PCT International Incorporated v. Holland Electronics LLC

Filing 267

ORDER that Defendant's 222 Motion for Sanctions is denied. Defendant's 223 Renewed Motion for Summary Judgment is granted in part and denied in part. Plaintiff's 260 Motion for Leave to File Non-Electronic Exhibit is d enied. ORDERED the Clerk of the Court shall return to PCT the non-electronic exhibit known as "Exhibit 26." Plaintiff's 229 Motion to Exclude is denied without prejudice. Plaintiff's 233 Motion to Exclude is denied without prejudice. Plaintiff's 237 Motion to Exclude is denied without prejudice. Signed by Senior Judge James A Teilborg on 3/2/2015.(LFIG)

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1 WO 2 3 4 5 6 IN THE UNITED STATES DISTRICT COURT 7 FOR THE DISTRICT OF ARIZONA 8 9 PCT International Incorporated, Plaintiff, 10 11 ORDER v. 12 No. CV-12-01797-PHX-JAT Holland Electronics LLC, 13 Defendant. 14 Pending before the Court are Defendant Holland Electronics LLC (“Holland”)’s 15 Motion, and Memorandum in Support Thereof, for Sanctions for PCT International Inc.’s 16 Protective Order Violation (Doc. 222); Defendant Holland Electronics, LLC’s Renewed 17 Motion for Summary Judgment on Infringement, or Alternatively, Partial Summary 18 Judgment on Damages and Renewed Motion to Preclude any Theory of Indirect 19 Infringement for Lack of Disclosure (Doc. 223); Plaintiff’s Resubmitted Motion to 20 Exclude Portions of the Expert Reports of Daniel J. Whittle, PhD (Doc. 229); Plaintiff’s 21 Resubmitted Motion to Exclude the Expert Opinion of David A. Haas (Redacted) (Doc. 22 233); Plaintiff’s Resubmitted Motion to Exclude the Expert Opinion of David A. Haas 23 (Filed under Seal) (Doc. 237); and Plaintiff’s Motion for Leave to File Non- 24 Electronically Exhibit 26 to Plaintiff’s Separate Statement of Additional Material Facts in 25 Support of PCT’s Opposition to Holland’s Renewed Motion for Summary Judgment 26 (Doc. 260). The Court now rules on the motions. 27 I. 28 Motion for Sanctions Holland moves for sanctions against Plaintiff PCT International Incorporated 1 (“PCT”) for PCT’s alleged violation of the Protective Order issued in this case. (Doc. 222 2 at 4). The Court previously entered a Protective Order pursuant to Federal Rule of Civil 3 Procedure (“Rule”) 26(c) that permits the parties to designate materials produced during 4 discovery as “confidential” or “outside attorneys’ eyes only.” (Doc. 53). The Protective 5 Order limits the parties’ ability to use and disclose these designated materials, and it 6 orders that designated materials “shall not be used or disclosed for any purpose other than 7 the litigation of this action.” (Id. at 2). 8 PCT is involved in litigation with its former supplier EZconn Corporation in the 9 United States District Court for the District of Nevada. In that litigation, PCT filed a 10 document giving rise to Holland’s instant motion for sanctions. The relevant portion of 11 PCT’s document is as follows: 12 13 14 15 16 17 18 19 20 21 22 23 24 25 26 27 28 Plaintiffs believe that third party discovery from Holland Electronics, LLC (“Holland”) will lead to documents that support personal jurisdiction over eGtran. [PCT] is currently involved in a patent infringement lawsuit against Holland in the District of Arizona. Case No. 12-cv-01797-PHX-JAT (D. Ariz.). During discovery in that case, Holland produced a number of documents pursuant to a protective order that may serve as evidence of jurisdictional facts relating to eGtran. The Arizona Court issued an order, attached as Exhibit G to the Harting Declaration, Dkt. No. 36, describing the documents at a high level. The Holland documents generally relate to:  EZconn/eGtran’s disclosure to Holland of “the price at which it offered to manufacture PCT’s product.” Dkt. No. 36, Exhibit G at 4-5.  EZconn/eGtran’s disclosure to Holland of “the quantities and shipment dates of PCT compression connector orders.” Id. at 5  Communications from EZconn/eGtran comprising “certain e-mail attachments to Holland in an e-mail with the subject line ‘RE: PCT.’ Id.  An email from EZconn/eGtran to Holland forwarding “copies of communications and a financial transaction between PCT and EZconn concerning a dispute regarding loans made from EZconn to PCT.” Id.  Communications from Holland to EZconn/eGtran asking “EZconn to delete e-mails concerning PCT after reading them because Holland was concerned about getting sued for ‘interference.’ Id. -2- 1 Plaintiffs’ Reply Memorandum of Points and Authorities in Support of Plaintiffs’ Motion 2 for Leave to Conduct Jurisdictional Discovery at 14:16-15:6, Andes Indus., Inc. et al. v. 3 EZconn Corp. et al., No. 2:14-cv-00400-APG-GWF (D. Nev. Oct. 16, 2014), ECF No. 60 4 (grammatical errors in original). 5 Holland alleges that the bullet points in the above-quoted portion of PCT’s filing 6 contain Holland’s confidential information designated pursuant to the Protective Order; 7 thus, Holland claims, PCT has violated the Order. (Doc. 222 at 4). PCT responds that all 8 of the details concerning the documents are direct quotations from the Court’s June 3, 9 2014 Order (Doc. 198). (Doc. 241 at 3). The Court has compared the details quoted in 10 PCT’s filing with its statements in its June 3, 2014 Order and they are identical. See 11 (Doc. 198 at 4-5). This is not surprising, because PCT’s filing cites to the Court’s Order 12 and uses quotation marks in its description of the documents. 13 The Protective Order provides that “[a]ny Designated Material which becomes 14 part of an official judicial proceeding . . . is public.” (Doc. 53 at 6). Furthermore, the 15 Court’s orders are public documents; information contained in them is public and cannot 16 be subject to any protective order. PCT did not disclose or use confidential information 17 under the Protective Order when it quoted the Court’s June 3, 2014 Order. The Court will 18 deny Holland’s motion. 19 II. Holland’s Motion for Summary Judgment 20 Holland moves for summary judgment on the issue of infringement, alleging that 21 it is not a direct infringer and there is no evidence of indirect infringement. (Doc. 223 at 22 2).1 Holland also moves for partial summary judgment on damages. (Id.) 23 A. 24 Summary judgment is appropriate when “the movant shows that there is no 25 genuine dispute as to any material fact and the movant is entitled to judgment as a matter 26 of law.” Fed. R. Civ. P. 56(a). “A party asserting that a fact cannot be or is genuinely 27 disputed must support that assertion by . . . citing to particular parts of materials in the Summary Judgment Standard 28 1 All page number references are to PDF page numbers. -3- 1 record, including depositions, documents, electronically stored information, affidavits, or 2 declarations, stipulations . . . admissions, interrogatory answers, or other materials,” or by 3 “showing that materials cited do not establish the absence or presence of a genuine 4 dispute, or that an adverse party cannot produce admissible evidence to support the fact.” 5 Id. 56(c)(1)(A), (B). Thus, summary judgment is mandated “against a party who fails to 6 make a showing sufficient to establish the existence of an element essential to that party’s 7 case, and on which that party will bear the burden of proof at trial.” Celotex Corp. v. 8 Catrett, 477 U.S. 317, 322 (1986). 9 Initially, the movant bears the burden of pointing out to the Court the basis for the 10 motion and the elements of the causes of action upon which the non-movant will be 11 unable to establish a genuine issue of material fact. Id. at 323. The burden then shifts to 12 the non-movant to establish the existence of material fact. Id. The non-movant “must do 13 more than simply show that there is some metaphysical doubt as to the material facts” by 14 “com[ing] forward with ‘specific facts showing that there is a genuine issue for trial.’” 15 Matsushita Elec. Indus. Co. v. Zenith Radio Corp., 475 U.S. 574, 586–87 (1986) (quoting 16 Fed. R. Civ. P. 56(e) (1963) (amended 2010)). A dispute about a fact is “genuine” if the 17 evidence is such that a reasonable jury could return a verdict for the non-moving party. 18 Anderson v. Liberty Lobby, Inc., 477 U.S. 242, 248 (1986). The non-movant’s bare 19 assertions, standing alone, are insufficient to create a material issue of fact and defeat a 20 motion for summary judgment. Id. at 247–48. However, in the summary judgment 21 context, the Court construes all disputed facts in the light most favorable to the non- 22 moving party. Ellison v. Robertson, 357 F.3d 1072, 1075 (9th Cir. 2004). 23 B. 24 Holland argues that PCT cannot succeed on its claim against Holland for direct 25 infringement of U.S. Patent 6,042,422 (filed Oct. 8, 1998) (the “‘422 Patent”) because 26 claim 1 of the ‘422 Patent requires that the coaxial connector be crimped to a cable and 27 Holland sells, but does not crimp, connectors. (Doc. 223 at 3-4). Direct Infringement 28 -4- 1 1. Legal Standard 2 A person is liable for patent infringement if, without permission of the patentee, 3 that person “makes, uses, offers to sell, or sells any patented invention[] within the 4 United States . . . during the term of the patent therefor.” 35 U.S.C. § 271(a). “A 5 determination of patent infringement requires a two-step analysis.” Dynacore Holdings 6 Corp. v. U.S. Philips Corp., 363 F.3d 1263, 1273 (Fed. Cir. 2004). First, the court must 7 interpret the claims “to determine their scope and meaning”; this is a question of law for 8 the court. Id. Second, the court must “then compare the properly construed claims to the 9 allegedly infringing device.” Id. “To prove infringement, the patentee must show that the 10 accused device meets each claim limitation, either literally or under the doctrine of 11 equivalents.” Id. Although this second step is a factual question, “[a]n infringement issue 12 is properly decided upon summary judgment when no reasonable jury could find that 13 every limitation recited in the properly construed claim either is or is not found in the 14 accused device either literally or under the doctrine of equivalents.” Gart v. Logitech, 15 Inc., 254 F.3d 1334, 1339 (Fed. Cir. 2001). 16 17 18 19 20 21 22 23 24 25 26 27 28 2. Analysis Claim 1 of the ‘422 Patent contains the following limitation: . . . said collapsible band forming an annular rib projecting inward toward said inner tube when said outer barrel is axially compressed . . . ‘422 Patent col.7 ll.1-3. Holland contends that PCT’s own infringement expert admitted that Holland’s products do not meet this limitation because as sold, the outer barrel has not yet been axially compressed. (Doc. 223 at 3-4). Thus, according to Holland, infringement only occurs when someone other than Holland “actually takes a Holland connector and attaches it to a piece of coaxial cable.” (Id. at 5). Holland’s argument fails because it misconstrues claim 1 of the ‘422 Patent. In construing claims, the Court first looks to the ordinary and customary meaning of the claim terms themselves. See Phillips v. AWH Corp., 415 F.3d 1303, 1312-13 (Fed. Cir. 2005). Claim 1 does not require that the collapsible band forms an annular rib and the -5- 1 outer barrel is axially compressed; it requires that the collapsible band forms an annular 2 rib when the outer barrel is axially compressed. Thus, claim 1’s language is one of 3 capability and not of immediate characteristics. 4 In Intel Corporation v. United States International Trade Commission, 946 F.2d 5 821 (Fed. Cir. 1991), the claim at issue required “programmable selection means” and 6 used language relating to capability, namely “when said alternate addressing mode is 7 selected.” 946 F.2d at 832. There, the Federal Circuit Court of Appeals (“Federal 8 Circuit”) held that the accused device need only be capable of operating in the alternate 9 addressing mode to be infringing. Id. In Finjan, Inc. v. Secure Computing Corp., 626 10 F.3d 1197 (Fed. Cir. 2010), the Federal Circuit clarified that when a claim “recites 11 capability and not actual operation, an accused device ‘need only be capable of operating’ 12 in the described mode.” 626 F.3d at 1204 (quoting Intel, 946 F.2d at 832). Here, the plain 13 language of claim 1 of the ‘422 Patent specifies that the annular rib is formed when the 14 outer barrel is axially compressed. A device having all of the limitations specified in 15 claim 1 thus infringes if the relevant collapsible band forms an annular rib when the outer 16 barrel is axially compressed; the device does not need to actually be compressed as a 17 condition precedent to infringement. 18 For these reasons, Holland’s interpretation of claim 1 is contrary to the ordinary 19 and customary meaning of the claim’s terms. Although Holland cites the testimony of 20 PCT’s infringement expert, Dr. Dickens, as evidence supporting Holland’s interpretation 21 of claim 1, “unsupported assertions by experts as to the definition of a claim term are not 22 useful to a court.” Phillips, 415 F.3d at 1318. In particular, expert testimony should be 23 discounted when expert testimony is “clearly at odds with the claim construction 24 mandated by the claims themselves.” Id. Thus, although Holland quotes Dr. Dickens as 25 stating that Holland’s connectors would infringe “when you’ve crimped it,” (Doc. 223 at 26 4), the Court finds Dr. Dickens’ testimony uncompelling.2 27 28 2 The Court will address Dr. Dickens’ subsequent modification of his testimony in its discussion of indirect infringement, infra. -6- 1 Moreover, although Holland argues that its motion for summary judgment is not 2 based upon claim construction but rather “upon Dr. Dickens’ admission that, as a factual 3 matter, the accused products as sold by Holland do not meet all the limitations of claim 4 1,” (Doc. 256 at 8), Holland does not contend that its connectors do not form annular ribs 5 when the outer barrel is axially compressed. Rather, Holland’s arguments involve the 6 interpretation of the claim language; in particular, Holland is arguing the meaning of 7 “when.” This is an issue of claim construction, which is a matter of law for the Court. 8 Thus, because the Court concludes that claim 1 of the ‘422 Patent recites capability and 9 not actual operation, Holland’s arguments fail.3 Accordingly, Holland has not established 10 that it is not a direct infringer.4 11 C. 12 Holland makes two arguments with respect to the issue of indirect infringement. 13 First, Holland asserts that PCT failed to disclose a theory of indirect infringement and the 14 Court should preclude any indirect infringement claim because of this failure to disclose. 15 (Doc. 223 at 5). Second, Holland asserts that PCT cannot show all of the elements of an 16 indirect infringement claim. (Id. at 7). 17 Indirect Infringement 1. Failure to Disclose 18 Holland argues that PCT failed to timely disclose any theory of indirect 19 infringement and therefore the Court should bar PCT from raising this theory. (Doc. 223 20 at 5). 21 a. Background 22 PCT’s Complaint alleges that “Holland has infringed and continues to infringe – 23 directly, contributorily, and/or by active inducement the ‘422 Patent by making, using, 24 25 26 27 28 3 This includes Holland’s arguments raised in its discussion of indirect infringement relating to connectors not crimped prior to the expiration of the ‘422 Patent. See (Doc. 223 at 8:26-9:9). 4 Therefore, the Court need not address PCT’s other arguments concerning Holland’s direct infringement as well as PCT’s alternative arguments that Holland failed to timely disclose its non-infringement arguments, at least as far as direct infringement is concerned. -7- 1 offering to sell, selling, and/or importing the Accused Products within the United States.” 2 (Doc. 1 ¶ 13). During discovery, Holland served PCT with an interrogatory asking PCT 3 to “[s]et forth in full and complete detail all information, and identify all facts and 4 circumstances” upon which PCT based this allegation and also for PCT to “identify all 5 witnesses having knowledge of and all documents supporting or relating to” PCT’s 6 allegations and contentions. (Doc. 224-21 at 3). PCT responded with references to its 7 analysis and claim charts concerning Holland’s allegedly infringing connector models, a 8 list of connector models, and also references to PCT’s answers to other interrogatories as 9 having additional responsive information. On the explicit subject of indirect 10 infringement, PCT responded: “In addition, Holland has failed to produce regularly 11 maintained financial documents demonstrating the customers to whom Holland sold 12 specific quantities of infringing products necessary for PCT to assess its claims for 13 indirect infringement. Thus, PCT reserves its right to supplement its answer to this 14 Interrogatory once Holland has produced all responsive documents to PCT’s discovery 15 requests.” (Id. at 4). 16 PCT later supplemented its response to this interrogatory, stating that the 17 depositions of Holland’s witnesses (including exhibits) as well as Dr. Dickens’ expert 18 and rebuttal reports (including exhibits) were additional responsive evidence. (Doc. 243-8 19 at 12). PCT did not further supplement its response. (Doc. 243 at 16). PCT stated in its 20 statement of the case in the parties’ Joint Proposed Case Management Plan that PCT 21 violated “35 U.S.C. § 271(a)-(c).” (Doc. 27 at 2). Subsections (b) and (c) of 35 U.S.C. § 22 271 concern liability for indirect infringement. 23 b. Analysis 24 Holland argues that under Rule 37(c)(1), PCT cannot pursue an indirect 25 infringement theory because PCT has failed to “fully” disclose this theory. (Doc. 223 at 26 6). Rule 37(c)(1) provides, in relevant part, that “[i]f a party fails to provide information 27 or identify a witness as required by Rule 26(a) or (e), the party is not allowed to use that 28 information or witness to supply evidence on a motion, at a hearing, or at a trial . . . .” -8- 1 Fed. R. Civ. P. 37(c)(1). Although a theory of liability may fail if Rule 37(c)(1) bars all 2 supporting evidence for that theory, the rule itself concerns the exclusion of only 3 untimely disclosed evidence. Because Holland seeks to preclude a legal theory, Holland’s 4 argument is more appropriately addressed under the Rule 12(b)(6) standard for failure to 5 state a claim. But because PCT’s complaint placed Holland on fair notice that PCT 6 claims Holland is liable for indirect infringement, see Bell Atl. Corp. v. Twombly, 550 7 U.S. 544, 555 (2007), PCT pleaded a claim for indirect infringement (both concerning 8 inducement and contributory infringement).5 9 2. 10 Indirect Infringement Claims a. Prerequisite of Direct Infringement 11 Holland argues PCT cannot show Holland’s liability for indirect infringement 12 because PCT cannot show the necessary prerequisite of direct infringement. (Doc. 223 at 13 7). Indirect infringement requires an underlying direct infringement, Glenayre Elecs., Inc. 14 v. Jackson, 443 F.3d 851, 858 (Fed. Cir. 2006), and the patentee must “either point to 15 specific instances of direct infringement or show that the accused device necessarily 16 infringes the patent in suit,” ACCO Brands, Inc. v. ABA Locks Mfrs. Co., 501 F.3d 1303, 17 1313 (Fed. Cir. 2007). 18 Holland argues that PCT has failed to identify any specific instances of direct 19 infringement and there is no evidence that the accused Holland connectors necessarily 20 infringe claim 1 of the ‘422 Patent. (Doc. 223 at 7-8). But PCT’s expert Dr. Dickens 21 testified at his deposition that Holland’s connectors infringe even before they are crimped 22 on a cable. (Doc. 243-5 at 155). Holland claims that Dr. Dickens instead “admitted that 23 whether or not a connector meets the requirement of the claim that an annular rib is 24 formed depends on what the third-party installer does when the connector is axially 25 compressed onto a piece of coaxial cable.” (Doc. 223 at 8). Although Dr. Dickens 26 initially so testified, he later changed his testimony, clarifying that he believed the 27 5 28 Even if Holland could seek to preclude a theory of liability, PCT adequately answered Holland’s interrogatories such that Holland was on notice that PCT is pursuing indirect infringement claims in this case. -9- 1 connector had to merely be capable of forming an annular rib.6 (Doc. 243-5 at 223). Dr. 2 Dickens also stated in his infringement report that each of the Holland connectors 3 accused of infringement literally infringe claims 1 and 11 of the ‘422 Patent. (Doc. 243-2 4 at 21). This testimony is sufficient to create an issue of fact.7 5 Holland next contends that there is no evidence that its connectors “necessarily 6 form an annular rib when axially compressed” because the “window” in Holland 7 connectors results in a “deformation of the compression ring in a manner that does not 8 form an annular rib.” (Doc. 223 at 8). But Dr. Dickens stated in his infringement report 9 that each accused Holland connector has a collapsible band that forms an annular rib 10 projecting inward as claim 1 of the ‘422 Patent requires.8 See (Doc. 243-2 at 54, 81, 102, 11 125; Doc. 243-3 at 3, 19, 35, 50, 70, 86, 105; Doc. 243-4 at 8, 29, 46, 61). Thus, if Dr. 12 Dickens testifies to these opinions at trial, a reasonable jury could conclude that 13 14 15 16 17 18 19 20 21 6 Holland asserts that Dr. Dickens’ testimony is inadmissible because Dr. Dickens offered at his deposition claim construction opinions not included in his expert reports. (Doc. 256 at 10). But Dr. Dickens’ testimony concerning whether Holland’s connectors form an annular rib when axially compressed was not an opinion regarding claim construction; rather it was a fact opinion as to the physical characteristics of the connectors. Thus, there is no basis for excluding this testimony. Holland also argues that because Dr. Dickens changed his opinion during his deposition, his later testimony is “conclusory and is insufficient to raise a genuine issue of fact.” (Id.) Dr. Dickens’ later testimony was not conclusory; to the contrary, Dr. Dickens thoroughly explained—in response to repeated questioning by Holland’s counsel—why his earlier statements were inadvertently incorrect. See (Doc. 243-5 at 153-62). Although Holland criticizes Dr. Dickens’ credibility, credibility arguments are for trial, not summary judgment. 7 22 23 24 25 26 27 28 Thus, Holland’s contention that its connectors “may not be used in the United States,” (Doc. 223 at 8), is without merit because claim 1 of the ‘422 Patent concerns capability, and therefore any infringement occurs at the time of production. Whether Holland’s connectors are ultimately crimped outside of the United States is irrelevant. 8 Holland contends that the Court may not rely on Dr. Dickens’ expert report because the report itself is inadmissible. (Doc. 256 at 10). But evidence offered in opposition to a motion for summary judgment need not be admissible, as long as it can be converted into an admissible form at trial. Quanta Indem. Co. v. Amberwood Dev. Inc., 2014 WL 1246144, at *2 (D. Ariz. Mar. 26, 2014). And although Holland also contends that Dr. Dickens’ deposition testimony contradicts his expert report, (Doc. 256 at 10), Holland ignores Dr. Dickens’ later deposition testimony, which is consistent with his report. Under Holland’s view, an expert witness can never modify his opinion during a deposition because any subsequent opinions by that expert will be contradictions of the expert’s initial sworn testimony. This is not the law. - 10 - 1 Holland’s connectors form an annular rib when axially compressed. 2 Holland also argues there is no evidence that its connectors have the two non- 3 collapsible wall portions described in claim 1 of the ‘422 Patent. (Doc. 223 at 8). Again, 4 Holland’s argument fails because Dr. Dickens stated in his expert report that each 5 accused Holland connector has a collapsible band extending between a first non- 6 collapsible wall portion and a second non-collapsible wall portion. See (Doc. 243-2 at 43, 7 70, 91, 113, 133; Doc. 243-3 at 10, 26, 42, 59, 77, 94, 116; Doc. 243-4 at 18, 37, 53). 8 Although Holland offers its own expert testimony through its expert Dr. Whittle, the 9 Court cannot weigh the evidence on a motion for summary judgment. Thus, although 10 Holland also contends that Dr. Dickens’ opinions are unreliable because the drawings 11 upon which Dr. Dickens relies “do not show the ‘window’, which has a dramatic impact 12 upon how the collapsible band in the Holland connectors deforms when compressed,” 13 (Doc. 223 at 8), this argument goes to the weight to be accorded to Dr. Dickens’ 14 testimony, and not to whether there is a genuine issue of material fact.9 More 15 significantly, Holland fails to develop this argument because it does not cite any 16 evidence. PCT has established the existence of a genuine issue of material fact as to 17 whether Holland’s connectors have the necessary collapsible wall portions as claim 1 of 18 the ‘422 Patent requires. 19 b. Inducement 20 Holland’s second major argument concerning indirect infringement is PCT cannot 21 show that Holland is liable for inducement to infringe. (Id.) Inducement to infringe is one 22 of the two types of indirect infringement, the other being contributory infringement. See 23 Dynacore, 363 F.3d at 1272. “Patent law provides that whoever actively induces 24 infringement of a patent shall be liable as an infringer.” Vita-Mix Corp. v. Basic Holding, 25 Inc., 581 F.3d 1317, 1328 (Fed. Cir. 2009). “Inducement requires a showing that the 26 27 28 9 Holland argues that because Dr. Dickens did not offer any opinions on indirect infringement, he cannot now testify about this subject. (Doc. 223 at 6). But to the extent the Court has relied upon Dr. Dickens’ testimony in this Order, his testimony concerns only direct infringement. - 11 - 1 alleged inducer knew of the patent, knowingly induced the infringing acts, and possessed 2 a specific intent to encourage another’s infringement of the patent.” Id. 3 Holland claims there is no evidence showing that Holland knowingly induced 4 direct infringers to commit infringing acts and that Holland possessed a specific intent to 5 encourage this infringement. (Doc. 223 at 9). But Holland knew of the ‘422 Patent no 6 later than May 1, 2006. (Doc. 243-10 at 82). On August 26, 2006, Holland sent an e-mail 7 to its manufacturer EZconn in which Holland asked for EZconn to replace the ring of 8 Holland’s SLCU-6 connector with “another one with a similar shape as the PCT outer 9 shell design.” (Doc. 243-10 at 95). Holland describes this new ring as “brass and 10 designed to bend inward with axial pressure.” (Id.) Holland subsequently sent a second e- 11 mail to EZconn in which Holland asked EZconn to “refine the design of the metal ring” 12 and told EZconn that “[w]e know that EZConn has experience with similar metal designs 13 used for your other customer, PCT.” (Id. at 98). This is sufficient evidence from which a 14 reasonable jury could conclude that Holland knew of the ‘422 Patent, knowingly induced 15 infringing acts, and possessed a specific intent to encourage another’s infringement of the 16 ‘422 Patent. 17 18 19 20 21 22 23 24 25 26 27 28 c. Contributory Infringement Next, Holland argues that there is no evidence of contributory infringement. (Doc. 223 at 9). 35 U.S.C. § 271(c) provides: Whoever offers to sell or sells within the United States or imports into the United States a component of a patented machine, manufacture, combination or composition, or a material or apparatus for use in practicing a patented process, constituting a material part of the invention, knowing the same to be especially made or especially adapted for use in an infringement of such patent, and not a staple article or commodity of commerce suitable for substantial noninfringing use, shall be liable as a contributory infringer. Thus, contributory infringement requires an act of direct infringement and that the defendant “knew that the combination for which its components were especially made was both patented and infringing and that [the] defendant’s components have no substantial non-infringing uses.” Lucent Techs., Inc. v. Gateway, Inc., 580 F.3d 1301, - 12 - 1 1320 (Fed. Cir. 2009). As the Court has discussed, there is evidence from which a 2 reasonable jury could conclude that Holland knew its connectors infringed the ‘422 3 Patent. There is also evidence that the only purpose for Holland’s connectors is to be used 4 to connect coaxial cables. (Doc. 243-9 at 22). Accordingly, there is sufficient evidence 5 from which a reasonable jury could conclude that Holland is liable for contributory 6 infringement. 7 3. Conclusion 8 For the foregoing reasons, Holland is not entitled to summary judgment on the 9 issue of infringement. Therefore, the Court need not address PCT’s contention that 10 Holland’s non-infringement arguments were untimely disclosed. 11 D. 12 Holland moves for partial summary judgment on the issue of damages, raising two 13 arguments. First, Holland seeks to limit PCT’s claim for damages to infringement 14 occurring after April 9, 2012 because PCT failed to properly mark its products. (Doc. 223 15 at 10). Second, Holland contends that some of its sales are not within the United States 16 and therefore are not infringing sales. (Id. at 16). 17 Damages 1. Marking 18 Holland asserts that PCT never marked its products with the ‘422 Patent number 19 and because of this, PCT is entitled to damages only from the date on which Holland 20 received actual notice of infringement. (Id. at 11). 21 a. Background 22 PCT has never marked its individual connectors with the ‘422 Patent number. 23 (Doc. 243 at 19). PCT believes the connectors are too small to legibly mark. (Id. at 40). 24 Despite this belief, PCT has affixed a label to some of its connectors that bears the PCT 25 logo as well as the PCT part number for the connector. (Id. at 20). These labels measure 5 26 mm in height and have text 2.8 mm in height. (Id.) However, according to PCT’s vice 27 president, Brandon Wilson, it is not “reasonably practical nor feasible” to add the word 28 “patent” or “pat.” along with one or more patent numbers to PCT’s labels on its - 13 - 1 connectors because “the relevant patent information would be too diminutive in size and 2 illegible to clearly read.” (Doc. 243-12 at 2). Wilson also states that “the design and 3 function of PCT’s coaxial cable connectors effectively prevents PCT from substantially 4 increasing the size of the label.” (Id.) 5 Because PCT believes it cannot legibly mark its individual connectors with the 6 ‘422 Patent number, PCT instead marks the packaging in which the connectors are sold. 7 (Id. at 22). This packaging consists of a plastic bag containing a quantity of connectors. 8 (Doc. 243-8 at 39-73). PCT has produced the engineering drawings for all relevant 9 connector packaging, and these drawings show the ‘422 Patent number. (Doc. 243 at 17, 10 22). Wilson testified at his deposition that he believes these engineering drawings reflect 11 the actual connector packaging for PCT’s products. (Doc. 243-10 at 10). PCT’s contract 12 manufacturers follow these drawings in producing PCT’s products. (Id. at 11). Moreover, 13 PCT conducted periodic audits of its manufacturers to ensure compliance with its 14 specifications, although patent marking was not explicitly the subject of investigation. 15 (Id.) 16 Wilson also declares that since 2006, “PCT has continuously and consistently 17 marked the packaging for its coaxial cable connectors covered by the ‘422 Patent with the 18 number of the ‘422 Patent – along with any other applicable patent numbers.” (Doc. 243- 19 12 at 2). Wilson also declares he is not aware of any instance in which a manufacturer 20 failed to comply with PCT’s specification for marking the ‘422 Patent number on PCT’s 21 packaging. (Id. at 3). 22 b. Legal Standard 23 The patent marking statute, 35 U.S.C § 287, “limits recoverable damages where a 24 patentee fails to mark [its] patented products.” Power Integrations, Inc. v. Fairchild 25 Semiconductor Int’l, Inc., 711 F.3d 1348, 1378 (Fed. Cir. 2013). A patentee is “entitled to 26 damages from the time when it either began marking its products in compliance with 27 section 287(a) or when it actually notified [the infringer] of its infringement, whichever 28 was earlier.” Am. Med. Sys., Inc. v. Med. Eng’g Corp., 6 F.3d 1523, 1537 (Fed. Cir. - 14 - 1 1993). 2 Section 287(a)’s constructive notice provision permits “[p]atentees, and persons 3 making, offering for sale, or selling within the United States any patented article for or 4 under them, or importing any patented article into the United States” to “give notice to 5 the public that the same is patented, either by fixing thereon the word ‘patent’ or the 6 abbreviation ‘pat.’, together with the number of the patent . . . or when, from the 7 character of the article, this can not be done, by fixing to it, or to the package wherein one 8 or more of them is contained, a label containing a like notice.” 35 U.S.C. § 287(a). If a 9 patentee fails to mark its products according to these requirements, “no damages shall be 10 recovered by the patentee in any action for infringement, except on proof that the 11 infringer was notified of the infringement and continued to infringe thereafter, in which 12 event damages may be recovered only for infringement occurring after such notice.” Id. 13 Although section 287(a) permits a patentee to mark the package containing a 14 patented product only if the product “can not” be marked, courts have interpreted this 15 provision as requiring less than absolute physical impossibility. “Alternative marking of 16 the package may sufficiently comply with the statute when there is some reasonable 17 consideration presented for not marking the article due to physical constraints or other 18 limitations, or, for reasons that go to the very purpose of the statute, marking the article 19 itself would not provide sufficient notice to the public.” Rutherford v. Trim-Tex, Inc., 803 20 F. Supp. 158, 162 (N.D. Ill. 1992); see also Sessions v. Romadka, 145 U.S. 29, 50 (1892) 21 (a patentee may mark the packaging when it is “doubtful” whether the product can be 22 legibly marked). When marking the product “raises concerns of feasibility or 23 practicality,” marking the package may comply with the statute. Belden Techs., Inc. v. 24 Superior Essex Commc’ns LP, 733 F. Supp. 2d 517, 534 (D. Del. 2010). 25 When a product’s size requires markings on the product to be so small that they 26 may not effectively notify the public of the patent, marking the packaging is appropriate. 27 See id. Markings that require the use of a magnifying glass to be legible are insufficient 28 to satisfy section 287(a). See Trussell Mfg. Co. v. Wilson-Jones Co., 50 F.2d 1027, 1030 - 15 - 1 (2d Cir. 1931). But “[w]here the patented article has markings or printing on it, other than 2 the appropriate patent marking, then the alternate form of patent markings on the package 3 is not sufficient compliance with the statute.” Rutherford, 803 F. Supp. at 163. This is 4 because when the “public finds markings or writings upon the article itself, the public 5 should be able to rely upon the fact that a patent, if it exists, should also be noted with 6 that writing.” Id. 7 Once a patentee has begun marking its products, the marking “must be 8 substantially consistent and continuous in order for the [patentee] to avail itself of the 9 constructive notice provisions” of section 287(a). Maxwell v. J. Baker, Inc., 86 F.3d 10 1098, 1111 (Fed. Cir. 1996). 11 Finally, in an action for infringement, the patentee bears the burden of proving that 12 it complied with the statutory marking requirements. Id. Although this is ordinarily a 13 question of fact, see id., a court may grant summary judgment if no reasonable jury could 14 find that a patentee complied with the marking statute, Belden, 733 F. Supp. 2d at 536. 15 c. Analysis 16 Holland argues that PCT failed to comply with the marking requirement of section 17 287(a) because PCT cannot show that it was not feasible to mark its individual 18 connectors. (Doc. 223 at 11-12). Holland contends that PCT’s labeling of its connectors 19 with its logo and part number shows that PCT could have chosen to mark the connectors 20 but failed to do so. (Id. at 12). 21 PCT argues that it is the custom in the connector industry to mark connector 22 packaging, rather than connectors, with the relevant patent numbers and this industry 23 custom is evidence that it is not feasible for PCT to mark its connectors. (Doc. 238 at 17). 24 The Court notes that nothing in section 287(a) directs a court to inquire as to industry 25 custom, nor can a subjective belief grounded in custom override the plain language of the 26 statute. Other manufacturers’ failure to mark according to section 287(a) does not excuse 27 PCT from complying with the same requirements. See Wayne-Gossard Corp. v. Sondra, 28 Inc., 434 F. Supp. 2d 1340, 1364 (E.D. Penn. 1977). Nonetheless, industry custom may - 16 - 1 still be probative as to whether it is not feasible for PCT to mark its connectors; the fact 2 that no one marks their connectors may be evidence that it is not feasible to mark a 3 connector of similar size. But the Court is not convinced that PCT’s industry custom 4 argument, standing alone, is more than a mere scintilla of evidence upon which to resist 5 summary judgment for Holland.10 See Anderson, 477 U.S. at 252. 6 More significant evidence exists in the declaration of PCT’s vice president 7 Brandon Wilson that it is not reasonably practical or feasible for PCT to mark its 8 connectors because the resulting text would be too small to read. On this point, Holland 9 cites a number of cases in which courts found that the mere presence of other text on the 10 patentee’s product demonstrated the feasibility of marking the product. (Doc. 223 at 12). 11 But as PCT points out, each of these cases is distinguishable. Many involve products 12 where the patentee marked the product with patent-related information but omitted the 13 patent number. See John L. Rie, Inc. v. Shelly Bros., Inc., 366 F. Supp. 84, 90-91 (E.D. 14 Penn. 1973) (patentee marked product “PAT PEND.” and could have marked “PAT 15 3002204”); Creative Pioneer Prods. Corp. v. K Mart Corp., 1987 WL 54482, at *3 (S.D. 16 Tex. 17 ELCONTROL—ITALY PAT.—PAT. APPL. IN I–UK–WG–F–USA–ROC–J”). Here, 18 PCT never marked its connectors with patent-related information. Second, in the 19 remaining cases cited by Holland, the patentee failed to offer a believable reason for its 20 failure to mark. See Belden, 733 F. Supp. 2d at 532, 536 (although the patentee argued 21 the inclusion of patent markings on its cables would violate regulatory standards 22 requiring cable markings to repeat every no more than every 40 inches, the patentee’s 23 cables contained 10-14 inches of blank space and repeated their markings every 24 24 inches); Briggs & Stratton Corp. v. Kohler Co., 398 F. Supp. 2d 925, 972 (W.D. Wis. 25 2005) (patentee did not argue it was infeasible to mark its product but instead claimed 26 section 287(a) did not apply to “system” patents); Kadant Johnson, Inc. v. D’Amico, 2012 July 10, 1987) (patentee marked product “MANUFACTURED BY 27 28 10 For this reason, the Court need not address Holland’s contention that PCT failed to timely disclose its industry custom evidence. (Doc. 256 at 8). - 17 - 1 WL 38319, at *5-6 (E.D. La. Jan. 9, 2012) (patentee affixed an plate to its product upon 2 which the “website address, the model number, the order number, and the temperature 3 and pressure limitations of” the product were stamped, but claimed it could not add its 4 patent number). 5 In the present case, the fact that PCT marks its connectors with its logo and the 6 product number undermines PCT’s argument. On the other hand, PCT marks its product 7 number using text measuring just 2.8 mm tall,11 hardly the “large, clear print” that 8 Holland purports it to be. Because patent marking must be legible, it is possible that 9 adding a patent number to the labels on PCT’s connectors would result in the patent 10 number being so small as to be illegible to the naked eye. Whether PCT can affix labels 11 containing a legible marking of the ‘422 Patent number to its products is an issue of fact. 12 There is sufficient evidence from which a reasonable jury could conclude that it was not 13 feasible for PCT to legibly mark its connectors with the ‘422 Patent number. 14 Holland next argues that PCT failed to mark its packaging in a “substantially 15 consistent and continuous” manner as section 287(a) requires. (Doc. 223 at 13). Holland 16 argues that PCT has not shown that its packaging was actually marked because PCT 17 produced only drawings of labels showing the ‘422 Patent number. (Id.) Holland 18 contends this is not evidence that these labels were actually affixed to packaging 19 containing PCT’s products. (Id.) Holland also argues that PCT’s audits of EZConn’s 20 manufacturing process were insufficient to demonstrate that all relevant PCT packaging 21 was marked with the ‘422 Patent number. (Id.) 22 To survive summary judgment on this point, all PCT must do is present sufficient 23 evidence from which a reasonable jury could conclude that it consistently and 24 continuously marked its packaging with the ‘422 Patent number. PCT has presented (1) 25 Wilson’s testimony that PCT marked all relevant packaging with the ‘422 Patent number; 26 (2) PCT’s engineering drawings showing the ‘422 Patent number marked on the 27 28 11 In the case of PCT’s “ERS” connectors, this text is as small as 2.4 mm. (Doc. 240 at 21). - 18 - 1 packaging; (3) Wilson’s testimony that he, as vice president of PCT, is unaware of any 2 instance in which a contract manufacturer failed to comply with PCT’s specifications 3 requiring the marking of the ‘422 Patent number; and (4) Wilson’s testimony that PCT 4 periodically, albeit sporadically and without a formal evaluation process, audited its 5 contract manufacturers to ensure their output complied with PCT’s specifications. 6 Holland claims this evidence is insufficient because these voluntary audits were 7 not comprehensive and because Wilson did not know what procedures were in place to 8 ensure the ‘422 Patent number was consistently marked on product packaging. (Doc. 223 9 at 14). Although PCT has the burden of proving compliance with section 287(a) at trial, 10 Holland has the burden of proving it is entitled to summary judgment.12 PCT has shown 11 sufficient evidence from which a reasonable jury could conclude that it consistently and 12 continuously marked its packaging with the ‘422 Patent number. Holland’s criticisms of 13 Wilson’s testimony go to its weight, not to its admissibility, and the Court cannot weigh 14 the evidence on a motion for summary judgment. See Anderson, 477 U.S. at 249. 15 Accordingly, Holland is not entitled to summary judgment on the issue of PCT’s 16 compliance with section 287(a).13 17 2. Foreign Sales 18 Holland argues that PCT improperly claims damages for sales of connectors 19 occurring outside of the United States. (Doc. 223 at 16). PCT’s damages expert has 20 calculated damages based, in part, on 6,165,642 units that Holland sold but did not 21 deliver within the United States (the “Foreign Sales”). (Doc. 230 at 8). PCT does not 22 contest that these Foreign Sales are not sales within the United States, but asserts Holland 23 offered, within the United States, to sell these units and this offer to sell constitutes 24 infringement. (Doc. 238 at 21). 25 12 26 Holland misstates this burden in its reply. (Doc. 256 at 14 n.6). 13 27 28 For this reason, the Court need not address Holland’s arguments concerning the date on which PCT gave actual notice of infringement to Holland. (Doc. 223 at 15). Even if the date of actual notice were undisputed, Holland would still not be entitled at summary judgment to limit the period of recoverable damages because there is an issue of fact as to constructive notice. - 19 - 1 Section 271(a) provides that “whoever without authority . . . offers to sell . . . any 2 patented invention, within the United States . . . infringes the patent.” 35 U.S.C. § 271(a). 3 The issue is whether for purposes of section 271(a), an offer to sell made within the 4 United States for a foreign sale is an infringement. This issue was previously unsettled, 5 Semiconductor Energy Lab. Co. v. Chi Mei Optoelectronics Corp., 531 F. Supp. 2d 1084, 6 1111 (N.D. Cal. 2007), and the parties cite numerous district court opinions to support 7 their respective viewpoints. However, the Federal Circuit has very recently decided this 8 issue: 9 The case now before us involves the opposite situation, where the negotiations occurred in the United States, but the contemplated sale occurred outside the United States. We . . . conclude here that [the alleged infringer] did not directly infringe the . . . patents under the “offer to sell” provision by offering to sell in the United States the products at issue, because the locations of the contemplated sales were outside the United States. 10 11 12 13 14 Halo Elecs., Inc. v. Pulse Elecs., Inc., 769 F.3d 1371, 1381 (Fed. Cir. 2014). The Federal 15 Circuit explained: 16 An offer to sell, in order to be an infringement, must be an offer contemplating sale in the United States. Otherwise, the presumption against extraterritoriality would be breached. If a sale outside the United States is not an infringement of a U.S. patent, an offer to sell, even if made in the United States, when the sale would occur outside the United States, similarly would not be an infringement of a U.S. patent. 17 18 19 20 21 22 23 24 25 26 27 28 Id. PCT does not dispute that the Foreign Sales occurred outside of the United States. (Doc. 243 at 31). As such, these sales were not infringements of the ‘422 Patent because Holland did not offer to sell these units within the meaning of section 271(a). PCT is not entitled to damages for the Foreign Sales. III. Motion for Leave to File Non-Electronic Exhibit 26 PCT has filed a motion for leave to file an exhibit in non-electronic form. (Doc. 260 at 2). Specifically, PCT seeks leave to file a CD-ROM containing a copy of a video demonstrating a Holland connector being affixed to a coaxial cable, known to the parties - 20 - 1 as “Exhibit 26.” (Id.) PCT contends that Holland refused to stipulate to the filing of 2 Exhibit 26 despite the fact that filing the exhibit is purely procedural and does not bear 3 upon whether the Court should substantively consider the exhibit. (Id. at 2-4). 4 Section II.M.2 of the Court’s Electronic Case Filing Administrative Policies and 5 Procedures Manual governs the procedure for filing exhibits in non-electronic form. The 6 filing of an exhibit is unrelated to the issue of whether the Court should substantively 7 consider an exhibit. The Court should not need to remind the parties that exhibits to a 8 summary judgment motion (or response to a summary judgment motion) are not admitted 9 for purposes of deciding that motion merely because they are filed. 10 Holland does not deny that it forced PCT to file a motion for leave to file Exhibit 11 26 in non-electronic form, and Holland admits that its opposition to filing Exhibit 26 in 12 non-electronic form is for substantive, not procedural, reasons. (Doc. 263 at 5). Local 13 Rule of Civil Procedure (“Local Rule”) 7.2(m)(2) provides that “[a]n objection to (and 14 any argument regarding) the admissibility of evidence offered in support of or opposition 15 to a motion must be presented in the objecting party’s responsive or reply memorandum 16 and not in a separate motion to strike or other separate filing.” Holland’s conduct in 17 forcing PCT to file a motion for leave to file Exhibit 26 and in filing a sixteen page 18 response to PCT’s motion certainly violates the spirit, if not the actual rule, of Local Rule 19 7.2(m)(2). 20 Because Holland is represented by experienced counsel, the Court can only infer 21 that Holland purposely directed its actions concerning Exhibit 26 in an effort to 22 improperly present an additional sixteen pages of evidentiary arguments to the Court that 23 would not otherwise fit in its motion or its reply. This conclusion is bolstered by 24 Holland’s inclusion of a paragraph arguing against the admission of Exhibit 26 in its 25 reply in support of its motion for summary judgment. See (Doc. 256 at 11:11-22). 26 Clearly, Holland knew the proper place to raise its substantive arguments. Instead, 27 Holland has forced PCT and the Court to devote valuable resources to what should have 28 been a routine procedural matter. This likely falls within the definition of vexatious. The - 21 - 1 Court admonishes Holland to not repeat such behavior. 2 Because the Court has not needed to consider Exhibit 26 in ruling on any of the 3 other motions in this case, the Court will deny PCT’s motion. PCT is not precluded from 4 attempting to admit Exhibit 26 at trial, and at that time, Holland may raise any 5 substantive objections. 6 IV. Motions to Exclude Expert Opinions 7 PCT moves to exclude the testimony of Holland’s expert witnesses David Haas 8 and Daniel Whittle. (Doc. 229; Doc. 233). These motions are motions to strike testimony, 9 prohibited under Local Rule 7.2(m)(1). Accordingly, the Court will deny these motions 10 without prejudice as procedurally improper. Because the Court has not relied on the 11 testimony of Haas or Whittle in ruling on the other pending motions, these motions to 12 exclude do not impact the Court’s analysis in the balance of this Order. 13 V. Conclusion 14 As the date for the parties to submit motions in limine is near, the Court reminds 15 the parties that motions in limine are not an opportunity to pre-try the case, and the only 16 motions the Court is prepared to consider are those which seek to preclude statements or 17 evidence which if not precluded would “ring the bell that could not be unrung.” 18 For the foregoing reasons, 19 IT IS ORDERED that Defendant Holland Electronics LLC (“Holland”)’s Motion, 20 and Memorandum in Support Thereof, for Sanctions for PCT International Inc’s 21 Protective Order Violation (Doc. 222) is denied. 22 IT IS FURTHER ORDERED that Defendant Holland Electronics, LLC’s 23 Renewed Motion for Summary Judgment on Infringement, or Alternatively, Partial 24 Summary Judgment on Damages and Renewed Motion to Preclude any Theory of 25 Indirect Infringement for Lack of Disclosure (Doc. 223) is granted in part and denied in 26 part. 27 IT IS FURTHER ORDERED that Plaintiff’s Motion for Leave to File Non- 28 Electronically Exhibit 26 to Plaintiff’s Separate Statement of Additional Material Facts in - 22 - 1 Support of PCT’s Opposition to Holland’s Renewed Motion for Summary Judgment 2 (Doc. 260) is denied. 3 4 IT IS FURTHER ORDERED that the Clerk of the Court shall return to PCT the non-electronic exhibit known as “Exhibit 26” (referenced in Doc. 259). 5 IT IS FURTHER ORDERED that Plaintiff’s Resubmitted Motion to Exclude 6 Portions of the Expert Reports of Daniel J. Whittle, PhD (Doc. 229) is denied without 7 prejudice. 8 9 IT IS FURTHER ORDERED that Plaintiff’s Resubmitted Motion to Exclude the Expert Opinion of David A. Haas (Redacted) (Doc. 233) is denied without prejudice. 10 IT IS FURTHER ORDERED that Plaintiff’s Resubmitted Motion to Exclude the 11 Expert Opinion of David A. Haas (Filed under Seal) (Doc. 237) is denied without 12 prejudice. 13 Dated this 2nd day of March, 2015. 14 15 16 17 18 19 20 21 22 23 24 25 26 27 28 - 23 -

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