Tarkus Imaging Inc. v. Adobe Systems Inc. et al

Filing 410

MEMORANDUM ORDER Granting 224 MOTION for Summary Judgment of No Willful Infringement filed by Adobe Systems Inc. Signed by Judge Leonard P. Stark on 6/5/12. (ntl)

IN THE UNITED STATES DISTRICT COURT
FOR THE DISTRICT OF DELAWARE

TARKUS IMAGING, INC.
Plaintiff,
C.A. No. 10-63-LPS

v.

ADOBE SYSTEMS, INC.;
CANON U.S.A., INC.;
NIKON AMERICAS INC.; and
NIKON, INC.
Defendants,

MEMORANDUM ORDER
At Wilmington this 5th day of June, 2012:
Pending before the Court is a Motion for Summary Judgment of No Willful Infringement
filed by defendant Adobe Systems, Inc. ("Adobe"). 1 (D.I. 224) For the reasons discussed below,
the Court will GRANT Adobe's Motion for Summary Judgment ofNo Willful Infringement.
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LEGALSTANDARDS
"The court shall grant summary judgment if the movant shows that there is no genuine

dispute as to any material fact and the movant is entitled to judgment as a matter oflaw." Fed. R.
Civ. P. 56(a). The moving party bears the burden of demonstrating the absence of a genuine
issue of material fact. See Matsushita Elec. Indus. Co. v. Zenith Radio Corp., 415 U.S. 574, 586
n.IO (1986). A party asserting that a fact cannot be- or, alternatively, is- genuinely disputed

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Various other motions remain pending in this case, which this Memorandum Order does
not address.
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must support its contention either by citing to "particular parts of materials in the record,
including depositions, documents, electronically stored information, affidavits or declarations,
stipulations (including those made for the purposes of the motions only), admissions,
interrogatory answers, or other materials," or by "showing that the materials cited do not
establish the absence or presence of a genuine dispute, or that an adverse party cannot produce
admissible evidence to support the fact." Fed. R. Civ. P. 56(c)(1)(A) & (B). If the moving party
has carried its burden, the nonmovant must then "come forward with specific facts showing that
there is a genuine issue for trial." Matsushita, 415 U.S. at 587 (internal quotation marks
omitted). The Court will "draw all reasonable inferences in favor of the nonmoving party, and it
may not make credibility determinations or weigh the evidence." Reeves v. Sanderson Plumbing
Prods., Inc., 530 U.S. 133, 150 (2000).
To defeat a motion for summary judgment, the non-moving party must "do more than
simply show that there is some metaphysical doubt as to the material facts." Matsushita, 475
U.S. at 586-87; see also Podohnik v. US. Postal Service, 409 F.3d 584, 594 (3d Cir. 2005)
("[The nonmovant] must present more than just bare assertions, conclusory allegations or
suspicions to show the existence of a genuine issue.") (internal quotation marks omitted).
However, the "mere existence of some alleged factual dispute between the parties will not defeat
an otherwise properly supported motion for summary judgment;" a factual dispute is genuine
only where "the evidence is such that a reasonable jury could return a verdict for the nonmoving
party." Anderson v. Liberty Lobby, Inc., 411 U.S. 242,247-48 (1986). "If the evidence is merely
colorable, or is not significantly probative, summary judgment may be granted." !d. at 249-50
(internal citations omitted); see also Celotex Corp. v. Catrett, 411 U.S. 317, 322 (1986) (stating
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entry of summary judgment is mandated "against a party who fails to make a showing sufficient
to establish the existence of an element essential to that party's case, and on which that party will
bear the burden of proof at trial"). Thus, the "mere existence of a scintilla of evidence" in
support of the non-moving party's position is insufficient to defeat a motion for summary
judgment; there must be "evidence on which the jury could reasonably find" for the non-moving
party. Anderson, 477 U.S. at 252.
II.

DISCUSSION
In In re Seagate Technology, LLC, 497 F.3d 1360 (Fed. Cir. 2007), the Federal Circuit set

forth a two-prong test for establishing willful infringement. In order to meet the first prong, the
plaintiff must show "by clear and convincing evidence that the infringer acted despite an
objectively high likelihood that its actions constituted infringement of a valid patent." !d. at
1371. If the first prong is satisfied, the plaintiff must next establish "that this objectively-defined
risk (determined by the record developed in the infringement proceeding) was either known or so
obvious that it should have been known to the accused infringer." !d. If, however, the first prong
cannot be shown, then the Court should not put the issue of willfulness- including the second
"subjective" prong- before a jury. See Powell v. Home Depot USA., Inc., 663 F.3d 1221, 1236
(Fed. Cir. 2011) ("Since Seagate, [the Federal Circuit] has required patentees to prove the
objective prong of the willful infringement inquiry by clear and convincing evidence as a

predicate to the jury's consideration ofthe subjective prong.... Should the court determine
that the infringer's reliance on a defense was not objectively reckless, it cannot send the

question of willfulness to the jury, since proving the objective prong is a predicate to
consideration of the subjective prong.") (emphasis added).

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The Court concludes that the first prong of Seagate cannot be satisfied here due to
Adobe's assertion of reasonable claim construction positions under which Adobe would not
infringe U.S. Patent No. 6,628,823 (the "patent-in-suit")2 and credible non-infringement theories
even under the Court's different constructions. "The objective and subjective willfulness
questions should be sent to the jury only when the patentee proves by clear and convincing
evidence that the objective prong of Seagate is met as to the legal issues that have been decided
by the Court." !d. at 123 7 n.1. As Tarkus "has failed to meet the threshold objective prong of
Seagate," Uniloc USA Inc. v. Microsoft Corp., 632 F.3d 1292, 1310 (Fed. Cir. 2011), summary
judgment of no willful infringement will be granted to Adobe.
Adobe proposed reasonable constructions for the claim terms "output device" and
"pictorial dynamic range" under which Adobe's accused products would not infringe. (See D.I.
225 at 4-5) Although the Court did not ultimately adopt Adobe's constructions for these terms
(see D.l. 367 at 16-19), the fact that Adobe asserted reasonable constructions under which its
products would not infringe precludes a finding that the first prong of Seagate is satisfied. See
Cohesive Techs., Inc. v. Waters Corp., 543 F.3d 1351, 1374 (Fed. Cir. 2008) (determining that
"because [disputed claim term] was susceptible to a reasonable construction under which
[defendant's] products did not infringe, there was not an objectively high likelihood that
[defendant's] actions constituted infringement"). The Court held a Markman hearing during
which it heard extensive argument from both sides, spent significant time deciding the proper
construction of disputed terms, and issued a detailed Memorandum Opinion addressing claim

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The reasonableness of a party's claim constructions is a question of law for the Court to
determine. See Powell, 663 F.3d at 1236.
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construction, all attesting to the reality that, in this case, "the proper claim construction was a
sufficiently close question to foreclose a finding of wilfulness." /d. at 1374 n.4.
Moreover, Adobe asserts reasonable arguments that, even under the Court's claim
construction, Adobe's accused products do not infringe because they do not meet three
limitations of claim 1 of the patent-in-suit. Specifically, Adobe contends that its accused
products do not: (1) obtain density capabilities of an output device; (2) determine a reproduction

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pictorial dynamic range from density capabilities of an output device; or (3) compare an original
pictorial dynamic range with a reproduction pictorial dynamic range. (See D.I. 225 at 3)
Because Adobe asserts credible, reasonable non-infringement theories, the first prong of Seagate
cannot be satisfied. 3 See Uniloc, 632 F .3d at 1310 ("If the accused infringer's position is
susceptible to a reasonable conclusion of no infringement, the first prong of Seagate cannot be
met."). This is true even ifthe Court or a jury ultimately rejects Adobe's non-infringement
theories. See generally, e.g., Spine Solutions, Inc. v. Medtronic Sofamor Danek USA, Inc., 620
F.3d 1305, 1319-20 (Fed. Cir. 2010) (upholding grant of judgment as matter of law of no willful
infringement where there was substantial question of obviousness of patent despite jury's finding
of non-obviousness); DePuy Spine, Inc. v. Medtronic Sofamor Danek, Inc., 567 F.3d 1314, 133637 (Fed. Cir. 2010) (upholding grant of judgment as matter oflaw on willful infringement where
defendant "presented a substantial question" of non-infringement under doctrine of equivalents,
even though jury found infringement by equivalence).

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These arguments are the subject of Adobe's pending motion for summary judgment of
non-infringement. (D.I. 220) Although the Court has not yet ruled on that motion, the Court has
concluded that Abode's non-infringement positions articulated therein are reasonable, even if
they may not be dispositive.

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Tarkus's efforts to defeat Adobe's motion are unavailing. Tarkus attempts to distinguish
the cases on which the Court relies by observing, correctly, that nearly all of them involved a
ruling of no willful infringement only after the willfulness evidence had been heard. That is, the
precedents involved motions for judgment as a matter of law made either during or after trial. In
the Court's view, this is a distinction without a difference, as one of the defenses on which
Adobe relies - non-infringement based on reasonable proposed claim construction -presents an

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issue the Court can resolve as a question oflaw. See Powell, 663 F.3d at 1236-37 ("The court
decided issues of claim construction and inequitable conduct, neither of which was before the
jury. Thus, while the jury was in a position to consider how the infringement case weighed in the
objective prong analysis, on other components - such as claim construction- the objective prong
question was properly considered by the court."); Solvay, S.A. v. Honeywell Specialty Materials
LLC, 827 F. Supp. 2d 358, 366 (D. Del. 2011) (granting summary judgment of no willful

infringement because defendant "presented a credible invalidity defense, precluding a finding of
objective recklessness despite the Federal Circuit's ultimate rejection of the defense").
Tarkus also points to purported genuine disputes of material fact. (See D.l. 240 at 6, 9,
13) There are, indeed, genuine disputes of material fact, but each of them relate solely to
Seagate's second prong, an inquiry that must not be put before the jury given Tarkus's failure to
satisfy the first prong.
Tarkus also contended during the hearing that some sort of "subjective prerequisite"
exists before the Court may even turn to the first prong. (See PreTrial Conference Hr'g Tr., June
1, 2012 at 79) ("Tr.") Although not entirely clear, the Court understands Tarkus's position to be

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that Adobe has a burden of showing that it subjectively believed it had reasonable non-

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infringement positions prior to the initiation of this litigation, and there is no such evidence in the
record. The answer to this is simply that it is not the law (and Tarkus has cited no authority for
it). See generally Seagate, 497 F.3d at 1397 ("The state of mind of the accused infringer is not
relevant to this [first-prong] objective inquiry.") (emphasis added). 4

Finally, Tarkus relies on Judge Farnan's opinion in Power Integrations, Inc. v. Fairchild
Semiconductor Int'l, Inc., 725 F. Supp. 2d 474 (D. Del. 2010). In the course of finding willful
infringement, Judge Farnan stated: "the Court understands the post-suit reasonableness of a
parties' defenses to be only one factor among the totality of the circumstances to be considered in
determining willful infringement. In the Court's view, a contrary approach to willful
infringement ... would negate the ability of a patentee to prove willful infringement in any hard
fought and hotly contested patent litigation." !d. at 480. The instant case does not require the

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Although Tarkus has not fully articulated its position, it seems that Tarkus is arguing that
there is an absence of evidence that Adobe relied on a reasonable belief of non-infringement.
(See Tr. at 78-79) ("I think you have to have at least one statement from one Adobe witness or
one Canon witness saying we didn't believe we infringed because ... and then you find it was
objectively reasonable. . . . Here, it just was not. There is no foundation. There is nobody who
said we didn't do this because we thought we didn't infringe. So you don't get to the objective
test because there isn't any foundation. Somebody has to say it. It can't be a lawyer after-thefact rationalization.") While Tarkus does not do so, it is possible to identify statements in
binding precedent that, arguably, suggest that reliance is relevant to the Court's inquiry. See
Powell, 663 F.3d at 1236 ("Under the objective prong, the answer to whether an accused
infringer's reliance on a particular issue or defense is reasonable is a question for the court when
the resolution of that particular issue or defense is a matter oflaw."); i4i Ltd. P 'ship v. Microsoft
Corp., 598 F.3d 831,860 (Fed. Cir. 2010), aff'd on other grounds,--- U.S.----, 131 S. Ct. 2238
(2011) ("Based on its own assessment of the evidence and Microsoft's defenses, the jury was free
to decide for itself whether Microsoft reasonably believed there were any substantial defenses to
a claim of infringement."). Tarkus has not made this argument. Moreover, it is difficult to see
how Adobe could have an affirmative burden of proving its subjective reliance as part of the
first-prong inquiry of Seagate, given that: the burden on willful infringement is on Tarkus; the
first prong is described as an "objective" prong; the state of mind of Adobe is not relevant to the
first prong; and the Court may only proceed to the subjective second-prong inquiry if the
objective prong is first established.

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Court to take a position on the broad proposition stated by Judge Farnan. It is enough for present

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purposes to point out that Power Integrations pre-dates several of the Federal Circuit decisions
on which the Court has relied today (e.g., Powell, Uniloc). Additionally, in Power Integrationsunlike here- "a clear separation" between the evidence proffered on the objective and subjective
prongs was not "possible," and "the evidence of copying [was] so strong ... and the evidence
related to counsel's opinion letters and measures taken by Fairchild to avoid infringement so

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weak, that it [was] hard to understand how one could objectively believe such actions would not
constitute a high likelihood of infringement." /d. at 480-81.

III.

CONCLUSION

For the foregoing reasons, IT IS HEREBY ORDERED that Adobe's Motion for

Summary Judgment of No Willful Infringement (D.I. 224) is GRANTED.

t~V,~

UNITEIS' STATES DISTRICT JUDGE

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