COMCAST CABLE COMMUNICATIONS, LLC et al v. SPRINT COMMUNICATIONS COMPANY L.P. et al
Filing
480
MEMORANDUM AND/OR OPINION. SIGNED BY HONORABLE JAN E. DUBOIS ON 8/16/2017. 8/16/2017 ENTERED AND COPIES MAILED AND E-MAILED.(sg, )
IN THE UNITED STATES DISTRICT COURT
FOR THE EASTERN DISTRICT OF PENNSYLVANIA
COMCAST CABLE
COMMUNICATIONS, LLC,
Plaintiff,
CIVIL ACTION
v.
NO. 12-859
SPRINT COMMUNICATIONS
COMPANY, LP,
Defendant.
DuBois, J.
August 16, 2017
MEMORANDUM
TABLE OF CONTENTS
I.
INTRODUCTION ................................................................................................................... 2
II. RENEWED MOTIONS FOR JUDGMENT AS A MATTER OF LAW ............................... 5
A.
Standard of Review ............................................................................................................. 5
B. Comcast’s Renewed Motion for Judgment as a Matter of Law That Claim 113 of the ‘870
Patent is Not Obvious ................................................................................................................. 6
1. Applicable Law ................................................................................................................ 7
2. Substantial Evidence that the Challenged Limitations Existed in the Prior Art .............. 9
3. No Substantial Evidence of Motivation to Combine or Likelihood of Success ............ 19
4. Conclusion ..................................................................................................................... 26
C.
Comcast’s Alternative Motion for a New Trial on Obviousness ...................................... 27
D.
Sprint’s Renewed Motion for Judgment as a Matter of Law Under Rule 50 ................... 28
1. Applicable Law .............................................................................................................. 28
2. Discussion ...................................................................................................................... 29
III. COMCAST’S MOTIONS RELATING TO DAMAGES ..................................................... 33
A.
Comcast’s Motion for a New Trial on Damages .............................................................. 34
1. Standard of Review ........................................................................................................ 34
2. Applicable Law .............................................................................................................. 35
3. Sufficient Evidence to Sustain the Jury Verdict ............................................................ 36
4. Forward Citation Analysis ............................................................................................. 39
5. References to other Sprint patents and a 1999 Nokia Invention Report ........................ 41
6. Conclusion ..................................................................................................................... 43
1
B.
Comcast’s Motion to Amend Final Judgment to Add Pre- and Post-Judgment Interest .. 44
1. Pre-Judgment Interest .................................................................................................... 44
2. Post-Judgment Interest ................................................................................................... 48
3. Application of Pre- and Post-Judgment Interest ............................................................ 48
IV. CONCLUSION ..................................................................................................................... 49
I.
INTRODUCTION
This case involves claims of patent infringement between Comcast Cable
Communications, LLC, and Sprint Communications Company, LP. After withdrawal of several
claims of infringement, only Comcast’s claim for infringement of its U.S. Patent Number
6,885,870 (“the ‘870 patent”) against Sprint and Sprint’s Counterclaims for infringement of its
U.S. Patents Numbers 6,754,907 and 6,757,907 (“the ‘907 patents”) against Comcast remained
in the case. The Court granted summary judgment in favor of Comcast as to Sprint’s
counterclaims under the ‘907 patents by Memorandum and Order dated August 24, 2016. See
Comcast Cable Commc’ns, LLC v. Sprint Commc’ns Co., LP (Comcast v. Sprint II), 203 F.
Supp. 3d 499 (E.D. Pa. 2016). That Memorandum contains the factual background, procedural
history, and details of the underlying patents in this case. For purposes of this Memorandum, the
following summary of the invention will suffice, and additional facts will be incorporated as
necessary.
The ‘870 patent, titled “Transferring of a Message,” claims a method “for inquiring about
information relating to a [wireless] terminal of a cellular network from the cellular network, from
a messaging server external to the cellular network.” ‘870 patent, at 2:45–48. The preferred
embodiment of the invention can be summarized as follows:
1. A multimedia messaging service center (“MMSC”) receives and stores a
multimedia message (“MMS”). ‘870 patent, at 6:14–16. The MMS may contain
pictures, text, or video, and is addressed to an RFC822 (i.e., e-mail) address, in
the standard form name@domain. ‘870 patent, at 6:47–61. Alternatively, the
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message may be addressed to a phone number, which is then converted by the
MMSC to a corresponding e-mail address. ‘870 patent, at 6:62–64. In the
preferred embodiment, the MMSC is located outside the General Packet Radio
Service (“GPRS”) system of the Global System for Communications (“GSM.”).
‘870 patent, at 6:65–66.
2. The MMSC maps the RFC822 address to a different address called an MMSID, which the patent describes as an identifier that is “external” to the cellular
network. ‘870 patent, at 7:10–22.
3. The MMSC sends an inquiry into the GPRS to a server called the Gateway
GPRS Support Node (“GGSN”) “to determine the readiness of the wireless
terminal to receive data.” ‘870 patent, at 8:9–12.
4. The GGSN maps the MMS-ID to a corresponding international mobile
subscriber identity (“IMSI”) that is specific to a subscriber identity module
(“SIM”) card in the wireless terminal. ‘870 patent, at 8:22–25. The GGSN
performs the mapping by “inquiring about the IMSI . . . that corresponds to [the]
MMS-ID from [a] database, in which the correspondences between the MMS-ID
and the IMSI code of the wireless terminal are stored.” ‘870 patent, at 8:25–29.
5. The GGSN uses the IMSI to search its database to determine if the wireless
terminal is currently connected to it. ‘870 patent, at 8:31–35. If so, the GGSN (1)
retrieves from the database the current dynamic network address of the wireless
terminal, and (2) determines whether the wireless terminal is ready to receive the
multimedia message. ‘870 patent, at 8:35–39. If the desired wireless terminal is
not connected to the GGSN, the GGSN inquires of another GPRS element, the
home location register (“HLR”), for the identity of the GGSN to which the
wireless terminal is connected, if any, and requests the information from that
GGSN. ‘870 patent, at 8:66–9:6, 9:47–51.
6. The ultimate result of the process, regardless of the result of step 5, is that the
GGSN sends a response message to the MMSC consisting of the information
retrieved regarding the wireless terminal—viz. the status of the wireless terminal
including its dynamic network address and current GGSN—and preferably
including the MMS-ID, the external identifier used in the request. ‘870 patent, at
10:14–28.
7. The MMSC then sends the message to the wireless terminal at its dynamically
assigned network address through the cellular network in packet-switched mode.
‘870 patent, at 11:7–10.
Comcast v. Sprint II, 203 F. Supp. 3d at 510–11.
3
Comcast asserted Claims 1, 7, and 113 of the ‘870 patent against Sprint. For purposes of
the present Motions, only the limitations of Claim 113 are relevant. Claim 113 depends on
Claim 112—i.e., Claim 113 incorporates by reference all of Claim 112’s limitations, and adds
additional restrictions. Claim 112, which was not asserted, claims:
A method for inquiring about information relating to a wireless terminal of a
cellular network, from the cellular network by a messaging server external to the
cellular network, wherein the method comprises:
[1] sending an inquiry from the messaging server to the cellular network to
determine said information relating to the terminal, the inquiry comprising
a first identifier identifying said terminal, the first identifier being a
specific identifier external to the cellular network;
[2] mapping said first identifier to a specific second identifier in the cellular
network, the second identifier being an internal identifier of the cellular
network, wherein the mapping is not performed by a Home Location
Register;
[3] determining said information relating to the terminal with the aid of said
second identifier;
[4] sending a response message in response to said inquiry from the cellular
network to said messaging server external to the cellular network, in
which response message the information relating to said terminal is
indicated with the aid of said first identifier.
Claim 113 adds the additional limitation that, in the third step, the determining is
performed by the same network element to which the initial inquiry is sent in the first step.
A jury trial on Comcast’s claims for infringement of Claims 1, 7, and 113 of the ‘870
patent began on January 30, 2017. Following a 14-day trial, on February 17, 2017, the jury
returned a verdict, finding that Sprint had infringed all three asserted Claims of the ‘870 patent.
The jury further found that Claims 1 and 7 of the ‘870 patent were valid as not anticipated and
not obvious, and that Claim 113 was not anticipated, but that it was obvious and therefore
invalid. The jury awarded Comcast a royalty of $1,500,000, in the form of a one-time lump sum
for the life of the ‘870 patent, for infringement of Claims 1 and 7. The Court entered judgment
on February 21, 2017.
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Presently before the Court are Comcast’s Renewed Motion for Judgment as a Matter of
Law that Claim 113 of the ‘870 Patent is Not Obvious, Sprint’s Renewed Motion for Judgment
as a Matter of Law Under Rule 50, Comcast’s Motion for New Trial on Damages, and Comcast’s
Motion to Amend Final Judgment to Add Pre-Judgment Interest and Post-Judgment Interest.
The Court disposes of the Motions as set forth below.
II.
RENEWED MOTIONS FOR JUDGMENT AS A MATTER OF LAW
A.
Standard of Review
Federal Rule of Civil Procedure 50(a) provides that after “a party has been fully heard on
an issue during a jury trial,” a district court may grant judgment as a matter of law (“JMOL”) if
“the court finds that a reasonable jury would not have a legally sufficient evidentiary basis to
find for the party on that issue.” Fed. R. Civ. P. 50(a)(1). During trial, both Sprint and Comcast
moved for JMOL under Rule 50(a), and the Court denied both Motions. See Trial Tr. (Feb. 14,
2017, afternoon) 193:21–200:19; Trial Tr. (Feb. 14, 2017, evening) 3:24–17:9.
“If the court does not grant a motion for judgment as a matter of law made under Rule
50(a) . . . the movant may file a renewed motion for judgment as a matter of law.” Fed. R. Civ.
P. 50(b). “To succeed on a renewed motion for JMOL following a jury trial and verdict, the
movant ‘must show that the jury’s findings, presumed or express, are not supported by
substantial evidence or, if they were, that the legal conclusion(s) implied [by] the jury’s verdict
cannot in law be supported by those findings.’” Comaper Corp. v. Antec, Inc., 867 F. Supp. 2d
663, 667 (E.D. Pa. 2012) (quoting Pannu v. Iolab Corp., 155 F.3d 1344, 1348 (Fed. Cir. 1998)),
rev’d on other grounds, 539 F. App’x 1000 (Fed. Cir. 2013). “[W]here there is a black box [i.e.,
general] jury verdict, as is the case here, we presume the jury resolved underlying factual
disputes in favor of the verdict winner and leave those presumed findings undisturbed if
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supported by substantial evidence.” Apple Inc. v. Samsung Elecs. Co., 839 F.3d 1034, 1047
(Fed. Cir. 2016). “‘Substantial’ evidence is such relevant evidence from the record taken as a
whole as might be accepted by a reasonable mind as adequate to support the finding under
review.” Perkin-Elmer Corp. v. Computervision Corp., 732 F.2d 888, 893 (Fed. Cir. 1984).
B.
Comcast’s Renewed Motion for Judgment as a Matter of Law That
Claim 113 of the ‘870 Patent is Not Obvious
At trial, Sprint’s expert Dr. Nathaniel Polish opined that Claims 1, 7, and 113 of the ‘870
patent were anticipated by PCT Publication No. WO 99/29125 (“Sonera”). In the alternative, Dr.
Polish opined that the asserted claims were invalid as obvious based on two theories: (a) the
combination of Sonera and PCT Publication No. WO 99/27722 (“Vuoristo”), and (b) the
modification of Sonera based on the knowledge of a person having ordinary skill in the art
(“skilled artisan”). The jury determined that Claim 113 was not anticipated, but that it was
obvious and therefore invalid. However, because the verdict sheet did not include special
interrogatories, it is not clear whether the jury determination that Claim 113 was obvious was
based on the combination of Sonera and Vuoristo, Sonera as modified based on the knowledge of
a skilled artisan, or both theories.
Comcast asks this Court to reverse the jury determination that Claim 113 was obvious.
Comcast’s Mem. of Law in Supp. of its Renewed Mot. for Judgment as a Matter of Law that
Claim 113 of the ‘870 Patent is Not Obvious (“Comcast JMOL”). Comcast argues (1) that there
was no substantial evidence that four limitations of Claim 113 existed in the combined prior art,
and (2) that there was no substantial evidence that a skilled artisan would have been motivated to
combine the prior art with a reasonable expectation of success. Id. at 10, 13, 17, 23, 27. For the
reasons set forth below, the Court concludes that there is substantial evidence that each of the
four limitations were disclosed by the combined prior art, but there is no substantial evidence of
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a motivation to combine the prior art with a reasonable expectation of success. Accordingly, the
Court grants Comcast’s Motion for JMOL.
1.
Applicable Law
An invention is not patent-eligible “if the differences between the subject matter sought
to be patented and the prior art are such that the subject matter as a whole would have been
obvious at the time of the invention was made to a person having ordinary skill in the art to
which the subject matter pertains” (a “skilled artisan”). 35 U.S.C. § 103 (2000). In other words,
to be patent-eligible, an invention must not have been obvious to a skilled artisan at the time of
invention. “Whether a patent is invalid as obvious is ultimately a determination of law based on
underlying determinations of fact.” Geo. M. Martin Co. v. All. Mach. Sys. Int’l LLC, 618 F.3d
1294, 1300 (Fed. Cir. 2010). The Federal Circuit instructs that a legal determination of
obviousness must be based on four factual inquiries: “1) the scope and content of the prior art; 2)
the level of ordinary skill in the art; 3) the differences between the claimed invention and the
prior art; and 4) secondary considerations of nonobviousness . . . .” Ruiz v. A.B. Chance Co., 234
F.3d 654, 662–63 (Fed. Cir. 2000) (citing Graham v. John Deere Co., 383 U.S. 1, 17–18 (1966)).
“[A] patent composed of several elements is not proved obvious merely by demonstrating
that each of its elements was, independently, known in the prior art.” KSR Int’l Co. v. Teleflex
Inc., 550 U.S. 398, 418 (2007). Rather, “[a] party seeking to invalidate a patent on obviousness
grounds must demonstrate by clear and convincing evidence that a skilled artisan would have
been motivated to combine the teachings of the prior art references to achieve the claimed
invention, and that the skilled artisan would have had a reasonable expectation of success in
doing so.” InTouch Techs., Inc. v. VGO Commc’ns, Inc., 751 F.3d 1327, 1347 (Fed. Cir. 2014).
The Supreme Court of the United States has cautioned that this analysis, known as the “teaching,
7
suggestion, or motivation” test, must be “expansive and flexible,” and not “rigid.” KSR, 550
U.S. at 407, 415, 419. “In appropriate circumstances, a single prior art reference can render a
claim obvious. However, there must be a showing of a suggestion or motivation to modify the
teachings of that reference to the claimed invention in order to support the obviousness
conclusion.” IGT v. Bally Gaming Int’l, Inc., 610 F. Supp. 2d 288, 320 (D. Del. 2009) (quoting
SIBIA Neurosciences, Inc. v. Cadus Pharm. Corp., 225 F.3d 1349, 1356 (Fed. Cir. 2000)), aff’d,
659 F.3d 1109 (Fed. Cir. 2011). The obviousness analysis must focus on the knowledge and
motivations of the skilled artisan at the time of the invention. InTouch Techs., 751 F.3d at 1348.
The jury was instructed on obviousness. Trial Tr. (Feb. 16, 2017) at 155:12–157:10.
After the Court instructed the jury, the Court convened a side bar so the parties could raise
objections to the instructions. The sole objection to the obviousness instruction, from Sprint,
overruled by the Court and not relevant to the issues presented in Comcast’s Motion for JMOL,
was that it should have incorporated the American Intellectual Property Law Association’s
Model Jury Instruction 5.3, which instructs the jury that “the higher the level of ordinary skill,
the easier it may be to establish obviousness.” Trial Tr. (Feb. 16, 2017) at 175:10–176:11. The
Court specifically asked the parties whether the obviousness instruction adequately conveyed the
requirements that “there would have to be a reason for combining the two [pieces of prior art].”
Trial Tr. (Feb. 16, 2017) at 176:13–177:4. The Court then instructed the parties to “think about”
whether the obviousness instruction was “broad enough to cover the case,” and both Sprint and
Comcast stated that they would do so. Trial Tr. (Feb. 16, 2017) at 184:11–185:5. The following
morning, before the jury began deliberating, Sprint reported that “the obviousness charge as
given is fine” to cover the issue raised by the Court, and Comcast reported that it was “fine with
the [obviousness] instruction.” Trial Tr. (Feb. 17, 2017, morning) at 3:5–4:20.
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2.
Substantial Evidence that the Challenged Limitations Existed in
the Prior Art
Comcast argues that there is no substantial evidence that the prior art disclosed four of
the limitations of Claim 113: (1) the “said first identifier” limitation, (2) the “same element”
limitation, (3) an external messaging server, and (4) a “mapping” step not performed by a Home
Location Register (“HLR”). For the reasons discussed below, the Court disagrees, and concludes
that there was substantial evidence that these four limitations were disclosed in the prior art.
a.
The “said first identifier” limitation of Claim 113
To begin, Comcast argues that there is no substantial evidence that prior art disclosed
Claim 113’s requirement that “the information relating to said terminal is indicated with the aid
of said first identifier.” Comcast JMOL at 10. Claim 113, through step four of Claim 112,
requires that the cellular network send a response message, including certain information about
the subscriber’s terminal, or cell phone, to the messaging server. In the response message, the
information about the cell phone is “indicated with the aid of said first identifier” (the “said first
identifier” limitation). The Court construed “with the aid of said first identifier” to mean “with
the aid of the first identifier, where the first identifier may, but need not be, included in the
response message,” and the jury was so instructed. Trial Tr. (Feb. 16, 2017) at 151:20–23. In
short, this limitation is satisfied if the first identifier aids in the method described in Claim 113 in
any way. See Comcast v. Sprint II, 203 F. Supp. 3d at 538 (“Under Comcast’s construction of
[‘indicated with the aid of said first identifier,’ which the Court ultimately adopted], any
involvement of the first identifier at any step of the method prior to sending a response would
satisfy the limitation.”).
Comcast’s challenge focuses on Dr. Polish’s terminology. Dr. Polish opined that the
“said first identifier” limitation was disclosed by Sonera’s use of what he “think[s]” is called “a
9
response ID.” Trial Tr. (Feb. 9, 2017, afternoon) at 37:2–11. When asked whether Sonera uses a
“transaction identifier,” Dr. Polish testified that in Sonera, the “messages are actually tagged
internally” with the response ID, and “that’s how the first identifier is then used to knit the whole
thing together.” Id. However, as Comcast notes, Sonera does not use the term “response ID.”
Comcast JMOL at 12. Dr. Polish’s testimony is not supported by Sonera, and without more, it is
not substantial evidence that this limitation was disclosed in the prior art.
But there is evidence, in both Sonera itself and in the testimony of Comcast’s expert, Dr.
Robert Akl, that Sonera uses an “Invoke Id” in a manner similar to the “said first identifier” in
Claim 113. See Sprint’s Response Comcast’s Renewed Motion for Judgment as a Matter of Law
that Claim 113 of the ‘870 Patent is Not Obvious (“Sprint Resp. to Comcast JMOL”) at 9–10.
Sonera vaguely describes the Invoke Id as an “[i]dentifier of the MAP service primitive.” See
Sprint Resp. to Comcast JMOL, Ex. A (DX-243) (“Sonera”) at 10:1–14:15. By Sonera’s plain
text, the Invoke Id is included in both its routing inquiry and the response message. Sonera at
10:24–11:22. In addition, Dr. Akl testified that Sonera discloses a process wherein the home
location register (“HLR”) “returns certain information,” including “the invoke ID.” Trial Tr.
(Feb. 15, 2017) at 120:3–13.
The “said first identifier” limitation is not unusually technical—it is satisfied if the first
identifier is simply involved in the patented method at any time prior to the response message.
See Comcast v. Sprint II, 203 F. Supp. 3d at 538. Sonera discloses an Invoke Id that is included
in both the routing inquiry and the response, and Dr. Akl testified that in Sonera, the HLR
“returns” information including the Invoke Id. The Court concludes that there is substantial
evidence—that is, a reasonable mind would accept this evidence as adequate—to support a
determination that Sonera disclosed Claim 113’s “said first identifier” limitation.
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b.
The “same element” limitation of Claim 113
Comcast further argues that there is no substantial evidence that the prior art disclosed the
limitation that “the inquiry is sent to, and the determining is performed by, the same element of
the cellular network.” Comcast JMOL at 13. Claim 113 adds this limitation to Claim 112.
Comcast argues that Dr. Polish’s testimony as to this limitation is conclusory and contrary to the
limitation’s plain meaning. Comcast JMOL at 14–16.
Dr. Polish’s only testimony directly addressing the “same element” language of Claim
113 was that Sonera discloses a step where “the inquiry is being sent to the same element as
what’s doing the determining.” Trial Tr. (Feb. 9, 2017, afternoon) at 43:8–10. Comcast argues
that this testimony is not substantial evidence, because Dr. Polish does not elaborate on that
process. But Dr. Polish’s testimony must be considered in context. The limitation that Claim
113 adds to Claim 112 is effectively identical to the limitation that Claim 7 adds to Claim 1.1
Therefore, Dr. Polish’s testimony regarding Claim 7, which immediately preceded his testimony
as to Claim 113, is relevant to the “same element” limitation. With respect to the “same
element” limitation added by Claim 7, Dr. Polish testified that Sonera’s “service node” both
“receives the inquiry and also is what does the determining by making a query with the HLR.”
Trial Tr. (Feb. 9, 2017, afternoon) at 41:1–21, 87:6–89:13; see also Sonera Fig. 2a. That
testimony applies equally to Claim 113’s “same element” limitation.
Comcast further argues that the “same element” limitation is not disclosed by Sonera
1
As Comcast notes, Claim 7 requires that the “same element” that receives the inquiry also
performs the determining step “using” the “second identifier,” while Claim 113 requires that the
“same element” performs the determining step “with the aid of” the “second identifier.”
Comcast JMOL Reply at 5, n.4. The Court’s construction of “with the aid of said first identifier”
is essentially the same as the plain meaning of “using.” In any event, Comcast’s semantic point
is irrelevant to the question of whether Sonera disclosed a process wherein the “same element”
both receives the inquiry and performs the determining step.
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because Dr. Polish testified that Sonera’s service node performs the determining step “by making
a query with the HLR,” not independently. Trial Tr. (Feb. 9, 2017, afternoon) at 41:17–20;
Comcast JMOL at 15. The Court did not construe the “same element” limitation, and “[i]n the
absence of such a construction . . . the jury was free to rely on the plain and ordinary meaning”
of the limitation. ePlus, Inc. v. Lawson Software, Inc., 700 F.3d 509, 520 (Fed. Cir. 2012).
Specifically, in ePlus, the Federal Circuit held that “the jury was free to rely on the plain and
ordinary meaning of the term ‘determining’ and conclude that a user who prompts a vendor to
report whether a particular item is available ‘determines’ whether that item is available—much
in the same way, for example, that one may call and speak to a sales representative at a local
store to determine whether a certain item is in stock.” 700 F.3d at 520. Similarly, the jury in this
case was free to find that the determining step is performed by the service node, the “same
element” that received the inquiry, with assistance from the HLR. For these reasons, the Court
concludes that there is substantial evidence to support the determination that “same element”
limitation was disclosed by Sonera.
c.
The external messaging server limitation of Claim 113
Next, Comcast argues that there is no substantial evidence that a “messaging server
external to the cellular network” is disclosed in the prior art, a limitation that Claim 113
incorporates through Claim 112. A messaging server, under the Court’s claim construction, is “a
server that has functionality for storing and forwarding messages and for sending an inquiry for
information relating to a wireless terminal.” Trial Tr. (Feb. 16, 2017) at 151:7–10. Comcast
specifically argues that there is no substantial evidence that an external messaging server was
disclosed in (1) Vuoristo, (2) Sonera, or (3) the knowledge of a skilled artisan. Comcast JMOL
at 23–27. The Court addresses each argument in turn.
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First, the Court concludes that Vuoristo itself disclosed an external messaging server. Dr.
Polish testified that Vuoristo discloses an external messaging server in the form of its external
SMSC. Trial Tr. (Feb. 9, 2017, afternoon) at 49:21–50:5. In response, Comcast argues that
Vuoristo’s SMSC is not a messaging server under the Court’s construction because it does not
have functionality to send inquiries.2 Comcast JMOL at 25–26. On this issue, Dr. Polish
testified that Vuoristo’s SMSC “mak[es] querys [sic] of the cellular network to get routing
information.” Trial Tr. (Feb. 9, 2017, afternoon) at 49:21–50:5. But Dr. Polish later
contradicted himself, testifying that in Vuoristo, “the query is coming from” the short message
service gateway (“SMSGW”). Trial Tr. (Feb. 9, 2017, afternoon) at 91:4–13. He opined that
Vuoristo discloses a messaging server, under the court’s construction, because “you can
combine” the SMSGW (which performs the querying) and the SMSC (which stores and
forwards). Trial Tr. (Feb. 9, 2017, afternoon) at 91:4–92:12. But there is no evidence that
Vuoristo’s SMSGW is external to the cellular network. Indeed, the only evidence on this issue is
Vuoristo itself, which depicts the SMSGW as internal. See Sprint Resp. to Comcast JMOL Ex.
B (DX-242) (“Vuoristo”) at 2:1–25, 6:29–7:32. Fig. 1. Thus, to the extent Dr. Polish’s opinion
requires the external SMSC to be combined with the internal SMSGW to create a messaging
server, such a combination does not result in an external messaging server under the Court’s
construction.
However, Dr. Polish also testified about Vuoristo’s service profile register (“SPR”).
Vuoristo’s SPR “receives and sends messages and information . . . to the services units outside
the network infrastructure (the short message service center SMSC).” Vuoristo at 16:28–32. If
the SPR sends and receives messages and information to and from the SMSC, it necessarily
2
Comcast does not dispute that Vuoristo’s SMSC has the functionality to store and forward
messages, or that it is external. See Comcast JMOL at 25–26.
13
follows that the SMSC is sending and receiving messages and information—i.e., inquiries—to
and from the SPR. See Sprint Resp. to Comcast JMOL at 16. In light of this, Dr. Polish opined
that Vuoristo’s SMSC is “clearly communicating with the cellular network.” Trial Tr. (Feb. 9,
2017, afternoon) at 94:1–24.
The Court concludes that the evidence regarding Vuoristo’s SPR is substantial evidence
that Vuoristo’s SMSC is external and has the functionality to send an inquiry. The Court also
concludes that there is substantial evidence that Vuoristo disclosed an external messaging server.
Having so concluded, the Court need not consider whether that limitation was disclosed
elsewhere in the prior art. The Court nonetheless addresses Comcast’s two remaining arguments
on this limitation.
Second, Dr. Polish opined, as with Vuoristo, that two of Sonera’s elements could be
combined to form an external messaging server. Specifically, he testified that Sonera disclosed
both a SMSC, which stores and forwards messages, and a short message service gateway
message service center (SMS-GMSC) “that is performing the inquiry.” Trial Tr. (Feb. 9, 2017,
afternoon) at 69:4–7. Dr. Polish then testified that these two elements could be combined to
form a messaging server under the Court’s construction. Id. However, when asked whether the
SMS-GMSC was a core network element, and therefore internal to the cellular network, Dr.
Polish stated that he was not prepared to opine on “what’s in the core network or not.” Trial Tr.
(Feb. 9, 2017, afternoon) at 68:20–69:3. The only expert testimony on the question of whether
Sonera’s SMS-GMSC was internal or external came from Dr. Akl, who opined that the SMSGMSC is a core network element, making it internal to the cellular network. Trial Tr. (Feb. 15,
2017, morning) at 11:11–23. In short, there was no evidence that Sonera’s SMS-GMSC was
external to the cellular network. Without an external SMS-GMSC, Dr. Polish’s combination
14
theory fails. The Court therefore concludes that there is no substantial evidence that Sonera
disclosed an external messaging server.
And third, Dr. Polish testified that messaging servers were disclosed in the prior art
because the skilled artisan “would have known that GSM networks are disclosing external
messaging servers, those were in the standards and the specs for GSM and someone of ordinary
skill would have known that.” Trial Tr. (Feb. 9, 2017, afternoon) at 47:14–23. Dr. Polish
focused on the GSM standard because “Sonera was aimed at a GSM network.” Trial Tr. (Feb. 9,
2017, afternoon) at 27:19; see also Sonera at 1:12–17. However, despite basing his opinion on
GSM standards, Dr. Polish later admitted that he had not referenced any GSM standard in
support of his opinion, and that he did not even know “how the GSM standard is written.” Trial
Tr. (Feb. 9, 2017, afternoon) at 77:4–7, 91:22–17. Testimony that is admittedly without support
is not substantial evidence.3
Sprint does not identify any evidence to support Dr. Polish’s testimony, and instead rests
its argument on Dr. Akl’s testimony on cross-examination. Sprint’s Resp. to Comcast JMOL at
17. Specifically, Sprint cites the following exchange:
Q: [I]n the prior art it was already taught that there was a messaging server, as
that term is used in these claims, external to the cellular network?
A: Yes.
Trial Tr. (Feb. 15, 2017) at 144:20–23.
Comcast argues that this exchange is taken out of context. Specifically, Comcast notes
that Dr. Akl testified that the GSM standards—which, Dr. Polish testified, are the relevant
standards for purposes of this analysis—do not disclose an external messaging server:
3
The only other evidence to which Sprint points is Dr. Polish’s testimony that “one would know
you can implement [the querying functionality] within the SMSC.” Trial Tr. (Feb. 9, 2017,
afternoon) at 91:22–92:12. But that testimony was in reference to Sonera, not the knowledge of
a skilled artisan. Trial Tr. (Feb. 9, 2017, afternoon) at 92:7–12.
15
Q: Did Dr. Polish show the jury any such GSM standards or specifications?
A: No, he did not and I disagree that the GS[M] standard has an external
messaging server. It has a store and forward capability, but not an external
messaging server as construed by the Court, because as you remember, the
messaging server has to have the two functionalities of store and forward and
sending a query. And as we’ve talked about the GSM standard and the query is
coming from the SMS-GMSC, that’s what the GSM standard says. It’s that
functionality and the mobile switching center and that’s core. So, I disagree and
he didn’t show any GSM standards that show any external messaging server.
Trial Tr. (Feb. 15, 2017) at 25:10–22.
In sum, Dr. Polish testified that a skilled artisan would have known that the GSM
standard disclosed an external messaging server, but admitted that he “did not know” whether
the GSM standard supported that opinion. Dr. Akl testified that the GSM standard does not
disclose an external messaging server, but he also testified—in a single statement on crossexamination—that an external messaging server was disclosed somewhere in the prior art.4 The
Court concludes that this evidence, “taken as a whole,” would not be “accepted by a reasonable
mind as adequate to support the finding.” Perkin-Elmer Corp., 732 F.2d at 893. Therefore, the
Court further concludes that there is no substantial evidence that the knowledge of a skilled
artisan disclosed external messaging servers, in the context of the relevant GSM standard.
The Court concludes that there is substantial evidence that prior art Vuoristo disclosed an
external messaging server. However, there is no substantial evidence that an external messaging
server was disclosed by Sonera or the knowledge of a skilled artisan.
4
The Court notes that a non-GSM standard could conceivably disclose an external messaging
server that might be relevant to this discussion. However, the only evidence on that subject is
Dr. Akl’s testimony in which he agrees, without explanation and without identifying a non-GSM
standard, that “in the prior art it was already taught that there was a messaging server . . .
external to the cellular network.” Trial Tr. (Feb. 15, 2017) at 144:20–23. The Court concludes
that this single statement is not substantial evidence that a non-GSM standard disclosed an
external messaging server.
16
d.
“Mapping” step not performed by the HLR limitation of
Claim 113
Fourth, Claim 113, through the second step of Claim 112, describes “mapping said first
identifier to . . . an internal identifier . . . wherein the mapping is not performed by a Home
Location Register” (the “mapping” limitation). The Court did not construe “first identifier,” but
it construed “internal identifier” to mean “an identifier used inside the cellular network to
identify a specific wireless terminal which may, but need not be revealed outside the cellular
network.” Trial Tr. (Feb. 16, 2017) at 151:15–19. Comcast argues that there is no substantial
evidence that this limitation was disclosed by Sonera or Vuoristo. Comcast JMOL at 27.
The Court concludes that Sonera discloses a “mapping” limitation not performed by a
HLR.5 Dr. Polish opined that Sonera disclosed “mapping said first identifier to a specific second
[internal] identifier, so that’s one phone number to another phone number.” Trial Tr. (Feb. 9,
2017, afternoon) at 35:2–4. Dr. Polish gave the specific example of mapping an 800 number—
“an external number that everybody knows, it’s advertised”—to a private number, “the phone
number of the person who’s going to receive the text [and which] is not an advertised number.”
Trial Tr. (Feb. 9, 2017, afternoon) at 34:18–35:12; see also Sonera at 1:12–31 (describing how
calls and texts initially sent to to a particular number, such as an 800 number, can be “directed to
the subscriber’s actual number,” and how “[c]alls can therefore be made from a mobile station to
another mobile station or to an ordinary telephone number . . . by using only extension
numbers.”).
Comcast does not dispute that a first identifier can be a phone number. Rather, Comcast
5
Comcast’s JMOL does not argue that Sonera’s mapping process is not performed by a HLR.
See generally Comcast JMOL at 28–29. Dr. Polish testified that the service node performed the
mapping process in Sonera, and not a HLR. Trial Tr. (Feb. 9, 2017, afternoon) at 42:6–22,
87:18–91:1 (referencing Sonera Fig. 2a). The Court concludes that this testimony is substantial
evidence that the mapping step disclosed by Sonera was not performed by a HLR.
17
argues that an internal identifier may not be a phone number because a phone number “needs to
be revealed, outside the cellular network . . . otherwise no one would be able to call the phone.”
Comcast JMOL at 28 (emphasis in original). This assertion is based on Dr. Akl’s testimony that
phone numbers are “revealed outside the cellular network,” because “that’s what you do with
phone number[s], you give them out to people.” Trial Tr. (Feb. 15, 2017) at 17:11–14.
The Court rejects Comcast’s argument. Under the Court’s construction, an internal
identifier “may, but need not be revealed outside the cellular network.” Trial Tr. (Feb. 16, 2017)
at 151:15–19. The Court’s construction does not explicitly preclude the use of a phone number
as an internal identifier. Rather, although phone numbers are typically shared with others, the
Court concludes that a phone number could be kept completely private such that it is “not . . .
revealed outside the cellular network.” The Court thus concludes that there is substantial
evidence that Sonera disclosed Claim 113’s “mapping” limitation, because Dr. Polish’s
testimony and Sonera itself “might be accepted by a reasonable mind as adequate to support the
finding under review.” Perkin-Elmer Corp., 732 F.2d at 893.
Having so concluded, the Court need not continue its analysis. Nonetheless, the Court
considers whether there is substantial evidence that Vuoristo discloses mapping not performed
by a HLR. Dr. Polish opined that Vuoristo “talks about mapping an MSISDN to an IMSI, which
is exactly how it appears in the ‘870 patent.” Trial Tr. (Feb. 9, 2017, afternoon) at 53:17–25.
There is no dispute that an MSISDN is a first identifier and an IMSI is an internal identifier.
Vuoristo discloses that “[u]sing the information in the HLR, the MSISDN numbers can be
associated with the correct subscriber identity IMSI.” Vuoristo at 2:23–25 (emphasis added).
Comcast argues that “associated” is different from “the affirmative act of ‘mapping.’”
Comcast’s Reply Regarding its Renewed Mot. for JMOL (“Comcast JMOL Reply”) at 10. The
18
Court did not construe “mapping,” and the jury was free to use the plain meaning of that term.
ePlus, 700 F.3d at 520. The Court concludes that Vuoristo’s use of the term “associate” is
substantial evidence to support a determination that Vuoristo disclosed a mapping step because
of the similarity between these verbs.6
Comcast further argues that Vuoristo’s mapping step does not disclose the limitation that
“the mapping is not performed by a Home Location Register” because Vuoristo’s mapping uses
“the information in the HLR.” Comcast JMOL at 30; Vuoristo at 2:23–25. The Court agrees.
Sprint does not address this argument in its Reply or Sur-Reply, and the Court has not identified
any evidence that Vuoristo’s mapping step was not performed by the HLR.7 Thus, Vuoristo
alone did not disclose Claim 113’s mapping limitation, because there is no evidence that
Vuoristo’s mapping step was not performed by a HLR.
In short, the Court determines that there is substantial evidence that Claim 113’s mapping
limitation, not performed by a HLR, is disclosed in Sonera, and that this limitation was disclosed
in the prior art. There is no substantial evidence that Vuoristo alone discloses this limitation
because there is no evidence that Vuoristo’s mapping is not performed by a HLR.
3.
No Substantial Evidence of Motivation to Combine or Likelihood
of Success
Having concluded that these four limitations were disclosed in the prior art, the Court
turns to the requirement that the proponent of obviousness “demonstrate by clear and convincing
6
“Associate” is defined as “to bring together or into relationship in any of various intangible
ways.” Associate, MERRIAM-WEBSTER.COM, https://www.merriamwebster.com/dictionary/associated (last visited August 11, 2017). Similarly, “map” can be
defined as “to be assigned in a relation or connection.” Map, MERRIAM-WEBSTER.COM,
https://www.merriam-webster.com/dictionary/map (last visited August 11, 2017).
7
Dr. Polish’s only testimony regarding Claim 113’s requirement that the mapping is not
performed by the HLR was elicited during his testimony on whether Sonera anticipates the ‘870
patent. See Trial Tr. (Feb. 9, 2017, afternoon) at 42:6–22, 87:18–91:1. He offered no opinion as
to whether Vuoristo’s mapping is performed by the HLR.
19
evidence that a skilled artisan would have been motivated to combine the teachings of the prior
art references to achieve the claimed invention, and that the skilled artisan would have had a
reasonable expectation of success in doing so.” InTouch Techs., 751 F.3d at 1347. The Court
grants Comcast’s JMOL as to obviousness on the grounds that (1) Dr. Polish’s testimony does
not constitute substantial evidence of motivation to combine Sonera and Vuoristo, (2) Dr.
Polish’s testimony does not constitute substantial evidence of motivation to combine Sonera with
the knowledge of a skilled artisan, (3) there is no substantial evidence of motivation implicit in
the prior art, and (4) there is no substantial evidence of a likelihood of success.8
a.
Motivation to Combine Sonera and Vuoristo Based on Dr.
Polish’s Testimony
The Court concludes that Dr. Polish’s testimony does not constitute substantial evidence
of motivation to combine Sonera and Vuoristo. Dr. Polish testified that a skilled artisan would
have combined the two inventions because “both deal with SMS messaging in a GSM network”
and both are “about a messaging server looking up information about a phone.” Trial Tr. (Feb.
9, 2017, afternoon) 50:21–51:8; see also Sonera at 1:1–36, 3:14–36; Vuoristo at 2:1–25, 6:29–
7:32. But there is insufficient evidence of a motivation to combine where the proponent of
obviousness “gave no reason for the motivation of a person of ordinary skill to combine [two
pieces of prior art] except that the references were directed to the same art or same techniques.”
Microsoft Corp. v. Enfish, LLC, 662 F. App’x 981, 990 (Fed. Cir. 2016). Thus, the Court
concludes that Dr. Polish’s conclusory testimony that Sonera and Vuoristo are directed at the
8
Comcast also argues that Dr. Polish’s testimony is “founded on by impermissible hindsight.”
Comcast JMOL at 17 (citing InTouch Techs., 751 F.3d at 1347). The Court does not reach this
argument—regardless of whether Dr. Polish might have used hindsight, the Court concludes that
there is no substantial evidence that a skilled artisan would have been motivated to combine the
prior art to achieve the invention described in the ‘870 patent.
20
same technology, without pointing to any specific motivation to combine the two, is not
substantial evidence of motivation to combine.
Dr. Polish also opined that Sonera and Vuoristo had other similarities. When asked why
a skilled artisan would have thought to combine the two inventions, Dr. Polish testified that both
“involve [1] messages being transferred, [2] having external messaging servers and [3] a cellular
network and [4] getting routing information from that network. So, it’s the same, it’s the same
problem.” Trial Tr. (Feb. 9, 2017, afternoon) 49:13–20. The Court concludes that Dr. Polish’s
reference to (1) “messages being transferred” and (3) “having . . . a cellular network” are
insufficient under Enfish, because the fact that two inventions were “directed to the same art or
techniques” is insufficient evidence of motivation to combine. 662 F. App’x at 990. Moreover,
Dr. Polish’s testimony and other evidence that both Sonera and Vuoristo (2) “hav[e] external
messaging servers” is insufficient because the Court has determined that Sonera does not
disclose an external messaging server. See supra Sec. II(B)(2)(c).
What remains is the question of whether Dr. Polish’s testimony in which he mentions the
“same problem” of (4) “getting routing information from [a cellular] network” constitutes
substantial evidence of a motivation to combine. Trial Tr. (Feb. 9, 2017, afternoon) 49:13–20. It
is true that “any need or problem known in the field and addressed by the patent can provide a
reason for combining the elements in the manner claimed.” KSR, 550 U.S. at 402. Yet aside
from this single statement Dr. Polish did not present any testimony or other evidence detailing
this alleged problem. His testimony is merely conclusory, and “rejections on obviousness
grounds cannot be sustained by mere conclusory statements.” KSR, 550 U.S. at 418. Without
any explanation of the alleged problem, the Court concludes that Dr. Polish’s conclusory
21
testimony is not substantial evidence that a skilled artisan would have been motivated to combine
Sonera and Vuoristo.
Finally, Sprint argues that Dr. Polish’s testimony regarding the limitations disclosed by
Vuoristo supports its argument that a skilled artisan would have been motivated to incorporate
those limitations into Sonera. Specifically, Dr. Polish testified that Vuoristo “shows the
messaging server actually outside the cellular network.” Sprint Resp. to Comcast JMOL at 14
(citing Trial Tr. (Feb. 9, 2017, afternoon) 52:3–13); see also Sonera, Fig. 1. He also opined that
Vuoristo disclosed “mapping of a first and second identifier” using “exactly the same language
as the ‘870 patent.” Trial Tr. (Feb. 9, 2017, afternoon) 53:17–54:14, 55:2–6. But the mere fact
that Vuoristo discloses an external messaging server9 or a mapping limitation10 does not bolster
Sprint’s argument—it shows only that those limitations were disclosed in the prior art, and “a
patent composed of several elements is not proved obvious merely by demonstrating that each of
its elements was, independently, known in the prior art.” KSR, 550 U.S. at 418.
For these reasons, the Court concludes that Dr. Polish’s testimony is not substantial
evidence that a skilled artisan would have been motivated to combine Sonera and Vuoristo.
b.
Motivation to Combine Sonera with the Knowledge of a
Skilled Artisan Based on Dr. Polish’s Testimony
Next, the Court turns to Dr. Polish’s testimony relating to motivation to combine Sonera
with the knowledge of a skilled artisan. Sprint argues (1) that evidence of such motivation is not
required, and (2) in the alternative, that Dr. Polish’s testimony is substantial evidence of such a
motivation. The Court rejects both arguments.
9
See supra Sec. II(B)(2)(c).
In addition, the Court has concluded that Vuoristo does not disclose Claim 113’s mapping
limitation. See supra Sec. II(B)(2)(d).
10
22
First, Sprint argues that “the jury could have decided that claim 113 was obvious in view
of Sonera and the knowledge of a skilled artisan—an independent basis for the obviousness
verdict for which motivation to combine references is irrelevant.” Sprint Resp. to Comcast
JMOL at 11. Sprint is incorrect. Although “a single prior art reference can render a claim
obvious . . . there must be a showing of a suggestion or motivation to modify the teachings of
[the single prior art] reference to the claimed invention in order to support the obviousness
conclusion.” SIBIA Neurosciences, 225 F.3d at 1356; see also Ormco Corp. v. Align Tech., Inc.,
463 F.3d 1299, 1307 (Fed. Cir. 2006) (“A claim can be obvious even where all of the claimed
features are not found in specific prior art references, where ‘there is a showing of a suggestion
or motivation to modify the teachings of [the prior art] to the claimed invention.’”) (quoting
SIBIA Neurosciences).
Second, Sprint argues that “Dr. Polish demonstrated in Sonera and in the knowledge of
one of ordinary skill why a motivation exists to combine Sonera with the knowledge of a skilled
artisan.” Sprint’s Sur-Reply to Comcast’s Renewed Motion for Judgment as a Matter of Law
that Claim 113 of the ‘870 Patent is Not Obvious (“Sprint Sur-Reply to Comcast JMOL”) at 5.
Although Sprint cites three parts of Dr. Polish’s testimony in support of this argument, the cited
testimony does not address any motivation to combine Sonera with the knowledge of a skilled
artisan. See Trial Tr. (Feb. 9, 2017, afternoon) 28:3–14 (describing Sonera, without reference to
motivation to combine), 48:4–51:8 (describing Vuoristo and explaining how Sonera could be
combined with Vuoristo). At best, one of these citations supports the argument that a skilled
artisan could combine Sonera with a skilled artisan’s knowledge of an external messaging server.
See Trial Tr. (Feb. 9, 2017, afternoon) 29:4–15 (explaining that Sonera is “talking about how you
can have the messaging service separate from the cellular network”) (emphasis added). But
23
obviousness cannot be based on testimony that a skilled artisan “could combine these
references”—there must be substantial evidence that the skilled artisan “would have been
motivated to do so.” InTouch Techs., 751 F.3d at 1352 (emphasis in original). The Court
therefore concludes that Dr. Polish’s trial testimony is not substantial evidence that a skilled
artisan would have been motivated to combine Sonera with the knowledge of a skilled artisan.
c.
Motivation to Combine Implied by the Prior Art
Sprint next argues that, notwithstanding Dr. Polish’s failure to articulate a specific
motivation for a skilled artisan to combine Sonera with either Vuoristo or some element known
by the skilled artisan, the patents themselves are substantial evidence of a motivation to combine.
Indeed, “a motivation [to combine] may be found implicitly in the prior art”—that is, the two
patents. Alza Corp. v. Mylan Labs., Inc., 464 F.3d 1286, 1290 (Fed. Cir. 2006) (emphasis in
original). Even so, “rejections on obviousness grounds cannot be sustained by mere conclusory
statements; instead, there must be some articulated reasoning with some rational underpinning to
support the legal conclusion of obviousness.” Id. at 1291.
Sprint first argues that “Sonera itself provides a motivation to use an external messaging
server” because it discusses the “independence and separate implementation” of an external
messaging server in the form of its SMSC. Sprint Resp. to Comcast JMOL at 13. On this issue,
the Court has concluded that Sonera does not disclose an external messaging server, see supra
Sec. II(B)(2)(c). However, for purposes of its motivation analysis, the Court assumes arguendo
that Sonera’s external SMSC discloses an external messaging server. Specifically, Sonera states
that “[a] further advantage of the invention is that it allows an independence of the supplier of
the short-message service centre (SMSC) because the service node is implemented as a unit
separate from the short-message service centre (SMSC).” Sonera at 8:28–32. Even assuming
24
that independence is synonymous with externality, Sonera only “allows” for independence. That
term is purely permissive; it is not evidence that a skilled artisan “would have been motivated” to
incorporate an external messaging server. InTouch Techs., 751 F.3d at 1352.
Next, Sprint argues that Vuoristo “further supports” the substantial evidence of a
motivation to combine Sonera with an external messaging server and Vuoristo’s alleged
mapping. Vuoristo discloses an external messaging server. See supra Sec. II(B)(2)(c). It also
discloses mapping from an MSISDN to an IMSI, which, according to Dr. Polish, are “exactly the
same” identifiers used in the ‘870 patent. Vuoristo at 2:24–25 (“the MSISDN numbers can be
associated with the correct subscriber identity IMSI”); Trial Tr. (Feb. 9, 2017, afternoon) 54:3–
14. But the mere fact that Vuoristo includes these limitations does not bolster Sprint’s
argument—it shows only that the limitations were disclosed in the prior art, and “a patent
composed of several elements is not proved obvious merely by demonstrating that each of its
elements was, independently, known in the prior art.” KSR, 550 U.S. at 418.
For these reasons, the Court concludes that a motivation to combine is not implicit in
Vuoristo or Sonera, and they are not substantial evidence of such a motivation.
d.
Likelihood of Success
Finally, “[a] party seeking to invalidate a patent on obviousness grounds must
demonstrate by clear and convincing evidence that a skilled artisan . . . would have had a
reasonable expectation of success” when combining the prior art. InTouch Techs., 751 F.3d at
1347. Comcast argues that Sprint presented no such evidence at trial. Comcast JMOL at 22–23;
Comcast JMOL Reply at 7–8.
Sprint’s Response and Sur-Reply identify no evidence supporting a likelihood of success,
and the Court, having examined the record, has discovered no such evidence. See, e.g., Trial Tr.
25
(Feb. 9, 2017, afternoon) 49:13–51:8, 52:3–55:14 (identifying similarities between Sonera and
Vuoristo and opining that the two could be combined, without explaining how that combination
would be implemented); Trial Tr. (Feb. 9, 2017, afternoon) 29:4–15 (opining that Sonera is
“talking about how you can have the messaging service separate from the cellular network,”
without explaining how that separate service would be implemented). Sprint’s Response argues
only that Sonera itself “states an expectation of success” because its SMSC “can be implemented
separate.” Sprint’s Resp. to Comcast JMOL at 13; see Sonera at 2:28–31. For purposes of
Sprint’s present argument, the Court assumes arguendo that a separately implemented SMSC
would motivate a skilled artisan to incorporate an external messaging server. But as discussed
supra, Sonera states only that a messaging server could be implemented externally. The Court
concludes that this possibility is not substantial evidence that “the skilled artisan would have had
a reasonable expectation of success.” InTouch Techs., 751 F.3d at 1347.
With respect to obviousness, Sprint’s burden at trial was to present clear and convincing
evidence, inter alia, of a motivation to combine and a reasonable expectation of success. The
Court concludes that Dr. Polish’s testimony and the text of the patents themselves are not
substantial evidence of a motivation to combine. Similarly, the Court concludes that the mere
possibility that the prior art could be combined or modified is not substantial evidence of a
reasonable likelihood of success.
4.
Conclusion
The Court concludes that there is substantial evidence that the “said first identifier”
limitation, the “same element” limitation, an external messaging server, and a “mapping” step
not performed by a Home Location Register (“HLR”) were disclosed in the prior art. However,
there is no substantial evidence of a suggestion or motivation to combine the prior art to create
26
the invention described by Claim 113, nor is there substantial evidence that any such
combination would have been likely to succeed. Thus, the Court grants Comcast’s JMOL, and
concludes that Claim 113 of the ‘870 patent is not obvious.
C.
Comcast’s Alternative Motion for a New Trial on Obviousness
In its Renewed Motion for JMOL, Comcast requests, in the alternative, that the Court
grant a new trial on the obviousness of Claim 113 of the ‘870 Patent. Comcast JMOL at 30. “If
the court grants a renewed motion for judgment as a matter of law, it must also conditionally rule
on any motion for a new trial by determining whether a new trial should be granted if the
judgment is later vacated or reversed. The court must state the grounds for conditionally
granting or denying the motion for a new trial.” Fed. R. Civ. P. 50(c)(1). A new trial may be
granted “for any reason for which a new trial has heretofore been granted in an action at law in
federal court.” Fed. R. Civ. P. 59(a)(1). Generally, a district court “ought to grant a new trial on
the basis that the verdict was against the weight of the evidence only where a miscarriage of
justice would result if the verdict were to stand.” Williamson v. Consol. Rail Corp., 926 F.2d
1344, 1352 (3d Cir. 1991).11
“Where a trial is long and complicated and deals with a subject matter not lying within
the ordinary knowledge of jurors a verdict should be scrutinized more closely by the trial judge,
[in ruling on a motion for new trial], than is necessary where the litigation deals with material
which is familiar and simple.” Lind v. Schenley Indus., Inc., 278 F.2d 79, 90–91 (3d Cir. 1960).
The Court recognizes that the 14-day trial in this case was “long and complicated,” and that the
complexities of cellular networks are “a subject matter not lying within the ordinary knowledge
11
For issues that are not patent-law-specific, the Federal Circuit defers to the law of the regional
circuit in which the district court sits—here, the United States Court of Appeals for the Third
Circuit. Harris Corp. v. Ericsson Inc., 417 F.3d 1241, 1248 (Fed. Cir. 2005).
27
of jurors.” Id. The jury verdict, therefore, deserves close scrutiny.
The Court has determined that the jury verdict as to the obviousness of Claim 113 was
not supported by substantial evidence, because no reasonable person would accept the evidence
produced as adequate to support a finding that a skilled artisan would have been motivated to
combine the prior art, or would have reasonably expected to succeed in doing so. For these same
reasons, the Court concludes that the jury determination that Claim 113 was obvious was against
the weight of the evidence. Thus, the Court conditionally grants Comcast’s Motion for a New
Trial on the question of whether Claim 113 of the ‘870 patent is obvious.
D.
Sprint’s Renewed Motion for Judgment as a Matter of Law Under
Rule 50
Sprint also filed a Renewed Motion for Judgment as a Matter of Law, arguing that the
‘870 patent is ineligible under Section 101 of the Patent Act because it is directed to an abstract
idea. For the reasons that follow, the Court denies Sprint’s Motion and again concludes that the
asserted claims of the ‘870 patent are eligible under Section 101.
1.
Applicable Law
Section 101 of the Patent Act provides that “[w]hoever invents or discovers any new and
useful process, machine, manufacture, or composition of matter, or any new and useful
improvement thereof, may obtain a patent therefor, subject to the conditions and requirements of
this title.” 35 U.S.C. § 101. But there is an “important implicit exception” to the broad scope of
Section 101: “laws of nature, natural phenomena, and abstract ideas are not patentable.” Assoc.
for Molecular Pathology v. Myriad Genetics, Inc., 133 S. Ct. 2107, 2116 (2013).
The Supreme Court has created a two-step “framework for distinguishing patents that
claim laws of nature, natural phenomena, and abstract ideas from those that claim patent-eligible
applications of those concepts.” Alice Corp. Pty. Ltd. v. CLS Bank Int’l, 134 S. Ct. 2347, 2355
28
(2014) (citing Mayo Collaborative Servs. v. Prometheus Labs., Inc., 132 S. Ct. 1289, 1296–97
(2012)). First, the court must “determine whether the claims at issue are directed to one of those
patent-ineligible concepts.” Id. Second, if the claims are directed to a patent-ineligible concept,
the court must “determine whether the additional elements transform the nature of the claim into
a patent-eligible application.” Id. (quotations omitted). The Federal Circuit “typically refer[s]
to step one as the ‘abstract idea’ step and step two as the ‘inventive concept’ step.” Intellectual
Ventures I LLC v. Erie Indem. Co., 850 F.3d 1315, 1325 (Fed. Cir. 2017). A more fulsome
discussion of the applicable legal framework is included in this Court’s Memorandum and Order
dated August 24, 2016. Comcast v. Sprint II, 203 F. Supp. 3d at 523–30.
2.
Discussion
The Court concludes that the asserted claims in the ‘870 patent12 are not directed to an
abstract idea, but that they instead implement a specific improvement in cellular networking.
Sprint first challenged the eligibility of the ‘870 patent under 35 U.S.C. § 101 by Motion for
Summary Judgment. The Court undertook a comprehensive analysis of the issue, denying
Sprint’s Motion and concluding that the claims at issue are not directed to an abstract idea and, in
the alternative, that there are sufficient additional elements to transform the claims into a patenteligible application. See Comcast v. Sprint II, 203 F. Supp. 3d 499. Sprint’s Renewed Motion
for Judgment as a Matter of Law includes “Sprint’s previous arguments for finding the asserted
claims of the ‘870 patent invalid under section 101.” Sprint’s Mem. of Law in Supp. of its
Renewed Mot. for Judgment as a Matter of Law Under Rule 50 (“Sprint’s JMOL”) at 4, n.4. The
Court incorporates by reference its previous decision on those issues, and again rejects those
12
Because the parties agree that the eligibility of the asserted dependent claims, Claim 7 and
Claim 113, is predicated on the eligibility of Claim 1, the Court does not address the dependent
claims separately.
29
arguments. See Comcast v. Sprint II, 203 F. Supp. 3d at 523–30. However, Sprint’s Motion
includes two additional arguments—based on Comcast’s expert testimony at trial and three
recent decisions from the Federal Circuit—that the Court addresses in this Memorandum.
First, Sprint argues that expert testimony presented by Comcast at trial shows that the
‘870 patent simply describes how a process that can be performed by a human can be performed
by a computer, and is therefore patent ineligible. Sprint JMOL at 11. “An inventive concept that
transforms the abstract idea into a patent-eligible invention must be significantly more than the
abstract idea itself, and cannot simply be an instruction to implement or apply the abstract idea
on a computer.” Bascom Global Internet Servs., Inc. v. AT&T Mobility LLC, 827 F.3d 1341,
1349 (Fed. Cir. 2016).
Dr. Akl offered expert opinion testimony about “the switching, the lookup” process that
enables “the phones to communicate with each other and with outside networks.” Trial Tr. (Feb.
2, 2017, morning) 97:3–17. To aid the jury, Dr. Akl analogized that process to the actions of a
switchboard operator. Id. at 97:3–9. Dr. Akl explained that switchboard operators “have the
wires and they—you know, a call comes in and they plug [the wires] in and complete the call,
and the way to know how to plug it in [correctly] is they have the notebooks in front of them, so
they look it up and they see what call is going to be connected to what user and they manually do
it.” Id. at 97:21–98:4. In the context of the ‘870 patent, Dr. Akl opined that “when the
[switchboard] operator is looking in her notebook to see what to connect, that’s what the
subscriber databases do,” and “the connections [are] what the [mobile switching center
(“MSC”)] does.” Trial Tr. (Feb. 2, 2017, afternoon) 13:15–14:3. In short, Dr. Akl testified that
this manual process formerly performed by the switchboard operator “is now being done by
computers.” Trial Tr. (Feb. 2, 2017, morning) 97:21–98:6.
30
Sprint argues that this testimony “illustrates the hallmark of an ineligible abstract idea—a
real-world practice long-performed in the field, now performed by computers.” Sprint’s JMOL
at 12. The Court has rejected this argument in denying Sprint’s Motion for Summary Judgment:
While identifying characteristics and sorting messages is an activity that people
perform every day, without computer assistance, the method implemented in the
‘870 patent has no such everyday analog and could not be performed “entirely in
the human mind.” See CyberSource Corp. v. Retail Decision, Inc., 654 F.3d
1366, 1375 (Fed. Cir. 2011). Rather, the ‘870 patent describes a method that can
only be performed on a computer. Specifically, it claims a method of sending an
inquiry between two elements in a network. Characterizing the method as simply
“matching identifiers to retrieve information,” as Sprint[] does in its bank teller
analogy, fails to consider each step in the method and removes the method from
context, ignoring the problem that the ‘870 patent solves. See Internet Patents
Corp., 790 F.3d at 1346 (“[T]he claims are considered in their entirety to
ascertain whether their character as a whole is directed to excluded subject
matter.” (emphasis added)).
Comcast v. Sprint II, 203 F. Supp. 3d at 528. Dr. Akl’s testimony at trial was merely an analogy
to assist the jury in understanding a complex process. It does not disturb the Court’s previous
conclusion that the ‘870 patent “can only be performed on a computer.” Id. The Court therefore
again rejects Sprint’s argument.
Second, Sprint points to three decisions published by the Federal Circuit after this Court
issued the Memorandum and Order dated August 24, 2016. Sprint contends that these decisions
“reinforce Sprint’s argument that the ‘870 patent is directed to the abstract idea of matching
identifiers to retrieve information and is invalid under section 101.” Sprint’s JMOL at 12–13.
The Court concludes that these three decisions do not adversely impact the Court’s August 24,
2016, Memorandum and Order, and rejects Sprint’s argument.
Sprint argues that two Federal Circuit decisions involving abstract ideas are similar to the
concept underlying the ‘870 patent. The first of these is Intellectual Ventures I LLC v. Erie
Indem. Co., in which the Federal Circuit concluded that the invention at issue was patent-
31
ineligible because it was “drawn to the abstract idea of ‘creating an index and using that index to
search for and retrieve data.’” 850 F.3d at 1327. In the second, the Federal Circuit held that
“receiving e-mail (and other data file) identifiers, characterizing e-mail based on the identifiers,
and communicating the characterization—in other words, filtering files/e-mail—is an abstract
idea.” Intellectual Ventures I LLC v. Symantec Corp., 838 F.3d 1307, 1313 (Fed. Cir. 2016). It
is Sprint’s position that Erie and Symantec are “instructive” and support its argument that the
claims of the ‘870 patent are aimed at a patent-ineligible abstract idea. Sprint JMOL at 13–14.
But the ‘870 patent does not merely describe a process of creating and using an index to
retrieve data, as in Erie, or a filtering process like the one in Symantec. Rather, as this Court
previously held, the claims of the ‘870 patent “set out a method for achieving a specific goal—
obtaining information about a wireless terminal with a dynamic network address—by applying
the abstract idea of matching identifiers to retrieve information in the cellular network.”
Comcast v. Sprint II, 203 F. Supp. 3d at 526 (emphasis in original). Erie and Symantec do not
affect that ruling.
In the third decision cited by Sprint, the Federal Circuit ruled that the patent claims at
issue were ineligible because they merely “confine[d] the abstract idea to a particular
technological environment—in [that] case, cellular telephones.” Affinity Labs of Texas, LLC v.
DIRECTV, LLC, 838 F.3d 1253, 1258–59 (Fed. Cir. 2016). The Federal Circuit reasoned that
“merely limiting the field of use of the abstract idea to a particular existing technological
environment does not render the claims any less abstract.” Id. at 1258–59. Sprint argues that
Affinity Labs governs this case because the ‘870 patent merely applies an abstract idea to the
technological environment of cellular networks and messaging servers. Sprint JMOL at 14. This
argument fails—as discussed supra, the ‘870 Patent is aimed at a non-abstract idea. The fact that
32
the ‘870 patent and the patent at issue in Affinity Labs are both directed at a “particular
technological environment” does not impact that conclusion. See Comcast v. Sprint II, 203 F.
Supp. 3d at 526.
For these reasons, the Court concludes that the claims of the ‘870 patent are not directed
to an abstract idea, and are therefore patent eligible.13 Accordingly, the Court denies Sprint’s
Motion for JMOL on the ground that the claims are ineligible under § 101.
III.
COMCAST’S MOTIONS RELATING TO DAMAGES
The jury determined that Sprint had infringed Comcast’s ‘870 patent, and awarded
damages of $1.5 million in the form of a one-time lump-sum royalty. Comcast has filed a
Motion for a New Trial on Damages, arguing that the jury verdict was not supported by
substantial evidence. Comcast’s argument that the verdict is not supported by substantial
evidence is based on an incorrect statement of the law. The correct standard is sufficient
evidence.14
Comcast also moves to amend the final judgment to add pre- and post-judgment interest.
For the reasons set forth below, the Court denies Comcast’s Motion for a New Trial on
Damages, and grants Comcast’s Motion to Amend the Final Judgment to Add Pre-Judgment and
Post-Judgment Interest.
13
Although Sprint’s Motion addresses only the “abstract idea” step, the Court reiterates its
conclusion that, “even if the claims at issue are directed to an abstract idea at step one, there are
sufficient additional elements [under the “inventive concept” step] to transform the claims into a
patent-eligible application.” Comcast v. Sprint II, 203 F. Supp. 3d at 530.
14
Comcast’s argument is based on Power Integrations, Inc. v. Fairchild Semiconductor Int’l,
Inc., 711 F.3d 1348, 1356 (Fed. Cir. 2013) (citing Thabault v. Chait, 541 F.3d 512, 532 (3d Cir.
2008)). Although Power Integrations states that the Third Circuit’s standard in this context is
“substantial evidence,” 711 F.3d at 1356, Thabault in fact states that the correct standard is
“sufficient evidence,” 541 F.3d at 532; see also Leonard v. Stemtech Int’l Inc., 834 F.3d 376, 392
(3d Cir. 2016). Nonetheless, the Court concludes that the distinction between these two
standards, if any, is insignificant in the context of this case, because the Court would reach the
same conclusion under either standard.
33
A.
Comcast’s Motion for a New Trial on Damages
The invention described in the ‘870 patent was invented by Outi Aho, who assigned the
patent to Nokia Mobile Phones, Ltd. (“Nokia”). The patent application was filed on February
22, 2001, but asserts priority to a Finnish patent application dated December 23, 1999. The
patent issued on April 26, 2005. On June 30, 2010, Comcast and Nokia entered into an
agreement (hereinafter “Comcast-Nokia Agreement”) wherein Comcast purchased a portfolio of
U.S. and international patents, including the ‘870 patent, from Nokia for $600,000. At trial,
Sprint’s damages expert, Dr. Alan Cox, opined that the damages award in this case, if any,
should be $1.5 million. His opinion was based in part on the purchase price of the ComcastNokia Agreement. The jury verdict precisely matched Dr. Cox’s expert opinion.
Comcast now seeks a new trial on damages, arguing that there was insufficient evidence
to support the award. In particular, Comcast argues that (1) the Comcast-Nokia Agreement is
not sufficient evidence to support the jury verdict, (2) Dr. Cox impermissibly relied on forward
citation analysis, and (3) Dr. Cox mentioned additional impermissible rationales. The Court
rejects these arguments. To the contrary, there is sufficient evidence to support the jury verdict
on damages.
1.
Standard of Review
Federal Rule of Civil Procedure 59 provides that a new trial may be granted “for any
reason for which a new trial has heretofore been granted in an action at law in federal court.”
Fed. R. Civ. P. 59(a)(1). “To review damages in patent cases, [the Federal Circuit applies]
regional circuit law to procedural issues” such as the Rule 59 standard. Finjan, Inc. v. Secure
Computing Corp., 626 F.3d 1197, 1207 (Fed. Cir. 2010). In the United States Court of Appeals
for the Third Circuit, “‘new trials because the verdict is against the weight of the evidence are
34
proper only when the record shows that the jury verdict resulted in a miscarriage of justice or
where the verdict, on the record, cries out to be overturned or shocks our conscience.’” Id. at
1203 (quoting Williamson, 926 F.2d at 1353). “A jury’s damages award will not be upset so
long as there exists sufficient evidence on the record, which if accepted by the jury, would
sustain the award.” Thabault, 541 F.3d at 532. In short, “‘our obligation is to uphold the jury’s
award if there exists a reasonable basis to do so.’” Finjan, 626 F.3d at 1207 (quoting Motter v.
Everest & Jennings, Inc., 883 F.2d 1223, 1230 (3d Cir. 1989)).
2.
Applicable Law
In this case, the parties agreed that any damages awarded should be in the form of a
reasonable royalty based on the result of a hypothetical negotiation that “attempts to ascertain the
royalty upon which the parties would have agreed had they successfully negotiated an agreement
just before infringement began.” Lucent Techs., Inc. v. Gateway, Inc., 580 F.3d 1301, 1324 (Fed.
Cir. 2009) (citing Georgia–Pacific Corp. v. U.S. Plywood Corp., 318 F.Supp. 1116, 1120
(S.D.N.Y.1970)); see Comcast MNT at 4; Sprint’s Opp. to Comcast’s MNT on Damages
(“Sprint Resp. to Comcast MNT”) at 8. The hypothetical negotiation asks the factfinder to
determine what reasonable royalty a willing licensor and a willing licensee would have agreed on
just before the infringement began. Lucent, 580 F.3d at 1324. The licensor, in this case, would
be Nokia, because Nokia owned the ‘870 patent when Sprint began infringing it; the licensee
would be Sprint; and the hypothetical negotiation would have taken place on April 26, 2005. See
Comcast MNT at 8; Sprint Resp. to Comcast MNT at 9; Trial Tr. (Feb. 10, 2017, morning) at
23:8–19.
“Where, as here, the current patent owner purchased the patent, the value of the
consideration given in exchange for the patent may be relevant to the determination of a
35
reasonable royalty because it may bear on the amount that might have been accepted by a
prudent patentee who was engaging in a hypothetical licensing negotiation.” Endress Hauser,
Inc. v. Hawk Measurement Sys. Pty. Ltd., 892 F. Supp. 1123, 1131–32 (S.D. Ind. 1995), aff’d sub
nom. Endress + Hauser, Inc. v. Hawk Measurement Sys. Pty. Ltd., 122 F.3d 1040 (Fed. Cir.
1997); see also Pers. Audio, LLC v. Apple, Inc., No. 9:09CV111, 2011 WL 3269330, at *10
(E.D. Tex. July 29, 2011) (“[T]he jury could, and should, have given substantial weight” to the
inventor’s “offer to sell, not merely to license, the actual patents-in-suit, not merely comparable
technology.”). The relevance of the purchase price is an extension of the so-called GeorgiaPacific factors, which allow the factfinder to consider, inter alia, “the royalties received by the
patentee for the licensing of the patent in suit.” Lucent, 580 F.3d at 1324 (citing GeorgiaPacific, 318 F. Supp. at 1120).
3.
Sufficient Evidence to Sustain the Jury Verdict
Dr. Cox opined that a reasonable royalty for the ‘870 patent would be $1.5 million. Trial
Tr. (Feb. 10, 2017, morning) at 39:25–40:3. In reaching that opinion, Dr. Cox testified that he
considered the Comcast-Nokia Agreement, under which Comcast paid Nokia $600,000 for
ownership of a portfolio of patents including the ‘870 patent. Trial Tr. (Feb. 10, 2017, morning)
at 28:1–6.
Comcast’s Motion sometimes appears to suggest that the Comcast-Nokia Agreement
should have been excluded at trial. For example, Comcast argues that “the Comcast-Nokia
agreement . . . cannot serve as a reasonable proxy for assessing what Sprint would have paid to
license the patent” and that the Agreement “cannot be used to establish a reasonable royalty.”
Comcast MNT at 10 (emphasis added). However, Comcast did not object to the admissibility of
the Comcast-Nokia Agreement at trial, so any argument that the Agreement should have been
36
excluded is rejected as waived. Belmont Indus., Inc. v. Bethlehem Steel Corp., 512 F.2d 434, 438
(3d Cir. 1975) (“[I]t is well-settled law that a party may not seek a new trial on the basis of
objections to evidence not brought to the court’s attention at the original trial.”). Comcast may
argue only that the Comcast-Nokia Agreement is insufficient to support the jury verdict.
Comcast MNT at 10; see Lucent, 580 F.3d at 1325.
Comcast primarily argues that Dr. Cox “refused” to account for Sprint’s actual use of the
‘870 patent. Comcast MNT at 10–15. Under the hypothetical negotiation, the parties must
account for the “economic demand for the claimed technology.” LaserDynamics, 694 F.3d at 77.
In accounting for demand, “evidence of usage after infringement started can, under appropriate
circumstances, be helpful to the jury and the court in assessing whether a royalty is reasonable,”
but there is no requirement that damages be proven by direct evidence of actual use. Lucent
Techs., Inc. v. Gateway, Inc., 580 F.3d 1301, 1333–34 (Fed. Cir. 2009). When Comcast
purchased the ‘870 patent, it had no plans to use the patent. Id. Thus, Comcast argues, the
Comcast-Nokia Agreement is not comparable because the parties to the Agreement did not
consider the scope of the infringer’s use, whereas that would be a focus of the hypothetical
negotiation. However, Dr. Cox testified that he considered economic demand. Specifically, he
acknowledged the enormous popularity of text messaging at the time of the hypothetical
negotiation. Trial Tr. (Feb. 10, 2017, morning) at 36:14–17. Dr. Cox also testified regarding the
uncertainty in the text messaging market, opining that the licensee took on “the risk that SMS
might not grow or that people would decide to communicate in other ways.” Trial Tr. (Feb. 10,
2017, morning) at 87:7–97:6. Based on this testimony, the Court concludes that Dr. Cox
adequately accounted for the “economic demand for the claimed technology” as required under
LaserDynamics. 694 F.3d at 77.
37
In addition, Comcast argues that the 2010 Comcast-Nokia Agreement is not comparable
to the 2005 hypothetical negotiation because the parties’ “economic circumstances . . . varied
greatly.” Comcast MNT at 15. Comcast’s expert Michele Riley testified that in 2005, Nokia
“was the world’s largest manufacturer of phones, enjoying very healthy profitability levels;” yet
by 2010, its financial position “had significantly deteriorated.” Trial Tr. (Feb. 3, 2017,
afternoon) at 86:2–8, 89:1–3. Thus, argues Comcast, Nokia was a weaker negotiator in 2010
than it would have been in 2005. Comcast MNT at 15–17. However, Dr. Cox testified that
Nokia was “still doing very well” and was “very healthy” financially in 2010. Trial Tr. (Feb. 14,
2017, afternoon) at 70:3–16. Indeed, Ms. Riley herself testified that Nokia was still profitable in
2010. Trial Tr. (Feb. 3, 2017, afternoon) at 89:1–5. Dr. Cox further opined that Nokia was
stable enough to “take their time about selling whatever assets they wanted to sell,” noting that
the Comcast-Nokia Agreement was “negotiated over a period of about two years.” Trial Tr.
(Feb. 14, 2017, afternoon) at 70:3–16. Considering both experts’ testimony, the Court concludes
that there is sufficient evidence that Nokia’s bargaining position in 2005 was comparable to its
2010 position.
Comcast also argues that the licensees’ bargaining power was not comparable. Dr. Cox
testified that under the circumstances of the 2005 hypothetical negotiation, Sprint “needed a
license [to the ‘870 patent] in order to stay in business.” Trial Tr. (Feb. 14, 2017, afternoon) at
68:12–19. In contrast, in 2010, Comcast “was interested in buying [the ‘870 patent] primarily
for defensive reasons,” according to Comcast’s Vice President for Strategic Intellectual Property
James Finnegan. Trial Tr. (Feb. 1, 2017, afternoon) at 8:10–19. The Court agrees that because
Sprint was committed to licensing the ‘870 patent, its bargaining position in 2005 was weaker
than Comcast’s 2010 position, because Comcast had no need for the patent. However, this
38
difference is not so significant that it renders the Comcast-Nokia Agreement and related
evidence insufficient to support the jury verdict.
Under both the Comcast-Nokia Agreement and the hypothetical negotiation, some
interest in the ‘870 patent was being conveyed, and Nokia was the patent owner. The Agreement
is plainly relevant to the hypothetical negotiation. Endress Hauser, 892 F. Supp. at 1131–32;
Pers. Audio, 2011 WL 3269330, at *10. And to the extent the two are not perfectly comparable,
Dr. Cox accounted for a number of differences between them. In addition, the Court notes that
“[v]igorous cross-examination, presentation of contrary evidence, and careful instruction on the
burden of proof are the traditional and appropriate means of attacking shaky but admissible
evidence.” Daubert, 509 U.S. at 596. Comcast had ample opportunity to dispute the weight of
the Agreement through cross examination and expert testimony. Comcast availed itself of that
opportunity, and the jury sided with Dr. Cox. The Court concludes that the Comcast-Nokia
Agreement, through the lens of the testimony presented at trial, is sufficient to support the jury
verdict.
4.
Forward Citation Analysis
Comcast argues that Dr. Cox’s use of forward citation analysis “requires a new trial on
damages” because (1) forward citation analysis is unreliable and (2) Dr. Cox failed to tie his
analysis to the facts of the case. Comcast MNT at 17. The Court has already heard and rejected
both arguments, holding that Dr. Cox’s use of forward citation analysis to corroborate his expert
opinion was reliable and tied to the facts of this case. Comcast Cable Commc’ns, LLC v. Sprint
Commc’ns Co., LP (Comcast v. Sprint III), 218 F. Supp. 3d 375, 382–84 (E.D. Pa. 2016).
Comcast now argues that Dr. Cox’s trial testimony discloses that he relied on forward citation
analysis rather than using it merely to corroborate his damages opinion. Comcast MNT at 17–
39
29. Specifically, Comcast notes that when Dr. Cox was asked whether he would reach his $1.5
million damages opinion “even if there was no [forward] citation analysis,” he responded “I’m
not sure that that’s true.” Trial Tr. (Feb. 14, 2017, morning) at 91:17–20. But Dr. Cox
immediately clarified that forward citation analysis merely bolstered his confidence in his
opinion, stating that “[i]f there had not been corroborating evidence that indicated that this patent
was very valuable, wasn’t even looked at very much, then I would be less confident of my
number, but I’m now very confident of my number as a result of that analysis.” Trial Tr. (Feb.
14, 2017, morning) at 92:1–5. Dr. Cox’s full testimony reveals that he used forward citation
analysis not to reach his damages opinion, but to cement his confidence in that opinion.
Comcast further argues that a new trial should be granted based on “an analogous
situation” addressed by the Federal Circuit. Comcast MNT at 29 (citing Uniloc USA, Inc. v.
Microsoft Corp., 632 F.3d 1292, 1311 (Fed. Cir. 2011)). In Uniloc, one party’s damages expert
showed the jury a pie chart depicting the reasonable royalty sought as a portion of the accused
product’s entire market value—$19 billion. Id. The expert testified that the resultant ratio
served as “kind of a check” on his damages calculation. Id. However, under the “entire market
value rule,” the entire market value of a product may be a basis for damages “only where the
patented feature creates the basis for customer demand or substantially creates the value of the
component parts.” Id. at 1318 (citing Lucent Techs., 580 F.3d at 1336)). The introduction of the
entire market value of a product can cause enormous bias, and the district court granted a
conditional new trial on damages because the rule was violated. Id. at 1321. The Federal Circuit
upheld the district court’s decision, concluding that the jury verdict “was supported in part by the
faulty foundation of the entire market value.” Id.
40
The Court rejects Comcast’s comparison to Uniloc. Forward citation analysis, unlike the
entire market value, is not prohibited by a bright-line rule. Rather, forward citation analysis is
reliable when, as here, it is tied to the facts of the case. Comcast v. Sprint III, 218 F. Supp. 3d at
384; see also Better Mouse Co., LLC v. SteelSeries ApS, No. 2:14-CV-198-RSP, 2016 WL
3611528, at *3 (E.D. Tex. Jan. 5, 2016) (concluding that a similar methodology was “reasonably
reliable”); but see Finjan, Inc. v. Blue Coat Sys., Inc., No. 13-CV-03999-BLF, 2015 WL
4272870, at *8 (N.D. Cal. July 14, 2015) (rejecting forward citation analysis as unreliable where
expert offered “no explanation as to why the forward citation methodology is an appropriate
measure of the value of the patents at issue in this case”); Oracle Am., Inc. v. Google Inc., No. C
10-03561 WHA, 2012 WL 877125, at *2 (N.D. Cal. Mar. 15, 2012) (rejecting forward citation
analysis as unreliable where expert failed to count citations to predecessor patents). Dr. Cox’s
use of forward citation analysis is a far cry from Uniloc, in which the introduction of the entire
market value of the accused product “skew[ed] the damages horizon for the jury.” 632 F.3d at
1311. Thus, Dr. Cox’s corroborative use of forward citation analysis does not disturb this
Court’s ruling that there was sufficient evidence to support the jury verdict of $1.5 million.
5.
References to other Sprint patents and a 1999 Nokia Invention
Report
Finally, Comcast argues that Dr. Cox’s references to “(1) other patents supposedly used
in Sprint’s system, and (2) a ranking of the importance of the invention of the ‘870 patent in a
1999 Nokia Invention Report form” cannot support his reasonable royalty opinion. Comcast
MNT at 29. The Court rejects both arguments.
First, Comcast argues that Dr. Cox’s testimony regarding other Sprint patents was
unsupported and irrelevant. Dr. Cox testified that “there are at least 10,000, probably tens of
thousands, of patents involved in the operation of a cellular network.” Trial Tr. (Feb. 10, 2017,
41
morning) at 17:10–21. He also testified that Sprint owned 23 messaging-related patents, Trial
Tr. (Feb. 14, 2017, morning) at 85:4-12, with the intent, according to Comcast, “to suggest that
Sprint was using its own patented technology in its messaging system and that the contribution
of the ‘870 patent should be discounted accordingly,” Comcast MNT at 31. Comcast argues that
Dr. Cox’s testimony on these issues was unsupported. Comcast MNT at 29–31. Significantly,
Comcast did not object to those parts of Dr. Cox’s testimony at trial. See Trial Tr. (Feb. 10,
2017, morning) at 17:10–23; Trial Tr. (Feb. 14, 2017, morning) at 85:4–22. As stated supra,
Comcast may not seek a new trial on this ground after failing to object to the testimony at trial.
Belmont Indus., 512 F.2d at 438 (“[I]t is well-settled law that a party may not seek a new trial on
the basis of objections to evidence not brought to the court’s attention at the original trial.”).
Nonetheless, the Court concludes that Comcast’s argument fails on its merits. Dr. Cox’s
statements about other Sprint patents were made in passing, and do not diminish the sufficiency
of the evidence—namely, the Comcast-Nokia Agreement and related expert testimony—to
support the jury verdict.
Second, Comcast argues that a 1999 Nokia Invention Report (the “1999 Report”)
introduced at trial and referenced by Dr. Cox had “no relevance” to the hypothetical negotiation.
Comcast MNT at 31–33 (citing DX-150). The 1999 Report indicated that a manager at Nokia
believed, in 1999, that the invention that became the ‘870 patent had a “strategic importance” of
two on a scale of zero to five. Trial Tr. (Feb. 10, 2017, morning) at 34:10–23. Comcast argues
that the 1999 Report is irrelevant to Nokia’s 2005 bargaining position. Comcast MNT at 31–33.
Comcast stipulated to the admission of DX-150, Trial Tr. (Feb. 8, 2017, afternoon) at 107:18–
108:1), and any argument for a new trial based solely on its admission is rejected, Belmont
Indus., 512 F.2d at 438.
42
But the Court again concludes that Comcast’s argument fails on its merits. Comcast
attacked the 1999 Report through the “traditional and appropriate means” of “[v]igorous crossexamination [and] presentation of contrary evidence.” Daubert, 509 U.S. at 596. On crossexamination, Dr. Cox admitted that text messaging “wasn’t widely used and commonly
available” in 1999. Trial Tr. (Feb. 14, 2017, morning) at 28:15–29:13. That admission implies
that the 1999 Report would not be perfectly analogous to Nokia’s valuation of the ‘870 patent in
2005, by which time messaging had exploded. Trial Tr. (Feb. 10, 2017, morning) at 36:14–17.
And Comcast introduced evidence that the percent of a wireless subscriber’s monthly bill
attributable to messaging rose from just 0.2% in 1999 to 8% in 2005, an indication that the value
of text messaging services rose similarly over that period. Trial Tr. (Feb. 14, 2017, morning) at
30:11–31:4. In short, Comcast successfully identified the weaknesses of the 1999 Report at trial
for the jury. Taking into consideration all the evidence on the issue of damages, including the
references to additional patents and the 1999 Report, the Court concludes there was ample
support for the verdict.
6.
Conclusion
The Court determines that the evidence is sufficient to support the jury verdict. In
particular, the Comcast-Nokia Agreement involved the sale of the patent at issue, and the seller
was Nokia, the licensor in the hypothetical negotiation. Comcast’s 2010 bargaining power was
stronger than Sprint’s 2005 position, but this difference is not so significant that it renders the
Agreement and associated expert testimony insufficient to support the jury verdict. That
sufficiency is not diminished by references to additional Sprint patents, which were made in
passing, and the 1999 Report, which Comcast effectively attacked. The Court therefore denies
Comcast’s Motion for a New Trial on Damages.
43
B.
Comcast’s Motion to Amend Final Judgment to Add Pre- and PostJudgment Interest
1.
Pre-Judgment Interest
Pre-judgment interest should be awarded under 35 U.S.C. § 284 “absent some
justification for withholding such an award.” Whitserve, LLC v. Computer Packages, Inc., 694
F.3d 10, 36 (Fed. Cir. 2012) (quoting Gen. Motors Corp. v. Devex Corp., 461 U.S. 648, 657
(1983)). In patent cases, “no recovery shall be had for any infringement committed more than
six years prior to the filing of the complaint . . . for infringement in the action. 35 U.S.C. §
286. Comcast filed this lawsuit on February 17, 2012. Thus, Comcast argues that prejudgment
interest should be awarded beginning February 17, 2006. Sprint has pointed to no justification
for withholding pre-judgment interest, and the Court has identified none. The Court therefore
concludes that pre-judgment interest shall be awarded.
“The rate of prejudgment interest and whether it should be compounded or
uncompounded are matters left largely to the discretion of the district court. In exercising that
discretion, the district court must be guided by the purpose of prejudgment interest, which is to
ensure that the patent owner is placed in as good a position as he would have been had the
infringer entered into a reasonable royalty agreement.” Bio-Rad Labs., Inc. v. Nicolet Instrument
Corp., 807 F.2d 964, 969 (Fed. Cir. 1986). To that end, the court must attempt to “make the
patent owner whole” for “the foregone use of the money between the time of infringement and
the date of the judgment.” Gen. Motors Corp., 461 U.S. at 656.
Sprint argues that prejudgment interest should be awarded at the weekly average 1-year
constant maturity Treasury yield (“T-Bill”) rate, compounded annually. According to Sprint,
“the vast majority of courts have awarded treasury investment rates” in this situation. Sprint’s
Opp. to Comcast’s Mot. to Amend Final Judgment to Add Pre-Judgment Interest and Post-
44
Judgment Interest (“Sprint Resp. to Mot. Amend”) at 3. In fact, “[i]t is difficult to tell if there is
an actual trend in any direction.” Mars, Inc. v. Coin Acceptors, Inc., 513 F. Supp. 2d 128, 136
(D.N.J. 2007). Even so, “the T–Bill rate has been accepted and employed by many courts in
patent cases as a reasonable method of placing a patent owner in a position equivalent to where it
would have been had there been no infringement.” Cornell Univ. v. Hewlett-Packard Co., No.
01-CV-1974, 2009 WL 1405208, at *3 (N.D.N.Y. May 15, 2009). Sprint also notes that the TBill rate is required for post-judgment interest, and argues that consistency favors using that
framework for prejudgment interest as well. Sprint Resp. to Mot. Amend at 4–5.
In contrast, Comcast seeks the Pennsylvania statutory interest rate of six percent, 41 Pa.
Const. Stat. § 202, with interest compounded quarterly, arguing that this rate is “often” used in
United States District Courts within Pennsylvania. Comcast’s Mot. for Pre-Judgment and PostJudgment Interest (“Comcast Mot. Amend”) at 5 (citing Univ. of Pittsburgh of Com. Sys. of
Higher Educ. v. Varian Med. Sys., Inc., No. 08CV1307, 2012 WL 1436569, at *10 (W.D. Pa.
Apr. 25, 2012), aff’d in part, vacated in part on other grounds, 561 F. App’x 934 (Fed. Cir.
2014) (reasoning that “it is in the interest of justice to have a consistent rate at which
prejudgment interest is awarded, and that the local statutory rate is an appropriate benchmark,”
and ordering quarterly compounding); Air Vent, Inc. v. Vent Right Corp., No. 02:08-CV-00146,
2011 WL 2117014, at *2 (W.D. Pa. May 24, 2011) (noting that “the Federal Circuit has affirmed
awards of prejudgment interest at the Pennsylvania statutory rate of 6%”)). Comcast mentions in
passing that it “likely would have made a much higher return on its money” than either proposed
rate, but presents no evidence that it would have invested in anything specific. Comcast’s Reply
in Support of its Mot. to Amend (Comcast Mot. Amend Reply) at 2.
45
The Court finds that the T-Bill rate, compounded annually, is the more appropriate
approach. First, the T-Bill rate is adequate to compensate Comcast for its lost use of royalties,
because Comcast has presented no evidence that it borrowed moneys at a higher rate during the
infringement period or that it would have invested the royalties at a higher rate. The Federal
Circuit and other district courts have repeatedly reached the same conclusion. See, e.g., Laitram
Corp. v. NEC Corp., 115 F.3d 947, 955 (Fed. Cir. 1997) (finding no abuse of discretion where
district court awarded T-Bill rate as adequate to compensate where there was no evidence that
patent holder would have borrowed at a higher rate); Finjan, Inc. v. Blue Coat Sys., Inc., 2016
WL 3880774, at *18 (awarding T-Bill rate where there was no evidence that patent holder
borrowed money during the infringement period at a higher rate); Transocean Offshore
Deepwater Drilling, Inc. v. GlobalSantaFe Corp., No. CIV.A. H-03-2910, 2006 WL 3227315, at
*6 (S.D. Tex. Nov. 6, 2006) (awarding T-Bill rate where patent holder presented no evidence
that a higher rate was necessary for full compensation).
Second, the Court is persuaded by the interest in consistency in the standard for pre- and
post-judgment interest. The T-Bill rate, compounded annually, is required for post-judgment
interest. 28 U.S.C. § 1961. “Courts have found this fact persuasive in utilizing the T-Bill rate
for pre-judgment interest as well.” Mars, 513 F. Supp. 2d at 137; Intex Plastic Sales Co. v. Hall,
No. C-85-2987-JPV, 1991 WL 270167, at *5 (N.D. Cal. July 10, 1991), aff’d, 960 F.2d 155
(Fed. Cir. 1992) (concluding that “the statutorily sanctioned [T-Bill] rate has a far more reasoned
basis,” and rejecting patent holder’s speculative argument that he would have invested at a
higher rate); Nat’l Presto Indus., Inc. v. Black & Decker Inc., No. 89 C 8978, 1992 WL 125559,
at *8 (N.D. Ill. May 27, 1992) (concluding, with respect to prejudgment interest, that patent
holder would “be fully compensated by being given the interest rate it could have earned if it had
46
had the money to invest, the interest rate that is statutorily established for post-judgment interest:
the Treasury Bill rate”).
Comcast may obtain damages for infringement beginning February 17, 2006. Because
the purpose of prejudgment interest is to “make the patent owner whole” for “the foregone use of
the money between the time of infringement and the date of the judgment,” the Court concludes
that the appropriate rate is the T-Bill rate for the week preceding February 17, 2006. Gen.
Motors Corp., 461 U.S. at 656. That rate was 4.7%. Sprint Resp. to Mot. Amend, Ex. A-1.15
And because “compounding is necessary to fully compensate the patentee,” the Court further
concludes that the statutorily prescribed compounding mechanism for post-judgment interest—
annual compounding—is also appropriate. Mars, 513 F.Supp. 2d at 137.
Finally, the Court must decide when prejudgment interest stopped accruing. Sprint
argues that prejudgment interest should be awarded only through the date of the original
judgment. Sprint’s Surreply in Opp. to Comcast’s Mot to Amend (“Sprint Surreply to Mot.
Amend”) at 7–8 (citing McDermott v. Party City Corp., 11 F. Supp. 2d 612, 633 (E.D. Pa. 1998)
(awarding prejudgment interest only through the date of the original judgment, even when
entering an amended judgment)). Comcast argues that prejudgment interest should be awarded
“from February 17, 2006 to February 21, 2016 [sic], the date of judgment.” Comcast Mot.
Amend at 6. But in its Reply, Comcast argues that the Court should award prejudgment interest
through the date of an order amending the judgment. Comcast Mot. Amend Reply at 6.
Comcast identifies no legal basis for its argument that prejudgment interest should continue to
accrue after the original judgment was entered. The Court agrees with Sprint, and finds that
15
See also United States District Court for the District of Utah, 2006 Post Judgment Interest
Rate, available at http://www.utd.uscourts.gov/2006-post-judgment-interest-rate (last visited
August 11, 2017).
47
prejudgment interest accrued beginning February 17, 2006, and ending February 21, 2017, the
date of the original judgment.
2.
Post-Judgment Interest
The Court turns next to post-judgment interest, which is mandatory. 28 U.S.C. § 1961(a).
Post-judgment interest must be calculated at a rate “equal to the weekly average 1-year constant
maturity Treasury yield . . . for the calendar week preceding the date of the judgment,” id., and it
must be compounded annually. 28 U.S.C. § 1961(b). The Court first concludes that Comcast is
entitled to post-judgment interest on the jury verdict of $1.5 million beginning on February 21,
2017, the date of the original entry of judgment.
Because interest is not unique to patent law, the law of the regional circuit controls. In
the Third Circuit, post-judgment interest is calculated based on the sum of the jury verdict plus
any prejudgment interest. Sun Ship, Inc. v. Matson Navigation Co., 785 F.2d 59, 63 (3d Cir.
1986). However, post-judgment interest on prejudgment interest does not accrue until the entry
of an order fixing the amount of prejudgment interest. Travelers Casualty and Surety Co. v.
Insurance Co. of N. America, 609 F.3d 143, 174–75 (3d Cir. 2010). Therefore, Sprint argues that
post-judgment interest on any awarded prejudgment interest cannot accrue until the date that
such prejudgment interest is awarded. Sprint Resp. to Mot. Amend at 7. Comcast agrees that
Travelers governs this case.16 Following Travelers, the Court concludes that post-judgment
interest on all accrued prejudgment interest may not be awarded until this Court’s entry of an
order awarding prejudgment interest. Such an order accompanies this Memorandum.
3.
Application of Pre- and Post-Judgment Interest
The Court concludes as follows. Prejudgment interest shall be awarded at the T-Bill rate
16
As discussed supra, Comcast requests that the Court award prejudgment interest through the
date of the Court’s amended final judgment. The Court has denied that request.
48
for February 17, 2006, or 4.7%, compounded annually. Prejudgment interest shall be awarded
on the damages verdict of $1.5 million beginning February 17, 2006, which is the first date at
which Comcast can recover damages based on its filing date, and ending on February 21, 2017,
the date of the original judgment.
Post-judgment interest on the damages verdict of $1.5 million shall be awarded beginning
February 21, 2017, the date on which the original judgment was entered, and ending on August
16, 2017, the date on which this Court’s order fixing prejudgment interest was entered. The
applicable rate is the weekly average yield for the week preceding the original judgment. The
weekly average yield for February 17, 2017, was 0.82%,17 and such interest shall be
compounded annually.
Finally, post-judgment interest on the combination of the damages verdict and all accrued
interest shall be awarded beginning August 16, 2017, the date on which such interest was
awarded by order accompanying this Memorandum. The applicable rate is the weekly average
yield for the week preceding the original judgment, which will be amended by order
accompanying this Memorandum. The weekly average yield for February 17, 2017, was
0.82%,18 and such interest shall be compounded annually.
IV.
CONCLUSION
Comcast’s Renewed Motion for Judgment as a Matter of Law that Claim 113 of the ‘870
Patent is Not Obvious is granted on the grounds that there was no substantial evidence of
motivation to combine, or likelihood of success. For those same reasons, Comcast’s alternative
17
United States District Court for the District of Utah, 2017 Post Judgment Interest Rate,
available at http://www.utd.uscourts.gov/2017-post-judgment-interest-rate (last visited August
11, 2017); see also Comcast Mot. to Amend at 7.
18
United States District Court for the District of Utah, 2017 Post Judgment Interest Rate,
available at http://www.utd.uscourts.gov/2017-post-judgment-interest-rate (last visited August
11, 2017); see also Comcast Mot. to Amend at 7.
49
motion for a new trial on the obviousness of Claim 113 is also granted. Sprint’s Renewed
Motion for Judgment as a Matter of Law Under Rule 50, on the grounds of ineligibility of the
‘870 patent under 35 U.S.C. § 101, is denied. Comcast’s Motion for New Trial on Damages is
denied. Comcast’s Motion to Amend Final Judgment to Add Pre-Judgment Interest and PostJudgment Interest is granted as described supra.
An appropriate order follows.
50
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