eBay Inc. et al v. PartsRiver, Inc., No. 4:2010cv04947 - Document 70 (N.D. Cal. 2011)

Court Description: ORDER GRANTING IN PART AND DENYING IN PART PLAINTIFFS (46 in 4:10-cv-05106-CW), (41 in 4:10-cv-04947-CW),(43 in 4:10-cv-05108-CW) MOTION FOR SUMMARY JUDGMENT AND CONSOLIDATING CASES. All future filings shall be made in Case No. C 10-4947 CW. . Signed by Judge Claudia Wilken on 5/9/2011. (ndr, COURT STAFF) (Filed on 5/9/2011)

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eBay Inc. et al v. PartsRiver, Inc. Doc. 70 1 IN THE UNITED STATES DISTRICT COURT 2 FOR THE NORTHERN DISTRICT OF CALIFORNIA 3 4 No. C 10-04947 CW 5 6 7 8 Plaintiffs, v. PARTSRIVER, INC. and KELORA SYSTEMS, LLC, Defendants. 9 United States District Court For the Northern District of California 10 / 13 14 Plaintiff, v. PARTSRIVER, INC. and KELORA SYSTEMS, LLC, Defendants. 15 16 / 19 20 21 22 23 No. C 10-05108 CW (Docket No. 43) MICROSOFT CORPORATION, 17 18 No. C 10-05106 CW (Docket No. 46) EBAY INC., 11 12 ORDER GRANTING IN PART AND DENYING IN PART PLAINTIFFS’ MOTION FOR SUMMARY JUDGMENT (Docket No. 41) AND CONSOLIDATING CASES EBAY INC. and MICROSOFT CORPORATION, Plaintiff, v. PARTSRIVER, INC. and KELORA SYSTEMS, LLC, Defendants. / AND ALL RELATED COUNTERCLAIMS / 24 25 In these related cases, Plaintiffs eBay Inc. and Microsoft 26 Corporation move for summary judgment of invalidity of Defendant 27 Kelora Systems, LLC’s U.S. Patent No. 6,275,821 (’821 patent) 28 Dockets.Justia.com 1 and/or for summary adjudication that the ’821 patent cannot give 2 rise to liability for infringement before November 2, 2010. 3 opposes the motion. 4 considered oral argument and the papers submitted by the parties, 5 the Court GRANTS Plaintiffs’ motion in part and DENIES it in part. The motion was heard on May 5, 2011. Kelora Having 6 BACKGROUND 7 The ’821 patent, which is entitled, “Method and System for 8 Executing a Guided Parametric Search,” claims a “process for 9 identifying a single item from a family of items.” ’821 patent, United States District Court For the Northern District of California 10 Abstract. 11 parametric search to isolate a subfamily of items within a family 12 of items based on alternatives associated with each item.” 13 3:36-39. 14 invention: (1) an embodiment that runs on a single, local computer, 15 see id. 5:50-18:9; and (2) an embodiment that runs over the 16 Internet and requires a server and client computer, see id. 18:10- 17 19:34. 18 electronic catalog, providing an electronic alternative to updating 19 and distributing product and/or service information.” 20 The invention is intended “to provide a guided Id. The patent specification describes two embodiments of the Over the Internet, “the invention . . . may be used as an Id. 4:6-9. A previous iteration of the ’821 patent was at issue in 21 PartsRiver, Inc. v. Shopzilla, Inc., Case No. C 09-0811 CW. 22 PartsRiver, the previous owner of the ’821 patent, charged eBay and 23 Microsoft with infringement. 24 judgment of non-infringement and invalidity. 25 the patent’s claim 1 and claim 2, which was dependent on claim 1, 26 were invalid based on the on-sale bar, 35 U.S.C. § 102(b). 27 September 18, 2009, PartsRiver appealed the Court’s judgment of 28 There, eBay and Microsoft counterclaimed for 2 The Court held that On 1 2 invalidity to the Federal Circuit. While litigation before this Court was ongoing, the U.S. Patent and Trademark Office (PTO) was conducting an ex parte 4 reexamination of claims 1 and 2. 5 initially rejected claims 1 and 2 as being clearly anticipated by 6 prior art. 7 arguing the prior art clearly did not teach the subject matter 8 contained in claim 1. 9 arguments, concluding that PartsRiver relied on features that did 10 United States District Court For the Northern District of California 3 not appear in the language of the claims subject to reexamination. 11 On or about September 18, 2009, PartsRiver appealed the patent 12 examiner’s final rejection to the Board of Patent Appeals and 13 Interferences (BPAI). 14 There, the patent examiner PartsRiver sought reconsideration of this conclusion, The patent examiner dismissed PartsRiver’s During the pendency of its appeals to the Federal Circuit and 15 the BPAI, PartsRiver proposed amending claim 1 and adding a ninth 16 claim to the ’821 patent. 17 necessarily changed dependent claim 2. 18 and deletion from claim 1, which are indicated below in underlined 19 and stricken text respectively, were as follows: 20 21 PartsRiver’s amendments to claim 1 PartsRiver’s additions to A method for assisting a user in identifying a subfamily of items within a family of items said method performed with a server connected to a client computer through a computer network, comprising the steps of: . . . 22 (h) 23 24 25 26 27 28 accepting a second selection criteria comprising from said client computer via said computer network at said server wherein the second selection criteria comprises a resubmission to the server of the alternative or alternatives of the first selection criteria plus at least one alternative selected from the revised feature screen, . . . Pls.’ Mot. for Summ. J, Ex. 2, at 1:25-52. 3 In relevant part, 1 2 3 PartsRiver’s new claim 9 discussed, A method for assisting a user in identifying a subfamily of items within a family of items, the method comprising the following steps which are performed with a server connected to a computer network: . . . 4 (d) receiving and accepting a first selection criteria of at least one alternative from said client computer, said first selection criteria being received by said server from said client computer via said computer network, . . . (h) receiving and accepting a second selection criteria from said client computer via said computer network, in which said second selection criteria comprises (1) a resubmission by said client computer of the alternative or alternatives of the first selection criteria along with (2) at least one alternative selected from the revised feature screen, . . . . 5 6 7 8 9 United States District Court For the Northern District of California 10 11 12 Id. at 2:8-41. The patent examiner deemed claim 1, as amended, and 13 new claim 9 to be patentable. Thereafter, PartsRiver’s BPAI appeal 14 was dismissed. And, after a reexamination certificate for the ’821 15 patent issued on November 2, 2010, PartsRiver filed a motion to 16 dismiss its appeal of this Court’s judgment, which the Federal 17 Circuit granted.1 18 Plaintiffs filed these related cases in November and December 19 2010, seeking declarations of non-infringement, invalidity and 20 intervening rights. On PartsRiver’s motion, the Court dismissed 21 Plaintiffs’ claims against PartsRiver because it disavowed any 22 remaining interest in the ’821 patent. Kelora, now the sole 23 Defendant in these actions, has counterclaimed against Plaintiffs 24 for infringement of the ’821 patent. 25 26 27 28 1 The Federal Circuit remanded to this Court PartsRiver’s request to vacate the judgment of invalidity. The Court denied PartsRiver’s motion. 4 1 LEGAL STANDARD 2 Summary judgment is properly granted when no genuine and 3 disputed issues of material fact remain, and when, viewing the 4 evidence most favorably to the non-moving party, the movant is 5 clearly entitled to prevail as a matter of law. 6 56; Celotex Corp. v. Catrett, 477 U.S. 317, 322-23 (1986); 7 Eisenberg v. Ins. Co. of N. Am., 815 F.2d 1285, 1288-89 (9th Cir. 8 1987). 9 United States District Court For the Northern District of California 10 Fed. R. Civ. P. DISCUSSION I. Identity Between Claims Contained in Amended ’821 Patent and Claims Held Invalid By This Court 11 Plaintiffs argue that claims 1, 2 and 9 of the ’821 patent, as 12 amended, are identical in scope to original claims 1 and 2, which 13 the Court held to be invalid. Thus, Plaintiffs argue, the Court’s 14 invalidity judgment in PartsRiver applies in these actions. 15 Plaintiffs cite PartsRiver’s contention that, “although the text of 16 claim 1 has been altered by amendment, the claim scope is legally 17 identical to that of originally issued claim 1.” Pls.’ Mot. for 18 Summ. J., Ex. 28, at 7. Kelora claims that they are not identical. 19 PartsRiver’s assertion does not establish, as a matter of law, 20 that the Court’s previous invalidity judgment applies to amended 21 claims 1 and 2 and new claim 9. Indeed, Plaintiffs acknowledge 22 that the claims are not identical in scope, noting that 23 PartsRiver’s amendments “narrowed claims 1 and 2 to overcome the 24 rejection based on the Granacki prior-art reference.” Pls.’ Mot. 25 for Summ. J. at 10:28-11:1. Further, that the examiner deemed the 26 claims to be patentable only after they were amended suggests a 27 28 5 1 lack of identity. 2 Accordingly, Plaintiffs’ motion is denied insofar as it seeks 3 summary adjudication that amended claims 1 and 2 and new claim 9 4 are identical in scope to original claims 1 and 2 and are invalid 5 as a result. 6 II. 7 Limitations on Liability Based on 35 U.S.C. § 252 The owner of a “reexamined patent is entitled to infringement damages, inter alia, for the period between the date of issuance of 9 the original claims and the date of issuance of the reexamined 10 United States District Court For the Northern District of California 8 claims if the original and reexamined claims are ‘identical.’” 11 Laitram Corp. v. NEC Corp., 163 F.3d 1342, 1346 (Fed. Cir. 1998) 12 (citing 35 U.S.C. §§ 252, 307(b) (1994)). 13 ‘identical’ to their original counterparts if they are ‘without 14 substantive change.’” 15 “Reexamined claims are Laitram, 163 F.3d at 1346. “There is no absolute rule for determining whether an amended 16 claim is legally identical to an original claim.” 17 Inc. v. N. Am. Mfg. Co., Inc., 129 F.3d 1247, 1250 (Fed. Cir. 18 1997). 19 “more definite without affecting its scope” are generally viewed as 20 “identical” for the purposes of section 252. 21 omitted). 22 following a prior art rejection is not per se a substantive 23 change.” 24 “Determination of whether a claim change during reexamination is 25 substantive requires analysis of the scope of the original and 26 reexamined claims in light of the specification, with attention to 27 the references that occasioned the reexamination, as well as the 28 Bloom Eng’g Co., Amendments that simply clarify a claim or make the claim Id. (citation However, “a claim amendment made during reexamination Laitram, 163 F.3d at 1347 (citation omitted). 6 1 prosecution history and any other relevant information.” 2 129 F.3d at 1250. 3 Bloom, Whether amended claims are identical in scope to the original 4 claims is a question of law. 5 rule flows from the general principle that ‘the interpretation and 6 construction of patent claims, which define the scope of the 7 patentee’s rights under the patent, is a matter of law, exclusively 8 for the court.’” 9 Instruments, Inc., 52 F.3d 967, 970-71 (Fed. Cir. 1995)). United States District Court For the Northern District of California 10 Laitram, 163 F.3d at 1346-47. “This Id. at 1347 (quoting Markman v. Westview A plain reading of amended claims 1 and 2 and new claim 9 11 shows that these claims are substantively different from original 12 claims 1 and 2. 13 method it addresses are “performed with a server connected to a 14 client computer through a computer network.” 15 J., Ex. 2, at 1:25-29. 16 limitation, which effectively excludes the local embodiment 17 described in the specification.2 18 language did not delineate the roles of the server and the client 19 computer at step (h), which calls for “accepting a second selection 20 criteria comprising the alternative or alternatives of the first 21 selection criteria plus at least one alternative selected from the 22 revised feature screen.” 23 defines these roles. 24 (h), the client computer combines “the alternative or alternatives Amended claim 1 states that the steps of the Pls.’ Mot. for Summ. Original claim 1 did not contain this Further, original claim 1’s Id., Ex. 1, at 19:56-59. Amended claim 1 The amended claim indicates that, at step 25 2 26 27 28 The local embodiment required only a single “computing system.” See Pls.’ Mot. for Summ. J., Ex. 1, at 7:1-10; see also Danish Decl. ¶ 8 (stating that claims 1 and 9 involve steps to be performed “with a server”). 7 1 of the first selection criteria plus at least one alternative 2 selected from the revised feature screen,” which, together, 3 constitute the “second selection criteria.” 4 52. 5 server. 6 claim 1, it is equally different from original claim 2. 7 9 reiterates this division of tasks between the server and client 8 computer. 9 argue that PartsRiver’s amendments did not substantially change the United States District Court For the Northern District of California 10 Id., Ex. 2, at 1:47- This “second selection criteria,” in turn, is accepted by the See id. Because amended claim 2 is dependent on amended New claim Kelora does not cite any portion of the specification to scope of the original claims 1 and 2.3 11 The reexamination proceedings further support the conclusion 12 that PartsRiver’s amendments narrowed original claim 1. 13 examiner rejected PartsRiver’s argument that original claim 1 14 reflected these limitations, stating that “there is nothing in 15 claim 1 about concatenation. 16 the data in a search instruction is actually formatted prior to 17 being sent to a controller to perform the selection.” 18 at 7. 19 already described. 20 The patent The claim makes no reference to how Id., Ex. 19, PartsRiver responded to this contention with the amendments Accordingly, the Court summarily adjudicates that Kelora may 21 3 27 Kelora insists that it has no burden of production, arguing that Plaintiffs have the burden to show they are entitled to intervening rights under paragraph 2 of 35 U.S.C. § 252. However, on this motion, Plaintiffs are not seeking a declaration that they have intervening rights. Instead, they contend that, under paragraph 1 of section 252, Kelora is precluded from recovering damages incurred before November 2, 2010 for infringement of claims 1, 2 and 9 of the amended ’821 patent. See Kaufman Co., Inc. v. Lantech, Inc., 807 F.2d 970, 976 (Fed. Cir. 1986) (stating that limitation on patentee’s rights contained in paragraph 1 of section 252 “is not . . . so-called ‘intervening rights’ set out in the second paragraph of § 252”). 28 8 22 23 24 25 26 1 not seek damages for infringement before November 2, 2010, the 2 issue date of the ex parte reexamination certificate. 3 III. Invalidity under 35 U.S.C. § 305 4 Under 35 U.S.C. § 305, during the reexamination process, 5 patent owners are permitted to add new claims in order to 6 distinguish the invention as claimed from prior art. 7 “[n]o proposed amended or new claim enlarging the scope of a claim 8 of the patent will be permitted in a reexamination proceeding under 9 this chapter.” 35 U.S.C. § 305. However, Whether the scope of a claim has United States District Court For the Northern District of California 10 been impermissibly broadened on reexamination is a matter of claim 11 construction, Quantum Corp. v. Rodime, PLC, 65 F.3d 1577, 1580 12 (Fed. Cir. 1995), and thus a question of law for the Court. 13 section 305, “a claim of a reissue application is broader in scope 14 than the original claims if it contains within its scope any 15 conceivable apparatus or process which would not have infringed the 16 original patent.” 17 1994). 18 broader than the original claims even though it may be narrower in 19 other respects.” 20 valid, clear and convincing evidence is required. 21 Sunglass Hut Int’l, 316 F.3d 1331, 1339 (Fed. Cir. 2003). 22 Under In re Freeman, 30 F.3d 1459, 1464 (Fed. Cir. “A claim that is broader in any respect is considered to be Id. To overcome the presumption that patents are Oakley, Inc. v. Plaintiffs contend that step (h) of original claim 1 provided 23 that the user of the client computer performed the task of 24 “accepting a second selection criteria comprising the alternative 25 or alternatives of the first selection criteria plus at least one 26 alternative selected from the revised feature screen.” 27 contrast, as explained above, step (h) of amended claim 1 provides 28 9 In 1 that the server performs this task. 2 amended claim 1 is broader because original claim 1 could not be 3 infringed by a server. 4 Thus, Plaintiffs argue, The Court is not convinced that the language of the original 5 claims supports the limitation advocated by Plaintiffs. 6 have not identified anything in the original claims indicating that 7 the user necessarily performed the “accepting” task as defined in 8 step (h). 9 Plaintiffs Accordingly, the Court denies Plaintiffs’ motion, to the United States District Court For the Northern District of California 10 extent it seeks summary judgment of invalidity under 35 U.S.C. 11 § 305. 12 with their motion for claim construction and summary judgment. This denial is without prejudice to renewal in connection 13 CONCLUSION 14 For the foregoing reasons, the Court GRANTS Plaintiffs’ motion 15 in part and DENIES it in part. 16 41; Case No. C 10-5106 CW, Docket No. 46; Case No. C 10-5108 CW, 17 Docket No. 43.) 18 not seek damages for infringement before November 2, 2010. 19 Plaintiffs’ motion is denied to the extent that it seeks summary 20 judgment of invalidity based on the Court’s invalidity judgment in 21 PartsRiver. 22 extent that it seeks summary judgment of invalidity based on 35 23 U.S.C. § 305; they may renew this request in connection with their 24 motion for claim construction and summary judgment. (Case No. C 10-4947 CW, Docket No. The Court summarily adjudicates that Kelora may Plaintiffs’ motion is denied without prejudice to the 25 As discussed at the May 5, 2011 hearing, Case Nos. C 10-5106 26 CW and C 10-5108 CW shall be consolidated with Case No. C 10-4947 27 CW. 28 The Clerk shall administratively close Case Nos. C 10-5106 CW 10 1 and C 10-5108 CW. 2 C 10-4947 CW. 3 4 5 All future filings shall be made in Case No. The hearing on claim construction and the parties’ dispositive motions will be held on November 17, 2011 at 2:00 p.m. IT IS SO ORDERED. 6 7 Dated: 5/9/2011 CLAUDIA WILKEN United States District Judge 8 9 United States District Court For the Northern District of California 10 11 12 13 14 15 16 17 18 19 20 21 22 23 24 25 26 27 28 11

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