UIC John Marshall’s Center for Intellectual Property, Information and Privacy has another excellent program, this one focuses on two key copyright issues – fair use and copyright data protection. Every practitioner can use some time working through the complexities of fair use. This program promises to be excellent. It will be led by McDermott Will’s Jennifer Mikulina and Catalina USA’s Executive Director & Senior Corporate Counsel Ariana Voight.

The program is on January 22, 2020, from 12pm to 1pm CT at John Marshall. The event is free, but registration is required.

 

Rehco, LLC v. Spin Master, Ltd., No. 13 C 2245, Slip Op. (N.D. Ill. Oct. 28, 2019) (Blakey, J.).

Judge  Blakey granted defendant Spin Master’s motion for supplemental claim construction and for summary judgment in this patent case involving remote control toy vehicles.

The Court previously construed the terms, but the Federal Circuit reversed for consideration of certain claim terms. First, the Federal Circuit held that “a signal” meant one or more signals, not one signal, as the Court originally determined. The Federal Circuit also remanded for consideration of whether the parties’ dispute on appeal regarding the “predefined-speed” limitation was an actual claim construction dispute and, if so, how it should be resolved. The Court adopted Spin Master’s proposed construction, requiring that a “predefined-speed” was “a speed programmed on the circuit board in advance to cause a vehicle to gain altitude.”

Spin Master’s accused devices did not have a set speed programmed into the circuit board of the vehicle. But the vehicle did program the circuit board to modify the percentage of a pulse modulation by a predetermined amount which had the impact of increasing the speed. While that was not a literal infringement, Rehco argued it was an infringement based upon the Doctrine of Equivalents (“DoE”). The DoE analysis is a question of fact that must be determined by the trier of fact because there are facts supporting both parties’ arguments. As such, summary judgment was inappropriate.

Flair Airlines, Ltd. v. Gregor LLC, No. 18 C 2023, Slip Op. (N.D. Ill. Jun. 25, 2019) (Guzman, J.).

Judge Guzman denied plaintiff Flair Airlines’ (“Flair”) Fed. R. Civ. P. 56 motion for summary judgment  because of “numerous disputed facts” in this cybersquatting and related state law claims case involving a dispute over a “poorly-documented and hastily-conceived” business venture to create an airline.

The Court held that even assuming that Flair could prove that its FLAIR marks were famous or distinctive and that defendants registered or used an identical or confusingly similar domain, the first two prongs of a cybersquatting analysis, Flair was not entitled to summary judgment because of factual disputes regarding whether defendants operated in bad faith to profit from the FLAIR marks.

Defendants registered the domains – including the FLAIR mark – at the outset of the parties’ joint business venture and with Flair’s knowledge. The Court also noted that the parties agreement initially tasked at least certain defendants with web development, business strategy development and other services related to the planned airline. Flair disputes defendants’ facts, but that because defendants’ facts are plausible, there is a question of material fact preventing summary judgment. The Court noted that Flair’s attempts to show a lack of disputed facts acted to emphasize the differences in the parties’ respective stories and to reinforce their factual disputes. The Court also declined to consider the relative credibility of witnesses at the summary judgment stage, leaving that for trial and the jury.

Malibu Media, L.L.C. v. Doe, No. 18 C 450, Slip Op. (N.D. Ill. Jun. 5, 2019) (Ellis, J.).

Judge Ellis denied Doe defendant’s Fed. R. Civ. P. 12(b)(6) & (f) motion to dismiss and to strike plaintiff Malibu Media’s copyright infringement complaint in this BitTorrent dispute.

The Court previously dismissed Malibu Media’s complaint because a defendant’s status as the IP address subscriber is not enough, without more, to create a reasonable inference that the defendant is the infringer. Malibu Media repled its complaint providing the following additional details:

  • Doe has a bachelor’s degree in computer science with experience in internet security, including password protection and routers;
  • Doe was the only male resident of the relevant home during the period at issue; and
  • Doe allegedly copied at least 240 other works, including numerous other adult movies, and the alleged copying ended after Doe received notice of the complaint.

While the allegedly infringed works – The Bourne Supremacy, Mr. Robot, the 100 and Vikings, as well as adult titles – did not on their own create a sufficient match to a man in his mid-forties, but the need for additional allegations did not render them superfluous. They were circumstantial evidence, and they were sufficient combined with the allegations regarding the timing of the download, and the allegation that the downloading stopped after Doe received notice of the complaint. The allegations were, therefore, sufficient.

Malibu Media’s identification of the allegedly downloaded works, including title, hit date, and file hash were sufficient. Malibu Media was not required to provide evidence at the pleading stage that Doe had a BitTorrent client on his computer or that he actually copied the works. Those facts had to be proved later in the case, after discovery.

Varex Imaging Corp. v. Richardson Elecs., Ltd., No. 18 C 6911, Slip Op. (N.D. Ill. Sep. 30, 2019) (Blakey, J.).

Judge Blakey denied defendant Richardson Electronics’ motion for preliminary injunction in this dispute involving x-ray tubes.

Varex claimed that Richardson Electronics sale of refurbished x-ray tubes infringed its patents and irreparably harmed Varex. As an initial matter, the Court noted that both parties claimed claim construction was unnecessary and ignored the Court’s request to decide the liability issues on a complete evidentiary record. Instead, the Court was left with a conflicting record that prevented the Court from making a clear assessment of likelihood of infringement or validity.

But that was secondary because Varex was unable to show irreparable harm. Varex has an exclusive contract to sell the x-ray tubes at issue to Toshiba / Canon. But Richardson did not sell to Toshiba / Canon. As a result, the parties were not competitors. And for the same reason, Varex could not show lost sales to Richardson because Richardson did not sell to Varex’s customer. Additionally, Varex claimed that Richardson sold in the refurbished parts market where Varex only sold original parts. The Court noted that it would have to reconsider its decision if Varex conceded there was a market for refurbished x-ray tubes.

Varex’s alleged lost reputation was not sufficient to show irreparable harm because Varex did not explain how its innovation reputation could be harmed by Richardson’s presence in a separate market. Similarly, Varex was not irreparably harm because its patent was expiring in a few years and its ability to exclude others was nearing an end.

Finally, in a prior motion, Richardson raised a substantial question about whether Varex’s patent rights were exhausted as to Richardson product.

Varex Imaging Corp. v. Richardson Elecs., Ltd., No. 18 C 6911, Slip Op. (N.D. Ill. Aug. 27, 2018) (Blakey, J.).

Judge Blakey denied defendant Richardson Electronics’ Fed. R. Civ. P. 12(b)(6) motion to dismiss based upon patent exhaustion in this dispute involving x-ray tubes.

Richardson Electronics alleged that plaintiff Varex’s sale of its x-ray tubes exhausted its patent rights, leaving Richardson Electronics free to refurbish them. Richardson Electronics allegedly procures used Varex’s x-ray tubes, opens them removing certain spent components and then rebuilding / refurbishing the x-ray tubes. The Court held that where Richardson Electronics’ actions sit on the spectrum of repair (allowable) or reconstruction (infringing). Because that analysis is heavily factual, it could not be decided at the Rule 12 stage.

Shure, Inc. v. ClearOne, Inc., No. 17 C 3078, Slip Op. (N.D. Ill. Aug. 25, 2018) (Chang, J.).

Judge Chang construed the remaining claims in this patent case involving audio-conferencing equipment utilizing beam microphones.

Of particular interest, the Court held as follows:

  • The Court construed “Each of the Plurality of Combined Signals Corresponding to a Different Fixed Beam” by holding that “fixed” requires that the beams parameters remain fixed during a conference.
  • The Court construed “Select With a Signal Selection Module One or More of the Combined Echo Cancelled Signals for Transmission to the Far End” as it did at the PI stage as not being means plus function language. The “signal selection module” was a structure.
  • The Court construed “Said Signal Selection Module uses the Far End Signal as Information to Inhibit said Signal Selection Module from Changing the Selection of the Combined Echo Cancelled Signals while Only the Far End Signal is Active” as having its ordinary meaning. There was no need to clarify that the information is from the far end signal. That would be clear to one of ordinary skill in the art.
  • The Court construed “Acoustically Transparent” as “provid[ing] no or minimal resistance to sound.”

The Court construed “Used in a Drop Ceiling Mounting Configuration” as “configured for use in a drop ceiling mounting configuration.”

Shure, Inc. v. ClearOne, Inc., No. 17 C 3078, Slip Op. (N.D. Ill. Aug. 25, 2018) (Chang, J.).

Judge Chang denied declaratory judgment defendant ClearOne’s motion for reconsideration of the Court’s denial of a preliminary injunction (PI) in this patent case involving audio-conferencing equipment utilizing beam microphones.

As an initial matter, the Court held that the parties were both incorrect regarding the Federal Rule that ClearOne’s motion was properly considered under. Rule 59(e) was inapplicable because the motion was filed more than twenty eight days after the PI decision. Rule 60(b) was inapplicable because a PI cannot be considered a final judgment. The motion was properly considered pursuant to Rule 54(b) giving the Court authority to reconsider a decision on less than all the merits at any time before a final judgment.

In its original denial of the PI, the Court noted that the PTAB’s institution decision was persuading authority, but not controlling.  Similarly, the PTAB’s final decision – which reversed course finding the challenged claims were not invalidated – was persuasive, but not binding. This was especially true based upon the “high bar” for preliminary injunctive relief.

The PTAB determined that petition had not met its burden of proving that the prior art disclosed fixed beams under the construction of fixed beam shared by the district court and the PTAB – “defined by parameters determined before a conference.” As a side note, this is an excellent example of the value of the Patent Office’s decision to normalize its claim construction standard with that of the federal courts.

The Court’s review of the prior art reference identified that the relevant section discussed adaptive – as opposed to fixed – beamforming at length, as noted by the PTAB. But the PTAB did not acknowledge that the section warned against adapting the beams too frequently during a call. That raised a significant question regarding whether the reference taught the claimed fixed beams.

The Court also was not persuaded to reverse its decision regarding the likelihood of infringement. The Court’s analysis was not based upon a claim that the accused device could not use adaptive beams, rather it was based upon the default fixed beam setting in the accused device. Nothing about the PTAB decision changed those facts or the analysis.

Shure, Inc. v. ClearOne, Inc., No. 17 C 3078, Slip Op. (N.D. Ill. Aug. 5, 2019) (Chang, J.).

Judge Chang granted declaratory judgment defendant ClearOne’s preliminary injunction and construed necessary terms of the patent, as the parties had already fully briefed claim construction, in this patent dispute related to in-ceiling beamforming microphone arrays.

Of particular note, the Court held as follows:

  • The Court held that the person of ordinary skill in the art need not necessarily have beamforming microphone array (BFMA) experience, but must have at least one year of work experience in the field of digital signal processing.
  • Declaratory judgment plaintiff Shure’s construction of BFMA – a plurality of microphones that produce audio signals to be used for a directional pick up pattern – was the correct one because it did not include related hardware that does the beamforming. The claim separately addressed that hardware.
  • The Court adopted ClearOne’s construction of “predetermined locations.” When the Court combined the two constructions, a BFMA is “a plurality of microphones positioned at predetermined locations that produce audio signals to be used to form a directional pick up pattern.”
  • The Court adopted ClearOne’s construction of “drop space.” The correct definition was “the space between the surface of the structural ceiling of the room and the lower surface of a suspended ceiling tile.”
  • It did not matter how the BFMA was integrated into a ceiling tile because the claims were not method claims. All that mattered was that the BFMA was integrated into a ceiling tile.
  • While there was a dispute regarding whether certain pads in the ceiling tile were sound dampening, as required by the claims, ClearOne had sufficiently met its burden of showing a likelihood of infringement.
  • Shure’s anticipatory invalidity argument failed because the BFMA was not integrated into a ceiling tile.
  • The Court held that it was not clear that one of ordinary skill in the art would have known to combine Shure’s obviousness references – microphones and ceiling-integrated speakers.
  • ClearOne showed irreparable harm based upon various lost sales because sales of integrated conferencing systems are not frequently made and are typically made not just for one location, but for all locations across a business.
  • ClearOne also showed a nexus between its harm and the patented features.
  • ClearOne’s harm was also difficult to quantify because a single lost sale likely had much further reaching impacts.
  • The Court ordered the parties to confer on an appropriate amount for the required bond.