MAXIM INTEGRATED PRODUCTS, INC., PATENT LITIGATION

Filing 878

MEMORANDUM OPINION re: 855 MOTION for Reconsideration. Signed by Chief Judge Joy Flowers Conti on 7/23/2014. (ten)

IN THE UNITED STATES DISTRICT COURT
FOR THE WESTERN DISTRICT OF PENNSYLVANIA
IN RE: MAXIM INTEGRATED
PRODUCTS, INC. MDL No. 2354

This Document Relates to: All Actions

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Master Docket: Misc. No. 12-244
MDL No. 2354

MEMORANDUM OPINION
CONTI, Chief District Judge
Centralized in this court for coordinated and consolidated pretrial proceedings at
the above-captioned master docket are a number of patent infringement cases transferred to this
court by order of the Panel on Multidistrict Litigation. (ECF No. 1.) These cases involve five
related patents, owned by Maxim Integrated Products, Inc. (“Maxim”), which are directed to
electronically performing secure transactions. (Id.) Maxim accuses various parties, referred to in
these proceedings as Opposing Parties (the “OPs”), of creating smartphone software
applications, or “Apps,” that infringe its patents. At one time nearly thirty separate cases were
proceeding at the master docket number assigned to this MDL, 12-mc-244, to which all citations
to the record refer. The court is informed that there are currently only six OPs remaining.
The court issued a memorandum opinion and order concerning claim construction
on December 17, 2013. (ECF Nos. 742-43.) On June 2, 2014, the United States Supreme Court
issued its decision in Nautilus, Inc. v. Biosig Instruments, Inc., 134 S.Ct. 2120 (2014). In
Nautilus, the Supreme Court replaced the tests previously established and applied by the Court of
Appeals for the Federal Circuit to determine whether a patent claim is invalid for indefiniteness,
i.e., the “insoluble ambiguity” and “amenable to construction” tests, with a “reasonable
certainty” test. Nautilus, 134 S.Ct. at 2124. Following issuance of that decision, the OPs

promptly filed a motion asking this court to reconsider its claim construction ruling that the term
“verification signal” is not indefinite. (ECF Nos. 855 and 856 at 4-6.) That term is found in
claim 1 of United States Patent No. 6,237,095 (the “‘095 Patent”), which reads, in pertinent part:
“adjust said first data object according to said second data object responsive to a verification
signal from said electronic device.” (ECF No. 610-13 (JX-9) at 27 (emphasis added).) Maxim
filed a brief in opposition to the OPs’ motion, and the court heard oral argument from the
interested parties on July 9, 2014. (ECF No. 874.)
For the reasons set forth herein, the motion will be denied because the Supreme
Court’s decision in Nautilus does not require this court to change its previously-issued claim
construction of “verification signal” or of any other allegedly indefinite claim term.
I. The Scope of This Opinion
As an initial matter, although the OPs ask that the court reconsider only its ruling
with respect to the “verification signal” term, they state that “Nautilus likewise requires reversal
of this court’s definiteness rulings concerning the other terms [the] OPs identified as indefinite.”
(ECF No. 856 at 2 n.3.) With respect to these other terms, the OPs offer to present additional
argument “should the court find it helpful,” but opt to expressly reserve their appellate rights.
(Id.)
During claim construction briefing, the OPs contended that five claim phrases
were indefinite: (1) “time stamping a predetermined function;” (2) “store a transaction script, the
transaction script including at least a representation of the time stamp generated by the timing
circuit;” (3) “said combination of said portable module reader and said secure microcontroller
performing secure data transfers with said first portable module;” (4) “substantially unique
electronically readable identification number;” and (5) “responsive to a verification signal from

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said electronic device.” (ECF No. 677-1.)1 The Special Master concluded that the first four
claim phrases were definite, but that “verification signal” was indefinite. (ECF No. 691 at 56-58,
65-81.) The court, after considering the parties’ objections to the Special Master’s Report and
Recommendation, found that all five claim phrases were definite. (ECF No. 742 at 8-9, 26-27,
29-35.)
In the instant motion, the OPs ask this court to reconsider only its prior ruling
with respect to the definiteness of “verification signal.” This court, however, will reconsider its
prior rulings with respect to the other four allegedly indefinite claim terms in an effort to obviate
the need for a remand to this court to do so in the first instance in the future. The court does not
require additional argument or briefing from the parties in order to do so.
II. The Parties’ Arguments
According to the OPs, reconsideration is appropriate in this case due to an
intervening change in the controlling law. Max's Seafood Cafe ex rel. Lou–Ann, Inc. v.
Quinteros, 176 F.3d 669, 673 (3d Cir. 1999). The OPs contend that “the term ‘verification
signal’ does not meet the more demanding definiteness standard under Nautilus” because it
“does not appear anywhere in the specification” and is “susceptible to multiple meanings.” (ECF
No. 856 at 5.) The OPs contend that this court improperly focused on a single one of the OPs’
arguments in its claim construction decision, and concluded that the term “can be afforded a
reasonable interpretation,” which is improper after Nautilus because the Supreme Court rejected
the principle that a claim is definite if a court can ascribe some meaning to it after-the-fact during

Claim phrase (1) is found in claim 1 of United States Patent No. 6,105,013 (the “‘013 Patent”)
(ECF No. 610-10 (JX-7)); claim phrases (2) and (5) are found in claim 1 of United States Patent
No. 6,237,095 (the “‘095 Patent”) (ECF No. 610-13 (JX-9)); and claim phrases (3) and (4) are
found in claim 1 of United States Patent No. 5,940,510 (the “‘510 Patent”) (ECF No. 610-6 (JX3)).
1

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claim construction. (Id. at 5-6.) The OPs argue that “verification signal” is indefinite because
none of the numerous possible meanings are made clear by the claims or specification, making it
impossible for the claim phrase to satisfy Nautilus’s new “reasonable certainty” test. (Id. at 6.)
The OPs also object to this court’s stated concern with preserving the validity of the patent,
noting that under Nautilus the “presumption of validity does not alter the degree of clarity that §
112, ¶ 2 demands from patent applicants.” (Id.)
Maxim opposes the motion for reconsideration because the court’s claim
construction decision meets the Nautilus standard. (ECF No. 874 at 1.) According to Maxim, the
OPs’ argument that the phrase “verification signal” must be indefinite because the OPs, Maxim,
the Special Master, and the court disagree about its meaning must be wrong because a) the same
argument was rejected by the Supreme Court, and b) there are always disagreements with respect
to the meaning of claim terms during patent litigation. (Id. at 2, 10-11.) Maxim contends that,
under Nautilus, if one of ordinary skill in the art would understand the scope of the invention by
carefully evaluating the claims, the specification, and the prosecution history, the claim is not
indefinite. (Id.) Maxim asserts that this court’s claim construction of “verification signal”
satisfies the Nautilus test because that construction was based on “convincing intrinsic evidence”
that one of ordinary skill in the art would understand the term’s meaning upon examining the
language of the patent. (Id. at 7-8.)

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III.

The Law of Indefiniteness
A. The Law as Set Forth in This Court’s Claim Construction Decision
In the claim construction decision, this court included the following summary of

the applicable law with respect to indefiniteness:
Patent claims must particularly point out and distinctly claim the subject
matter regarded as the invention. 35 U.S.C. § 112, ¶ 2. Whether a claim meets
this definiteness requirement is a question of law. Amgen Inc. v. F. Hoffman–LA
Roche Ltd., 580 F.3d 1340, 1371 (Fed. Cir. 2009); Young v. Lumenis, Inc., 492
F.3d 1336, 1344 (Fed. Cir. 2007). The primary purpose of the definiteness
requirement is to ensure that the claims are written in such a way that they give
notice to the public of the extent of the legal protection afforded by the patent so
that interested members of the public, e.g., competitors of the patent owner, can
determine whether or not they infringe. All Dental Prodx, LLC v. Advantage
Dental Prods., Inc., 309 F.3d 774, 779–80 (Fed. Cir. 2002) (citing Warner–
Jenkinson Co. v. Hilton Davis Chem. Co., 520 U.S. 17, 28–29 (1997)). In other
words, “[a] patent holder should know what he owns, and the public should know
what he does not.” Festo Corp. v. Shoketsu Kinzoku Kogyo Kabushiki Co., 535
U.S. 722, 731 (2002).
An accused infringer must demonstrate by clear and convincing evidence
that one of ordinary skill in the relevant art could not discern the boundaries of the
claim based upon the claim language, the specification, the prosecution history,
and the knowledge in the relevant art in order to meet the “exacting standard” to
prove indefiniteness. Halliburton Energy Servs., Inc. v. M-I LLC, 514 F.3d 1244,
1249-50 (Fed. Cir. 2008). “Only claims ‘not amenable to construction’ or
‘insolubly ambiguous’ are indefinite.” Id. at 1250 (quoting Datamize, LLC v.
Plumtree Software, Inc., 417 F.3d 1342, 1347 (Fed. Cir. 2005)). Where “one
skilled in the art would understand the bounds of the claim when read in light of
the specification” the claim is sufficiently definite. Exxon Research & Eng'g Co.
v. United States, 265 F.3d 1371, 1375 (Fed. Cir. 2001). The ultimate issue is
whether someone working in the relevant technical field could understand the
bounds of a claim. Haemonetics Corp. v. Baxter Healthcare Corp., 607 F.3d 776,
783 (Fed. Cir. 2010). Where “the meaning of a claim is discernible, even though
the task may be formidable and the conclusion may be one over which reasonable
persons will disagree,” the claims are sufficiently clear to avoid invalidity on
indefiniteness grounds. Exxon Research, 265 F.3d at 1375. This approach
“accord[s] respect to the statutory presumption of patent validity...and…protect[s]
the inventive contribution of patentees, even when the drafting of their patents has
been less than ideal.” 35 U.S.C. § 282; Datamize, 417 F.3d at 1347–48.
(ECF No. 742 at 8-9 (emphasis added).)

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The Supreme Court’s decision in Nautilus rejected the ‘not amenable to
construction’ and ‘insolubly ambiguous’ tests set forth in the above statement of the law
because they “tolerate some ambiguous claims but not others.” Nautilus, 134 S.Ct. at 2124. The
Court held, instead, that “a patent is invalid for indefiniteness if its claims, read in light of the
specification delineating the patent, and the prosecution history, fail to inform, with reasonable
certainty, those skilled in the art about the scope of the invention. Id. In other words, the
Supreme Court replaced the ‘not amenable to construction’ and ‘insolubly ambiguous’ tests with
a ‘reasonable certainty’ test.
Nautilus does not overrule any other legal principle recited in this court’s claim
construction decision. Nautilus, in fact, reaffirms the majority of this court’s statement of the
law; specifically its focus on the perspective of a person of ordinary skill in the art, the
importance of the public-notice function of the definiteness requirement, and the need to decide
definiteness questions by reviewing the claims, the specification, and the prosecution history.
(ECF No. 742 at 8-9.) As the OPs acknowledged at oral argument, a party challenging the
validity of a patent under § 112, ¶ 2 must still satisfy the clear and convincing evidence standard,
even after Nautlius.
B. The Supreme Court’s Decision in Nautilus
The invention at issue in Nautilus was a heart rate monitor incorporated into a
piece of exercise equipment. Nautilus, 134 S.Ct. at 2126. The pertinent claim required that a live
electrode and a common electrode be “mounted…in spaced relationship with each other” on
each half of a cylindrical bar (e.g., a handlebar). Id. The district court granted the motion for
summary judgment filed by Nautilus, Inc. (“Nautilus”), finding that the term “spaced
relationship” was indefinite because it “did not tell [the court] or anyone what precisely the space

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should be,” or even supply “any parameters” for determining the appropriate spacing. Id. at
2127. The Court of Appeals for the Federal Circuit reversed, finding that the phrase was definite
because the intrinsic evidence, i.e., the claim language, the specification, and the prosecution
history, disclosed “inherent limits of that spacing,” those being that the space had to be smaller
than the human hand and large enough that the two kinds of electrodes did not effectively merge
such that they could not detect separate signals from the user’s hand. Id. The Supreme Court
vacated the court of appeals’ judgment and remanded with instructions to the appellate court to
reconsider, under the proper standard, whether the claims in the patent assigned to Biosig
Instruments, Inc. (“Biosig”) are sufficiently definite. Id. at 2131.
At the Supreme Court, the dispute between the parties was framed as a difference
“of just how much imprecision § 112, ¶ 2 tolerates.” Id. at 2128. Nautilus’ position was that “a
patent is invalid when a claim is ‘ambiguous, such that readers could reasonably interpret the
claim’s scope differently’.” Id. Biosig, and the government, “would require only that the patent
provide reasonable notice of the scope of the claimed invention.” Id.2 In resolving this dispute
and reaching its holding, the Supreme Court summarized the generally- and still- accepted
principles of indefiniteness, including that the inquiry must be made from the perspective of a
“person skilled in the art at the time the patent was filed” and that the “claims are to be read in
light of the patent’s specification and prosecution history.” Id. at 2128. The Court characterized
§ 112, ¶ 2 as requiring a “delicate balance” between the “inherent limitations of language” and
the need of patents to “afford clear notice of what is claimed, thereby apprising the public of
what is still open to them” so as to avoid “a zone of uncertainty which enterprise and
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Although the Supreme Court did not state its holding in these terms, its decision in Nautilus is
closer to Biosig’s position than to Nautilus’ position. The Court expressed primary concern with
the public-notice function of a patent’s claims, and never accepted Nautilus’ position that a claim
subject to more than one reasonable interpretation must be indefinite.
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experimentation may enter only at the risk of infringement claims.” Id. at 2128-29. The Court
noted that “absent a meaningful definiteness check… patent applicants face powerful incentives
to inject ambiguity into their claims.” Id. at 2129.
The Court ultimately reconciled these competing concerns with its newly-stated
requirement that “a patent’s claims, viewed in light of the specification and prosecution history,
inform those skilled in the art about the scope of the invention with reasonable certainty.” Id.
According to the Court, this standard “mandates clarity while recognizing that absolute precision
is unattainable.” Id. The Court concluded that the Court of Appeals for the Federal Circuit’s
“amenable to construction” and “insolubly ambiguous” standards “breed lower court confusion”
and “diminish the definiteness requirement’s public-notice function and foster the innovativediscouraging ‘zone of uncertainty’.” Id. at 2130. The Court labeled the court of appeals’
standards as “amorphous” and as “leav[ing] courts and the patent bar at sea without a reliable
compass.” Id. at 2130, 2131. The Court also found the court of appeals’ standards to be
erroneous because they focused on whether a court, viewing matters after-the-fact, could
“ascribe some meaning to a patent’s claims,” whereas the proper question to ask is what “a
skilled artisan at the time of the patent application” would understand is being claimed. Id.
(emphasis in original).
In a footnote, the Court spoke to the limitations of its holdings. The Court
indicated that the parties before it agreed that the “the presumption of validity does not alter the
degree of clarity that § 112, ¶ 2 demands,” and declined to decide whether “factual findings
subsidiary to the ultimate issue of definiteness trigger the clear and convincing evidence standard
and, relatedly, whether deference is due to the PTO’s resolution of disputed issues of fact”
because those questions were not before the Court. Id. at 2130 n.10.

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IV.

This Court’s Definiteness Decision with respect to “Verification Signal”
As set forth above, this court determined that “verification signal” was definite,

contrary to the Special Master’s recommendation. (ECF No. 742 at 32-33.) The entirety of this
court’s decision with respect to the definiteness of “verification signal” is reproduced
immediately below:
The Special Master found this term to be indefinite, and claim 1 of the
‘095 Patent to be invalid. Maxim objects to this conclusion, (ECF No. 705 at 28), and the OPs argue in support of this court’s adoption of the Special Master’s
finding (ECF No. 714). The court heard oral argument on this term at the
November Hearing. As summarized above, the burden is on the OPs to prove, by
clear and convincing evidence, that the term is insolubly ambiguous and incapable
of being given any reasonable meaning. Biosig Instruments, Inc. v. Nautilus, Inc.,
715 F.3d 891, 901-02 (Fed. Cir. 2013); Young, 492 F.3d at 1346. Close questions
of indefiniteness must be resolved in favor of the patentee. Bancorp Services,
LLC v. Hartford Life Ins. Co., 359 F.3d 1367, 1372 (Fed. Cir. 2004).
The Special Master found this term to be indefinite because the
verification signal is “typically” contained in the certificate, which is separately
claimed and not linked to the “verification signal,” and because the recited
“adjustment” is made in response to the “compare and check” operations, not in
response to the signal originating from the “electronic device,” as required by the
claims. (ECF No. 691 at 75-78.) The Special Master’s conclusions are wellreasoned and supported by the record. So too, however, are Maxim’s responsive
positions.
Maxim convincingly cites to the language of the patent itself indicating
that the “certificate” claimed earlier in claim 1 is different from the “verification
signal.” (ECF No. 705 at 8.) With respect to the Special Master’s second
justification, Maxim explains that the term “verification signal” can be afforded a
reasonable interpretation if it is understood to be a signal that is capable of being
verified, resulting in adjustments being made indirectly or ultimately in response
thereto. (ECF No. 705 at 5-7; ECF No. 610 at JX-9, 14:30-35, figs. 8 & 10.)
Maxim’s argument that the information provided from the merchant or service
provider side of the transaction in figures 8 and 10 is what allows the “compare
and check” operations to proceed, and adjustment to ultimately take place, is
convincing. (ECF No. 705 at 7.) Both experts opined in support of the position
advanced by the party by whom they were retained. The OPs’ expert, however,
did not opine that a person of ordinary skill in the art would understand
“responsive” to mean only immediately or directly responsive.

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When the evidence is such that reasonable persons can disagree, this court
is constrained to issue a construction that preserves the validity of the claim.
Biosig, 715 F.3d at 901-02; Bancorp, 359 F.3d at 1372. The court need not
“rewrite” the claims of the patent to reach this conclusion; rather, the intrinsic
record aptly supports Maxim’s position. This court is required by controlling
precedent to reject the Special Master’s recommendation and issue a construction
of the term “verification signal.”
(ECF No. 742 at 32-34.)
Of the decisions that this court cited in the above analysis, as well as in the
earlier-reproduced summary of the generally applicable law with respect to indefiniteness, the
Supreme Court’s decision in Nautilus vacated the Court of Appeals for the Federal Circuit’s
judgment in Nautilus (short cited by this court as Biosig), and abrogated Datamize’s and Exxon’s
“insolubly ambiguous” and “amenable to construction” tests. Nautilus, 134 S.Ct. at 2130 n.9.
Under Nautilus, a court must now ask whether the patent “fail[s] to inform, with reasonable
certainty, those skilled in the art about the scope of the invention.” Id. at 2124. The other legal
principles relied upon by this court in its claim construction decision remain binding after
Nautilus, and properly focus on the public-notice function of § 112, ¶ 2, and the need to answer
the definiteness question from the viewpoint of one of ordinary skill in the art at the time of the
invention. (ECF No. 742 at 8-9.) For the reasons that follow, this court concludes that even
under the Supreme Court’s new “reasonable certainty” test, “verification signal” is definite.
The Special Master recommended that the phrase “verification signal” be found
indefinite for two reasons: (1) the verification signal is “‘typically’ contained in the certificate,”
yet the certificate is claimed separately and is not linked to the verification signal in the patent;
and (2) adjustments are made in response to the “‘compare’ and ‘check’ operations” not in
response to the verification signal, as is claimed. (ECF No. 691 at 76-77.) This court resolved
the parties’ objections to the Special Master’s recommendations by reaching two conclusions: (1)

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based on the language of the patent, the “certificate” is different from the “verification signal”;
and (2) the OPs produced no evidence that a person of ordinary skill in the art would
understand “‘responsive’ to mean only immediately or directly responsive,” making the
intervening “compare and check operations” relied upon by the Special Master inconsequential
to answering the definiteness question. (ECF No. 742 at 33-34 (emphasis added).) Neither of
these conclusions is affected by the Nautilus decision.
The OPs, however, argue that these conclusions must be reversed because this
court’s claim construction decision recited the now-invalid “insolubly ambiguous” and
“amenable to construction” tests, and improperly attributed some meaning, after-the-fact, to a
phrase susceptible to multiple meanings, in a misguided, and now improper, effort to preserve
the validity of the claim. (ECF No. 856 at 5-6.) As expressed during oral argument, the OPs’
primary position is that “verification signal” is indefinite because the specification does not
ascribe any particular meaning to the phrase, and the various embodiments in the specification
conflict, making it impossible to assign any definitive meaning to the phrase. (Id.) In support of
their position, the OPs discussed Figures 7 and 9 of the ‘095 Patent, and their corresponding
explanatory text, at length during oral argument. ‘095 Patent, 9:41, et seq. and 11:20, et seq. The
OPs argued that these figures reflect instances in which data objects are adjusted without any
compare and check operations or verification signals, proving that this court’s claim construction
was improper. According to the OPs, these figures demonstrate that “verification signal” is a
broad and ambiguous term that lacks the clarity mandated by Nautilus.
As an initial matter, the court finds that the bulk of the OPs’ arguments do no
more than cloak the positions they previously took during claim construction proceedings in the
light of Nautilus’ “change in the law.” This court rejected the OPs’ positions in a claim

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construction decision that was fact-specific, and grounded in the language and structure of the
‘095 Patent’s specification and claims. The reasoning and analysis set forth in that decision
apply with equal force both before and after Nautilus. The Special Master concluded that
“verification signal” was indefinite because “the adjustment is not responsive to what is being
transmitted…as asserted by Maxim, but responsive to the ‘compare’ and ‘check’ operations.”
(ECF No. 691 at 77.) The court considered the Special Master’s analysis, but instead concluded
that the OPs made no showing that “a person of ordinary skill in the art would understand
‘responsive’ to mean only immediately or directly responsive,” making “Maxim’s argument that
the information provided from the merchant or service provider side of the transaction in figures
8 and 10 is what allows the “compare and check” operations to proceed, and adjustment to
ultimately take place…convincing.” (ECF No. 742 at 33.) The OPs were required to prove, by
clear and convincing evidence, that the claim phrase was indefinite. This court studied the
language of the patent, considered the expert evidence presented by the parties, and found that
the OPs failed to meet their burden of proof. Such a decision is unaffected by Nautilus.
The OPs’ reliance, at oral argument, on Figures 7 and 9 does not establish that the
specification of the ‘095 Patent is so ambiguous and uncertain that it “fail[s] to inform, with
reasonable certainty, those skilled in the art about the scope of the invention.” Nautilus, 134 S.Ct.
at 2124. Those figures, instead, actually align with this court’s claim construction of
“verification signal.” Figure 7, and its corresponding text, reflects an adjustment being made
after information transmitted between a Merchant and a Bank is “confirm[ed]” and “this test is
passed.” ‘095 Patent, 9:66-10:16. Figure 9, and its corresponding text, reflects an adjustment
being made after it is confirmed that certain data exchanged between a Merchant and a Payee
“agree.” ‘095 Patent, 11:34-35. The process reflected in these exemplars is similar to the process

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reflected in Figures 8 and 10, which this court relied on in its claim construction opinion. (ECF
No. 742 at 32-33.) To this point, the court finds it particularly noteworthy that Maxim included a
discussion of Figure 9, and the ‘095 Patent’s text following the description of Figure 7, in both
its original claim construction presentation, and its R&R objections presentation to support its
proffered construction of “verification signal.” (Maxim’s Claim Construction Slides at p. 14;
Maxim’s R&R Objections Slides at p. 32.) Contrary to the OPs’ contentions, Figures 7 and 9 do
not cause the term “verification signal” to be uncertain or ambiguous, or to fail Nautilus’
“reasonable certainty” test as a result.
Even if the OPs were correct that Figures 7 and 9 could not be reconciled with
this court’s prior claim construction, it does not follow that the construction is incorrect and that
claim 1 is invalid as indefinite. It is not necessary that each claim read on every embodiment
disclosed in a patent. Baran v. Medical Device Technologies, Inc., 616 F.3d 1309, 1316 (Fed.
Cir. 2010). The fact that all claims of the ‘095 Patent are dependent on claim 1 does not change
the result. It is possible for a patent to disclose subject matter, but not claim it, resulting in
abandonment of the unclaimed subject matter to the public. Johnson & Johnston Assoc., Inc. v.
R.E. Serv. Co., Inc., 285 F.3d 1046, 1054 (Fed. Cir. 2002). The court expresses no opinion with
respect to these matters, but states these rules only to demonstrate that the failure of claim 1 to
read on the embodiments disclosed in Figures 7 and 9 would not mean that the ‘095 Patent must
be invalid as indefinite.
Turning now to the legal principles relied upon by this court in the claim
construction decision, there is no dispute that this court recited the then-applicable, but now
improper, “insolubly ambiguous” and “amenable to construction” standards. (ECF No. 742 at 8,
33.) Not surprisingly, the OPs repeatedly cite to these statements of the law as proof that this

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court’s conclusion that “verification signal” is not indefinite is erroneous after Nautilus and must
be reversed. (ECF No. 856 at 3, 6.) As reproduced above, however, this court found the claim
phrase “verification signal” to be definite based on the language of the patent and the
knowledge of one of ordinary skill in the art. (ECF No. 742 at 32-33 (emphasis added).) The
Supreme Court’s decision in Nautilus reaffirms that these are the considerations that must inform
a court’s indefiniteness inquiry. Nautilus, 134 S.Ct. at 2128-31. The “verification signal”
limitation cannot “fail to inform, with reasonable certainty, those skilled in the art about the
scope of the invention,” when this court previously analyzed the language of the patent with
respect to “certificate,” “verification signal,” and “responsive,” as viewed from the perspective
of a person of ordinary skill in the art, and found that the phrase was definite. (ECF No. 742 at
32-33.) Even under the new “reasonable certainty” test, the phrase “verification signal” remains
definite for the same reasons set forth in this court’s prior claim construction decision.
This court also relied on the legal precept that “close questions of indefiniteness
must be resolved in favor of the patentee,” citing Bancorp Services, LLC v. Hartford Life
Insurance Company, 359 F.3d 1367 (Fed. Cir. 2004). (ECF No. 742 at 33). Bancorp was not
overruled by Nautilus. Regardless of the status of Bancorp, the legal proposition for which this
court cited it does no more than reflect that indefiniteness must be proven by clear and
convincing evidence, a standard that the Supreme Court left undisturbed in Nautilus. Nautilus,
134 S.Ct. at 2130 n.10. This court’s statement that “[w]hen the evidence is such that reasonable
persons can disagree, this court is constrained to issue a construction that preserves the validity
of the claim” is likewise a statement of this still-applicable clear and convincing evidence
standard. (ECF No. 742 at 34.) The inclusion of these principles of law in this court’s prior
claim construction decision, therefore, does not invalidate the prior definiteness rulings.

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Contrary to the OPs’ assertions, by relying on these principles, this court did not endeavor to
manufacture an after-the-fact construction of “verification signal,” for the sole purpose of
ensuring that the ‘095 Patent was not invalidated. (ECF No. 856 at 6.) The prior construction
given to the term “verification signal” was explicitly grounded in the specification of the ‘095
Patent, and based on the OPs’ failure to meet their burden to prove indefiniteness by clear and
convincing evidence. (ECF No. 742 at 33-34.) This is not a case in which a claim term was
found to be definite only because a court could, in hindsight, ascribe some meaning to it in order
to render it so.
Although the Supreme Court changed the standard against which indefiniteness
must be judged in Nautilus, this court’s general statement of the law of indefiniteness, and its
specific analysis of the phrase “verification signal,” remain valid and viable. Under the
“reasonable certainty” test, the phrase “verification signal” would remain definite for the same
reasons set forth in this court’s prior claim construction decision, i.e., because “certificate” is not
synonymous with “verification signal” in the language of the patent, and because the OPs made
no showing that a person of ordinary skill in the art would understand “responsive” to mean only
immediately and directly responsive. (ECF No. 742 at 32-34.) The Nautilus decision does not
require that any change be made to this court’s prior ruling with respect to the definiteness of
“verification signal.”
V.

This Court’s Definiteness Decisions with respect to the Other Claim Phrases
As stated previously, although the OPs challenged four other claim phrases on the

ground that they were indefinite during claim construction, their motion for reconsideration asks
only that this court change its ruling with respect to “verification signal.” (ECF No. 856 at 2.)
The other phrases are: (1) “time stamping a predetermined function;” (2) “store a transaction

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script, the transaction script including at least a representation of the time stamp generated by the
timing circuit;” (3) “said combination of said portable module reader and said secure
microcontroller performing secure data transfers with said first portable module;” and (4)
“substantially unique electronically readable identification number.” Reconsidering “verification
signal” but not the other four phrases would result in piecemeal litigation, and run the risk of a
future remand to this court to consider the effect of Nautilus on them in the first instance. In an
effort to avoid that result, even though the OPs have not asked for reconsideration of these
phrases, this court has undertaken a review of them. No additional briefing or argument is
necessary in order to do so. A review of these phrases indicates that the Nautilus decision would
not change any of this court’s definiteness rulings.
(1) time stamping a predetermined function: The OPs argued that the phrase “time
stamping a predetermined function” in the ‘013 Patent was indefinite because
software programs cannot be time stamped. (ECF No. 642 at 66-68.) This court
found that the phrase was not indefinite because the OPs’ argument that
“predetermined function” is synonymous with “software program” was
unsupported and illogical. Once that argument was rejected, construction of the
phrase followed from the court’s prior construction of the terms “time stamp” and
“time stamping data transactions.” (See ECF No. 742 at 26-27.) Nautilus’
holding would not change this fact-dependent analysis. This claim phrase would
remain definite under Nautilus.
(2) store a transaction script, the transaction script including at least a
representation of the time stamp generated by the timing circuit: The OPs
contended that this phrase was indefinite because: (1) the specification does not

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disclose or explain its meaning; (2) the asserted claim is internally irreconcilable;
and (3) users cannot create transaction scripts. (ECF No. 642 at 68-70.) The court
concluded that the OPs’ interpretation of the claim and specification language was
based upon a fundamental misapprehension of what the claim states, and that the
OPs’ indefiniteness argument was not supported by any evidence, beyond
counsel’s arguments. (ECF No. 742 at 29-30.) The court examined the language
of the ‘095 Patent and found that the claim contemplates a script that includes a
“representation of the time stamp,” and not that the script itself be time stamped,
as the OPs contended. (Id.) The court noted that Maxim presented numerous
examples from the specification that reflect operation of the properly interpreted
requirement. (Id.) The decision in Nautilus is in line with this court’s ultimate
conclusion that “[t]he OPs cannot meet the ‘exacting standard’ to prove by clear
and convincing evidence that one of ordinary skill in the relevant art could not
discern the boundaries of the claim based upon the claim language, the
specification, the prosecution history, and the knowledge in the relevant art.”
(ECF No. 742 at 29-30.) These are the same legal principles and standards that
the Supreme Court left undisturbed in Nautilus. This claim phrase would remain
definite under Nautilus.
(3) said combination of said portable module reader and said secure
microcontroller performing secure data transfers with said first portable
module: The OPs contended that this phrase was indefinite because it mixed
apparatus and method claim limitations, in violation of IPXL Holdings, LLC v.
Amazon, Inc., 430 F.3d 1377 (Fed. Cir. 2005). (ECF No. 642 at 60-61.) Nautilus

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did not address indefiniteness based on mixing apparatus and method claim
limitations. In rejecting the OPs’ position during claim construction, this court,
applying the clear and convincing evidence standard, concluded that the OPs’
failure to produce any expert evidence indicating how the claim would, or would
not, be understood by one of ordinary skill in the art in response to Maxim’s
expert testimony on that issue was “significant, and arguably dispositive.” (ECF
No. 742 at 30-32.) This court, nevertheless, considered the substance of the OPs’
legal argument, but concurred with the Special Master’s explanation with respect
to why, read in the context of the specification and claims of the ‘510 Patent, it
would be understood by a person of ordinary skill in the art that infringement of
the ‘510 Patent occurred when a system capable of performing secure data
transfers was created. (Id. at 32.) This court found that it would be readily
apparent that creation of a system with the required parts and the referenced
capabilities would result in infringement, and that actual performance of the
purpose for which the system was built was unnecessary. (Id.) This claim phrase
would remain definite under Nautilus because this court answered the definiteness
question by asking whether one of ordinary skill in the art would understand when
the claim was infringed, which reflects the Supreme Court’s primary focus in
Nautilus on the public-notice function of patent claims.
(4) substantially unique electronically readable identification number: The OPs
argued that this phrase was indefinite because there was no standard against
which the word of degree - “substantially unique” - could be measured. (ECF No.
642 at 62-64.) The Special Master concluded that the specification of the ‘510

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Patent provided criteria for one skilled in the art to determine if an identification
number is substantially unique, and the court agreed. (ECF No. 742 at 34-35.) In
doing so, this court examined the language of the ‘510 Patent and found that it
was clear that “substantially” unique was unique enough to distinguish one
portable module from another portable module, making the term definite. (Id. at
35.) The decision in Nautilus is in line with this court’s ultimate conclusion that
“[t]he OPs made no sustainable argument, and certainly presented no clear and
convincing evidence, that the patent provides no standard for measuring the
degree of uniqueness such that a person of ordinary skill in the art would be
unable to determine if an identification number was ‘substantially unique’ or not.”
(Id.) Notably, although the patent-in-suit in Nautilus included the phrase
“produce a substantially zero [EMG] signal,” the Supreme Court did not address
this word-of-degree issue. Nautilus, 134 S.Ct. at 2126. Therefore, Nautilus does
not change this court’s analysis or conclusion with respect to the definiteness of
this term. This claim phrase would remain definite under Nautilus.
The Nautilus decision does not require that this court’s prior rulings with respect
to the definiteness of any other challenged claim terms or phrases be changed.

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VI.

Conclusion
For the foregoing reasons, the Supreme Court’s recent decision in Naultius does

not require that this court change any of its prior definiteness rulings, and the motion for
reconsideration will be denied. An appropriate order will be filed contemporaneously with this
opinion.

Dated: July 23, 2014

BY THE COURT,
/s/ Joy Flowers Conti
Joy Flowers Conti
Chief United States District Judge

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