Eolas Technologies Incorporated v. Adobe Systems Incorporated et al

Filing 1020

REPLY to Response to Motion re 873 SEALED PATENT MOTION for Summary Judgment of No Enhanced Damages for Willful Infringement filed by Adobe Systems Incorporated, Amazon.com Inc., CDW Corporation, Citigroup Inc., Google Inc., J.C. Penney Corporation, Inc., Staples, Inc., The Go Daddy Group, Inc., Yahoo! Inc., YouTube, LLC. (Jones, Michael)

Download PDF
IN THE UNITED STATES DISTRICT COURT FOR THE EASTERN DISTRICT OF TEXAS TYLER DIVISION EOLAS TECHNOLOGIES INCORPORATED, PLAINTIFF, v. ADOBE SYSTEMS INC., et al., DEFENDANTS. § § § § § § § § § § § Civil Action No. 6:09-CV-446-LED JURY TRIAL DEMANDED REPLY IN SUPPORT OF DEFENDANTS’ MOTION FOR SUMMARY JUDGMENT OF NO ENHANCED DAMAGES FOR WILLFUL INFRINGEMENT Although Eolas argues that it “does not seek enhanced damages based solely on the Defendants’ post-filing conduct,”1 Eolas has already stipulated that it has sustained zero damages for pre-suit conduct.2 There can thus be no willfulness damages for pre-suit conduct; “three times zero is still zero.”3 The only remaining question is whether enhanced damages are available for post-suit conduct.4 Under Seagate, they are not. Seagate makes clear that a preliminary injunction is the remedy for post-filing willful infringement, and that a patentee who makes no attempt to secure one is not entitled to enhanced damages for post-filing conduct.5 Having chosen not to move for a preliminary injunction, Eolas may not now seek to “enhance” any post-filing compensatory damages. There is also no merit to Eolas’ arguments that, under the GSI case, Eolas is somehow exempt from Seagate because of Defendants’ alleged pre-suit patent knowledge.6 Eolas’ 1 See 9/28/2011 Eolas’ Response In Opposition To Defendants’ Motion For Summary Judgment Of No Enhanced Damages For Willful Infringement (“Eolas’ Response”) (D.N. 990) at 2. 2 See 8/17/2011 Joint Stipulation of No Pre-Suit Damages (D.N. 867). 3 See, e.g., GSI Group, Inc. v. Sukup Mfg. Co., 591 F. Supp. 2d 977, 983-84 (C.D. Ill. 2008) (holding pre-suit enhanced damages unavailable for patents as to which pre-suit compensatory damages unavailable; “[A]vailable compensatory damages for Sukup’s alleged pre-filing infringement of these patents is zero, and three times zero is still zero. GSI, therefore, cannot recover enhanced damages for the pre-filing infringement of these patents.”). 4 Eolas’ arguments about 35 U.S.C. § 287 are a red herring. Eolas’ inability to collect pre-suit enhanced damages results from its stipulation that it sustained zero damages for pre-suit conduct, and its inability to collect post-suit enhanced damages results from its failure to seek a preliminary injunction.. 5 See In re Seagate Tech., LLC, 497 F.3d 1360, 1374 (Fed. Cir. 2007) (en banc) (“[A] patentee can move for a preliminary injunction, which generally provides an adequate remedy for combating post-filing willful infringement. A patentee who does not attempt to stop an accused infringer’s activities in this manner should not be allowed to accrue enhanced damages based solely on the infringer’s post-filing conduct.” (emphasis added) (citations omitted)); see also, e.g., Baxter Healthcare Corp. v. Fresenius Med. Care. Holdings, Inc., No. C 07-1359, 2010 U.S. Dist. LEXIS 21778 at *49-50 (N.D. Cal. Feb. 19, 2010) (holding no enhanced damages for post-suit conduct available under Seagate where patentee failed to move for preliminary injunction). 6 This argument necessarily applies only to the ‘906 patent. The ‘985 patent issued on October 6, 2009—the day Eolas filed this suit. See U.S. Patent No. 7,599,852 B2; 10/6/2009 Complaint (D.N. 1). Further, Eolas’ “distinction” of Anascape and Webmap on the basis that they “involved patentees who had no evidence of pre-suit knowledge” (Eolas’ Motion at 3) completely mischaracterizes Anascape and ignores Webmap’s reliance on Anascape. Contrary to Eolas’ Motion, the Anascape plaintiff—represented by the same counsel representing Eolas here—argued that defendants had pre-suit knowledge. See Anascape, Ltd. v. Microsoft Corp., No. 9:06-CV-158, 2008 WL 7182476, at *3 (E.D. Tex. Apr. 25, 2008) (Clark, J.) (“Anascape argues that a reasonable jury could conclude that Defendants had pre-suit knowledge of the [patent-in-suit] before Anascape filed the lawsuit.”). The Webmap court relied heavily on Anascape (and referred to the Anascape plaintiff’s failed attempt to establish pre-suit patent knowledge) and held that the Webmap plaintiff, having failed to seek a preliminary injunction, was not entitled to post-suit enhanced damages under Seagate. See Webmap Techs., LLC v. Google, Inc., No. 2:09-CV-343-DF-CE, 2010 WL 3768097, at *3 (E.D. Tex. Sept. 10, 2010). Further, Eolas’ only “distinction” of Cordance is that there, the court discussed facts surrounding plaintiff’s willfulness allegations before rejecting plaintiff’s arguments. But there, 1 carefully-chosen quotes from GSI refer to “pre-filing conduct” and “post-filing conduct” as “relevant.”7 This discussion of GSI by Eolas is, at best, misleading. The referenced “pre-suit conduct” and “post-suit conduct” was deemed relevant to pre-suit willful infringement of the one patent for which pre-suit compensatory damages were available.8 There is no such patent here.9 Further, the GSI court held that Seagate barred post-filing enhanced damages for all six asserted patents, including the one patent for which pre-suit damages were available: The statements in the Seagate opinion, however, are quite clear. The Federal Circuit stated that a patent holder, such as GSI, has an adequate remedy for post-filing willful infringement through the pursuit of preliminary injunctive relief. The Federal Circuit further stated: “A patentee [such as GSI] who does not attempt to stop an accused infringer’s activities in this manner should not be allowed to accrue enhanced damages based solely on the infringer’s post-filing conduct.” Id. at 1374. This Court must follow the Federal Circuit. GSI is not entitled to enhanced damages for any post-filing willful infringement; GSI could have stopped such infringement through preliminary injunctive relief. 10 GSI thus held that, for patents as to which no pre-suit compensatory damages were available (true of both patents here), no pre-suit enhanced damages were available, and that for every asserted patent, post-suit enhanced damages were not available under Seagate, since patentee chose not to move for a preliminary injunction (true of both patents here). Rather than attempt to distinguish GSI, Eolas thus resorted to misstating the critically relevant portion of its holding. Defendants respectfully request that the Court grant their motion for summary judgment, and accordingly enter summary judgment against Eolas on its willfulness claims. defendants had argued that plaintiffs’ “failure to provide notice of the patents-in-suit or its claims of infringement prior to commencing this lawsuit precludes a pre-suit willfulness finding.” See Cordance Corp. v. Amazon.com, Inc., 639 F. Supp. 2d 406, 414 (D. Del. 2009). There was no stipulation of no pre-suit damages in Cordance. 7 See Eolas’ Response at 3 (“pre-filing conduct with respect to th[o]se patents . . . is still relevant”) (“Willfulness is an issue of intent.”) (“post-filing conduct . . . is still relevant to show intent.”) (alterations and omissions in Eolas’ Response); see also GSI, 591 F. Supp. 2d at 983-84. 8 GSI, 591 F. Supp. 2d at 984 (“As explained above, Sukup’s pre-filing conduct with respect to these patents may tend to show a pattern of recklessness that could support a finding of willful infringement of the ‘271 Patent.”). 9 See 8/17/2011 Joint Stipulation of No Pre-Suit Damages (D.N. 867). 10 See GSI, 591 F. Supp. 2d at 984-85 (emphasis added). GSI also undercuts Eolas’ argument that Seagate is somehow irrelevant where pre-suit patent knowledge is at issue. Pre-suit patent knowledge was present in GSI, and indeed is part of the “pre-suit conduct” conduct referenced by Eolas’ GSI quotes. That court recognized that it “must follow the Federal Circuit” and held patentee was not entitled to post-suit enhanced damages under Seagate. 2 Respectfully submitted, Dated: October 11, 2011 By: /s/ James R. Batchelder, with permission by Michael E. Jones James R. Batchelder (pro hac vice) james.batchelder@ropesgray.com Sasha G. Rao (pro hac vice) sasha.rao@ropesgray.com Mark D. Rowland mark.rowland@ropesgray.com Brandon Stroy (pro hac vice) brandon.stroy@ropesgray.com Rebecca R. Hermes (pro hac vice) rebecca.wight@ropesgray.com Han Xu (pro hac vice) han.xu@ropesgray.com ROPES & GRAY LLP 1900 University Avenue, 6th Floor East Palo Alto, California 94303-2284 Telephone: (650) 617-4000 Facsimile: (650) 617-4090 Michael E. Jones (Bar No. 10929400) mikejones@potterminton.com Allen F. Gardner (Bar No. 24043679) allengardner@potterminton.com POTTER MINTON A Professional Corporation 110 N. College, Suite 500 Tyler, TX 75702 Telephone: (903) 597-8311 Facsimile: (903) 593-0846 ATTORNEYS FOR DEFENDANTS GOOGLE, INC. AND YOUTUBE, LLC /s/ David J. Healey, with permission by Michael E. Jones David J. Healey 1221 McKinney Street, Suite 2888 Houston, TX 77010 713.652.0115 healey@fr.com Jason W. Wolff 12390 El Camino Real San Diego, CA 92130 858.678.4705 wolff@fr.com Frank E. Scherkenbach 3 Proshanto Mukherji One Marina Park Drive Boston, MA 02110 617.542.5070 scherkenbach@fr.com mukherji@fr.com Attorneys for Defendant ADOBE SYSTEMS INCORPORATED /s/ Edward R. Reines, with permission by Michael E. Jones Edward R. Reines edward.reines@weil.com Jared Bobrow jared.bobrow@weil.com Sonal N. Mehta sonal.mehta@weil.com Aaron Y. Huang aaron.huang@weil.com Andrew L. Perito andrew.perito@weil.com WEIL, GOTSHAL & MANGES LLP 201 Redwood Shores Parkway Redwood Shores, CA 94065 Telephone: (650) 802-3000 Facsimile: (650) 802-3100 Doug W. McClellan doug.mcclellan@weil.com WEIL, GOTSHAL & MANGES LLP 700 Louisiana, Suite 1600 Houston, TX 77002 Telephone: (713) 546-5000 Facsimile: (713) 224-9511 Jennifer H. Doan jdoan@haltomdoan.com Joshua R. Thane jthane@haltomdoan.com HALTOM & DOAN 6500 Summerhill Road, Suite 100 Texarkana, TX 75503 Telephone: (903) 255-1000 Facsimile: (903) 255-0800 Otis W. Carroll, Jr. (Bar No. 03895700) fedserv@icklaw.com Deborah J. Race (Bar No. 16448700) 4 drace@icklaw.com IRELAND CARROLL & KELLEY 6101 S. Broadway, Suite 500 Tyler, TX 75703 Telephone: (903) 561-1600 Facsimile: (903) 581-1071 Attorneys for Defendants AMAZON.COM and YAHOO! INC.  /s/ Thomas L. Duston, with permission by Michael E. Jones Thomas L. Duston Julianne Hartzell Scott A. Sanderson Anthony S. Gabrielson Marshall Gerstein & Borun 233 S. Wacker Drive 6300 Willis Tower Chicago, IL 60606 312.474.6300 tduston@marshallip.com jhartzell@marshallip.com ssanderson@marshallip.com agabrielson@marshallip.com Eric Hugh Findlay Brian Craft Findlay Craft 6760 Old Jacksonville Highway Suite 101 Tyler, TX 75703 903.534.1100 efindlay@findlaycraft.com bcraft@findlaycraft.com Attorneys for Defendant CDW LLC /s/ Edwin R. DeYoung, with permission by Michael E. Jones Edwin R. DeYoung Roger Brian Cowie Galyn Dwight Gafford Michael Scott Fuller Roy William Hardin Jason E. Mueller Locke Lord LLP 2200 Ross Ave. Suite 2200 Dallas, TX 75201 5 214.740.8500 edeyoung@lockelord.com rcowie@lockelord.com ggafford@lockelord.com sfuller@lockelord.com rhardin@lockelord.com jmueller@lockelord.com Eric L. Sophir SNR Denton 1301 K Street, N.W. Suite 600, East Tower Washington, DC 20005-3364 202.408.6470 eric.sophir@snrdenton.com Attorneys for Defendant CITIGROUP INC. /s/ Proshanto Mukherji, with permission by Michael E. Jones Thomas M. Melsheimer Neil J. McNabnay Carl Bruce Fish & Richardson 1717 Main Street Suite 5000 Dallas, TX 75201 214.474.5070 melsheimer@fr.com mcnabnay@fr.com bruce@fr.com Proshanto Mukherji Fish & Richardson One Marina Park Drive Boston, MA 02210 617.542.5070 mukherji@fr.com Attorneys for Defendant THE GO DADDY GROUP, INC. /s/ Christopher M. Joe, with permission by Michael E. Jones Christopher M. Joe Brian Carpenter Eric W. Buether Buether Joe & Carpenter 1700 Pacific, Suite 2390 Dallas, TX 75201 214-466-1270 Chris.Joe@BJCIPLaw.com 6 Eric.Buether@BJCIPLaw.com Brian.Carpenter@BJCIPLaw.com Attorneys for Defendant J.C. PENNEY CORPORATION, INC. /s/ Michael Ernest Richardson, with permission by Michael E. Jones Michael Ernest Richardson Beck Redden & Secrest 1221 McKinney Suite 4500 Houston, TX 77010 713.951.6284 mrichardson@brsfirm.com Kate Hutchins Wilmer Cutler Pickering Hale and Dorr, LLP 399 Park Avenue New York, NY 10022 212.230.8800 kate.hutchins@wilmerhale.com Donald R. Steinberg Mark Matuschak Wilmer Cutler Pickering Hale and Dorr, LLP 60 State Street Boston, MA 02109 617.526.5000 don.steinberg@wilmerhale.com mark.matuschak@wilmerhale.com Daniel V. Williams Jonathan Hardt Wilmer Cutler Pickering Hale and Dorr, LLP 1875 Pennsylvania Avenue, N.W. Washington, D.C. 20006 202.663.6012 daniel.williams@wilmerhale.com jonathan.hardt@wilmerhale.com Attorneys for Defendant STAPLES, INC. 7 CERTIFICATE OF SERVICE The undersigned hereby certifies that all counsel of record who are deemed to have consented to electronic service are being served with a copy of this document via the Court’s CM/ECF system per Local Rule CV-5(a)(3) on this 11th day of October, 2011. All other counsel of record will be served via facsimile or first class mail. /s/ Michael E. Jones 8

Disclaimer: Justia Dockets & Filings provides public litigation records from the federal appellate and district courts. These filings and docket sheets should not be considered findings of fact or liability, nor do they necessarily reflect the view of Justia.

Why Is My Information Online?