of the patent, which was issued in 2015. Microsoft further argues that it cannot have willfully infringed the ’226 and ’325 patents, relying on the same position as in its equitable estoppel defense—that it inferred from Kewazinga's voluntary dismissal of the 2013 Lawsuit that Kewazinga was abandoning its infringement allegations.
Under Section 284 of the Patent Act, "punitive or increased damages" can be recovered "in a case of willful or bad-faith infringement." "District courts enjoy discretion in deciding whether to award enhanced damages" and "[a]s with any exercise of discretion, courts should continue to take into account the particular circumstances of each case in deciding whether to award damages, and in what amount." "Awards of enhanced damages under the Patent Act over the past 180 years establish that they are not to be meted out in a typical infringement case, but are instead designed as a ‘punitive’ or ‘vindictive’ sanction for egregious infringement behavior. The sort of conduct warranting enhanced damages has been variously described in our cases as willful, wanton, malicious, bad-faith, deliberate, consciously wrongful, flagrant, or—indeed—characteristic of a pirate." "It is well-settled that knowledge of the non-infringer's patent is a necessary element to a claim of willful infringement." "[C]ulpability is generally measured against the knowledge of the actor at the time of the challenged conduct." "Knowledge is defined for [the purpose of willful infringement] as knowledge of the allegedly infringed patent and its claims." Summary judgment is appropriate on a willful infringement claim "[i]f Defendants can point to an absence of record evidence concerning its knowledge of the [patent-in-suit] and its claims."
Halo Elecs., Inc. v. Pulse Elecs., Inc. , 579 U.S. 93, 136 S. Ct. 1923, 1930, 195 L. Ed. 2d 278 (2016) (internal quotation marks omitted).
Id. at 1933.
Id. at 1932.
Olaf Sööt Design, LLC v. Daktronics, Inc. , 325 F. Supp. 3d 456, 461 (S.D.N.Y. 2018) ; see also Verint Sys. Inc. v. Red Box Recorders Ltd. , No. 14-cv-5403, 2016 WL 7177844, at *2 (S.D.N.Y. Dec. 7, 2016) ("For a finding of willful or induced infringement, the law requires that a defendant have had actual knowledge of the patents at issue."); Gustafson, Inc. v. Intersys. Indus. Prods. , Inc., 897 F.2d 508, 511 (Fed. Cir. 1990). ("[A] party cannot be found to have ‘willfully’ infringed a patent of which the party had no knowledge.").
Halo Elecs., Inc. v. Pulse Elecs., Inc. , 579 U.S. 93, 136 S. Ct. 1923, 1933, 195 L. Ed. 2d 278 (2016).
Olaf Sööt Design , 325 F. Supp. 3d 456, 461 (S.D.N.Y. 2018) (internal quotation marks and citations omitted).
Id.
A reasonable jury could find that Microsoft had pre-suit knowledge of the ’234 patent because it knew of the ’226 and ’325 patents, which are in the same patent family as the ’234 patent, as well as other patent applications in the same family. The ’234 patent issued on June 9, 2015 from application number 14/505,208 ("the ’234 application"), which was filed on October 2, 2014. Here, it is undisputed that Microsoft was aware of the ’225 and ’325 patents in 2013, as the parties met and communicated about Microsoft's alleged infringement of those patents. Kewazinga further argues that Microsoft's own patent prosecution process cited to the ’325 patent and other patents related to the ’234 patent after the ’234 patent issued. While this evidence does not establish knowledge of the ’234 patent itself, "[e]vidence of pre-suit knowledge of a patent can be circumstantial" and a reasonable factfinder could infer that Microsoft was aware of the ’234 patent based on its actual knowledge of patents in the same family, including the ’226 and ’325 patents. The Federal Circuit has explained that because "patent applications and realtime prosecution activity are published[, i]t is no longer the case that all ‘[p]atent applications are secret.’ " Indeed, in SIMO Holdings Inc. v. Hong Kong uCloudlink Network Tech. Ltd. , the court determined that a jury could reasonably infer that the defendant had knowledge of a patent based in part on testimony that an employee of the alleged infringer was at least familiar with the parent patent of the patent at issue. The SIMO Holdings court noted that the factfinder's inference of knowledge "might not have been reasonable had [defendant] adduced evidence establishing when, in fact, it learned of the patent. But without such evidence, the jury was not forbidden from concluding, based on all of the circumstances, that [defendant] in fact did know of the ’689 Patent, at or before the time of its issuance." Microsoft's former in-house attorney, Ms. Quan, has stated that she personally is "unaware of Kewazinga ever communicating about the new patent application or new ’234 patent" during the time frame between the 2013 dismissal and the filing of this suit. But this leaves open the question of whether Microsoft learned of the ’234 patent by some other means. And, Microsoft has not pointed the Court to undisputed evidence supporting when it did learn of the ’234 patent. Thus, the Court cannot determine that a reasonable factfinder could not find that Microsoft had pre-suit knowledge of the ’234 patent and Microsoft's motion for summary judgment on the issue of willful infringement of the ’234 patent is denied.
SOF ¶ 223.
SOF ¶ 222.
Dkt. No. 192-12 at 24-25.
SIMO Holdings Inc. v. Hong Kong uCloudlink Network Tech. Ltd. , 396 F. Supp. 3d 323, 334 (S.D.N.Y. 2019) (citing Kaneka Corp. v. SKC Kolon PI, Inc., 198 F. Supp. 3d 1089, 1107 (C.D. Cal. 2016) ).
WCM Indus., Inc. v. IPS Corp. , 721 F. App'x 959, 970 (Fed. Cir. 2018) (quoting Gustafson , 897 F.2d at 511 ).
396 F. Supp. 3d 323, 334 (S.D.N.Y. 2019).
Id.
Quan Decl. ¶ 10.
Because a reasonable factfinder could find that Microsoft had pre-suit knowledge of the ’234 patent, as required for willful infringement of that patent, the Court need not reach the question of whether Kewazinga can recover damages based on Microsoft's alleged post-suit willful infringement of the ’234 patent.
Next, Microsoft must show that no reasonable juror could find that Microsoft willfully infringed the ’226 and ’325 patents through conduct described in the Supreme Court's decision: "willful, wanton, malicious, bad-faith, deliberate, consciously wrongful, flagrant, or—indeed—characteristic of a pirate." Microsoft argues that it reasonably believed Kewazinga was no longer pursuing infringement claims for those patents after it dismissed the 2013 Lawsuit and therefore, any infringement could not be willful. However, as explained above in the Court's analysis of Microsoft's equitable estoppel defense, whether that belief was reasonable is an open question and "[w]hether an act is ‘willful’ is by definition a question of the actor's intent, the answer to which must be inferred from all the circumstances." Kewazinga voluntarily dismissed the 2013 Lawsuit, which alleged that Streetside infringed the ’226 and ’325 patents, and the parties did not communicate until the filing of this lawsuit. In December 2013, Microsoft publicly announced the availability of the Bing Maps Preview App for Windows 8.1, including Streetside, available for download from Windows Store. In April 2015, Microsoft publicly announced the Maps App, including Streetside, for use with devices running the Windows 10 operating system. In June 2016, Microsoft publicly announced the availability of a new version of the Bing Maps website, including Streetside. Prior to that dismissal without prejudice, Kewazinga consistently held its position that Microsoft was infringing the ’226 and ’325 patents. A reasonable factfinder could determine that Microsoft's continued development and release of products which were alleged to incorporate infringing technology, constitutes the kind of bad-faith and deliberate behavior described in Halo . Thus, Microsoft's motion for summary judgment on the issue of willful infringement of the ’226 and ’325 patents is denied.
Halo Elecs., Inc. v. Pulse Elecs., Inc. , 579 U.S. 93, 136 S. Ct. 1923, 1933, 195 L. Ed. 2d 278 (2016).
WCM Indus., Inc. v. IPS Corp. , 721 F. App'x 959, 970 (Fed. Cir. 2018) (quoting Gustafson , 897 F.2d at 510–11 ).
SOF ¶¶ 228-230, 234.
SOF ¶ 231.
SOF ¶ 232.
SOF ¶ 233.
3. Apportionment
Microsoft argues that it is entitled to summary judgment on Kewazinga's damages case because Kewazinga's damages expert, Michele Riley, failed to meet the requirements of apportionment. Specifically, Microsoft asserts that Ms. Riley used a royalty base larger than the smallest salable patent-practicing unit and failed to properly apportion between "patented and "unpatented" features of Streetside. For the following reasons, summary judgment as to this issue is granted.
One method of calculating damages is the entire-market-value-rule, which calculates a rate applied to the entire market value of an infringing product. The entire-market-value rule applies "only in those circumstances where the basis of customer demand for the infringing product is traceable to the infringing features of the product." However, "the entire market value rule [is] impermissible" where a plaintiff "fail[s] to present evidence showing that the patented [features] drove demand for the" product. In such cases, courts have "generally required that royalties be based not on the entire product, but instead on the ‘smallest salable patent-practicing unit.’ " The parties do not dispute that this case falls into the latter scenario and that apportionment is appropriate.
In re Avaya Inc. , 602 B.R. 445, 459 (S.D.N.Y. 2019) ; see, e.g., Lucent Techs., Inc. v. Gateway, Inc. , 580 F.3d 1301, 1336 (Fed. Cir. 2009) ("For the entire market value rule to apply, the patentee must prove that the patent-related feature is the basis for customer demand." (internal quotation marks omitted)).
LaserDynamics, Inc. v. Quanta Comput., Inc. , 694 F.3d 51, 68 (Fed. Cir. 2012).
LaserDynamics, Inc. , 694 F.3d at 67 (quoting Cornell Univ. v. Hewlett-Packard Co. , 609 F. Supp. 2d 279, 283 (N.D.N.Y. 2009) ).
First, Microsoft challenges the royalty base used in Ms. Riley's apportionment analysis and argues that Ms. Riley attempts to rely on an "ecosystem" theory of the Bing universe to ignore the SSPPU. Microsoft instead insists that Ms. Riley's analysis should have begun with Bing.com/Maps. In her expert report, Ms. Riley opined that Streetside brings value to the wider Bing ecosystem of products and services. Specifically, she opines that "street-level images are strategic for the Bing Maps business because the feature offers unique local search functionality and helps the company achieve competitive parity with Google." Therefore, to determine the royalty base for Streetside, Ms. Riley began with the online revenue related to Bing.com, allocated the search revenue to local searches, then further apportioned that amount to the revenue contributed by Streetside by looking to Streetside user metrics. Although Microsoft argues that this ecosystem analysis is a shrouded attempt to use the entire market value rule, it is evident from Ms. Riley's report that this is not true and that she did not apply the entire-market-value-rule. She clearly explains how she apportioned to what she believed to be the smallest salable patent-practicing unit. Indeed, Microsoft has not presented any binding authority that would require the Court to preclude Ms. Riley from viewing the Bing universe of products and services as an ecosystem for purposes of her damages analysis. Ms. Riley's assessment of the importance of Streetside to the wider system of Bing-related products and services does not make her opinion unreliable. Instead, this assessment goes to the weight of her testimony, but does not render it inadmissible.
As an initial note, the parties agree that Streetside is the SSPPU of as Bing.com/Map and Bing Maps API.159 Microsoft's position is that Streetside is the SSPPU for the Windows Maps App, while Kewazinga argues that the SSPPU for the Windows 10 Operating Software is monthly active device count.159 and Windows Maps App.
Dkt. No. 249-5 (Riley Report) ¶ 145.
Riley Report ¶¶ 185-196.
Riley Report ¶ 183.
Riley Report ¶¶ 182-196.
See Dkt. No. 252-20 at 112.
Next, Microsoft asserts that it is entitled to summary judgment on Kewazinga's damages theory because Ms. Riley failed to apportion between the patented and unpatented features of Streetside. When "an infringing product is a multi-component product with [both] patented and unpatented components, apportionment is required." "[I]n any case involving multi-component products, patentees may not calculate damages based on sales of the entire product, as opposed to the smallest salable patent-practicing unit, without showing that the demand for the entire product is attributable to the patented feature." "The principle, applicable specifically to the choice of a royalty base, is that, where a multi-component product is at issue and the patented feature is not the item which imbues the combination of the other features with value, care must be taken to avoid misleading the jury by placing undue emphasis on the value of the entire product."
Mentor Graphics Corp. v. EVE-USA, Inc. , 870 F.3d 1298, 1299 (Fed. Cir. 2017) (Stoll, J., concurring in denial of rehearing en banc ) (collecting cases).
LaserDynamics, Inc. , 694 F.3d at 67–68.
Ericsson, Inc. v. D-Link Sys., Inc. , 773 F.3d 1201, 1226 (Fed. Cir. 2014).
Ms. Riley apportioned to Streetside, the agreed-upon SSPPU of the Bing.com/maps and Bing Maps App products. The issue here is whether Ms. Riley was required to apply a further apportionment beyond that analysis. The parties do not dispute that Streetside includes at least one unpatented feature ("privacy blurring of faces and license plates"), with Microsoft identifying other unpatented features. Thus, Microsoft argues that Ms. Riley was required to further apportion beyond Streetside to determine what portion of the value of the product is attributable to the patented technology. For the reasons explained in the Court's Daubert opinion, Ms. Riley's opinions are excluded because she failed to identify a properly apportioned royalty base that accounted for both the patented and unpatented features of Streetside. Thus, Microsoft's application for summary judgment is warranted as to Kewazinga's damages theory.
SOF ¶ 241.
See California Inst. of Tech. v. Hughes Commc'ns Inc. , 2015 WL 11089496, at *6 (C.D. Cal. May 5, 2015).
4. Forfeiture of Damages Prior to June 27, 2013
Microsoft asserts that Kewazinga has forfeited all damages on the ’226 and ’325 patents because it "made (and used) unmarked systems" under those patents after the patents were issued. Section 287(a) requires that "[p]atentees, and persons making ... within the United States any patented article" must mark the article with the patent number, or "no damages shall be recovered by the patentee in any action for infringement, except on proof that the infringer was notified of the infringement and continued to infringe thereafter." 35 U.S.C. § 287(a). The purpose of section 287 is "to encourage the patentee to give notice to the public of the patent." In response, Kewazinga contends that it was not required to mark the Sawgrass K-System because it was made before the ’226 and ’325 patents issued. "[I]tems made, offered for sale or sold prior to issuance of a patent are necessarily irrelevant to the marking statute."
American Medical Systems, Inc. v. Medical Engineering Corp., 6 F.3d 1523, 1538 (Fed. Cir. 1993).
Magnetar Techs. Corp. v. Six Flags Theme Parks Inc. , 2014 WL 533425, at *4 (D. Del. Feb. 7, 2014) (citing Am. Med. Sys., Inc. v. Med. Eng'g Corp. , 6 F.3d 1523, 1537 (Fed. Cir. 1993) ).
As an initial note, Microsoft claims that the applicable notice date is the date of the complaint in the 2013 Lawsuit, June 27, 2013, while Kewazinga argues that the notice date should be in 2006, when it first informed Microsoft of the ’226 and ’325 patents. At issue here is the "Sawgrass K-System," a proof-of-concept product which Mr. Worley has testified was covered under the ’226 and ’325 patents. The Sawgrass K-System was developed in late 2000, a few months prior to Kewazinga's first production event in 2001. The ’325 Patent issued February 18, 2003. The ’226 Patent issued March 18, 2003. At some point between March 24 and 28, 2003, Kewazinga assembled the Sawgrass K-System on site and used it at a golf course in Florida, after the ’226 Patent issued. The Sawgrass K-System was not marked with either patent number during its 2003 assembly. The same proof-of-concept product was used for all of Kewazinga's production events between 2001 and 2003 and Kewazinga did not handle events after 2003.
Dkt. No. 252-1 (Hanna Report) ¶ 448.
Id.
’325 Patent.
’226 Patent.
SOF ¶ 231-32.
SOF ¶ 233.
Hanna Report ¶ 448.
The question before the Court is whether Kewazinga's assembly of the system in 2003 is considered "making" the invention under Section 287(a), precluding Kewazinga from recovering damages before Microsoft had notice of the infringement. Kewazinga asserts that it was "merely plugging cables into cameras and bolting together two halves of a pre-built rig" and therefore it was not required to mark the system. Dr. Hanna's expert report describes the mechanics of the product. Some of the product remained permanently assembled, whereas other segments, such as the cameras, were disassembled for transport to prevent damage. The assembly process was described as a "plug-and-play process" and the assembly and software were the same at each event. Dr. Hanna has opined that this type of basic assembly does not constitute making a product, as it is to be expected for transporting large systems to remote locations. Microsoft has not put forth any evidence that the assembly process was other than what Kewazinga describes. Based on the evidence in the record, jury could easily find for Kewazinga on this issue.
Id. ¶ 449.
Id.
Id.
In support of its motion, Microsoft relies on two Federal Circuit cases for the principle that Kewazinga's "assembly" of the Sawgrass K-System should be considered "making" the invention under Section 287(a). These cases are unpersuasive for that purpose because they are clearly distinguishable. In Amsted Indus., the plaintiff undisputedly authorized its customers to make, use, and sell the patented article by manufacturing and selling its own unmarked center plates for use in the patented combination, and providing installation drawings which instructed how to assemble the center plate, along with other components, according to the teachings of the patent. Permitting purchasers to create new products under the patent (thereby "assembling" the invention) as in Amsted is distinguishable from this case, where Kewazinga reconstructed its own pre-existing system. And in Microsoft's second case, Lifetime Indus., Inc. v. Trim-Lok, Inc. , the Circuit was not analyzing whether the patentee had made the patented invention under Section 287. Instead, the Circuit assessed whether the plaintiff had adequately pleaded that defendant had directly infringed a patent by asserting it assembled one component of the invention. Thus, because Microsoft's motion for summary judgment is unsupported by both the facts and the law, it is denied.
Amsted Indus. Inc. v. Buckeye Steel Castings Co. , 24 F.3d 178, 185 (Fed. Cir. 1994).
Lifetime Indus., Inc. v. Trim-Lok, Inc. , 869 F.3d 1372, 1378 (Fed. Cir. 2017).
Id.
5. Conception of CIP Claims Prior to October 15, 1999
One of Microsoft's defenses is that the claimed subject matter is obvious in view of the prior art, rendering the claims invalid under 35 U.S.C. § 103. Section 103 provides
See Dkt. No. 15 (Answer) at 8.
A patent for a claimed invention may not be obtained, notwithstanding that the claimed invention is not identically disclosed as set forth in section 102, if the differences between the claimed invention and the prior art are such that the claimed invention as a whole would have been obvious before the effective filing date of the claimed invention to a person having ordinary skill in the art to which the claimed invention pertains. Patentability shall not be negated by the manner in which the invention was made.
35 U.S.C.A. § 103. The ’234 and ’325 patents issued directly or indirectly from a continuation-in-part ("CIP") application filed October 15, 1999. Microsoft argues that Kewazinga did not conceive of the inventions prior to meeting with Sarnoff, a third party with whom Kewazinga entered into development agreements. Microsoft asserts that certain Sarnoff disclosures to Kewazinga prior to the CIP's filing date are prior art that would render the claimed subject matter obvious. Specifically, Microsoft claims that Sarnoff disclosed its designs to Kewazinga its integration of mosaicing, tweening and mixing of images from multiple arrays. In response, Kewazinga contends the conception date of the Asserted Claims reciting mosaicing and/or tweening is on or about August 1998, prior to Kewazinga's first meeting with Sarnoff in September 1998.
Dkt. No. 192-22 at 5.
Conception requires more than just a general goal or research plan, and instead requires a "definite and permanent idea of an operative invention, including every feature of the subject matter to be patented." "Conception is a question of law premised on underlying factual findings." "Inventor testimony of conception must be corroborated by other, independent information." Whether there is sufficient corroboration is governed by a "rule of reason" analysis, which requires all pertinent evidence to be examined to determine whether the inventor's testimony is credible.
In re VerHoef , 888 F.3d 1362, 1366 (Fed. Cir. 2018) (internal quotation marks and emphasis omitted); see also Kolcraft Enterprises, Inc. v. Graco Children's Prod., Inc. , 927 F.3d 1320, 1324 (Fed. Cir. 2019) ("Conception is ‘the formation, in the mind of the inventor of a definite and permanent idea of the complete and operative invention, as it is thereafter to be applied in practice.’ ") (citing REG Synthetic Fuels, LLC v. Neste Oil Oyj , 841 F.3d 954, 962 (Fed. Cir. 2016) ).
Kolcraft , 927 F.3d at 1324 (citing In re VerHoef , 888 F.3d 1362, 1365 (Fed. Cir. 2018) ).
Id. (citing Apator Miitors ApS v. Kamstrup A/S , 887 F.3d 1293, 1295 (Fed. Cir. 2018) ); see also Hahn v. Wong , 892 F.2d 1028, 1032 (Fed. Cir. 1989) ("The inventor, however, must provide independent corroborating evidence in addition to his own statements and documents."); Kridl v. McCormick , 105 F.3d 1446, 1450 (Fed. Cir. 1997) (stating that corroboration is "independent confirmation of the inventor's testimony"); Chen v. Bouchard , 347 F.3d 1299, 1310 (Fed. Cir. 2003) ("Evidence of the inventive facts must not rest alone on the testimony of the inventor himself.").
Kolcraft , 927 F.3d at 1324 (citing In re NTP, Inc. , 654 F.3d 1279, 1291 (Fed. Cir. 2011) ).
Kewazinga has cited the deposition testimony of named inventors Mr. Worley and Mr. Sorokin, in which the inventors state that they conceived of the inventions using mosaicing and tweening, prior to meeting with Sarnoff. As explained above, those statements are insufficient on their own because "[i]nventor testimony of conception must be corroborated by other, independent information." "Whether there is sufficient corroboration is governed by a ‘rule of reason’ analysis, which requires all pertinent evidence to be examined to determine whether the inventor's testimony is credible."
Dkt. No. 197-6 (Worley 1-21-20 30(b)(6) Dep. Tr.) at 30:25-32:21, 33:20-34:4.
Kolcraft , 927 F.3d at 1324.
Id. (citing In re NTP, Inc. , 654 F.3d at 1291 and Kridl , 105 F.3d at 1450.
However, Kewazinga has identified evidence that would corroborate Mr. Worley and Mr. Sorokin's testimony. First, the document entitled "Historical Review of Kewazinga's Relationship with Sarnoff" states that in September 1998, "Kewazinga and Sarnoff meet at Sarnoff's offices to discuss the Kewazinga immersive video concept and to review potentially applicable Sarnoff IP, including tweening and mosaicing." A reasonable juror could infer that based on the evidence in the record, Kewazinga had already conceived of the inventions and were meeting with Sarnoff because of Kewazinga's interest in implementing Sarnoff's technology for their invention. Both parties cite to the same February 2, 1999 report prepared by Sarnoff for Kewazinga on the feasibility of Kewazinga's K-System. The K-System report prepared by Sarnoff appears to corroborate the named inventors’ testimony: the very first line of the report says that "Kewazinga has conceptualized a unique and revolutionary approach to delivering events and experiences to viewers at remote sites. The compelling aspect of the K-System is that it delivers an experience that provides immediate feedback to viewer inputs and also provides degrees of freedom that are not available in linear media." Because that report was prepared by a third-party, and does not "depend solely on the inventor[,]" the testimony of the inventors is sufficiently corroborated. The combination of Mr. Worley and Mr. Sorokin's testimony and the corroborating evidence cited by Kewazinga is enough to defeat Microsoft's request for summary judgment. Upon considering all of the evidence in the record, a reasonable factfinder could determine that the inventors had a definite and permanent idea of the video system utilizing tweening and mosaicing methods, prior to its initial meeting with Sarnoff. Thus, Microsoft's motion for summary judgment as to this issue is denied.
Dkt. No. 202-11.
See, e.g. , Dkt. No. 202-16 (Feasibility of K-System); 1–9, 34–46).
Id. at 3.
See Apator , 887 F.3d at 1295.
IV. CONCLUSION
For the reasons stated above, Kewazinga's motion for summary judgment is granted in part and denied in part. Microsoft's cross-motion for summary judgment is denied. Microsoft's motion for summary judgment is granted in part and denied in part.
SO ORDERED.