Velocity Patent LLC v. Mercedes-Benz USA, LLC et al

Filing 144

MEMORANDUM Opinion and Order Signed by the Honorable John W. Darrah on 9/21/2016. Mailed notice (mc, )

UNITED STATES DISTRICT COURT
NORTHERN DISTRICT OF ILLINOIS
EASTERN DIVISION
VELOCITY PATENT LLC,
Plaintiff,
v.
MERCEDES-BENZ USA, LLC;
MERCEDES-BENZ U.S.
INTERNATIONAL, INC.,
Defendants.
VELOCITY PATENT LLC,
Plaintiff,
v.
FCA US LLC,
Defendant.

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Case No. 13-cv-8413
Judge John W. Darrah

Case No. 13-cv-8419
Judge John W. Darrah

MEMORANDUM OPINION AND ORDER
Plaintiff Velocity Patent LLC filed Complaints against Defendants
Mercedes-Benz USA, LLC, Mercedes-Benz U.S. International, Inc., and FCA US LLC 1
(“FCA”) (collectively, the “Defendants”), each alleging one count of infringement of U.S. Patent
No. 5,954,781 (“the ‘781 Patent”). Defendants filed joint Motions for Summary Judgment of
Indefiniteness or Noninfringement [13-cv-8413, Dkt. 104; 13-cv-8419, Dkt. 80]. Plaintiff filed
cross-Motions for Summary Judgment of Infringement [13-cv-8413, Dkt. 111; 13-cv-8419,
Dkt. 87]. For the reasons set forth below, Defendants’ Motions [13-cv-8413, Dkt. 104;

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FCA US LLC is the successor in interest to Chrysler Group, LLC, against whom the
original Complaint was filed. An Amended Complaint was filed against FCA US LLC on
October 27, 2015.

13-cv-8419, Dkt. 80] and Plaintiff’s cross-Motions [13-cv-8413, Dkt. 111; 13-cv-8419, Dkt. 87]
are denied.
LOCAL RULE 56.1
Local Rule 56.1(a)(3) requires the moving party to provide “a statement of material facts
as to which the party contends there is no genuine issue for trial.” Ammons v.
Aramark Uniform Servs., 368 F.3d 809, 817 (7th Cir. 2004). Local Rule 56.1(b)(3) requires that
“[a]ll material facts set forth in the statement required of the moving party will be deemed to be
admitted unless controverted by the statement of the opposing party.” Id. Local Rule
56.1(b)(3)(C) permits the nonmovant to submit “any additional facts that require the denial of
summary judgment. . . .” To overcome summary judgment, “the nonmoving party must file a
response to each numbered paragraph in the moving party’s statement.” Schrott v.
Bristol-Myers Squibb Co., 403 F.3d 940, 944 (7th Cir. 2005). In the case of any disagreement,
the nonmoving party must reference affidavits, parts of the record, and other materials that
support his stance. Id. A nonmovant’s “mere disagreement with the movant’s asserted facts is
inadequate if made without reference to specific supporting material.” Smith v. Lamz, 321 F.3d
680, 683 (7th Cir. 2003). Legal conclusions or otherwise unsupported statements, including
those that rely upon inadmissible hearsay, will be disregarded. See First Commodity
Traders, Inc. v. Heinold Commodities, Inc., 766 F.2d 1007, 1011 (7th Cir. 1985); see also
Eisenstadt v. Centel Corp., 113 F.3d 738, 742 (7th Cir. 1997). If the nonmovant’s response only
provides extraneous or argumentative information, the response will fail to constitute a proper
denial of the fact, and the fact will be admitted. See Graziano v. Vill. of Oak Park,
401 F. Supp. 2d 918, 936 (N.D. Ill. 2005).

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BACKGROUND
The following facts are taken from the parties’ statements of undisputed material facts
submitted in accordance with Local Rule 56.1.
Velocity is an Illinois limited-liability corporation with its principal business address in
Atherton, California. (Dkt. 113, ¶ 1.) Mercedes-Benz USA, LLC is a Delaware limited-liability
corporation with its principal place of business in Dunwoody, Georgia. (Id. ¶ 5.)
Mercedes-Benz U.S. International, Inc. is an Alabama corporation with its principal place of
business in Vance, Alabama. (Id.) FCA is a Delaware corporation with its principal place of
business in Auburn Hills, Michigan. (Id. ¶ 6.)
The ‘781 Patent is titled “METHOD AND APPARATUS FOR OPTIMIZING VEHICLE
OPERATION” and was issued on September 21, 1999. (Id. ¶ 9.) Velocity asserts Claims 1, 7,
13, 17, 18-20, 33-34, 40, 42, 46, 53, 56, 58, 60, 64,66, 69, 75, and 76 of the ’781 Patent against
Defendants Mercedes. (Id. ¶ 16.) Velocity asserts Claims 1, 7, 13, 17-20, 28, 33-34, 40, 41, 42,
46, 53, 56, 58, 60, 64, 66, 69, 75-76, and 88 of the ’781 Patent against Defendant FCA. (Id.
¶ 46.) Claims 1, 7, 13, 17, 28, 60, 69, and 76 are independent claims that include a
“fuel overinjection notification circuit” limitation. (Id., ¶¶ 16, 47). That limitation requires a
“fuel overinjection notification circuit . . . said fuel overinjection notification circuit issuing a
notification that excessive fuel is being supplied to said engine of said vehicle.” (Id. ¶ 48.)
LEGAL STANDARD
Summary judgment will be granted where “the movant shows that there is no genuine
dispute as to any material fact and the movant is entitled to judgment as a matter of law.”
Fed. R. Civ. P. 56. Courts are required to view all facts and make reasonable inferences “in the
light most favorable to” the nonmoving party. Scott v. Harris, 550 U.S. 372, 378 (2007). A
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genuine dispute of material facts exists where “the evidence is such that a reasonable jury could
return a verdict for the nonmoving party.” Anderson v. Liberty Lobby, Inc., 477 U.S. 242, 248
(1986). The moving party has the initial burden of establishing that there is no genuine dispute
as to any material fact. Celotex Corp. v. Catrett, 477 U.S. 317, 323 (1986). To overcome a
motion for summary judgment, “[t]he nonmoving party must point to specific facts showing that
there is a genuine issue for trial.” Stephens v. Erickson, 569 F.3d 779, 786 (7th Cir. 2009). The
nonmovant must show “that a reasonable jury could return a verdict for the nonmoving party.”
Pugh v. City of Attica, Ind., 259 F.3d 619, 625 (7th Cir. 2001) (quoting Anderson, 477 U.S. at
248).
ANALYSIS
Indefiniteness
Defendants claim that the ‘781 Patent is invalid because it is indefinite, referencing the
arguments in their claim construction response brief. Specifically, Defendants argue that the
term “fuel overinjection notification circuit” is indefinite. A patent must “conclude with one or
more claims particularly pointing out and distinctly claiming the subject matter which the
applicant regards as [the] invention.” 35 U.S.C. § 112, ¶ 2. A lack of definiteness renders the
patent or any claim in suit invalid. 35 U.S.C. § 282, ¶ 2(3).1. “[A] patent is invalid for
indefiniteness if its claims, read in light of the specification delineating the patent, and the
prosecution history, fail to inform, with reasonable certainty, those skilled in the art about the
scope of the invention.” Nautilus, Inc. v. Biosig Instruments, Inc., 134 S. Ct. 2120, 2124 (2014).
“[T]he burden of proving indefiniteness remains on the party challenging [the patent’s] validity
and . . . they must establish it by clear and convincing evidence.” Dow Chem. Co. v.

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Nova Chemicals Corp. (Canada), 809 F.3d 1223, 1227 (Fed. Cir. 2015). As discussed in the
claim construction Memorandum Opinion and Order, the term “fuel overinjection notification
circuit” is not indefinite.
Infringement
“To prove literal infringement, a plaintiff must show that the accused device contains
each and every limitation of the asserted claims.” Presidio Components, Inc. v.
Am. Tech. Ceramics Corp., 702 F.3d 1351, 1358 (Fed. Cir. 2012) (citing Uniloc USA, Inc. v.
Microsoft Corp., 632 F.3d 1292, 1301 (Fed. Cir. 2011)). In infringement cases, the court
interprets the claims to determine their scope and meaning; then the fact-finder compares the
properly construed claims to the allegedly infringing device. Id. (citing Cybor Corp. v. FAS
Techs., Inc., 138 F.3d 1448, 1454 (Fed. Cir. 1998)). If any claim is missing from the accused
device, there is no literal infringement as a matter of law. Bayer AG v. Elan Pharm. Research
Corp., 212 F.3d 1241, 1247 (Fed. Cir. 2000).
The term “fuel overinjection notification circuit” was construed as: “A circuit that
notifies a driver that more fuel is being supplied to the engine than is necessary.” The term
“a notification” was construed as: “An act or instance of notifying, making known or giving
notice to the operator of the vehicle.” The term “processor subsystem” was construed to be
governed by 35 U.S.C. § 112(f). The claim language states that the processor subsystem
“determines” whether to activate a notification circuit. Because the claim does not provide
sufficient structure for performing the functions recited in the claims, i.e., determining whether
to activate the notification circuit, § 112(f) applies and an algorithm is required.

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ECO Display
Plaintiff contends that Defendants Mercedes’ ECO display and Defendant FCA’s ECO
and Fuel Saver Mode displays infringe the ‘781 Patent. Plaintiff alleges that
Defendants Mercedes’ ECO display meets the term “fuel overinjection notification circuit.”
(Dkt. 113, ¶ 20.) Plaintiff alleges that Defendant FCA’s ECO display and Fuel Saver Mode
display meet the term “fuel overinjection notification circuit.” (Id., ¶¶ 50-53).
Defendants Mercedes’ ECO display features curved or straight bars relating information
about acceleration, coasting, and constant speed. In one version of the display, an icon
corresponding to the bar is illuminated green under certain conditions. In another version of the
display, the bars start at 50 percent and go up or down depending on certain factors.

(Dkt. 112, p. 12.) Defendant FCA’s ECO Index Gauge shows a number between 0 and 5, which
represents the “efficiency of the driving style.” Defendant FCA’s ECO display illuminates the
word ECO when a person is driving in a fuel efficient manner. Defendant FCA’s Fuel Saver
Mode display shows the words Fuel Save Mode when the engine is operating on four cylinders.

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Plaintiff argues that all of these features notify the driver when they are, or are not,
operating the vehicle in a fuel efficient manner. Defendants argue that the displays provide
information about driving style and do not notify the driver of changes to fuel economy.
Defendants also argue that the same display could indicate increased fuel efficiency - for
example going from 49 percent to 50 percent - or decreased efficiency - for example going from
51 percent to 50 percent. The parties dispute what information the ECO displays and Fuel Saver
Mode display conveys and whether those displays notify the driver of a change in fuel efficiency.
Whether the ECO displays and Fuel Saver Mode display issue notifications that inform the driver
more fuel is being provided to the engine than necessary is a question of material fact.
MPG and Range Displays
Plaintiff alleges that Defendants Mercedes’ MPG and Range display meets the term “fuel
overinjection notification circuit.” (Dkt. 113, ¶ 31.) Plaintiff alleges that Defendant FCA’s
Average Fuel Economy display and MPG display meet the term “fuel overinjection notification
circuit.” (Id., ¶¶ 63-65.) Defendants Mercedes’ MPG and Range display shows the level of fuel
consumption in miles per gallon in a bar and shows the range of the vehicle.

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Defendant FCA’s Average Fuel Economy display and MPG display show the average fuel
consumption in miles per gallon and the current fuel consumption in miles per gallon in real
time.

Plaintiff argues that, when the current MPG falls below the average MPG, these displays
show that there is reduced fuel economy. Plaintiff also argues that the range combined with the
current fuel consumption conveys information to the driver regarding fuel economy. Defendants
argue that these displays are merely providing information and do not notify the driver that more
fuel than necessary is being consumed. Defendants also argue that some of this information is
not displayed at the same time and, therefore, cannot notify the driver that more fuel than
necessary is being consumed. Whether the MPG and Range displays issue notifications that

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inform the driver more fuel is being provided to the engine than necessary is a question of
material fact.
Check Engine or Engine Malfunction Light
Plaintiff alleged that the Check Engine or Engine Malfunction Lights infringed under
Defendants’ proposed construction of the term “fuel overinjection notification circuit.”
However, Plaintiff only alleged that the Check Engine or Engine Malfunction Lights infringed
under Defendants’ proposed construction. Since Defendants’ proposed construction was not
adopted, this issue is moot.
Doctrine of Equivalents
Plaintiff argues that if the Court decides that § 112(f) applies, the accused features may
still infringe under the doctrine of equivalents. “Literal infringement of a § 112[(f)] claim
requires that the relevant structure in the accused device perform the identical function recited in
the claim and be identical or equivalent to the corresponding structure in the specification.”
Lockheed Martin Corp. v. Space Sys./Loral, Inc., 324 F.3d 1308, 1320 (Fed. Cir. 2003).
Specifically, “an accused device may infringe under the doctrine of equivalents if each element
performs substantially the same function, in substantially the same way, to achieve substantially
the same result.” Id. (citing Warner-Jenkinson Co. v. Hilton Davis Chem. Co., 520 U.S. 17, 40
(1997)). The purpose of the doctrine of equivalents is to allow the patentee “to claim those
insubstantial alterations that were not captured in drafting the original patent claim but which
could be created through trivial changes.” AquaTex Indus., Inc. v. Techniche Solutions, 419 F.3d
1374, 1381 (Fed. Cir. 2005) (quoting Festo Corp. v. Shoketsu Kinzoku Kogyo Kabushiki Co., 535
U.S. 722, 733 (2002)).

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Defendants argue that it is too late for Plaintiff to amend their infringement contentions to
include the doctrine of equivalents. It should be noted that Plaintiff has not submitted its Final
Infringement Contentions yet; but, even if that were the case, the Local Patent Rules allow for
amendment of final contentions “upon a showing of good cause and absence of unfair prejudice
to opposing parties.” LPR 3.4. An example of a circumstance supporting a finding of good
cause is: “a claim construction by the Court different from that proposed by the party seeking
amendment.” Id. A motion to amend final contentions because of a claim construction ruling
shall be filed, along with the proposed amendments, within fourteen days of the entry of a claim
construction ruling. Id. The Local Patent Rules do not preclude Plaintiff from filing a motion to
amend their contentions, unless there is undue prejudice, because Plaintiff’s constructions were
not adopted in several instances.
At this point, it is premature to determine whether the doctrine of equivalents is available
to Plaintiff, as it has not moved to amend its infringement contentions.
CONCLUSION
For the reasons set forth above, Defendants’ joint Motions for Summary Judgment of
Indefiniteness or Noninfringement [13-cv-8413, Dkt. 104; 13-cv-8419, Dkt. 80] are denied.
Plaintiff’s cross-Motions for Summary Judgment of Infringement [13-cv-8413, Dkt. 111;
13-cv-8419, Dkt. 87] are denied.

Date:

September 21, 2016
JOHN W. DARRAH
United States District Court Judge

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