|March 28, 2014|
Previously published on March 26, 2014
Further to our February 24, 2014 post, on March 21, 2014, the International Trade Commission (the “Commission”) issued the public version of its opinion finding no violation of Section 337 in Certain Wireless Consumer Electronics Devices and Components Thereof (Inv. No. 337-TA-853).
By way of background, the Complainants in this investigation are Technology Properties Limited LLC (“TPL”), Phoenix Digital Solutions LLC (“PDS”), and Patriot Scientific Corp. (collectively, “Complainants”). The remaining Respondents are Barnes and Noble, Inc., Garmin Ltd., Garmin International, Inc., Garmin USA, Inc., HTC Corp., HTC America, Huawei Technologies Co., Ltd., Huawei Device Co., Ltd., Huawei Device USA Inc., Futurewei Technologies, Inc. d/b/a Huawei Technologies (USA), LG Electronics, Inc., LG Electronics U.S.A., Inc., Novatel Wireless, Inc., Samsung Electronics Co., Ltd., Samsung Electronics America, Inc., ZTE Corp., and ZTE (USA) Inc. (collectively, “Respondents”). The Patent-In-Suit is U.S. Patent No. 5,809,336 (the ‘336 patent).
On September 6, 2013, ALJ E. James Gildea issued an Initial Determination (“ID”) finding no violation of Section 337. Specifically, the ALJ determined that (1) none of the accused products directly or indirectly infringe the asserted claims of the ‘336 patent; (2) the asserted claims of the ‘336 patent are not invalid; (3) Respondents had not shown that the accused LG product is covered by a license to the ‘336 patent, and (4) Complainants had satisfied the domestic industry requirement. See our November 5, 2013 post for more details on the ID.
On November 25, 2013, the Commission determined to review the ID in part. In particular, the Commission determined to review the ID’s findings concerning claim construction and infringement of claims 6 and 13 of the ‘336 patent for all accused products, except for the accused products listed on page eighty-eight of the ID. The Commission also determined to review the ID’s findings on domestic industry. See our December 2, 2013 post for more details.
In the opinion, the Commission affirmed ALJ Gildea’s claim constructions as to claims 6 and 13 of the ‘336 patent. The Commission also affirmed, with modification, the ALJ’s finding that the accused products do not satisfy the “entire oscillator,” “varying,” and “external clock” limitations of claims 6 and 13. Moreover, the Commission affirmed ALJ Gildea’s finding that Complainants had failed to prove indirect infringement. With respect to domestic industry, the Commission determined that Complainants had satisfied the economic prong of the domestic industry requirement based on modified reasoning. However, the Commission took no position on whether Complainants had satisfied the technical prong of the domestic industry requirement.
ALJ Gildea had construed the disputed claim term “an entire oscillator disposed upon said integrated circuit substrate” to mean “an oscillator that is located entirely on the same substrate as the central processing unit and does not rely on a control signal or an external crystal/clock generator to generate a clock signal.” This was essentially the construction proposed by Respondents, and it was instrumental in ALJ Gildea’s ultimate finding of non-infringement.
Complainants had argued that the term should be construed to mean “an oscillator that is located entirely on the same semiconductor substrate as the central processing unit.” However, ALJ Gildea had rejected this proposed construction after finding that it had not accounted for the ‘336 patent’s prosecution history. In particular, ALJ Gildea found that, during prosecution, the patent applicant had specifically distinguished the claimed invention over prior art references that relied on outside components to provide a control signal or clock signal.
In the opinion, the Commission affirmed ALJ Gildea’s claim construction. In particular, the Commission noted that the ALJ was correct that the prosecution history supported his limiting construction. However, the Commission further noted that the claims themselves and the ‘336 patent specification also bolster this construction. With respect to the claims, the Commission found that their plain language required that the operating rates of the claimed oscillator and CPU be allowed to change in response to the chip’s process, voltage, and temperature (“PVT”) parameters as opposed to some other influence. With respect to the specification, the Commission found that its teachings were antithetical to allowing outside influences to affect the clock rate of the on-chip oscillator, which was how prior art microprocessors operated. Rather, the specification explicitly taught that the use of external sources for timing was inefficient and that the solution was to allow the clock rate of the oscillator to vary solely due to the same parameters that were affecting the CPU. Accordingly, the Commission affirmed ALJ Gildea’s claim construction based on the totality of the intrinsic evidence.
In view of the Commission’s affirmance of ALJ Gildea’s construction of the claim term “an entire oscillator disposed upon said integrated circuit substrate,” the Commission went on to affirm the ALJ’s finding that the term does not read on Respondents’ accused products. In particular, the Commission found that ALJ Gildea’s application of his construction of the “entire oscillator” limitation to the accused products was correct, including in particular his discussion of the intricate relationship between the generation and frequency of a clock signal.
The Commission also affirmed ALJ Gildea’s finding that the accused products do not satisfy the “varying - in the same way” limitations of claims 6 and 13. Complainants argued that the ALJ had failed to take into account the specific language of the asserted claims and had failed to consider whether the CPU and clock rate of the oscillator vary in the same way due strictly to their fabrication process, as opposed to operational parameters. In particular, Complainants argued that the fact that the chips in the accused products are subjected to a practice called “binning”—to account for the varying performance levels of chips due to the manufacturing process—proves that processing frequency of the CPU in the accused products will vary with the clock rate of the on-chip oscillator as a function of the fabrication parameters that were fixed in the chip at the factory, thereby satisfying the “varying - in the same way” limitation.
The Commission rejected Complainants’ argument based on the binning process. In particular, the Commission found that the binning process merely sorts individual chips based on the maximum processing frequency at which a chip is capable of operating and has nothing to do with the actual frequency and clock rate at which the chip operates. The Commission also found that an additional non-infringement argument that Complainants had apparently never raised before the ALJ had been waived. Moreover, the Commission found that, in any event, Complainants’ additional argument could not overcome the ultimate finding that the accused products do not satisfy the “varying - in the same way” limitation.
The Commission also affirmed ALJ Gildea’s finding that Complainants had failed to show that the accused products satisfy the “external clock” limitation of claims 6 and 13. Accordingly, the Commission affirmed the ID’s ultimate determination of no direct infringement by the accused products.
Based on its affirmance of the no direct infringement finding, the Commission also affirmed the ID’s finding that Complainants had failed to prove induced infringement. In particular, since it was undisputed that induced infringement requires proof of direct infringement, there could be no induced infringement in the instant case because the accused products do not meet all of the limitations of the asserted claims.
With respect to domestic industry, the Commission affirmed ALJ Gildea’s finding that Complainants had satisfied the economic prong. Specifically, the Commission found that Complainants’ licensing program was ongoing at the time the complaint was filed and that Complainant TPL’s investments related to licensing the ‘336 patent were substantial.
To support their domestic industry case, Complainants relied primarily on their Moore Microprocessor Patent (“MMP”) portfolio licensing program. Specifically, Complainants relied on the activities of Alliacense, a California-based vendor that carries out Complainants’ licensing program. Shortly before the filing of the complaint, primary responsibility for Complainants’ licensing activity appears to have shifted from TPL to PDS.
Based on the evidence, the Commission found that Complainants’ licensing program appeared to be ongoing under PDS’s control, with TPL’s participation, although the record did not identify a way to definitively determine the amount of PDS’s pre- or post-complaint investment. The Commission found that ALJ Gildea had properly limited Complainants to relying on TPL’s pre-complaint expenditures as opposed to PDS’s expenditures for purposes of satisfying the economic prong.
However, the Commission also determined that the filing of TPL’s complaint in the instant investigation was sufficiently contemporaneous with its activities with respect to the licensing of the ‘336 patent and that those activities should be examined for purposes of the economic prong. Moreover, even though the post-complaint licensing activity was funded by PDS (rather than TPL) and could not be substantively relied upon to support satisfaction of the economic prong, the evidence nevertheless supported a finding that Complainants’ licensing activity was ongoing.
With respect to TPL’s pre-complaint investments in licensing, Respondents argued that Complainants had not provided sufficient evidence with which the Commission could determine what expenses related to licensing as opposed to irrelevant litigation, patent prosecution, and patent reexamination activities. However, the Commission found that, even excluding certain categories of expenditures, Complainants had made a substantial investment in licensing related to the ‘336 patent. The Commission found that there was a strong nexus between TPL’s expenditures and the MMP portfolio, and noted the ALJ’s finding that the ‘336 patent was a central part of that portfolio. Accordingly, the Commission affirmed ALJ Gildea’s finding that Complainants had satisfied the economic prong of the domestic industry requirement.
With respect to the technical prong, ALJ Gildea had noted in the ID that “where a complainant is relying on licensing activities, the domestic industry determination does not require a separate technical prong analysis and the complainant need not show that it or one of its licensees practices the patents-in-suit.” However, subsequent to the Commission’s decision to review the ID in part in the instant investigation, the Commission issued its opinion in Certain Computers and Computer Peripheral Devices, and Components Thereof, and Products Containing the Same (Inv. No. 337-TA-841), which held that there is a technical prong requirement with respect to “articles protected by the patent” for a domestic industry asserted under Section 337(a)(3)(C). See our January 15, 2014 post for more details on the Commission opinion in the 841 investigation.
In the instant opinion in the 853 investigation, the Commission determined to take no position on whether the technical prong had been satisfied. The Commission apparently found that it was justified in not taking a position on the issue due to its findings of non-infringement and the overall posture of the investigation.
In view of the above, the Commission found no violation of Section 337 with respect to the ‘336 patent.