Kelora Systems, LLC v. Target Corporation et al

Filing 415

ORDER RE 11/2/2011 DISCOVERY LETTER 405 . Signed by Judge Beeler on 11/9/2011. (lblc1, COURT STAFF) (Filed on 11/9/2011)

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UNITED STATES DISTRICT COURT

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Northern District of California

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Oakland Division
KELORA SYSTEMS, LLC,

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For the Northern District of California

UNITED STATES DISTRICT COURT

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No. C 11-01548 CW (LB)

Plaintiff,
v.

ORDER RE 11/2/2011 DISCOVERY
LETTER

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TARGET CORPORATION, et al.,
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[ECF No. 405]
Defendants.
_____________________________________/

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I. INTRODUCTION

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The district court has referred all discovery matters in the above-captioned patent case and the

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related cases to the undersigned. Referral Order, ECF No. 333 at 2.1 On November 2, 2011, Kelora

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Systems, LLC and Defendants2 submitted a joint discovery letter in which Kelora seeks to compel

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Defendants to produce documents in response to discovery requests for websites that were not

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identified in Kelora’s infringement contentions. ECF No. 405 at 1. After conducting a telephonic

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hearing, the court denies Kelora’s motion to compel because its requested discovery undercuts the

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purpose of Local Patent Rule (“LPR”) 3-1.

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II. FACTUAL BACKGROUND

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Kelora is the owner by assignment of all right, title and interest in U.S. Patent No. 6,275,821

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Citations are to the clerk’s electronic case file (ECF) with pin cites to the electronic page
numbers at the top (as opposed to the bottom) of the page.
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Defendants are Amazon.com, Inc., Costco Wholesale Corp., Hewlet-Packard Co., Office
Depot, Inc., and Target Corp.
ORDER RE 11/2/2011 DISCOVERY LETTER
C 11-01548 CW (LB)

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(“‘821 patent”), which is entitled “Method and system for executing a guided parametric search” and

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was issued by the U.S. Patent & Trademark Office (“PTO”) on August 14, 2001. Second Amended

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Complaint, ECF No. 334 at 3. The PTO issued a reexamination certificate for the ‘821 patent on

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November 2, 2010. Id. The patent claims a “process for identifying a single item from a family of

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items” that is run on a single, local computer or over the internet. ECF No. 330-4 at 2-3.

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On November 8, 2010, Kelora filed suit against 20 defendants in the Western District of

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Wisconsin. This action was subsequently transferred to the Northern District of California (Kelora

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Systems, LLC v. Target Corp., et al., CV 11-1548 CW).

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On November 2, 2011, Kelora Systems, LLC and Defendants submitted a joint discovery letter
in which Kelora seeks to compel Defendants to produce documents in response to discovery requests

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for websites that were not identified in Kelora’s infringement contentions. ECF No. 405 at 1.

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For the Northern District of California

UNITED STATES DISTRICT COURT

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III. DISCUSSION

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Kelora argues that Defendants must produce documents in response to discovery requests for

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websites that have not been identified in Kelora’s infringement contentions. ECF No. 405 at 1.

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Kelora accuses Defendants of infringement based on their alleged “guided parametric search

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methods,” and argues that this claim is not confined to the websites listed in its LPR 3-1 disclosures.

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ECF No. 405 at 1 (citing Advanced Micro Devices, Inc. v. Samsung Electronics Co., 2009 WL

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1834147, *3 (N.D.Cal. Jun 24, 2009)). At the hearing, Kelora noted that LPR 3-1 is written in the

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disjunctive and contended that it did more than was necessary because it identified the method and

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examples of sites implementing it. Additionally, Kelora argues that LPR 2-5 specifically states that

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the requirement of 3-1 disclosures is not a basis for objecting to discovery requests, aside from

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certain exceptions that are not relevant here. Id. at 2. Kelora also contends that the requested

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discovery may lead to evidence related to the patented method at issue as practiced by Defendants

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on sites identified in the 3-1 disclosures (e.g., to establish willfulness or to determine a reasonable

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royalty). Id. at 2-3. Kelora further contends that it has identified the infringing methods, which are

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not limited to infringement on specific websites and, therefore, no amendment to the 3-1 disclosures

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must be made. Id. at 3. Additionally, Kelora argues that not all of the websites are public or are

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clearly associated with Defendants, which provides good cause for amending the 3-1 disclosures.
Id.
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Defendants counter that Kelora’s argument ignores that there are many different ways to

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implement what might be considered “guided parametric search,” including via different hardware

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and software. Id. at 4. Defendants also note that LPR 3-1 requires the “specific identification” of

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the method that allegedly is being infringed. Id. According to Defendants, here, Kelora is

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effectively asking Defendants to guess at which other websites are encompassed by the term “guided

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parametric search.” Id. This defeats a central purpose of LPR 3-1 , which is to “make discovery

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manageable.” Id. (citing Bender v. Freescale, No. 09-1156, 2010 WL 1689465, at *3

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(N.D. Cal. Apr. 26, 2010)).

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The court agrees with Defendants. In AMD, AMD sued Samsung for allegedly infringing on a

1834147, at *1. AMD did not accuse Samsung processors of infringing this patent but, instead,

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For the Northern District of California

method patent that related to the formation of contacts in semiconductor devices. 2009 WL

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UNITED STATES DISTRICT COURT

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accused only Samsung’s memory products in its preliminary infringement contentions. Id. at *3.

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Samsung moved for a protective order with regard to AMD’s request for information about the

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processors. Id. Samsung claimed that AMD was not entitled to discovery because the processors

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were not named in the preliminary infringement contentions. Id. Samsung also claimed that the

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request was unduly burdensome because the processors include many different types of products.

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Id. The district court rejected Samsung’s first argument, finding that Samsung had sufficient notice

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because the identical process was used in each of the products. Id. The district court rejected

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Samsung’s second argument because only a limited set of documents was requested and there was

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no need to repeat a deposition. Id. But the case is distinguishable because: (1) the AMD case was

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governed by the old local patent rules; (2) Kelora could have determined whether the public

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websites infringed on its patents without needing any discovery and should have identified them in

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accord with LPR 3-1(b)’s requirement that the allegedly infringed method be identified as

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specifically as possible; and (3) AMD identified a specific manufacturing process that was

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identically deployed across products in contrast to the different hardware and software

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implementations that allegedly infringe on the method at issue in this case.

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The court finds that, given the facts in this case, the goal of LRP 3-1, which is to make discovery
manageable, is best served by denying discovery for instrumentalities that were not accused in the
preliminary infringement contentions. See Bender, 2010 WL 1689465, at *3; Oracle America, Inc.
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v. Google Inc., No. C 10–03561 WHA, 2011 WL 4479305, at *2 (N.D. Cal. Sept. 26, 2011); Shared

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Memory Graphics LLC v. Apple Inc., No. C–10–02475 MMC (JSC), 2011 WL 3878388, at *6-*7

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(N.D. Cal. Sept. 2, 2011). As these cases and local patent rules make clear, the defendants should

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not have to guess as to which of its public websites are encompassed by Kelora’s request,

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particularly where (1) it should not have been burdensome for Kelora to identify the sites, (2) it is

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unclear that the request was sufficiently specific given that the term “guided parametric searches” is

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in dispute, and (3) the websites use different hardware and software to implement the allegedly

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infringing methods.

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IV. CONCLUSION

pursue discovery on websites that it did not identify in its infringement contentions, it should first

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For the Northern District of California

For the foregoing reasons, the court denies Kelora’s motion to compel. If Kelora intends to

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UNITED STATES DISTRICT COURT

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seek leave to amend its infringement contentions under LPR 3-6.

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This disposes of ECF No. 405.

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IT IS SO ORDERED.

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Dated: November 9, 2011

_______________________________
LAUREL BEELER
United States Magistrate Judge

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ORDER RE 11/2/2011 DISCOVERY LETTER
C 11-01548 CW (LB)

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