eBay Inc. et al v. PartsRiver, Inc.

Filing 70

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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IN THE UNITED STATES DISTRICT COURT

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FOR THE NORTHERN DISTRICT OF CALIFORNIA

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No. C 10-04947 CW

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Plaintiffs,
v.
PARTSRIVER, INC. and KELORA SYSTEMS,
LLC,
Defendants.

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United States District Court
For the Northern District of California

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/

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Plaintiff,
v.
PARTSRIVER, INC. and KELORA SYSTEMS,
LLC,
Defendants.

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/

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No. C 10-05108 CW
(Docket No. 43)

MICROSOFT CORPORATION,

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No. C 10-05106 CW
(Docket No. 46)

EBAY INC.,

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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.
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AND ALL RELATED COUNTERCLAIMS
/

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In these related cases, Plaintiffs eBay Inc. and Microsoft

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Corporation move for summary judgment of invalidity of Defendant

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Kelora Systems, LLC’s U.S. Patent No. 6,275,821 (’821 patent)

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and/or for summary adjudication that the ’821 patent cannot give

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rise to liability for infringement before November 2, 2010.

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opposes the motion.

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considered oral argument and the papers submitted by the parties,

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the Court GRANTS Plaintiffs’ motion in part and DENIES it in part.

The motion was heard on May 5, 2011.

Kelora

Having

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BACKGROUND

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The ’821 patent, which is entitled, “Method and System for

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Executing a Guided Parametric Search,” claims a “process for

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identifying a single item from a family of items.”

’821 patent,

United States District Court
For the Northern District of California

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Abstract.

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parametric search to isolate a subfamily of items within a family

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of items based on alternatives associated with each item.”

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3:36-39.

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invention: (1) an embodiment that runs on a single, local computer,

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see id. 5:50-18:9; and (2) an embodiment that runs over the

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Internet and requires a server and client computer, see id. 18:10-

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19:34.

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electronic catalog, providing an electronic alternative to updating

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and distributing product and/or service information.”

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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

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PartsRiver, Inc. v. Shopzilla, Inc., Case No. C 09-0811 CW.

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PartsRiver, the previous owner of the ’821 patent, charged eBay and

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Microsoft with infringement.

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judgment of non-infringement and invalidity.

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the patent’s claim 1 and claim 2, which was dependent on claim 1,

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were invalid based on the on-sale bar, 35 U.S.C. § 102(b).

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September 18, 2009, PartsRiver appealed the Court’s judgment of

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There,

eBay and Microsoft counterclaimed for

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The Court held that

On

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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

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reexamination of claims 1 and 2.

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initially rejected claims 1 and 2 as being clearly anticipated by

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prior art.

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arguing the prior art clearly did not teach the subject matter

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contained in claim 1.

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arguments, concluding that PartsRiver relied on features that did

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United States District Court
For the Northern District of California

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not appear in the language of the claims subject to reexamination.

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On or about September 18, 2009, PartsRiver appealed the patent

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examiner’s final rejection to the Board of Patent Appeals and

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Interferences (BPAI).

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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

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the BPAI, PartsRiver proposed amending claim 1 and adding a ninth

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claim to the ’821 patent.

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necessarily changed dependent claim 2.

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and deletion from claim 1, which are indicated below in underlined

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and stricken text respectively, were as follows:

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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: . . .

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(h)
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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.
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In relevant part,

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2
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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: . . .

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(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, . . . .

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United States District Court
For the Northern District of California

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Id. at 2:8-41.

The patent examiner deemed claim 1, as amended, and

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new claim 9 to be patentable.

Thereafter, PartsRiver’s BPAI appeal

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was dismissed.

And, after a reexamination certificate for the ’821

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patent issued on November 2, 2010, PartsRiver filed a motion to
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dismiss its appeal of this Court’s judgment, which the Federal
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Circuit granted.1
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Plaintiffs filed these related cases in November and December
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2010, seeking declarations of non-infringement, invalidity and
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intervening rights.

On PartsRiver’s motion, the Court dismissed

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Plaintiffs’ claims against PartsRiver because it disavowed any
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remaining interest in the ’821 patent.

Kelora, now the sole

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Defendant in these actions, has counterclaimed against Plaintiffs
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for infringement of the ’821 patent.
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The Federal Circuit remanded to this Court PartsRiver’s
request to vacate the judgment of invalidity. The Court denied
PartsRiver’s motion.
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LEGAL STANDARD

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Summary judgment is properly granted when no genuine and

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disputed issues of material fact remain, and when, viewing the

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evidence most favorably to the non-moving party, the movant is

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clearly entitled to prevail as a matter of law.

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56; Celotex Corp. v. Catrett, 477 U.S. 317, 322-23 (1986);

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Eisenberg v. Ins. Co. of N. Am., 815 F.2d 1285, 1288-89 (9th Cir.

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1987).

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United States District Court
For the Northern District of California

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Fed. R. Civ. P.

DISCUSSION
I.

Identity Between Claims Contained in Amended ’821 Patent and
Claims Held Invalid By This Court

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Plaintiffs argue that claims 1, 2 and 9 of the ’821 patent, as
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amended, are identical in scope to original claims 1 and 2, which
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the Court held to be invalid.

Thus, Plaintiffs argue, the Court’s

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invalidity judgment in PartsRiver applies in these actions.
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Plaintiffs cite PartsRiver’s contention that, “although the text of
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claim 1 has been altered by amendment, the claim scope is legally
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identical to that of originally issued claim 1.”

Pls.’ Mot. for

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Summ. J., Ex. 28, at 7.

Kelora claims that they are not identical.

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PartsRiver’s assertion does not establish, as a matter of law,
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that the Court’s previous invalidity judgment applies to amended
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claims 1 and 2 and new claim 9.

Indeed, Plaintiffs acknowledge

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that the claims are not identical in scope, noting that
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PartsRiver’s amendments “narrowed claims 1 and 2 to overcome the
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rejection based on the Granacki prior-art reference.”

Pls.’ Mot.

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for Summ. J. at 10:28-11:1.

Further, that the examiner deemed the

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claims to be patentable only after they were amended suggests a
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lack of identity.

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Accordingly, Plaintiffs’ motion is denied insofar as it seeks

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summary adjudication that amended claims 1 and 2 and new claim 9

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are identical in scope to original claims 1 and 2 and are invalid

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as a result.

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II.

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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

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the original claims and the date of issuance of the reexamined

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United States District Court
For the Northern District of California

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claims if the original and reexamined claims are ‘identical.’”

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Laitram Corp. v. NEC Corp., 163 F.3d 1342, 1346 (Fed. Cir. 1998)

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(citing 35 U.S.C. §§ 252, 307(b) (1994)).

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‘identical’ to their original counterparts if they are ‘without

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substantive change.’”

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“Reexamined claims are

Laitram, 163 F.3d at 1346.

“There is no absolute rule for determining whether an amended

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claim is legally identical to an original claim.”

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Inc. v. N. Am. Mfg. Co., Inc., 129 F.3d 1247, 1250 (Fed. Cir.

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1997).

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“more definite without affecting its scope” are generally viewed as

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“identical” for the purposes of section 252.

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omitted).

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following a prior art rejection is not per se a substantive

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change.”

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“Determination of whether a claim change during reexamination is

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substantive requires analysis of the scope of the original and

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reexamined claims in light of the specification, with attention to

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the references that occasioned the reexamination, as well as the

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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).

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prosecution history and any other relevant information.”

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129 F.3d at 1250.

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Bloom,

Whether amended claims are identical in scope to the original

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claims is a question of law.

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rule flows from the general principle that ‘the interpretation and

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construction of patent claims, which define the scope of the

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patentee’s rights under the patent, is a matter of law, exclusively

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for the court.’”

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Instruments, Inc., 52 F.3d 967, 970-71 (Fed. Cir. 1995)).

United States District Court
For the Northern District of California

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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

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shows that these claims are substantively different from original

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claims 1 and 2.

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method it addresses are “performed with a server connected to a

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client computer through a computer network.”

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J., Ex. 2, at 1:25-29.

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limitation, which effectively excludes the local embodiment

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described in the specification.2

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language did not delineate the roles of the server and the client

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computer at step (h), which calls for “accepting a second selection

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criteria comprising the alternative or alternatives of the first

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selection criteria plus at least one alternative selected from the

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revised feature screen.”

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defines these roles.

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(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

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2

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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”).
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of the first selection criteria plus at least one alternative

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selected from the revised feature screen,” which, together,

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constitute the “second selection criteria.”

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52.

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server.

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claim 1, it is equally different from original claim 2.

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9 reiterates this division of tasks between the server and client

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computer.

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argue that PartsRiver’s amendments did not substantially change the

United States District Court
For the Northern District of California

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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

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The reexamination proceedings further support the conclusion

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that PartsRiver’s amendments narrowed original claim 1.

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examiner rejected PartsRiver’s argument that original claim 1

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reflected these limitations, stating that “there is nothing in

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claim 1 about concatenation.

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the data in a search instruction is actually formatted prior to

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being sent to a controller to perform the selection.”

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at 7.

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already described.

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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

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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”).

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not seek damages for infringement before November 2, 2010, the

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issue date of the ex parte reexamination certificate.

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III. Invalidity under 35 U.S.C. § 305

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Under 35 U.S.C. § 305, during the reexamination process,

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patent owners are permitted to add new claims in order to

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distinguish the invention as claimed from prior art.

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“[n]o proposed amended or new claim enlarging the scope of a claim

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of the patent will be permitted in a reexamination proceeding under

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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

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been impermissibly broadened on reexamination is a matter of claim

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construction, Quantum Corp. v. Rodime, PLC, 65 F.3d 1577, 1580

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(Fed. Cir. 1995), and thus a question of law for the Court.

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section 305, “a claim of a reissue application is broader in scope

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than the original claims if it contains within its scope any

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conceivable apparatus or process which would not have infringed the

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original patent.”

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1994).

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broader than the original claims even though it may be narrower in

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other respects.”

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valid, clear and convincing evidence is required.

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Sunglass Hut Int’l, 316 F.3d 1331, 1339 (Fed. Cir. 2003).

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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

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that the user of the client computer performed the task of

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“accepting a second selection criteria comprising the alternative

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or alternatives of the first selection criteria plus at least one

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alternative selected from the revised feature screen.”

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contrast, as explained above, step (h) of amended claim 1 provides

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In

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that the server performs this task.

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amended claim 1 is broader because original claim 1 could not be

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infringed by a server.

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Thus, Plaintiffs argue,

The Court is not convinced that the language of the original

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claims supports the limitation advocated by Plaintiffs.

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have not identified anything in the original claims indicating that

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the user necessarily performed the “accepting” task as defined in

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step (h).

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Plaintiffs

Accordingly, the Court denies Plaintiffs’ motion, to the

United States District Court
For the Northern District of California

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extent it seeks summary judgment of invalidity under 35 U.S.C.

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§ 305.

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with their motion for claim construction and summary judgment.

This denial is without prejudice to renewal in connection

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CONCLUSION

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For the foregoing reasons, the Court GRANTS Plaintiffs’ motion

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in part and DENIES it in part.

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41; Case No. C 10-5106 CW, Docket No. 46; Case No. C 10-5108 CW,

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Docket No. 43.)

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not seek damages for infringement before November 2, 2010.

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Plaintiffs’ motion is denied to the extent that it seeks summary

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judgment of invalidity based on the Court’s invalidity judgment in

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PartsRiver.

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extent that it seeks summary judgment of invalidity based on 35

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U.S.C. § 305; they may renew this request in connection with their

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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

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As discussed at the May 5, 2011 hearing, Case Nos. C 10-5106

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CW and C 10-5108 CW shall be consolidated with Case No. C 10-4947

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CW.

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The Clerk shall administratively close Case Nos. C 10-5106 CW
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and C 10-5108 CW.

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C 10-4947 CW.

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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.

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Dated:

5/9/2011
CLAUDIA WILKEN
United States District Judge

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United States District Court
For the Northern District of California

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