Opinion
Case No. 00 C 6144
January 8, 2002
REPORT AND RECOMMENDATION
This patent infringement action is before the Court for decision following the July 23, 2001 through July 27, 2001 hearing on Plaintiff Telular Corporation's Motion for a Preliminary Injunction. Defendant Vox2 defended Telular's motion on the grounds of noninfringement and invalidity. Telular's Motion for a Preliminary Injunction should be denied because, among other reasons, the patent is not infringed either literally or under the doctrine of equivalents. In rendering this decision, the Court has considered the testimony of the witnesses, the documents admitted into evidence, Plaintiff Telular Corporation's Proposed Conclusions of Law and Findings of Fact, Vox2, Inc.'s Proposed Findings of Fact and Conclusions of Law in Support of its Opposition to Telular's Motion for Preliminary Injunction, and the pre-hearing submissions of the parties. Pursuant to Rule 52 of the Federal Rules of Civil Procedure, the Court's findings of fact and conclusions of law are set forth below. These findings are based solely on the evidence presented at the hearing on Telular's Motion for Preliminary Injunction and do not prohibit or limit the trial court from making different findings based on evidence which is presented at a trial on the merits.
Given the Court's findings on the infringement question, it need not reach the issue of validity at this preliminary stage of the litigation. This decision does not prevent Vox2 from asserting any of the validity challenges preliminarily raised during the preliminary injunction proceedings or from relying on any admissible evidence presented at the preliminary injunction hearing in support of its invalidity defense at trial.
FINDINGS OF FACT I. BACKGROUND
An asterisk indicates the findings of fact stipulated by the parties.
A. The Parties
1. *Plaintiff Telular Corporation ("Telular") is a Delaware Corporation with its principal place of business in Vernon Hills, Illinois. Complaint ¶ 1.
2. *Defendant Vox2, Inc. ("Vox2") is a Delaware Corporation with its principal place of business in Northborough, Massachusetts. Answer ¶ 3.
3. Telular was founded in 1985 by William DiNicolo. Telular became a publicly held company in 1994. At the time of the hearing, Telular employed 145 people, including 45 to 50 engineers. Telular generated $40 million in revenues in 2000 and expects to generate in excess of $100 million in revenues in 2001. Millard 465:10-15, 468:19-23, 521:10-12.
4. Vox2 was founded in 1999 by Mike Hoeffler, John Clayton, Ken Holberger, and Rick Sullivan. At the time of the hearing, Vox2 employed 12 people. Plf. Ex. 21; Clayton 1003:15-1004:4; Noeffler 1102:11-18.
B. The `096 Patent
5. The patent at issue in this preliminary injunction matter is U.S. Patent No. 4,658,096 ("the `096 patent").
6. Inventors William West, Jr. and James E. Shafer filed the `096 patent application on September 18, 1994. The patent, entitled "System for Interfacing a Standard Telephone Set with a Radio Transceiver," issued on April 14, 1987 to Metrophone, Inc. Telular is the owner of the `096 patent by assignment. Def. Ex. 1.
7. The `096 patent describes a system for interfacing a standard telephone set with a cellular radio transceiver that is linked to a local central telephone office in an overall telephone network. The cellular radio transceiver is part of an existing cellular radio system in the area. `096 patent 1:6-13.
8. The interface of the `096 invention allows a user to place and receive telephone calls on a standard telephone set connected to the interface in the same manner that a user would place or receive calls on a landline telephone connected to the local central telephone office through a regular telephone jack. `096 patent 2:5-10.
9. When a standard telephone set connected to the `096 interface is taken offhook, the interface creates a dial tone. The dial tone is identical to the dial tone a user hears on a regular landline telephone connected to the telephone central office. `096 patent 2:46-52, 5:7-60.
10. As the telephone numbers are dialed on the standard telephone set, the `096 interface converts the dialed numbers into digital data for transmission by the transceiver. The interface includes a means for converting touch tone or pulse dialed numbers. `096 patent 2:63-68, 5:61-6:21, 6:52-7:8.
11. The interface of the `096 patent automatically determines when the last number of a telephone number has been dialed on the standard telephone set by using "digit analysis" or a combination of digit analysis and a "time-out" method. `096 patent 9:64-12:33.
12. The `096 patent explains that the first step in determining when the last number of a telephone number has been dialed is to look at the initial numbers of a telephone number and determine if the number one or the number zero has been dialed. The interface analyzes whether the number one or the number zero has been dialed in the first three numbers of the telephone number. By analyzing whether the number one or the number zero has been dialed in the first three numbers of the telephone number, the interface determines the type of number (i.e. local, long distance, international, etc.) dialed and thus, the expected total number of numbers in the telephone numbers. The numbers are counted as they are dialed. When the last number in the expected total number of numbers is dialed, a SEND code is sent by the interface instructing the radio transceiver to initiate a call. `096 patent 9:64-12:15.
13. *For certain types of numbers, such as international numbers, the number of numbers in the telephone number is indefinite. In this situation, the digit analysis method alone cannot determine when the last number has been dialed. To solve this problem, the `096 interface uses a time-out method in conjunction with digit analysis. Using the time-out method, the interface determines when the last number of a telephone number has been dialed through a timing operation. If a certain period of time elapses after any number is dialed, the interface assumes that number was the last number of the telephone number and causes the telephone call to be placed. The example used in the patent is a three-second time-out. If the user dials a number beginning with 011 and three seconds elapse without another number being dialed, the time-out circuit causes a SEND code to be sent and the SEND code causes the radio transceiver to initiate the call. `096 patent 12:16-33.
C. The Accused Device
14. Vox2's cell phone interface product is named the Vox.Link.
15. The Vox.Link is a microprocessor-based interface that allows calls to be placed and received through the cellular telephone by using a standard touch-tone telephone.
16. The Vox.Link is sold primarily as an accessory product for cellular telephones. There are currently three versions of the Vox.Link. One version works with Motorola cell phones, another version works with Nokia cell phones, and a third version works with Ericsson cell phones. Each version of the Vox.Link has a unique version of software that is executed by the microprocessor. Plf. Exs. 9-12, 23; Rhyne 916:10-917:1,
17. To use the Vox.Link, the user must connect a standard touch-tone telephone set to the Vox.Link using a piece of regular telephone wire. The telephone wire plugs into a phone jack, the RJ-11 jack, which is located in the back of the Vox.Link. The Vox.Link is also plugged into an electrical outlet from which it receives power to operate and charges the battery of the cellular telephone when placed in its cradle. A cellular telephone is placed in the Vox.Link cradle. Rhyne 733:13-734:9, 735:6-736:2; Hoeffler 1078:11-23.
18. If a user dials a telephone number on a standard touch-tone telephone set interfaced with the Vox.Link and then takes no further action, the Vox.Link will not initiate the telephone call over the cellular network. To initiate a call using the Vox.Link, the user must press the "#" key on the keypad of the touch-tone phone after dialing the telephone number. After the user presses the "#" key, the Vox.Link sends the telephone number and a command to place the call over the cellular network to the cellular telephone in the Vox.Link cradle. O'Brien 112:13-113:24; Rhyne 731:10-732:13, 734:11-735:5.
19. The Vox.Link only works with touch-tone phones. The Vox.Link does not work with rotary or pulse-dialed telephones. Rhyne 735:6-736:2; Hoeffler 1085:13-15.
D. The Claims at Issue
20. Four claims of the `096 patent are at issue in this preliminary injunction matter. Claim I reads as follows:
1. A telephone interface system for coupling a standard Touch-Tone/rotary dial telephone set with a radio transceiver used in a telephone communication system wherein the transceiver is capable of radio communication with a remote radio transmitter-receiver system that is part of a telephone network, wherein the interface system comprises:
a. telephone coupling means for providing a two-way communication link with the telephone set;
b. transceiver coupling means for providing a two-way communication link with the radio transceiver;
c. telephone number digital conversion means for receiving a group of touch tone or rotary dialed telephone numbers from said telephone coupling means, converting the group of telephone numbers into digital data, and providing said digital data to said transceiver coupling means;
d. determination means coupled with the telephone number digital conversion means for determining the last number of the group of telephone numbers provided at said transceiver coupling means;
e. send signal means coupled with said determination means for providing a send signal to the transceiver coupling means;
f. call detecting means for detecting an incoming call signal provided at said transceiver coupling means;
g. off-hook detecting means for detecting an off-hook signal provided at said telephone coupling means;
h. audio channel means for providing a two-way audio signal path between said telephone coupling means and said transceiver coupling means; and
i. telephone simulation means coupled with said telephone coupling means for providing audio frequency ring tone and dial tone signals thereto.
For easy reference, letters have been added to identify each of the elements of the claims at issue. This is consistent with how the parties referred to the claim elements during the preliminary injunction hearing.
21. For purposes of the preliminary injunction motion, the term "standard touch-tone/rotary dial telephone set" used in the preamble of claim 1 and elements c and d require interpretation.
22. Claim 9 of the `096 patent reads as follows:
9. A telephone interface system for coupling a standard Touch-Tone/rotary dial telephone set with a cellular-type radio transceiver comprising:
a. telephone number digital conversion means for converting a group of telephone numbers to digital data and for providing digital data to the transceiver;
b. determination means for automatically determining the last number of the group of telephone numbers;
c. send signal means coupled with said determination means for sending a predetermined send code signal to the transceiver in response to the determination means determining the last number;
d. call detecting means for detecting an incoming call from the transceiver; and
e. ring frequency generating means responsive to the incoming call for providing periodic audio ring tone frequency signals to said telephone set.
23. For purposes of the preliminary injunction motion, the term "standard touch-tone/rotary dial telephone set" used in the preamble of claim 9 and elements a and b require interpretation.
24. Claim 12 of the `096 patent reads as follows:
12. A cellular-type radio/telephone communication system having at least one remote radio station transmitter-receiver linked with a master cellular-type switching center which is in turn linked with a local telephone central switching office, wherein the remote radio station transmitter-receiver provides a wireless communication link with a base station transceiver, the improvement comprising:
a. a standard Touch-Tone/pulse dialing telephone set;
b. a cellular-type radio transceiver mounted at a fixed site;
c. interfacing means for interfacing said telephone set to said transceiver, said interfacing means including, power supply means for supplying DC voltage to said transceiver;
d. telephone number digital conversion means for converting touch-tone dialed/pulse-dialed telephone numbers from said telephone set to digital data for temporary storage in said transceiver;
e. sending means for enabling said transceiver to transmit the digital data;
f. telephone simulation means for providing ring-type and dial tone-type tone frequency signals to the telephone set.
25. For purposes of the preliminary injunction motion, the term "a standard Touch-Tone/pulse dialing telephone set" in element a and elements d and e of claim 12 require interpretation.
26. Claim 14 of the `096 patent reads as follows:
14. A telephone interface system for coupling a standard Touch Tone/rotary dial telephone set with a radio transceiver used in a telephone communication system wherein the transceiver is capable of radio communication with a telephone network, wherein the interface system comprises:
a. telephone number digital conversion means for converting a group of telephone numbers to digital data and for providing the digital data to a transceiver for storage of the digital data therein;
b. send signal means for providing a send signal to the transceiver for enabling the transceiver to transmit the digital data stored therein;
c. determination means for automatically determining when the send signal is to be provided to the transceiver; and
d. call detecting means for detecting an incoming call from the transceiver.
27. For purposes of the preliminary injunction motion, the term "standard touch-tone/rotary dial telephone set" used in the preamble of claim 14 and elements a and c require interpretation.
II. LIKELIHOOD OF SUCCESS ON THE MERITS
A. Infringement — Determination Means
28. *The determination means is found in each of the disputed claims of the patent. Claims 1, 9, and 14 are the independent claims directed to the interface. Claim 12 is a system claim, which claims a cellular-type radio/telephone communication system. `096 patent 15:21-55, 16:31-59, 16:60-17:15, 18:1-18; Rhyne 859:22-860:17.
Because claim 12 is a system claim, the Vox.Link device by itself cannot directly infringe the claim. Telular's allegation of infringement of claim 12 is based on a theory of contributory infringement or inducement. O'Brien 252:16-253:14.
29. The determination means is an important aspect of the `096 patent. `096 patent abstract, 2:8-10, 2:68-3:3, 7:28-30, 7:34-43, 9:64-12:33; Def. Ex. 6, ¶¶ 13-14; Def. Ex. 81; O'Brien 82:8-11; Def. Exs. 15 p. 8, 16 p. 10.
30. The first step of the literal infringement analysis for this mean-plus-function element is to determine if the Vox.Link performs the function of automatically determining when the last number of the group of telephone numbers is dialed.
31. To initiate a call using the Vox.Link, the user must press the "#" key after dialing the last number of the telephone number. Pressing the "#" key causes a SEND signal to be sent to the cellular telephone in the Vox.Link cradle. If the user does not press the pound key after dialing the last number of the telephone number, a SEND signal is never sent to the cellular telephone and the call is never initiated. O'Brien 112:12-113:24; Rhyne 731:10-732:13, 734:11-735:5.
32. The Vox.Link does not perform the function of automatically determining when the last number of the group of telephone numbers is dialed. The user must make this determination by pressing the "#" key after dialing the last number of the telephone numbers. The user's brain and finger perform the determination means function in a system using the Vox.Link. Rhyne 872:2-8, 888:3-8, 889:13-21, 890:1-10.
33. Manually determining when the last number of a telephone number has been dialed is not identical to the determination means automatically determining when the last number of a group of telephone number has been dialed. Thus, the Vox.Link does not perform the identical function of the determination means element of claims 1, 9, 12, and 14. Rhyne 872:2-8, 888:3-8, 889:13-21, 890:1-10.
34. Telular's expert, Kevin O'Brien, testified that the Vox.Link performed the same function as the determination means of the `096 patent through the use of a "software solution." O'Brien opined:
the preliminary injunction hearing, Vox2 moved to disqualify O'Brien as an expert with respect to claim interpretation, infringement, and validity of the patent. The Court did not rule on this issue because even if the Court were to assume that O'Brien qualified as an expert in these three areas, it would reach the same noninfringement result.
All of that determination means, all of that logical analysis is taking place inside that MCU, that box where we have the four — the D0 through 3 coming in, and we have the data from the MCU going out. The software is resident in that module and it can perform essentially whatever you can detect anything.
O'Brien 145:22-146:3. The Court finds O'Brien's opinion unpersuasive because he is not an expert on digital system design and at the time the patent was filed had not designed a digital circuit. O'Brien 349:15-350:7. O'Brien also admitted that he is not an expert on microprocessor based systems and has not designed a product that used a microprocessor as its control unit. O'Brien 350:19-25. O'Brien has never converted a system that used discrete logic components into a microprocessor-based system. O'Brien 352:2-5. O'Brien conceded that he is not a source code expert and admitted that it would take him two to three years to review all of the Vox.Link software. O'Brien further admitted that he did not review two of the three versions of the Vox.Link software. O'Brien 61:23-62:3, 353:25-354:19.
35. O'Brien also opined that Vox2's source code indicates that the Vox.Link analyzes the numbers that are dialed in a manner identical to the `096 determination means because the Vox.Link counts the numbers as they are dialed. O'Brien 166:11-168:23. The Court finds O'Brien's opinion incredible because the Vox device counts digits to determine if too many numbers have been dialed, not to determine if the last number of a group of telephone numbers has been dialed or to initiate a call. Rhyne 980:8-13. The Vox, Link does not use digit analysis or time-out to determine the last number of a group of dialed numbers.
36. To infringe claims 1, 9, 12, and 14 under the doctrine of equivalents, the Vox.Link must perform a function that is equivalent to automatically determining when the last number of the group of telephone numbers has been dialed or equivalent to automatically determining when the send signal is to be provided to the transceiver. A task completed manually by the user, such as pressing the pound to initiate a call, is not the same as or equivalent to a system that automatically completes the same task as described in the `096 patent. Rhyne 893:11-21. Thus, the Vox.Link does not infringe under the doctrine of equivalents.
37. The second step of the literal infringement analysis for this mean-plus-function claim element is to determine if the Vox.Link has structure that is identical or equivalent to the corresponding structure disclosed in the `096 patent.
38. The structure disclosed in the `096 patent that corresponds to the determination means is an interconnected group of hardwired discrete electronic components or digital circuitry shown in figures 3C and 3D. Figure 3C is the hardwired digital circuitry that performs the digit analysis. Figure 3D is the hardwired digital circuitry that performs the time-out function which is sometimes used in conjunction with the digit analysis. The information obtained from the analysis performed by figures 3C and 3D is used to determine when the last number of the group of telephone numbers has been dialed. Once that determination is made, a SEND signal is automatically generated and the telephone call is placed. Rhyne 797:9-810:6.
39. The Vox.Link lacks structure which is identical or equivalent to the circuit of figures 3C and 3D. The Vox.Link utilizes a microprocessor executing software code rather than the hardwired digital circuits disclosed in the circuit diagrams of the `096 patent. Rhyne 894:21-25. The fact that the Vox.Link uses a microprocessor and software does not in and of itself avoid the possibility of having an equivalent structure. If a microprocessor and software based device is programmed to perform an equivalent function as hardwired digital circuitry, the structures may be equivalent. However, in order to perform the equivalence analysis, one must study how the software controls the microprocessor which requires knowledge of the detailed operation of the relevant portions of the software. Rhyne 894:21-895:23.
40. The structure of the `096 patent is not equivalent to the software executed by the microprocessor in the Vox.Link. Def. Exs. 84, 84A, 84B; Rhyne 896:9-899:10.
B. Infringement — Conversion Means
41. The first step of the literal infringement analysis for this means-plus-function claim element is to determine if the Vox.Link performs the function of converting both touch-tone dialed telephone numbers and rotary dialed (or pulse-dialed) telephone numbers into digital data. The Vox.Link does not work with rotary dial telephones or tone/pulse telephones set to the "pulse" mode of operation because it cannot convert pulse dialing signals to digital data. The Vox.Link can only convert DTMF signals from a touch-tone telephone. Thus, the Vox.Link does not perform the identical converting function of claims 1, 9, 12, and 14.
42. Because the Vox.Link can only convert DTMF signals into digital data and cannot convert rotary (or pulse-dialed) signals into digital data, the Vox.Link does not perform an equivalent function. Rhyne 890:15-894:6.
43. The converting function of the conversion means element corresponds to the decoder circuit 13 shown in figure 3A of the `096 patent. Decoder circuit 13 is a Teltone-948. The Teltone-948 is capable of converting both rotary pulses and DTMF signals into digital data. Rhyne 870:5-19, 887:25-888:2.
44. The Vox.Link contains a decoder which can only convert DTMF signals into digital data. The Vox.Link does not have the capability of converting rotary pulses. A decoder that converts only DTMF signals is not identical or equivalent to a decoder that is capable of converting both rotary pulses and DTMF signals. Rhyne 870:5-871:25, 887:22-888:2, 889:1-9, 890:1-10.
III. IRREPARABLE HARM
A. Telular Does Not Compete With Vox2
45. Telular's failure to compete with Vox2 evidences a lack of irreparable harm. At the time of his deposition in June of 2001, Telular's CEO, Kenneth Millard, was aware of only one alleged instance where a customer who was going to purchase a Telular product instead purchased the Vox.Link. Millard 571:9-23.
46. Telular and Vox2 target different markets and consumers. The Vox.Link is an accessory for a personal cell phone. Cellular customers increasingly use their cellular telephone and cellular network service at home in order to take advantage of cellular plans with free long distance calling at night and on weekends. In addition, many people who frequently use their cellular telephones want to be able to easily place and receive calls using their cellular telephone while at home. The Vox.Link caters to this new and expanding market for cellular telephone use at home. Hoeffler 1079:7-1081:4.
47. Telular's products have a cellular transceiver built into the terminal and are not desirable to consumers who own a cell phone. Vox2 targets its cradle to consumers who own a cell phone. Hoeffler 1077:3-1080:14.
48. *The Consumer Electronics Show is held in Las Vegas each year and is the world's biggest consumer electronics show. In Vox2's first year in existence, it was an active participant at the show and provided preliminary product information to many buyers from potential retail sales channels. Telular does not attend the Consumer Electronics Show in any official capacity, and it does not display its products at this show. Millard 565:24-567:2; Clayton 1005:9-1006:17.
49. Telular's products are different than Vox's product. Telular does not make a single product that works with a personal cell phone. All of Telular's products are made with a cellular transceiver built into the product. Thus, an individual who has a personal cell phone and a service plan associated with that cell phone cannot use her cell phone or service plan with a Telular product. Rather, she must get a separate service plan to use the Telular product. Millard 555:8-11, 556:1-6.
50. In 1998, Telular sold a product that required the user to place a cell phone in the cradle of the device. The product was discontinued by Telular after 1998 despite the product accounting for one third of Telular's sales in 1998. Millard 556:24-557:9.
51. Telular is currently working on developing a newer version of the cradle but that project is not a priority for Telular. Millard 565:11-23.
52. Telular does not make a product which requires the user to manually press the pound key on the telephone keypad to place the call. Every Telular product that interfaces a standard telephone set with a cellular transceiver incorporates the automatic determination means of the `096 patent. Telular deliberately decided to utilize the automatic determination means of the `096 patent in order to seamlessly replicate a landline telephone while placing a call over the cellular network. Telular believes that having its products automatically place the telephone call using the automatic determination means provides Telular with a competitive advantage. Millard 550:14-551:1.
53. Every Telular product has the capability to work with both a touch-tone telephone and a rotary dial telephone (or tone/pulse phone). Millard 557:23-558:3.
54. Telular produces two families of products: 1) fixed wireless terminals and 2) security products. Fixed wireless terminals transmit voice, fax, and other data over cellular systems. Telular's security products provide a back-up for alarm systems. Millard 466:25-468:6
55. *In the Fixed Wireless Terminal ("FWT") category, Telular's products are normally identified by the prefix "SX." According to its website, Telular markets its FWT products as an alternative to landline telephone service and as a means to address situations where "landline systems are unsuitable, unavailable, or simply to costly to deploy." A small percent of Telular's FWT products are sold in the United States where the landline telephone infrastructure is fully developed. Ex. G to Vox2, Inc.'s Memorandum in Opposition to Telular Corporation's Motion for Preliminary Injunction.
56. *Telular's best selling product is a desktop phone, model SX4D, which does not compete with the Vox.Link. The SX4D does not embody or practice the `096 invention because it does not work with a standard telephone set. The SX4D does not have a connection that will allow a standard telephone set to be plugged into it. Rather, the SX4D has both a telephone keypad and a transceiver integrated to form a single functional unit. Def. Ex. 37; Millard 551:14-552:8.
57. Telular sells a fixed wireless terminal, model SX4E, that interfaces a standard telephone set with a radio transceiver. Telular asserts that the SX4E family competes directly with the Vox.Link, but the SX4E differs in many important respects from the Vox.Link. Millard 557:10-13. The SX4E allows users to transmit faxes and data from a modem over the cellular network. The Vox.Link does not have these capabilities. Hoeffler 1083:16-1084:15. The SX4E also contains an external connector allowing a high quality antenna that provides better reception to be connected. The Vox.Link does not have an external connector allowing an antenna to be connected. Instead, the Vox.Link uses the antenna built into the personal cell phone docked in the cradle. Millard 559:21-560:1; Hoeffler 1084:16-1085:1. Telular's SX4E products work with 16 kHz pay phone tones. The Vox.Link does not offer this feature. Millard 560:21-561:1; Hoeffler 1085:25-1086:9. The SX4E retails in the United States for $500 while the Vox.Link retails for $200. Millard 557:14-18; Hoeffler 1088:7-9.
58. Telular did not offer any evidence suggesting that its security products practice the invention of the `096 patent. There is no evidence in the record that Telular's security products can interface a standard telephone set with a radio transceiver which is a fundamental requirement of the `096 invention.
B. Telular's License to Andrews Corporation
59. Telular's license to Andrews Corporation ("Andrews") for a product similar to Vox.Link provides further evidence that the Vox.Link does not compete with Telular's fixed wireless terminals.
60. *Andrews manufactures a cellular telephone cradle that competes with the Vox.Link. The Andrews' product is called the Extensis. The Extensis was launched in March of 2001 with a suggested retail price of $200. Plf. Ex. 34; Farkas 1047:24-1048:7; Hoeffler 1093:6. 1094:10-24.
61. Andrews licensed the `096 patent as well as U.S. Patent No. 4,922,517 and U.S. Patent No. 4,775,997.
62. *The Andrews license contained certain limitations, one of which was a maximum equivalent Ringer Equivalence Number ("REN"). Plf. Ex. 18(4).
63. *The REN limitation in the Andrews license limits the Extensis to powering a certain number of telephones. The Telular fixed wireless terminals have a much higher power level and can power up to five standard telephones.
64. The actual REN value of the Extensis is 3.0. The actual REN value of the Vox.Link is also 3.0. Hoeffler 1099:15-25. Thus, the Vox.Link and the Extensis will ring an equivalent number of telephones.
65. The Vox.Link is capable of decoding only DTMF signals, not rotary/pulse signals. The Vox.Link does not provide for a remote antenna and it only uses the integral antenna of the cellular telephone it is being used with. The Vox.Link is designed to be manufactured, marketed, and sold only as an external finished product for use with a cellular telephone. Thus, the Vox.Link appears to comply with every limitation in the Andrews' license that the Extensis complies with. Plf. Ex. 18(4); Hoeffler 1099:10-1100:9.
66. The Extensis does not require the user to press the "#" symbol to manually initiate a call. Rather, the unit performs a digit analysis to automatically determine when the last number of a telephone number is dialed. Thus, the Extensis utilizes the automatic determination feature of the `096 patent while the Vox.Link does not. Hoeffler 1100:1-6.
67. With the exception of manually initiating a call instead of automatically determining when the last number of a telephone number has been dialed, the Vox.Link is virtually identical to the Extensis in terms of price, features, and performance. Hoeffler 1094:10-22. Because the Telular license with Andrews with designed to keep the Extensis from competing with Telular's fixed wireless products, it is reasonable to conclude that the Vox.Link does not compete with Telular's products.
C. The WHP Wireless Case
68. *Telular is currently involved in another patent infringement lawsuit involving the `096 patent and a cell telephone cradle similar to the Vox.Link. The declaratory judgment plaintiff in that case is WHP Wireless ("WHP"). WHP filed a declaratory judgment action in March 2001 seeking a declaration that its cellular telephone cradle, called the Cell Socket (Def. Ex. 77). does not infringe the `096 patent and certain other Telular patents. Telular answered and counterclaimed alleging that the Cell Socket infringes the `096 patent as well as other Telular patents in suit. Def. Ex. 59; Millard 523:9-524:1; 526:17-19.
69. The Cell Socket is essentially identical to the Vox.Link. The Cell Socket is designed to work with a cellular telephone. The Cell Socket looks like and functions like the Vox.Link. The Cell Socket has been offered for sale to the public since June of 2001 because Vox2 was able to purchase a Cell Socket at that time. Def. Ex. 77; Millard 523:19-524:1, Farkas 1048:9-19.
70. Telular's CEO admitted that WHP's Cell Socket poses the same threat of irreparable harm to Telular as the Vox.Link. He further admitted that he does not know if Telular has suffered any harm, irreparable or otherwise, from WHP selling the Cell Socket. Telular's decision not to seek a preliminary injunction as of July 10, 2001 against WHP's sales of the Cell Socket further confirms that Telular is not suffering irreparable by the sale of the Vox.Link. Millard 524:19-23; 525:17- 526:8; 526:20-527:15.
D. Vox2 Will Not Be Judgment Proof
71. Telular maintains that a preliminary injunction should be granted because Vox2 will likely be judgment proof after a full trial on the merits. Because Vox2 will likely obtain significant additional outside investor financing if the preliminary injunction is denied and its sales have been steadily increasing, the Court concludes that Vox2 will not be judgment proof after a full trial on the merits.
72. Vox2 received an initial investment (first round financing) and since then has received additional funding in the form of a bridge loan. Farkas 1038:4-5, 1045:4-8.
73. Numerous venture capitalists have shown an interest in Vox2 as an investment, but Vox2 has been unable to proceed past the first round of financing due to the patent issues in this case and the cost of litigation. Several institutions have made a commitment to invest in Vox2 pending the outcome of this case. This second round of investment would include conversion of the bridge loan. Farkas 1039:24-1040:23, 1069:1-10.
74. It is reasonable to conclude that if the preliminary injunction is denied, Vox2 would receive significant additional financing which would make it unlikely that Vox2 would be judgment proof after trial.
75. In addition, sales of the Vox.Link have been steadily increasing since the product launch in November of 2000. Plf. Ex. 21; Clayton 1008:1-6.
76. The potential success of the Vox.Link is confirmed by Vox2's short relationship with ATT. Vox2 had an agreement with ATT to sell the Vox.Link through ATT's web site and direct mailings to customers. Under this agreement, ATT quickly sold Vox.Link units. Hoeffler 1091:12-23.
77 *When Telular's attorneys learned that ATT was selling the Vox.Link, they sent a letter dated March 15, 2001 to ATT demanding that it cease and desist from selling or distributing the Vox.Link. ATT complied with Telular's demands and stopped selling the Vox.Link. Def. Ex. 49; Hoeffler 1091:24-1092:11.
78. The market in which the Vox.Link is sold is fairly large and can accommodate many competing firms. Farkas 1050:24-1051:7. According to Telular's CEO, [t]he market for interface devices has expanded dramatically since its first introduction period, . . . [and] the markets are now finally poised for an explosion in interface products." Millard Declaration ¶ 10.
79. If an injunction does not issue, Vox2 will likely be capable of selling more than enough units to break even a year from now. Hoeffler 1111:16-18.
80. In the next year to two years, Vox2 will have the time to successfully raise money, develop the market and increase sales of the Vox.Link to pay a potential damage award in the several hundred thousand dollar range. Farkas 1051:22-1052:8; Hoeffler 1101:24-1102:10.
IV. BALANCE OF THE HARMS
81. Vox2 will suffer an immediate and devastating harm if a preliminary injunction issues. The Vox.Link is the only product Vox2 manufactures and sells. Vox2 will be forced to go out of business almost immediately if a preliminary injunction issues. Hoeffler 1102:11-18.
82. If a preliminary injunction issues, Vox2 would be unable to generate additional investment capital to keep the company operating during the time between the issuance of the preliminary injunction and a trial on the merits. Without the ability to sell the Vox.Link and additional investment capital, Vox2 would promptly go out of business. Farkas 1044:4-10.
83. If the Court wrongly enters the preliminary injunction, Vox2 will be put out of business.
84. Telular's assertion that it will probably go out of business if an injunction does not issue is not credible. Millard 521:13-522:25. Telular expects to generate revenues in excess of $100 million in 2001. Millard 521:10-12. For the first three quarters of Telular's 2001 fiscal year, sales of SX4D telephones comprised $56,828,000 of Telular's $81,944,000 in total domestic and international sales. Accordingly, the desktop phone, which does not practice the invention of the `096 patent, generates 69.3% of Telular's current sales. Plf. Ex. 24; Millard 551:14-17. Beyond the situation with ATT Wireless, Telular did not offer any evidence of lost sales due to the sale of the Vox.Link.
V. THE PUBLIC INTEREST
85. The public interest will not be served by enjoining the sale of the noninfringing Vox.Link which is a reasonably priced cellular telephone accessory.
CONCLUSIONS OF LAW
I. JURISDICTION AND PRELIMINARY INJUNCTION STANDARD
1. The Court has jurisdiction over this matter pursuant to 28 U.S.C. § 1331 and 1338(a).
2. As the moving party, Telular bears the burden of establishing it is entitled to a preliminary injunction in light of four factors: (1) a reasonable likelihood of success on the merits; (2) irreparable harm if an injunction is not granted; (3) a balance of hardships tipping in its favor; and (4) the injunction's favorable impact on the public interest.Amazon.com, Inc. v. Barnesandnoble.com, Inc., 239 F.3d 1343, 1350 (Fed. Cir. 2001).
3. Telular's preliminary injunction motion can only be granted if it establishes both of the first two factors, i.e., likelihood of success on the merits and irreparable harm. Id.
4. If Telular establishes the first factor by making a clear showing of both validity and infringement, it is entitled to a rebuttable presumption of irreparable harm. Purdue Pharma L.P. v. Boehringer Ingelheim GMBH, 237 F.3d 1359, 1363 (Fed. Cir. 2001).
II. LIKELIHOOD OF SUCCESS ON THE MERITS
5. To demonstrate a likelihood of success on the merits, Telular must show that, in light of the presumptions and burdens that will inhere at a trial on the merits, (1) Telular will likely prove that Vox2 infringes the `096 patent, and (2) Telular's infringement claim will likely withstand Vox2's challenges to the validity of the `096 patent.Amazon.com, Inc., 239 F.3d at 1350.
6. If Vox2 raises a substantial question concerning either infringement or invalidity by asserting an infringement or validity defense that Telular cannot prove "lacks substantial merit," the preliminary injunction should not issue. Id. at 1350-51.
7. An infringement analysis requires two steps. The claim scope is first determined, and then the properly construed claim is compared with the accused device to determine whether all of the claim limitations are present either literally or by a substantial equivalent. Young Dental Mfg. Co. v. Q3 Special Products, Inc., 112 F.3d 1137, 1141 (Fed. Cir. 1997).
8. Determining the meaning and scope of each asserted claim is the first step in an infringement analysis. Amazon.com, Inc., 239 F.3d at 1351.
A. Claim Construction
9. Claim construction, including the meaning and scope of any means-plus-function limitations, is a question of law. J M Corp. v. Harley-Davidson, Inc., 269 F.3d 1360, 1366 (Fed. Cir. 2001).
10. "When construing claims, a court should first look to the intrinsic evidence: the claims themselves, the specification, and if in evidence, the prosecution history." Globetrotter Software, Inc. v. Elan Computer Group, Inc., 236 F.3d 1363, 1368 (Fed. Cir. 2001).
11. "Extrinsic evidence is that evidence which is external to the patent and file history, such as expert testimony, inventor testimony, dictionaries, and technical treatises and articles." Vitronics Corp. v. Conceptronic, Inc., 90 F.3d 1576, 1584 (Fed. Cir. 1996). "[C]ourts [should] not rely on extrinsic evidence in claim construction to contradict the meaning of claims discernible from thoughtful examination of the claims, the written description, and the prosecution history — the intrinsic evidence." Pitney Bowes, Inc. v. Hewlett-Packard Co., 182 F.3d 1298, 1308 (Fed. Cir. 1999).
12. Words in a claim are generally given their ordinary and customary meaning. Vitronics Corp., 90 F.3d at 1582; Carroll Touch, Inc. v. Electro Mechanical Sys., Inc., 15 F.3d 1573, 1577 (Fed. Cir. 1993) (stating "[T]he words of a claim are generally given their ordinary and accustomed meaning, unless it appears from the specification or the file history that they were used differently by the inventor.").
13. The parties agree that the claims at issue include means-plus-function limitations governed by 35 U.S.C. § 112, ¶ 6.
14. Section 112, paragraph 6 states that a means-plus-function claim "shall be construed to cover the corresponding structure, materials, or acts described in the specification and equivalents thereof."
15. Interpreting the elements of a mean-plus-function claim is a two-step process. The court first identifies the function of the claim element. After identifying the function of the means-plus-function claim element, the court identifies the structure corresponding to that function in the patent. Micro Chemical, Inc. v. Great Plains Chemical Co., Inc., 194 F.3d 1250, 1258 (Fed. Cir. 1999). The scope of claim language in a means-plus-function limitation is "sharply limited to the structure disclosed in the specification and its equivalents." J M Corp., 269 F.3d at 1367.
16. "Where words in the preamble `are necessary to give meaning to the claim and properly define the invention,' they are deemed limitations of the claim." Gerber Garment Tech., Inc. v. Lectra Systems, Inc., 916 F.2d 683. 688 (Fed. Cir. 1990) (quoting Perkin-Elmer Corp. v. Computervision Corp., 732 F.2d 888, 896 (Fed. Cir.), cert. denied, 469 U.S. 857, 105 S.Ct. 187, 83 L.Ed.2d 120 (1984)). "The effect preamble language should be given should be resolved only on review of the entirety of the patent to gain an understanding of what the inventors actually invented and intended to encompass by the claim." Corning Glass Works v. Sumitomo Electric U.S.A., Inc., 868 F.2d 1251, 1257 (Fed. Cir. 1989).
1. Claim 1 — Preamble
17. The term "standard touch-tone/rotary dial telephone set" used in the preamble of claim 1 requires interpretation.
18. The term "standard touch-tone/rotary dial telephone set" is a joinder of the terms "standard touch-tone telephone set" and "standard rotary dial telephone set." The term includes both a standard touch-tone telephone and a standard rotary dial telephone.
19. A standard touch-tone telephone set is a telephone with a keypad of twelve individual keys consisting of the numbers 0-9 and the "#" and "*" symbols. A standard touch-tone telephone set allows dialing of numerals 0-9 and the "#" and "*" symbols by producing paired audible tones in accordance with the dual-tone multifrequency (DTMF) standard. Redial, repertory dialing, and speed dialing are not required features of a standard touch-tone telephone set. Def. Ex. 29; O'Brien 363:20-364:5; Rhyne 721:23-722:18, 725:15-728:10. Redial, repertory dialing, and speed dialing are not part of the `096 invention. O'Brien 231:21-23.
20. A standard rotary dial telephone set is a telephone with a single circular telephone dial having ten equally spaced fingerholes labeled with the numbers 0-9. A standard rotary dial telephone set allows dialing of the numbers 0-9, but not the "#" or "*" symbols, representing the dialed numbers by the number of times the subscriber loop circuit is opened and closed at a time rate following release of the dial. Def. Ex. 29; Rhyne 721:23-722:18, 725:15-728:10.
21. The term "standard touch-tone/rotary dial telephone set" in the preamble of claim 1 is the first recitation of and the antecedent basis for structural limitations that are referred to later in the body of the claim. The term "standard touch-tone/rotary dial telephone set" is a substantive limitation to the scope of claim I.
22. Telular's SX4E wireless terminal which embodies the invention of the `096 patent works with both a touch-tone and a rotary dial telephone. Plf. Demonstrative Ex. 2; Def Ex. 42; Rhyne 789:22-790:14.
23. The Court concludes that the limitation that the interface of claim 1 work with a "touch-tone/rotary dial telephone set" means the interface must be capable of working with both a standard touch-tone telephone set and a standard rotary dial telephone set. The specification makes clear that the inventors wanted the interface of the `096 patent to be capable of working with standard or conventional telephones. `096 patent 2:5-7 ("The present invention relates to the interfacing of conventional telephone handsets with standard cellular-type radio transceivers."); 2:26-28 ("The instant invention . . . can be coupled to standard telephones"); 2:45-46 ("The radio transceiver is coupled with conventional telephone sets by a novel interface system."); 3:11-13 ("It is thus an objection of the present invention to provide a new and unique interfacing system for interfacing a standard telephone set with a wireless radio transceiver"); 3:33-35 ("Still another object of the present invention is to employ the standard cellular type radio transceiver in a fixed location with conventional telephone handsets"). At the time of the invention in 1984, standard telephones included both rotary dial telephone sets and touch-tone telephone sets. O'Brien 45:18-46:5. The Court's construction is also consistent with the decoder circuit 13 disclosed in the specification which converts both touch-tone and rotary dialed inputs.
2. Claim 1 — Conversion Means
24. The "telephone number digital conversion means" ("conversion means") of claim 1 requires interpretation.
25. The conversion means of claim 1 comprises a"telephone number digital conversion means for receiving a group of touch tone or rotary dialed telephone numbers from said telephone coupling means, converting the group of telephone numbers into digital data, and providing said digital data to said transceiver coupling means." `096 patent 15:33-15:38.
26. The terms "number" or "numbers" should be given their ordinary meaning. "Number" or "numbers" refers to the Arabic numerals 0-9. O'Brien 363:7-19.
27. The term "a group of touch-tone or rotary dialed telephone numbers" as used in the conversion means element of claim 1 also requires interpretation.
28. It is unclear from the conversion means use of the term "or" whether the corresponding structure of the receiving means and converting means must be capable of receiving and converting only touch-tone telephone numbers, only rotary dialed telephone numbers, or both types of numbers. This ambiguity can be resolved by turning to the specification and looking at the corresponding structure.
29. Turning first to the specification, it is clear that the conversion means of the interface unit must be capable of receiving and converting a group of touch-tone dialed telephone numbers as well as a group of rotary dialed numbers. The specification states: "[D]ialing may be accomplished by either touchtone or rotary dialing depending upon the standard headset available. In either case, the particular telephone numbers that are dialed are decoded by the converter circuit 13." `096 patent 5:61-5:65.
30. Moreover, the only structure described in the specification that performs a converting function is circuit element 13. Circuit element 13 is a Teltone M-948 DTMF receiver. The Teltone M-948 receives the group of telephone numbers and converts the group of telephone numbers into digital data. The Teltone M-948 is capable of converting both DTMF signals produced by a standard touch-tone telephone set and pulse signals produced by a standard rotary dial telephone set into digital data. Def Ex. 31; O'Brien 378:22-379:1; Rhyne 762:1-762:19.
31. In addition, at the time the `096 patent was filed in 1984, circuits that received and converted only DTMF signals were readily available. At that same time, circuits that received and converted only pulse-dialed telephone numbers were also readily available. O'Brien 382:23-383:21; Rhyne 792:18-793:18. Thus, the inventors of the `096 patent could have disclosed a circuit that received and converted only DTMF signals or received and converted only pulse signals.
32. In disclosing circuit element 13, the patent specification states: "Circuit element 13 is a Teltone M-948 DTMF receiver, although equivalent converter or decoder circuits could be employed." `096 patent 5:13-15. In this context, an equivalent converter or decoder circuit is another circuit that can decode both touch-tone and rotary dial telephone signals. A circuit that can only decode touch-tone signals or only decode rotary signals is not an equivalent circuit to one that can decode both touch-tone signals and rotary dial signals.
33. Thus, the Court concludes that a "group of touch-tone or rotary dialed telephone numbers" means a group of touch-tone dialed telephone numbers or a group of rotary dialed telephone numbers. This term does not include a group of telephone numbers consisting of a mixture of the two types of numbers. The word "or" in the quoted term means that the referenced group of telephone numbers consists only of one type of dialed number or the other. The word "or" does not mean that the conversion means of the interface need only be capable of processing one type of group of telephone numbers or the other. Rather, the conversion means must be capable or processing both types of groups of dialed numbers.
34. Because the conversion means element of claim 1 is written in a means-plus-function form, the Court must identify the claimed function of the conversion means limitation.
35. Paragraph c of claim 1 recites three functions that must be performed by the conversion means: (1) receiving a group of touch tone or rotary dialed telephone numbers from the telephone coupling means; (2) converting the group of telephone numbers into digital data; and (3) providing said digital data to said transceiver coupling means.
36. Having identified the functions of the conversion means element, the Court next looks to the written description to identify the structure corresponding to those three functions.
37. The structure disclosed in the `096 patent specification that corresponds to the function of receiving a group of touch tone or rotary dialed telephone numbers from said telephone coupling means is current sensing relay 11, standard touch-tone/rotary dial decoder-converter circuit 13, the LC(NOT) and SIG IN pins of standard touch-tone/rotary dial decoder-converter circuit 13, buffers 15, buffer 25 and the resistance and capacitance circuits connected to it, transistor 17, relay 19, and modulation chokes 21, 23 as shown in figure 3A. Def. Ex. 29; Rhyne 757:15-19.
38. The Court concludes that receiving a "group of touch-tone or rotary dialed telephone numbers" means that the receiving structure must be capable or receiving both a group of touch-tone dialed telephone numbers and a group of rotary dialed telephone numbers. The receiving structure need not be capable of receiving a group consisting of a mixture of touch-tone and rotary dialed telephone numbers.
39. The structure disclosed in the `096 patent specification that corresponds to the function of converting the group of telephone numbers into digital data is circuit element 13, including the LC(NOT) (for receiving pulse dialing inputs), SIG IN (for receiving tone dialing inputs), D3, D2, D1 and D0 pins as shown in figure 3A. Def. Ex. 29; Rhyne 758:23-760:15.
40. The Court determines that converting the "group of touch-tone or rotary dialed telephone numbers" means that the converting structure must be capable of converting both a group of touchtone dialed telephone numbers and a group of rotary dialed telephone numbers. The corresponding structure need not be capable of converting a group of numbers consisting of a mixture of touch-tone and rotary dialed telephone numbers.
41. The structure disclosed in the `096 patent specification that corresponds to the function of providing said digital data to said transceiver coupling means is buffers 65, TRI-STATE buffer 67, gate 51, and data lines D3, D2, D1 and D0 as shown in figure 3A, terminals 7(D3), 8(D2), 9(D1), 10(D0), and 16(DATA) of junction J3 to the adapter board 9, as shown in figures 3B and 5, shift register 75 and data line 77 as shown in figure 5, gate 230, and terminal 5 of junction J2 of interface board 5 as shown in figure 3B. Def. Ex. 29; Rhyne 778:6-11.
42. The Court concludes that providing said digital data means that the corresponding structure must be capable of providing digital data representing a group of touch-tone dialed telephone numbers and be capable of providing digital data representing a group of rotary dialed telephone numbers. The corresponding structure need not be capable of providing digital data representing a group consisting of a mixture of touch-tone and rotary dialed telephone numbers.
3. Claim 1 — Determination Means
43. The determination means of claim 1 comprises a "determination means coupled with the telephone number digital conversion means for determining the last number of the group of telephone numbers provided at said transceiver coupling means." `096 patent 15:39-15:42.
44. The meaning of the terms "number" or "numbers" in the determination means of claim 1 is Arabic numerals 0-9, the same meaning as in the conversion means of claim I.
45. The parties dispute whether the term "digit" means the same thing as "number" or "numerals." Telular asserts that the term "digit" includes any button on a twelve digit keypad of a standard touch-tone telephone, including the "#" and "*" buttons. Vox2 argues that the term "digit" should be construed to mean the same thing as the terms "number" or "numerals" or the Arabic numerals 0-9.
46. Though the use of an appositive, the `096 patent repeatedly uses the term "number" or "numerals" to mean the same thing as the term "digit." Appositives are two words or a group of words which mean the same thing and are placed together in a sentence. A nonrestrictive appositive is not essential to maintain the meaning of the sentence and may be left out without changing the sentence's basic meaning. A nonrestrictive appositive is separated by commas. Def. Exs. 1, 82, 83; Chicago Manual of Style, p. 170-71 (14the ed. 1993).
47. In at least six separate instances, the `096 patent uses a nonrestrictive appositive to indicate that the term "numbers" or "numerals" means the same thing as the term "digit." `096 patent 2:65, 3:26, 6:58, 7:28, 10:1, 14:31. Thus, the language of the patent resolves the issue of whether the terms "number" or "numerals" and "digits" mean the same thing.
48. The Court concludes that within the `096 patent, the terms "numbers" or "numerals" and "digits" are used as synonyms and mean the same thing, namely the Arabic numerals 0-9. The pound symbol on the keypad of a touch-tone telephone is not a "number" or a "numeral."
49. Neither the word "pound" nor the "#" symbol appear in the `096 patent. The term "digit" does not appear in any of the four independent claims of the patent. The language of the claims makes clear that the function of the determination means is determining the last number of the group of telephone numbers. The claims are limited to determining the last Arabic numeral (i.e., 0-9) of the group of telephone numbers, and it would be improper to broaden the claim by redefining the term "number" to include the # symbol.
50. The "determination means" element of claim I is written in a means-plus-function form. The Court must therefore identify the claimed function of the "determination means" limitation.
51. The function of the determination means element of claim 1 is automatically determining the last number of the group of telephone numbers provided at said transceiver coupling means.
52. The structure found in the `096 patent specification that corresponds to the determining function of the determination means of claim 1 is the DV output of decoder 13, inverter 49, NAND gate 51, DV inverter 53, and buffers 65 as shown in figure 3A, counter 111. binary to decimal converter or decoder 113, decimal digit converter or decoder 115, gates 117A-E, latch 119, gate 121, gate 123, gate 125, latch 127, gate 129, gate 131, gate 133, latch 135, latch 137, gate 138, gate 139, latch 141, gate 143, gate 145, counter 147, gate 149, gate 151, gate 153, gate 155 as show in figure 3C, and timer 59, 39 as shown in figure 3D. Def. Ex. 29; Rhyne 799:16-808:11.
53. The structure corresponding to the determining function determines the last number of the group of numbers by using digit analysis or a combination of digit analysis and a time-out method. `096 patent 9:64-10:34; Rhyne 797:9-798:3. Digit analysis and time-out are both required to perform the determination means function to handle all possible dialing combinations. Rhyne 806:21-807:7.
54. To determine the last number of a group of numbers using digit analysis, the structure corresponding to the determination means analyzes the first three numbers dialed on the standard telephone set to determine what type of telephone number is being dialed. By analyzing whether the number one or the number zero has been dialed in the first three numbers of a telephone number, the structure can determine the expected total number of numbers in that particular telephone number. The numbers are counted as they are dialed and when the last number in the telephone number is dialed, the SEND code is sent to another portion of the interface signaling the last number of a group of numbers has been dialed. `096 patent 9:64-12:15; Rhyne 800:7-804:18.
55. To determine the last number of a group of numbers using a combination of digit analysis and the time-out method, the structure corresponding to the determination means analyzes the first three numbers dialed on the standard telephone set to determine what type of telephone number is being dialed. If the particular type of telephone number has an indefinite number of total numbers, the time-out method is used to determine when the last number of the group of telephone numbers is dialed. When using the time-out method, the determination means sends a command to another portion of the interface signaling that the last number of a group of numbers has been dialed after three seconds elapse after a number is dialed. `096 patent 10:64-11:34, 12:16-33; Rhyne 805:8-807:7.
56. The only structure disclosed in the `096 patent corresponding to the determination means is a structure which automatically determines when the last number of a group of telephone numbers is dialed. No manual indication by the user that the last number has been dialed is necessary to initiate the call. Because the structure disclosed in the `096 patent performs only automatic determination, the determining function does not encompass manually pressing the "#" key to indicate that the last number of the telephone number has been dialed. Telemac Cellular Corp. v. Topp Telecom, Inc., 247 F.3d 1316, 1324 (Fed. Cir. 2001). `096 patent 7:28-34, 9:64-68; Rhyne 804:20-805:7, 806:15-806:20, 807:8-807:14; Def. Ex. 81 (inventor testimony confirming that a system which requires the user to manually press SEND to initiate the call is different than a system which automatically determines when the last number of a group of telephone numbers has been dialed). 4. Claim 9 — Preamble
Telular claims that in DNIC Brokerage Co. v. Morrison Dempsey Communications Inc., 14 U.S.P.Q.2d 1043 (C.D. Ca. 1989), the court held that the defendant's AB3X device infringed the `096 patent because device used the pound and the asterisk sign as part of the determination of the last number dialed. The court's opinion does not indicate whether its finding of infringement is based on the AB3X's use of the pound sign or on some other ground. Telular's Memorandum in Support of its Motion for a Preliminary Injunction, Ex. B. At the hearing in this matter, Telular attempted to introduce into evidence a copy of O'Brien's testimony from the DNIC litigation to help explain the basis of the trial judge's infringement opinion. Vox2 objected to the admission of the testimony on hearsay grounds. Telular has not responded to Vox2's hearsay objection and that objection is sustained. Because the DNIC court's opinion lacks reasoning supporting its infringement finding, the Court finds it unpersuasive in this matter.
57. The term "standard touch-tone/rotary dial telephone set" used in the preamble of claim 9 requires interpretation.
58. The meaning of the term `standard touch-tone/rotary dial telephone set" used in the preamble of claim 9 has the same meaning as defined in claim 1. The term includes both a standard touch-tone telephone set and a standard rotary dial telephone set.
59. The term "standard touch-tone/rotary dial telephone set" in the preamble of claim 9 is the first recitation of and the antecedent basis for structural limitations that are referred to later in the body of the claim. Thus, a "standard touch-tone/rotary dial telephone set" is a substantive limitation to the scope of claim 9.
60. The limitation that the telephone interface system of claim 9 work with a "touch-tone/rotary dial telephone set" means that the interface must be capable of working with both a standard touch-tone telephone set and a standard rotary dial telephone set. A user must be able to successfully use a standard touch-tone telephone set with the interface and also be able to successfully use a standard rotary dial telephone set with the same interface.
5. Claim 9 — Conversion Means
61. The telephone number digital conversion means of claim 9 comprises a "telephone number digital conversion means for converting a group of telephone numbers to digital data and for providing the digital data to the transceiver." `096 patent 16:33-16:36.
62. The meaning of the terms "number" or "numbers" in the conversion means element of claim 9 is the same as the meaning of those terms in the conversion means element of claim 1, i.e. the Arabic numerals 0-9.
63. Because the conversion means element of claim 9 is written in a means-plus-function form, the Court must identify the claimed function of the "conversion means" limitation.
64. The conversion means of claim 9 contains two functions: (1) converting a group of telephone numbers to digital data and (2) providing the digital data to the transceiver.
65. The Court next looks to the written description to identify the structure corresponding to those two functions.
66. The structure corresponding to the converting function of the conversion means of claim 9 is the same structure identified for the conversion means of claim 1, namely, circuit element 13, including the LC(NOT) (for receiving pulse dialing inputs), SIG IN (for receiving tone dialing inputs), D3, D2, D1 and D0 pins as shown in figure 3A. Def. Ex. 29; Rhyne 838:23-839:7.
67. Like the converting function of claim 1, converting the "group of telephone numbers" in claim 9 means that the converting structure must be capable of converting both a group of touch-tone dialed telephone numbers and a group of rotary dialed telephone numbers. The `096 interface must be capable of working with both touch-tone and rotary dialed telephone numbers. The corresponding structure need not be capable of converting a group of telephone numbers consisting of a both touch-tone and rotary dialed telephone numbers.
68. The structure corresponding to the providing function of the conversion means of claim 9 is the same structure identified for the providing function of the conversion means of claim 1, namely, buffers 65, Tri-STATE buffer 67, gate 51, and data lines D3, D2, D1 and D0 as shown in figure 3A, terminals 7(D3), 8(D2), 9(D1), 10(D0), and 16(DATA) of junction J3 to the adapter board 9, as shown in figures 3B and 5, shift register 75 and data line 77 as shown in figure 5, gate 230, and terminal 5 of junction J2 of interface board 5 as shown in figure 3B. Def. Ex. 29; Rhyne 838:23-839:7.
69. Providing said digital data means that the corresponding structure must be capable of providing digital data representing a group of touch-tone dialed telephone numbers and also be capable of providing digital data representing a group of rotary dialed telephone numbers. The corresponding structure need not be capable of providing digital data representing a group consisting of both touch-tone and rotary dialed telephone numbers.
6. Claim 9 — Determination Means
70. The determination means of claim 9 comprises a "determination means for automatically determining the last number of the group of telephone numbers." `096 patent 16:37-38.
71. The meaning of the terms "number" or "numbers" in the determination means element of claim 9 is the same as the meaning of those terms in the conversion means element of claim 1, namely Arabic numerals 0-9.
72. Because the determination means element of claim 9 is written in a means-plus-function form, the Court must identify the claimed function of the determination means limitation.
73. The function of the determination means of claim 9 is automatically determining the last number of the group of telephone numbers.
74. The structure corresponding to the determining function of the determination means of claim 9 is the same structure identified for the determining function of the determination means of claim 1, namely, the DV output of decoder 13, inverter 49, NAND gate 51, DV inverter 53, and buffers 65 as shown in figure 3A, counter 111, binary to decimal converter or decoder 113, decimal digit converter or decoder 115, gates 117A-E, latch 119, gate 121, gate 123, gate 125, latch 127, gate 129, gate 131, gate 133, latch 135, latch 137, gate 138, gate 139, latch 141, gate 143, gate 145, counter 147, gate 149, gate 151, gate 153, gate 155 as show in figure 3C, and timer 59, 39 as shown in figure 3D. Def. Ex. 29; Rhyne 847:12-18.
75. The language of the determination means element of claim 9 requires that the determination means automatically determine the last number of the group of telephone numbers. `096 patent 16:37.
76. The structure corresponding to the determining function of claim 9 automatically determines the last number of the group of numbers by using digit analysis or a combination of digit analysis and a time-out method. Rhyne 847:9-21.
77. The digit analysis technique described in the `096 patent for the determination means of claim 9 is the same as described for the determination means of claim 1. The combination of digit analysis and the time-out method described in the `096 patent for the determination means of claim 9 is the same as described for the determination means of claim 1. Rhyne 847:9-21.
78. The automatic determination limitation of the determination means element of claim 9 does not include the user manually depressing the "#" symbol to indicate that the last number of the telephone number has been dialed.
7. Claim 12 — Standard Touch-Tone/Pulse Dialing Telephone Set
79. The term "standard touch-tone/pulse dialing telephone set" used in claim 12 requires interpretation. There is no written description in the patent specification for a phone that can perform either tone or pulse dialing. Rhyne 956:12-18. Nothing in the claim or the specification indicates how the pulse-tone switch should be set.
80. A "standard touch-tone/pulse dialing telephone set" is a telephone set that can emulate a standard touch-tone telephone or a standard rotary dial telephone. Typically, a tone/pulse phone has a switch that can be positioned to allow tone dialing or pulse dialing. If the tone/pulse phone switch is set in the "tone" mode, the phone emulates a standard touch-tone telephone by emitting DTMF tones representing the numerals 0-9 or the "#" or "*" symbols. If the switch is set to the "pulse" mode, the phone generates electrical pulses produced by standard rotary dial telephones representing the dialed numbers but does so without using a mechanical rotor. When the tone/pulse phone is set in the pulse mode, it can emit pulses representing only the numerals 0-9. The user cannot dial the "#" or "*" symbols be cause these symbols do not have a corresponding pulse signal. Def. Ex. 29; Rhyne 722:19-723:9, 726:16-24, 727:13-20, 852:16-857:10.
8. Claim 12 — Conversion Means
81. The telephone number digital conversion means of claim 12 comprises a "telephone number digital conversion means for converting touch-tone dialed/pulse-dialed telephone numbers from said telephone set to digital data for temporary storage in said transceiver." `096 patent 17:7-10.
82. The term "touch-tone dialed/pulse-dialed telephone numbers" used in the conversion means element of claim 12 requires interpretation.
83. It is unclear from the virgule separating "touch-tone dialed" and "pulse dialed" whether the corresponding structure of the conversion means must be capable of converting only touch-tone dialed telephone numbers, only pulse dialed telephone numbers, or both types of numbers.
84. The term "said telephone" in the conversion means element of claim 12 refers back to the "standard Touch-Tone/pulse dialing telephone set" mentioned in element a of claim 12. A touch-tone/pulse-dialing telephone set can produce both tones and pulses depending on the setting of the pulse-tone switch. Rhyne 854:3-6.
85. The Court concludes that the term "touch-tone dialed/pulse dialed telephone numbers" means a group of touch-tone dialed telephone numbers or a group of pulse dialed telephone numbers but not a group consisting of both of the two types of numbers. The virgule does not mean that the conversion means need only be capable of converting one type of a group of telephone numbers or the other. Rather, the conversion means must be capable of processing both types of groups of dialed numbers.
86. Because the conversion means element of claim 12 is written in a means-plus-function format, the Court must identify the claimed function of the conversion means limitation.
87. The function of the conversion means element of claim 12 is converting touch-tone dialed/pulse-dialed telephone numbers from said telephone set to digital data for temporary storage in said transceiver.
88. The structure disclosed in the `096 patent specification that corresponds to the converting function of the conversion means of claim 12 is the same structure identified for the converting function of the conversion means of claim 1, namely, circuit element 13, including the LC(NOT) (for receiving pulse dialing inputs), SIG IN (for receiving tone dialing inputs), D3, D2, D1 and D0 pins as shown in figure 3A. Def. Ex. 29; Rhyne 858:4-859:2.
89. Converting "touch-tone dialed/pulse-dialed telephone numbers" means that the converting structure must be capable of converting both a group of touch-tone dialed telephone numbers and a group of pulse dialed telephone numbers. The corresponding structure need not be capable of converting a group consisting of both touch-tone and pulse dialed telephone numbers.
9. Claim 12 — Sending Means
90. The sending means for claim 12 comprises a "sending means for enabling said transceiver to transmit the digital data." `096 patent 17:11-12.
91. Because the sending means element of claim 12 is written in a means-plus-function format, the Court must identify the claimed function of the sending means limitation.
92. To enable the transceiver to transmit the digital data or telephone number, the sending means of the interface must provide the transceiver with the telephone number to be dialed and a SEND code. To determine when to provide the SEND code, the sending means of claim 12 must first determine whether the user has dialed the last number of the party's telephone number, The structure that determines when the user has dialed the last number of the called party's telephone number is the structure corresponding to the determination means of claim 1. Thus, the sending means of claim 12 encompasses the functions and corresponding structure of the determination means of claim 1. Rhyne 859:22-860:17.
93. The structure corresponding to the sending function of the sending means of claim 12 is the same structure identified for the determination means of claim 1, namely, the DV output of decoder 13, inverter 49, NAND gate 51, DV inverter 53, and buffers 65 as shown in figure 3A, counter 111, binary to decimal converter or decoder 113, decimal digit converter or decoder 115, gates 117A-E, latch 119, gate 121, gate 123, gate 125, latch 127, gate 129, gate 131, gate 133, latch 135, latch 137, gate 138, gate 139, latch 141, gate 143, gate 145, counter 147, gate 149, gate 151, gate 153, gate 155 as show in figure 3C, and timer 59, 39 as shown in figure 3D, and gate 69, AKR one-shot 79, latch 85, NAND gate 87, gate 89, inverter 90, delay one-shot 91, SEND one-shot 93, and TRI-STATE buffer 95 as shown in figure 3A. Def. Ex. 29; Rhyne 860:18-862:6.
94. As in claim 1, the structure corresponding to the determining function determines when the last number of the telephone number has been dialed by using digit analysis or a combination of digit analysis and a time-out method. Rhyne 862:7-21.
95. The digit analysis technique for the determination of the last number in the telephone number for the sending means of claim 12 is the same as described for the determination means of claim 1. The time-out method for the sending means of claim 12 is the same as described for the determination means of claim 1. Rhyne 862:7-21.
96. The only structure disclosed in the `096 patent corresponding to the determining function of the sending means of claim 12 is a structure which automatically performs the determination enabling the transceiver to transmit digital data. The user dials the telephone number and no manual indication by the user that the last number has been dialed is required. Telemac Cellular Corp., 247 F.3d at 1324. `096 patent 7:28-34, 9:64-68; Rhyne 804:20-805:7, 806:15-20, 862:7-21.
97. The automatic determination of when the last number of a telephone number has been dialed is a limitation of the sending means element of claim 12. O'Brien 414:10-20; Rhyne 836:16-837:1, 862:7-21. Telemac Cellular Corp., 247 F.3d at 1324.
10. Claim 14 — Preamble
98. The term "standard Touch-tone/rotary dial telephone set" used in the preamble of claim 14 requires interpretation.
99. The meaning of the term "standard Touch-tone/rotary dial telephone set" used in the preamble of claim 14 has the same meaning as defined in claim 1. The term includes both a standard touch-tone telephone set and a standard rotary dial telephone set.
100. The term "standard touch-tone/rotary dial telephone set" used in the preamble of claim 14 is the first recitation of and the antecedent basis for structural limitations that are referred to later in the body of the claim. The term a "standard touch-tone/rotary dial telephone set" is a substantive limitation of the scope of claim 14.
101. The limitation that the telephone interface system of claim 14 work with a "standard touch-tone/rotary dial telephone set" means that the interface must be capable of working with both a standard touch-tone telephone set and a standard rotary dial telephone set. The user must be able to successfully use a standard touch-tone telephone set with the interface and also successfully use a standard rotary dial telephone set with the same interface.
11. Claim 14 — Conversion Means
102. The telephone number digital conversion means of claim 14 comprises a "telephone number digital conversion means for converting a group of telephone numbers to digital data and for providing the digital data to a transceiver for storage of the digital data therein." `096 patent 18:7-10.
103. The meaning of the terms "number" and "numbers" in the conversion means element of claim 14 is the same as defined in the conversion means element of claim 1, namely, the Arabic numerals 0-9.
104. Because the conversion means element of claim 14 is written in a means-plus-function format, the Court must identify the claimed function of the conversion means limitation.
105. The conversion means element of claim 14 has two functions: (1) converting a group of telephone numbers to digital data and (2) providing the digital data to a transceiver for storage of the digital data therein.
106. The structure corresponding to the converting function of the conversion means of claim 14 is the same structure identified for the converting function of the conversion means of claim 1, namely, circuit element 13, including the LC(NOT) (for receiving pulse dialing inputs), SIG IN (for receiving tone dialing inputs), D3, D2, D1 and D0 pins as shown in figure 3A. Def. Ex. 29; Rhyne 864:15-19.
107. The Court concludes that converting the "group of telephone numbers" means that the converting structure must be capable of converting both a group of touch-tone dialed telephone numbers and a group of rotary dialed telephone numbers. The `096 interface must be capable of working with both touch-tone and rotary dialed telephone numbers. The corresponding structure need not be capable of converting a group consisting of both touch-tone and rotary dialed telephone numbers.
108. The structure corresponding to the providing function of the conversion means element of claim 14 is the same structure identified for the providing function of the conversion means of claim 1, namely, buffers 65, TRI-STATE buffer 67, gate 51, and data lines D3, D2, D1 and D0 as shown in figure 3A, terminals 7(D3), 8(D2), 9(D1), 10(D0), and 16(DATA) of junction J3 to the adapter board 9, as shown in figures 3B and 5, shift register 75 and data line 77 as shown in figure 5, gate 230, and terminal 5 of junction J2 of interface board 5 as shown in figure 3B. Def. Ex. 29; Rhyne 864:15-19.
109. The Court determines that providing digital data means that the corresponding structure must be capable of providing digital data representing a group of touch-tone dialed telephone numbers and be capable of providing digital data representing a group of rotary dialed telephone numbers. The corresponding structure need not be capable of providing digital data representing a group consisting of both touch-tone and rotary dialed telephone numbers.
12. Claim 14 — Determination Means
110. The determination means element of claim 14 comprises a "determination means for automatically determining when the send signal is to be provided to the transceiver." `096 patent 18:14-16.
111. Because the determination means element of claim 14 is written in a means-plus-function format, the Court must identify the claimed function of the determination means limitation.
112. The determination means of claim 14 encompasses the functions and corresponding structure of the determination means of claim 1. Rhyne 866:18-867:15. The function of the determination means of claim 14 is automatically determining when the send signal is to be provided to the transceiver.
113. The structure corresponding to the determining function of the determination means of claim 14 is the same structure identified for the determining function of the determination means of claim I, namely, the DV output of decoder 13, inverter 49, NAND gate 51, DV inverter 53, and buffers 65 as shown in figure 3A, counter 111, binary to decimal converter or decoder 113, decimal digit converter or decoder 115, gates 117A-E, latch 119, gate 121, gate 123, gate 125, latch 127, gate 129, gate 131, gate 133, latch 135, latch 137, gate 138, gate 139, latch 141, gate 143, gate 145, counter 147, gate 149, gate 151, gate 153, gate 155 as show in figure 3C, and timer 59, 39 as shown in figure 3D. Def. Ex. 29; Rhyne 866:18-867:12.
114. The structure corresponding to the automatically determining function determines when the last number of a telephone number has been dialed by using digit analysis or a combination of digit analysis and a time-out method. Rhyne 866:20-23.
115. The digit analysis technique described in the `096 patent for the automatic determination of the last number in the telephone number for the determination means of claim 14 is the same as described for the determination means of claim 1. The time-out method described in the `096 patent for the determination means of claim 14 is the same as described for the determination means of claim 1. Rhyne 866:18-867:15.
116. The only structure disclosed in the `096 patent corresponding to the determination of the last number of a telephone number is a structure which automatically performs the determination. The user dials the telephone number and no manual indication by the user that the last number has been dialed is required. The automatic determination of when the last number in the telephone number has been dialed is a limitation of the determination means element of claim 14. Rhyne 866:18-867:15.
B. Infringement
117. To prove infringement, Telular bears the burden of proving each element of the claim is present in the Vox.Link product either literally or under the doctrine of equivalents. Day Intern., Inc. v. Reeves Brothers, Inc., 260 F.3d 1343, 1349 (Fed. Cir. 2001).
118. "Literal infringement of a § 112, § 6 limitation requires that the relevant structure in the accused device perform the identical function recited in the claim and be identical or equivalent to the corresponding structure in the specification." Odetics, Inc. v. Storage Technology Corp., 185 F.3d 1259, 1267 (Fed. Cir. 1999). "Functional identity and either structural identity or equivalence are both necessary." Id.
119. One test for infringement under the doctrine of equivalents is whether the accused device "performs substantially the same overall function, in substantially the same way, to achieve substantially the same result as that of the invention claimed." Telemac Cellular Corp., 247 F.3d at 1330.
120. A software process can be transformed into an equivalent hardware process, and a hardware process can be transformed into an equivalent software process. Overhead Door Corp. v. Chamberlain Group, Inc., 194 F.3d 1261, 1269 (Fed. Cir. 1999).
121. The structure of a microprocessor is the algorithm that has been programmed to carry out its functions. WMG Gaming, Inc. v. Int'l Game Tech., 184 F.3d 1339, 1348-49 (Fed. Cir. 1999).
122. To prove that the microprocessor and software in the Vox.Link perform the function of a claim element written in means-plus-function format, Telular must show that the microprocessor and software perform the same or substantially the same functions in substantially the same way to achieve substantially the same result as the hardwired digital logic integrated circuitry of the `096 patent. Jackson v. Casio Phonemate, Inc., 2001 U.S. Dist. Lexis 4732, *23-25 (N.D.Ill. April 13, 2001).
123. Merely showing that a microprocessor, if programmed properly, could perform the same or substantially the same functions as the hardwired digital logic circuitry of the `096 patent does not establish infringement. Jackson, 2001 U.S. Dist. Lexis 4732 at *31.
124. To establish that the Vox.Link performs the function using structure identical or equivalent to the corresponding structure identified in the patent specification of the `096 patent, Telular must identify the specific components within the Vox.Link, including any algorithm used by its microprocessor, that perform the same functions as performed by the corresponding digital logic circuitry of the `096 patent and how the components go about performing these functions. Jackson, 2001 U.S. Dist. Lexis 4732 at *26-32.
125. Functional analysis followed by "reasoning by deduction" is insufficient to establish infringement. Jackson, 2001 U.S. Dist. Lexis 4732 at *28. Simply concluding that the microprocessor and software in the Vox.Link is equivalent to the corresponding structures of the `096 patent because the result of a particular function is the same is inadequate to establish infringement. Jackson, 2001 U.S. Dist. Lexis 4732 at *27.
126. Telular has failed to meet its burden of establishing a right to a preliminary injunction because it has not shown a likelihood of success at trial on the merits.
127. Telular has not demonstrated that it is likely to succeed in proving that the Vox.Link infringes claims 1, 9, and 14 of the `096 patent at a trial on the merits.
128. Telular has also failed to demonstrate that it is likely to succeed in proving that Vox2 induces infringement or contributes to the infringement of claim 12 of the `096 patent at a trial on the merits.
1. Claim I
129. The Vox.Link does not infringe claim I of the `096 patent either literally or under the doctrine of equivalents.
130. The Vox.Link does not function with rotary-dialed telephones. Accordingly, the Vox.Link does not function with a standard touch-tone/rotary dial telephone set as required by the preamble of claim 1.
131. The Vox.Link does not perform the identical or equivalent function of receiving a group of rotary dialed telephone numbers as required by the conversion means element of claim 1. The Vox.Link also lacks structure that it identical or equivalent to the structure corresponding to the receiving function of the conversion means element of claim 1.
132. The Vox.Link does not perform the identical or equivalent function of converting a group of rotary dialed telephone numbers into digital data as required by the conversion means element of claim 1. The Vox.Link also lacks structure that it identical or equivalent to the structure corresponding to the converting function of the conversion means element of claim 1.
133. The Vox.Link does not perform the identical or equivalent function of providing digital data representing rotary dialed telephone numbers to the transceiver as required by the conversion means element of claim 1.
134. An interface that is only capable of functioning with a standard touch-tone telephone is not substantially similar to an interface that must be capable of functioning with both a standard touch-tone telephone and a standard rotary dial telephone. Therefore, the Vox.Link is substantially different from the interface claimed in claim 1 of the `096 patent.
135. The Vox.Link cannot automatically determine the last number of a group of dialed telephone numbers. The Vox.Link dials the telephone number only after the user manually presses the pound key. In a system using the Vox.Link, the brain and finger of the user perform the function of the determination means of the `096 patent. A task completed by a user is not the same or equivalent to identical tasks completed automatically by a device. Telemac Cellular Corp., 247 F.3d at 1331-32; Davies v. United States, 31 Fed. Cl. 769, 778-79 (Ct.Cl. 1994) (holding no infringement where the human operator manually performs the function recited in the claim because "patent claims do not cover structures in which a human being substitutes for a part of the claimed structure.");Clintec Nutrition Co. v. Baxa Corp., 988 F. Supp. 1109, 1115 (N.D. Ill. 1997) (stating "[a]s a matter of law, human judgment exercised by the operator [of the accused device] is a structure neither identical to nor equivalent of the computer.").
136. The Vox.Link does not perform the identical or an equivalent function of automatically determining the last number of a group of telephone numbers as required by the determinating function of the determination means element of claim 1. The Vox.Link also lacks structure that is identical or equivalent to the structure corresponding to the determining function of the determination means element of claim 1.
137. A device that requires the user to manually push a button to generate a call is not substantially similar to a device that automatically determines that the user is finished dialing a telephone number and then places a call. The determination means in the Vox.Link is substantially different from the determination means of claim I of the `096 patent.
2. Claim 9
138. The Vox.Link does not infringe claim 9 of the `096 patent either literally or under the doctrine of equivalents.
139. The Vox.Link does not function with rotary dialed telephones. Accordingly, the Vox.Link does not function with a standard touch-tone/rotary dial telephone set as required by the preamble of claim 9.
140. The Vox.Link does not perform the identical or an equivalent function of converting a group of rotary dialed telephone numbers into digital data as required by the conversion means element of claim 9. The Vox.Link also lacks structure that is identical or equivalent to the structure corresponding to the converting function of the conversion means element of claim 9.
141. The Vox.Link does not perform the identical or an equivalent function of providing digital data representing rotary dialed telephone numbers to the transceiver as required by the conversion means element of claim 9.
142. An interface that is only capable of functioning with a standard touch-tone telephone is not substantially similar to an interface that must be capable of functioning with both a standard touch-tone telephone and a standard rotary dial telephone. Therefore, the Vox.Link is substantially different from the interface claimed in claim 9 of the `096 patent.
143. The Vox.Link cannot automatically determine the last number of a group of dialed telephone numbers. The Vox.Link dials the telephone number only after the user manually presses the pound key. In a system using the Vox.Link, the brain and finger of the user perform the function of the determination means of the `096 patent. A task completed by a user is not the same or equivalent to identical tasks completed automatically by a device. Telemac Cellular Corp., 247 F.3d at 1331-32; Davies v. United States, 31 Fed. Cl. at 778-79; Clintec Nutrition Co. v. Baxa Corp., 988 F. Supp. at 1115.
144. The Vox.Link does not perform the identical or an equivalent function of automatically determining the last number of a group of telephone numbers as required by the determining function of the determination means element of claim 9. The Vox.Link also lacks structure that it identical or equivalent to the structure corresponding to the determining function of the determination means element of claim 9.
145. A device that requires the user to manually push a button to generate a call is not substantially similar to a device that automatically determines that the user is finished dialing a telephone number and then places a call. The determination means in the Vox.Link is substantially different from the determination means of claim 9 of the `096 patent.
3. Claim 12
146. Vox2 is not inducing infringement of claim 12 or contributorily infringing claim 12, either literally or under the doctrine of equivalents, by making and selling the Vox.Link device. Claim 12 of the `096 patent is a system claim, which claims a cellular-type radio/telephone communication system. The Vox.Link device itself cannot infringe claim 12. To prove active inducement of infringement or contributory infringement, Telular must show that users of the Vox.Link directly infringe the `096 patent. Sage Prods., Inc. v. Devon Indus., Inc., 45 F.3d 1575, 1577 (Fed. Cir. 1995).
147. The Vox.Link does not function with a pulse dialing telephone set as required by element a of claim 12. The Vox.Link does not perform the identical or an equivalent function of converting a group of pulse dialed telephone numbers into digital data as required by the conversion means element of claim 12. The Vox.Link also lacks structure that is identical or equivalent to the structure corresponding to the converting function of the conversion means element of claim 12.
148. The accused Vox.Link does not perform the identical or an equivalent function of enabling the transceiver to transmit digital data representing pulse dialed telephone numbers as required by the sending function of the sending means element of claim 12. The Vox.Link also lacks structure that is identical or equivalent to the structure corresponding to the sending function of the sending means element of claim 12.
149. A system that is only capable of functioning with a standard touch-tone telephone is not substantially similar to a system that must be capable of functioning with both a standard touch-tone telephone and a standard pulse dialing telephone. Therefore, the Vox.Link is substantially different from the system claimed in claim 12 of the `096 patent.
150. Automatic determination of when the last number in the telephone number has been dialed is a limitation of the sending means element.
151. The Vox.Link cannot automatically determine the last number of a group of dialed telephone numbers. The Vox.Link dials the telephone number only after the user manually presses the pound key. In a system using the Vox.Link, the brain and finger of the user perform the function of the determination means of the `096 patent. A task completed by a user is not the same or equivalent to identical tasks completed automatically by a device. Telemac Cellular Corp., 247 F.3d at 1331-32; Davies v. United States, 31 Fed. Cl. at 778-79; Clintec Nutrition Co. v. Baxa Corp., 988 F. Supp. at 1115.
152. The Vox.Link does not perform the identical or an equivalent function of automatically determining the last number of a group of telephone numbers as required by the determining function of the sending means element of claim 12. The Vox.Link also lacks structure which is identical or equivalent to the structure corresponding to the determining function of the sending means element of claim 12.
153. A device that requires the user to manually push a button to generate a call is not substantially similar to a device that automatically determines that the user is finished dialing a telephone number and then places a call. The sending means in the Vox.Link is substantially different from the sending means of claim 12 of the `096 patent.
154. For these reasons, the users of the Vox.Link do not infringe claim 12 either literally or under the doctrine of equivalents. Therefore, Vox2 cannot induce infringement or contribute to infringement of claim 12 of the `096 patent.
4. Claim 14
155. The Vox.Link does not infringe claim 14 of the `096 patent either literally or under the doctrine of equivalents.
156. The Vox.Link does not function with a rotary dial telephone as required by claim 14. Accordingly, the Vox.Link does not perform the identical or an equivalent function of converting a group of rotary dialed telephone numbers into digital data as required by the conversion means element of claim 14. The Vox.Link also lacks structure that is identical or equivalent to the structure corresponding to the converting function of the conversion means element of claim 14.
157. The Vox.Link does not perform the identical or an equivalent function of providing digital data representing rotary dialed telephone numbers to the transceiver as required by the conversion means element of claim 14.
158. An interface that is only capable of functioning with a standard touch-tone telephone is not substantially similar to an interface that must be capable of functioning with both a standard touch-tone telephone and a standard rotary dial telephone. Therefore, the Vox.Link is substantially different from the interface claimed in claim 14 of the `096 patent.
159. The Vox.Link cannot automatically determine the last number of a group of dialed telephone numbers to determine when the send signal is to be provided to the transceiver. The Vox.Link generates the send signal only after the user manually presses the pound key. In a system using the Vox.Link, the brain and finger of the user perform the function of the determination means of the `096 patent. A task completed by a user is not the same or equivalent to identical tasks completed automatically by a device. Telemac Cellular Corp., 247 F.3d at 1331-32; Davies v. United States, 31 Fed. Cl. at 778-79; Clintec Nutrition Co. v. Baxa Corp., 988 F. Supp. at 1115.
160. The Vox.Link does not perform the identical or an equivalent function of automatically determining the last number of a group of telephone numbers to determine when the send signal is to be provided to the transceiver as required by the determination means element of claim 14. The Vox.Link also lacks structure that is identical or equivalent to the structure corresponding to the determining function of the determination means element of claim 14.
161. A device that requires the user to manually push a button to generate a call is not substantially similar to a device that automatically determines that the user is finished dialing a telephone number and then generates a send signal based on that determination. The determination means in the Vox.Link is substantially different from the determination means of claim 14 of the `096 patent.
III. IRREPARABLE HARM
162. To obtain a preliminary injunction, Telular must show that it will be irreparably harmed if an injunction is not granted. Amazon.com, Inc., 239 F.3d at 1350.
163. Irreparable harm is harm that cannot be compensated by money damages. Hybritech Inc. v. Abbott Labs., 849 F.2d 1446, 1457 (Fed. Cir. 1988). Irreparable harm may be established by showing that the alleged infringer is financially irresponsible or might be judgment-proof at the end of the litigation. Cordis Corp. v. Medtronic, Inc., 780 F.2d 991, 996 (Fed. Cir. 1985), cert. denied, 476 U.S. 1115 (1986).
164. Irreparable harm is proven by evidence of actual competitive damage being done to the patentee's exclusive position in the market. No irreparable harm exists where the patentee and the alleged infringer do not compete. High Tech Med. Instrumentation v. New Image Indus, Inc., 49 F.3d 1551, 1556 (Fed. Cir. 1995). A patentee maybe harmed if it has licensees who would be injured by competition from the alleged infringer. Id.
165. The patentee is entitled to a rebuttable presumption of irreparable harm if it clearly establishes a reasonable likelihood of success on the merits. Purdue Pharma, 237 F.3d at 1363.
166. Where the patentee has granted licenses under the patent, no injunction should issue. The granting of licenses undermines any argument by the patentee that it is being or will be irreparably harmed during the litigation. The act of granting licenses indicates that the patentee is willing to accept money damages, in lieu of its right to exclude, as compensation for any alleged infringement. Hi-Tech Med. Instrumentation, 49 F.3d at 1557; Polymer Techs., Inc. v. Bridwell, 103 F.3d 970, 974 (Fed. Cir. 1996).
167. Telular has not made a clear showing of its likely success on the merits of its infringement claim and thus, is not entitled to a rebuttable presumption of irreparable harm.
168. Telular has not shown that it will suffer irreparable harm if Vox2 is not enjoined from selling the Vox.Link before a trial on the merits.
169. The Vox.Link does not compete with the Telular product that practices the `096 invention. The Vox.Link is targeted towards consumers who already own a cellular telephone. The Vox.Link retail price is less than half that of the product Telular identified as being the closest to the Vox.Link.
170. In addition, Telular has licensed the `096 patent extensively which demonstrates its willingness to accept monetary damages if infringement is found.
171. The fact that Telular licensed the Andrews Extensis, a product which is virtually identical to the Vox.Link, undermines Telular's allegations of irreparable harm. The Vox.Link appears to comply with the same limitations Telular placed on the Andrews Extensis in Telular's license to Andrews. The sale of the Vox.Link should cause no more harm to Telular than sales of the Andrew Extensis. Although Vox2's impact on Andrews in the marketplace may impact on Telular's licensing fee, Telular has not shown how any lost sales to Andrews would not be compensable in money damages. Hoeffler 1122:10-12. Illinois Tool Works, Inc. v. Grip-Pak, Inc., 906 F.2d 679, 683 (Fed. Cir. 1990) (stating no evidence of irreparable harm where patentee failed to show how "lost sales attributable" to patentee would be any less compensable in dollars than "lost sales attributable" to licensee).
172. Telular's failure to seek a preliminary injunction against WHP Wireless in the District of Delaware also undermines Telular's claim of irreparable harm. The accused Cell Socket product in that case is the same type of product as the Vox.Link. If Telular faced a real theat of irreparable harm from products such as the Cell Socket or the Vox.Link, one would reasonably expect Telular to seek a preliminary injunction against the Cell Socket. The fact that Telular has decided to allow the Cell Socket to remain in the market during the pendency of the WHP Wireless case is further evidence that the presence of the Vox.Link in the market during the pendency of this case will not irreparably harm Telular. Polymer Tech., Inc., 103 F.3d at 976 (holding failure to bring suit against other potential infringers may be relevant to an analysis of irreparable harm if it indicates a willingness to accept royalty-type damages in lieu of market exclusivity).
IV. BALANCE OF HARDSHIPS
173. When it is unlikely that the patentee will succeed on the merits, the balance of hardships tips in favor of the alleged infringer. Illinois Tool Works, Inc., 906 F.2d at 683.
174. The Court may consider the relative sizes of the parties as one factor when determining the balance of the hardships. Bell Howell Document Mgmt. Prods. Co. v. Altek Sys., 132 F.3d 701, 708 (Fed. Cir. 1997).
175. Telular has failed to demonstrate a likelihood of success at a trial on the merits which tips the balance of the hardships in favor of Vox2.
176. Vox2 will suffer significant harm from the grant of an injunction. Vox2 will likely be unable to receive additional investment capital and will be put out of business if it is enjoined from selling the Vox.Link.
V. THE PUBLIC INTEREST
177. Finally, the Court must consider whether and how an injunction would impact the public interest.
178. Where the patentee fails to demonstrate a likelihood of success on the merits, the public interest in vigorous competition in the marketplace is served by denying a request for a preliminary injunction.Illinois Tool Works, Inc., 906 F.2d at 684; Tyco Indus., v. Tiny Love, Ltd., 914 F. Supp. 1068, 1083 (D.N.J. 1996).
179. Telular has failed to demonstrate a likelihood of success on the merits of its infringement claim. Telular has not shown that the public interest favors the issuance of a preliminary injunction.
180. The public interest weighs in favor of Vox2. The public interest does not favor the grant of an injunction against one who does not infringe.
CONCLUSION
Because Telular has not shown a reasonable likelihood of success on the merits, irreparable harm if an injunction is not granted, a balance of hardships tipping in its favor, and an injunction's favorable impact on the public interest, the Court recommends that Telular's motion for a preliminary injunction be denied.
Counsel has ten days from the date of service to file objections to this Report and Recommendation with the Honorable Blanche M. Manning.See Fed.R.Civ.P. 72(b); 28 U.S.C. § 636(b)(1). Failure to object constitutes a waiver of the right to appeal. Lorentzen v. Anderson Pest Control, 64 F.3d 327 (7th Cir. 1995).