Trading Techs. Int’l, Inc. v. CQG, Inc., No. 05 C 4811, Slip Op. (N.D. Ill.) (Coleman, J.).

Judge Coleman granted plaintiff Trading Technologies’ (“TT”) motion to terminate Markman proceedings in this patent case involving commodities trading software — click here for much more on this case in the Blog’s archives).  Defendants (collectively “CQG”) sought

Trading Techs. Int’l., Inc. v. eSpeed, Inc., No. 04 C 5312, Slip Op. (N.D. Ill. Mar. 29, 2011) (Dow, J.).
Judge Dow amended the final judgment in this case to reflect the jury verdict and post-remittitur damages award of about $2.5M — go to the Blog’s archives for much more on this case and related cases. The Court also, after a de novo review, adopted Judge Schenkier’s report and recommendation on the motion. Plaintiff Trading Technologies (“TT”) sought to amend the Court’s final judgment, entered by the late Judge Moran, pursuant to Fed. R. Civ. P. 59(e) or 60(a), to reflect the damages award, and sought its fees for bringing the instant motion. The Court held as follows:
While it may have been too late to amend the judgment pursuant to Rule 59(e), the Court had discretion to amend pursuant to Rule 60(a) to correct an “oversight or omission.” The record established that TT and defendants (collectively “eSpeed”) understood that there was a money judgment. For example, eSpeed moved the Court to waive the supersedes bond normally required to appeal a case with money damages.
The Federal Circuit and the parties understood the appeal to be on all issues, not just injunctive relief. As such, eSpeed cannot argue that it held back arguments on appeal, that it might otherwise have made if eSpeed had known the appeal went beyond injunctive issues.
Whatever TT’s reason for not seeking to correct the judgment with Judge Moran while the case was still pending before him, all parties understood that the judgment included the money damages.
Finally, the Court denied TT’s request for it fees incurred bringing the motion. First, both parties should have sought to correct the judgment when it was entered. Second, TT’s fee request was undermined by its unreasonable demand in the initial motion that eSpeed pay the money damages within five days.

Continue Reading Trading Technologies: Final Judgment Amended to Include Monetary Damages

Rosenthal Collins Group, LLC v. Trading Technologies Int’l, Inc., No. 05 C 4088, Slip Op. (N.D. Ill. Nov. 23, 2010) (Coleman, J.).
Judge Coleman denied plaintiff Trading Technologies’ (“TT”) Local Rule 40.4 motion to consolidate TT’s sixteen pending patent cases,* involving nine patents. Initially, the Court noted that TT did not seek consolidation of all sixteen cases in a single case, but consolidation of the four remaining cases that TT filed in 2005, and separately the twelve cases TT filed in 2010. LR 40.4 requires that a motion to consolidate be filed in the lowest number case. So, while the instant case was the lowest number of the 2005 cases, it was not the lowest number 2010 case. As to the 2010 cases, therefore, the Court did not address consolidation. As to the 2005 cases, TT failed to show that the cases were sufficiently related — while they involved common patents, the accused products operated in “very different manner[s].” Furthermore, while Judge Moran previously coordinated discovery of all of the 2005 cases before the cases were reassigned, TT did not demonstrate that consolidating the 2005 cases would conserve resources.
* Click here for much more on these cases in the Blog’s archives.

Continue Reading Trading Technologies: Court Denies Motion to Consolidate Sixteen Pending Cases

Rosenthal Collins Group, LLC v. Trading Techs. Int’l, Inc., No. 05 C 4088, Slip Op. (N.D. Ill. Feb. 23, 2011) (Coleman, J.).*
Judge Coleman granted defendant/counter-plaintiff Trading Technologies’ (“TT”) motion for evidentiary sanctions and default judgment. Judge Moran previously dismissed plaintiff/counter-defendant Rosenthal Collins Group’s (“RCG”) motion for summary judgment regarding the alleged prior art Buist trading program for discovery abuse, ordered RCG to produce additional documents and things related to the Buist program, and ordered RCG to pay certain of TT’s attorney’s — click here for the Blog’s post on that decision. Initially, the Court the severity of a default judgment as a sanction, calling it “extreme,” and noted that the Seventh Circuit required a showing of willfulness, bad faith or fault by a preponderance of the evidence in order to justify dismissing a case.
The Court held that the high standard was met in this case, for at least the following reasons:
During his deposition, Buist admitted modifying and overwriting source code in 2006 that he and by extension RCG held out as having been created in 1998 or 1999. And in the face of clear evidence of these facts, RCG continued to deny them, even calling the claims “libelous,” “audacious,” and “Oliver Stone-esque.”
Buist later admitted “wiping” or erasing six of seven zip disks that originally contained the relevant source code and that were later produced by RCG because they allegedly contained the code. The seventh was also wiped, although there was a dispute regarding whether Buist or others had access to it when it was wiped. But the Court held that it was “impossible to believe that it is merely coincidence that the seventh disk happened to be wiped on May 2, 2006, which just happened to be the same day that TT was scheduled to inspect it.”
There was evidence that “virtually every piece of media ordered produced by the Court in May 2007 and July 2008 was wiped, altered, or destroyed after those orders were entered . . . .” (emphasis in original).
Even if RCG and its counsel had no knowledge of the destruction of the evidence, the destruction might have been avoided if RCG had timely complied with the Court’s orders to produce the materials. And regardless, RCG and its counsel should have preserved the evidence by taking custody of it.
Buist was RCG’s agent and, therefore, RCG was bound by Buist’s behavior and actions.
Based upon these determinations, the Court found clear and convincing evidence that “RCG, and its counsel, acted in bad faith and with willful disregard for the rules of discovery and this Court’s orders.” And because a monetary sanction alone was not sufficient, the Court entered a default judgment in favor of TT and dismissed RCG’s complaint and struck its defenses to TT’s counterclaim. The Court also fined RCG $1,000,000 for “egregious conduct before the Court” and ordered RCG’s counsel to pay TT the attorney’s fees and costs related to TT’s motion for default judgment.
* I have a few earlier opinions from the Trading Technologies cases, but this one was significant enough that I moved it up. Click here for more on the case in the Blog’s archives.

Continue Reading Trading Technologies: “Willful and Intentional” Evidence Fabrication Leads to $1M Fine & Default Judgment

Trading Techs. Int’l, Inc. v. eSpeed, Inc., Case Nos. 2008-1392,-1393 & -1922, Slip Op. (Fed. Cir. Feb. 25, 2010) (Rader, J.) (Clark, J. concurring).
Writing for a panel including Judge Lourie and Eastern District of Texas District Judge Clark, Judge Rader affirmed each of the challenged decisions from Judge Moran’s jury trial in this patent litigation involving futures trading software.
For much more on this case, click here to read numerous posts in the Blog’s archives analyzing Judge Moran’s opinions and various aspects of the jury trial. Judge Moran construed the claims of the patents-in-suit, ruled upon several summary judgment motions and presided over the jury trial. The jury found that defendants’ (collectively “eSpeed”) Future View software willfully infringed the patents and that the patents were valid, awarding plaintiff Trading Technologies (“TT”) $3.5M. Judge Moran remitted the damages overall to approximately $2.5M.
Claim Construction
The most interesting aspect of the decision is the discussion of the de novo review of claim construction decisions. Judge Rader spent two and a half pages explaining the fact-law dichotomy of claim construction and concluded that claim construction required resolution of evidentiary and factual issues before construing the disputed terms:
In sum, claim construction involves many technical, scientific, and timing issues that require full examination of the evidence and factual resolution of any disputes before setting the meaning of the disputed terms.
And District Judge Clark wrote a concurring opinion solely to argue against de novo review:
[de novo review] may result in the unintended consequences of discouraging settlement, encouraging appeals, and, in some cases, multiplying the proceedings.
After a de novo review of his decisions, the Court upheld Judge Moran’s constructions. “Static display of prices” meant “a display of prices comprising price levels that do not change positions unless a manual re-centering command is received.” And a “static condition” meant that “the price axis never changes positions unless by manual re-centering or re-positioning.” While Judge Moran’s constructions may have appeared narrower than the patent intended initially, they were supported by both the intrinsic and extrinsic evidence. Because eSpeed’s Dual Dynamic and eSpeedmeter systems had mandatory re-centering features, they did not literally infringe.
Doctrine of Equivalents
The court upheld Judge Moran’s ruling that the doctrine of equivalents did not apply to the static elements in the claim. Even if the accused products only re-centered once or twice a day, allowing that re-centering to be captured by the doctrine of equivalents would vitiate the claims. Furthermore, prosecution history estoppel also barred equivalents. The patentee differentiated his invention by explaining that its “price axis do[es] not move.”
The Court upheld Judge Moran’s ruling overturning the jury’s willfulness finding. eSpeed’s prompt redesign efforts and immediate removal of infringing products were not objectively reckless. And TT offered no evidence that eSpeed sold Future Views during the contested period.
The Court held that “single action of a user input device” was not indefinite. Judge Moran correctly construed the term as requiring “an action by a user within a short period.” One of ordinary skill in the art could distinguish between single and multiple actions, even when a “single action” was a double-click.
Priority Date
The Court held that there was an issue of material fact regarding the priority date warranting a jury trial. The Court upheld the use of patent law experts, and found a sufficient basis for the jury’s priority decision:
Considering the undisputed knowledge of those skilled in the art, disclosure of a species in this case provides sufficient written description support for a later filed claim directed to a very similar and understandable genus. Accordingly, the patents-in-suit are entitled to claim priority to the provisional application.
Inequitable Conduct
The Court upheld Judge Moran’s ruling that failure to disclose certain software to the PTO was not inequitable conduct. The software was not material because the software’s use after the priority date would not have impacted the examiner’s analysis. And confidential use of the software for personal purposes was experimental.

Continue Reading Questioning De Novo Claim Construction Review

Rosenthal Collins Group, LLC v. Trading Techs. Int’l., Inc., No. 05 C 4088, Slip Op. (N.D. Ill. Sept. 18, 2009) (Dow, J.).
Judge Dow denied the parties’ cross-motions for summary judgment in this patent dispute regarding software for electronic futures trading using a static price axis.* Although the other related cases are stayed pending an appeal of the related eSpeed case to the Federal Circuit, declaratory judgment defendant Trading Technologies (“TT”) sought and Judge Moran agreed to allow this case to proceed based upon TT’s agreement that declaratory judgment plaintiff Rosenthal Collins Group (“RCG”) infringed even under the Court’s allegedly narrow construction of a “common static price axis” and “static display of prices.” TT sought to broaden the constructions on appeal. The parties agreed on how the accused Onyx software operated. The price axis was generally dynamic. But if a user pointed a cursor in the window containing the axis, the axis became static until the cursor was removed or after thirty seconds, whichever came first. TT identified this as Onyx’s order entry mode. And because Onyx has a static axis in order entry mode, TT argued that Onyx infringed based upon the order entry mode, even if it did not infringe in other modes. RCG argued that Onyx only had a single mode, and because the price axis was not consistently static, without manual recentering, there was no infringement. The Court held that whether Onyx operated in three modes and, therefore, infringed, or operated in a single mode and, therefore, did not was a question of fact. The case, therefore, was not appropriate for summary judgment.
The Court also stayed the case pending appeal of the eSpeed case, except for TT’s motion for default and sanctions.
* Click here for much more on this case and its related cases in the Blog’s archives.

Continue Reading Whether Software Operates in One or Three Modes is a Question of Fact

The Northern District recently sent out the following notice of a memorial service for Judge Moran to all e-filers:
The Judges of the United States District Court
for the Northern District of Illinois
cordially invite you to attend the
Memorial Service
in Remembrance of
Honorable James B. Moran
Monday, July 13, 2009, beginning at 3:30 p.m.
James Benton Parsons Memorial Courtroom
Everett McKinley Dirksen United States Courthouse
Twenty-fifth floor
219 South Dearborn Street
Chicago, Illinois
Reception immediately following in the 25th floor lobby,
Please RSVP by July 9, 2009 via e-mail

Continue Reading Memorial Service for Judge Moran

Judge Moran passed away yesterday. Click here for the Northern District’s official statement.* This is a difficult post for me to write. It is hard, maybe impossible, to capture Judge Moran’s impact on the Northern District of Illinois in a relatively short blog post. Judge Moran served as a federal district judge for almost thirty years, including as Chief Judge in the early 1990s. Judge Moran also served Illinois as a state representative and spent several years in the Army after getting his undergraduate degree from the University of Michigan and before attending Harvard Law School.
As a district judge, Judge Moran was respectful, thoughtful, and thorough. Judge Moran’s most lasting contributions to the Northern District were likely as a mentor and a writer. Judge Moran’s opinions were detailed and well reasoned, but most of all his opinions were written in straight forward language that opened the federal courts to people without legal training. Judge Moran’s passing is a significant loss.
[UPDATE:] The Chicago Tribune posted a detailed obituary here with more comments from Judge Moran’s peers and a more detailed account of his impressive legal career.
* I will post more information regarding any memorials, as the information becomes available. On a procedural note, Judge St. Eve is hearing any motions pending on Judge Moran’s docket until further notice.

Continue Reading The Passing of Judge Moran

Trading Techs. Int’l., Inc. v. CQG, Inc., No. 05 C 4811, Slip Op. (N.D. Ill. Feb. 17, 2009) (Moran, Sen. J.).
Judge Moran denied a motion to reconsider an earlier order continuing a summary judgment motion and staying the case pending the appeal of a related case, Trading Technologies v. eSpeed.* The Court also ordered the parties to meet and confer regarding how to exchange defendants’ sensitive trading information. The Court previously ordered defendants to work with plaintiff Trading Technologies (“TT”) to determine how to produce defendants’ raw transaction data, which was required for a damages calculation. The parties could not agree on how to exchange the information because of defendants’ unwillingness to provide such sensitive data to TT without restrictions. The Court ordered the parties to continue trying to resolve the issue and suggested various ways that the information could be exchanged without forcing defendants to provide all of their sensitive business information.
* Click here for much more on this case and the related cases in the Blog’s archives.

Continue Reading Trading Technologies v. eSpeed: Parties Ordered to Work Out Discovery Issues

Rosenthal Collins Group, LLC v. Trading Techs. Int’l, Inc., No. 05 C 4088, Min. Order (N.D. Ill. Feb. 2, 2009) (Moran, Sen. J.).*
In this pair of entries, Judge Moran denied plaintiff Trading Technologies’ motions for fees and costs related to a discovery motion and referred another fees motion to Magistrate Judge Schenkier. In the first entry, the Court noted that it was time to end “unnecessary [discovery] battles” in the case and that it might not be as forgiving with the next fees motion. In the other entry, the Court transferred a fees motion to Judge Schenkier, but questioned how “a single discovery dispute could blossom into a claim for over $300,000.
* Click here to read much more about this case and the related cases in the Blog’s archives.

Continue Reading Court Warns Parties That Future Fee Motions May be Granted