Anascape, Ltd v. Microsoft Corp. et al

Filing 348

RESPONSE in Opposition re 337 MOTION for New Trial -- Nintendo of America Inc.'s Motion for Remittitur or, in the Alternative, a New Trial on Damages filed by Anascape, Ltd. (Attachments: # 1 Exhibit 1, # 2 Exhibit 2, # 3 Exhibit 3, # 4 Exhibit 4, # 5 Text of Proposed Order)(Cawley, Douglas)

Anascape, Ltd v. Microsoft Corp. et al

Doc. 348 Att. 3

Exhibit 3

Dockets.Justia.com

PATENT LICENSE AGREEMENT

Thls Agreement is effective April 20, 2004 ("Effective Date") and IS by and between, on the one hand, Sony COml~uter Entertainment Amerlca inc. ("$CEA"), a Delaware corporatlon having an office at East Hillsdale 15oulevard, Foster City, CA 94404, and Sony Computer Entertainment Inc. ("SCEI"), a :Japanese company having an office at 2-6-21 Mlnaml-aoyama, Mlnato-ku, Tokyo, i07-0062 Japan, and, on the other hand, Anascape, a Nevada limited partnership ("Anascape") having an office at 6699 Sierra Vfsta Lane, Carson City, NV B9701, Brad A. Armstrong, an Individual ("Armstrong')having a residence at 6699 5~erra Vista Lane, Carson City, NV 89701, and Kelly Tyler, an Individual ('~Tyler") having a residence at 13950 via De )amul, .lamul, CA 9:[935 (collectfvely, the "Anascape Parties").
WHEREAS, the Anascape Parties have alleged that SCEA is Infringing the Licensed Anascape Patents (defined below} and SCEA has disputed that allegation, and WHEREAS, the Anascape Parties and SCF__A are interested In amlcably resolving the dispute, NOW THEREFORE, in consideration of the foregoing recitals and the terms and conditions set Forth In this Agreement, the parties agree as follows: 1, DEFINITIONS

1.1 "Afflllal:e" of a Party means a corporation or other legal enttL-y (a) controlled by the ParW, (b) controlling the Party, or controlled by the corporation or legal entity which controls the Party. For the purposes of this paragraph, to "control" a corporation or an entlty means to own or control, either directly or Indirectly, (1) 50% or more of the shares or other securities entitled to vote for election of directors (or other managing authoriW) of the corporation or entity; (2) 50% or more of the equity Interest of the corporation or entity; (3) If the corporation or entlW does not have outstandlng shares or securities as may be the case In a partnership, jolnt venture, or unincorporated association, 50% or more of the ownership Interest representing the right to make decisions for the corporation or entity or (4) the maximum shares or other securttles entitled to vote for election of directors (or other managing authority) o[ a foreign corporation or entity permitted by law if (i) the app!lcable country does not permit the Party to own greater share due to its nationality and (il) the foreign corporaUon

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ANS0004667

or entity is substantially controlled by the Party. By way of example only, an Affiliate of a party includes parent corporations (either direct or Indlrect), subsidiaries, dlvlslons and sister companies. Thus, by way of further example only, with respect to SCEAt Its parent Sony Computer Entertainment Inc., and Its indlrect uttlmate parent Sony Corporation, are Affiliates. 1.2 "Anascape Parties" means Anascape~ Armstrong and Tyler.

1.3 "Deploy" means to sell, make, have made, use, offer for sale, import, distribute, provide or otherwise dispose of anywhere In the world. 1.4 "Licensed Anascape Patents" means any patent or patent application anywhere in the world (a) assigned to Anascape, or which Anascape or Armstrong can license, prior to Hay 1, 2005, (b) In which-Armstrong Is an lnventoG provided that the appllcat~on from which the patent issues was filed prior to May I, 2005~ (c) listed In Schedule A, or (d) ts a continuation, continuation-in-part, divisional, reissue, reexamination, substitute application (as defined In MPEP § 201.09) or any other patent or patent application which claims the benefit of priority of a patent or patent application meeting the requirements of clauses "a", "b" or "c" of this paragraph. For the purposes of this paragraph, a patent shall be deemed to be licensable only if Anascape or Armstrong have the right to grant a license or subltcense to Sony within the scope of the license granted hereunder. :~.5 "Licensed Sony Patents" means (a) Unlted States Patents 5,551,693; 5,853,326; and 5,716,274 and (b) contlnuatlons, c0ntinuatlons~in-part, dlvislonals, reissues, reexaminations, and substitute applications (as defined in MPEP § 201.09) thereot~ or any other patent or patent application which claims the benefit or priority thereof. 1.6 "Parties" means the Anascape Parties and Sony. "Sony" means SCEA, SCEI and their Affiliates. 1.8 "Sony Products" means products and services (a) Deployed by or to Sony or (b) Deployed by Permitted Third Partles (defined In Paragraph !.10 below) solely lf~ and only to the extent that, the product or service is Intended solely for use with products or services Deployed by Sony. By way of example only, Sony Products include video games intended for use with Sony's
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PlayStation :2 console. By further way of example only, Sony Products do not Include video games manufactured and sold by non-Sony companies for use with game consoles that are not manufactured or sold by Sony. The fact that an example is mlsslng from this paragraph shall not be construed to imply that the example is or Is not covered by this definition. :L.9 "Term" means the period beginning on the Effective Date and ending upon the expiration of all of'the Licensed Anascape Patents and Licensed Sony Patents. 1.10 "Permitted Third Parties" means any third party which incorporates any of the Licensed Anascape Patents Into software (e.g., video games), but not into hardware (e.g., game controllers). No license rights are granted under this Agreement for any third party hardware.
LICENSE AND RELEASE

2.1 Non-Exclusive Patent Rights. Anascape Parties hereby grant a non-exclusive, Irrevocable, world-wide ilcense under all of the Licensed Anascape Patents (except that patent described in Paragraph 2.2 below) to (a) Sony to Deploy Sony Products, and (b) publishers, developers, distributors, $ony's customers, Sony's suppliers (indirect or direct), and other third parties solely to the extent such entitles are Deploying software based Sony Products, and only to the extent that such entities are licensed by Sony and are Permitted Third Parties. By way of example, the license granted by Anascape herein applles to third party software developers and publishers for video games Itcensed by SCEA for use with the PS2 console. The license does not cover third party sales of such video games for use on competing video game consoles. The license also does not cover thlrd party sales of hardware peripherals controllers and the like) for use with any video game console. 2.2 Exclusive Patent Rights. Anascape Parties hereby grant and transfer an exclusive, irrevocable, world-wide license under the Licensed Anascape Patent known as United States Patent 6,3:1.0,606 entitled "Multi-Plane Sheet Connected Sensors" (the '606 Patent) to Sony. This exclusive license Is a transfer to Sony of all rights held by each of the Anascape Parties In the '606 Patent. This transfer is of a capital asset by each of the Anascape Parties in accordance with United States Code Title 26, Section 1235.

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ANSO004669

2.3 Anascape Parties, on behalf of themselves and their Affiliates, hereby release, remit, acquit and forever discharge Sony, from all manner of actions and causes of action, debts, dues, Ilab~tltles, controversies, claims and demands of every kind and nature relating to the infringement or alleged infringement prlor to the Effective Date at' the Licensed Anascape Patents, including those which were asserted or could have been asserted, whether or not known. 2.4 Anascape Parties, on behalf of themselves and their Affiliates, hereby release, remit, acquit and forever discharge Permitted Third Parties who are licensed by Sony, from all manner of actions and causes of action, debts, dues, Ilabilltles, controversies, claims and demands of every kind and nature relating to the infringement or alleged infringement prior to the Effective Date of the .Licensed Anascape Patents, solely to the extent such entities were Permitted Third Parties Deploying soft'ware -based Sony Products, and only to the extent such entitles were licensed by Sony, including those claims which were asserted or could have been asserted, whether or not known. No releases of ctalms are granted under this Agreement for any third party hardware. 2.5 SCEA and SCEI hereby grant the Anascape Parties a nonexclusive, Irrevocable, world-wide license under the Licensed Sony Patents rot the purpose of Deploying video game controllers and other devices covered by such patents, Including related technology required for such devices to function for their intended purpose.
3, PAYMENT

3.1 Sony shall pay the Anascape Parties US$10,000,000 (Ten Mlllton United States Dollars) no later than July 7, 2004, in consideration for Sony's receipt of all substantial rights in the Anas¢ape Patent described in Paragraph 2.2 above. All of the rights and releases provlded by the Anascape Parties in Section 2 are conditioned on the Anascape Parties' timely receipt of this sum. 3.2 The Anascape Parties' right to the non-exclusive use of the Licensed sony Patents Is consideration for Sony's and Permitted Third Parties' right to the non-exclusive use of all of the Licensed Anascape Patents described in Paragraph 2.:1. above and the other benefits afforded to Sony under this Agreement (other than as provided in Paragraph 2.2 above). Due tO the uncertainty as to the .4-

ANS0004670

value of any of these patents that are the subject of the cross license provisions of this Agreement, the Parties agree and acknowledge that they are unable to arrive at appropriate royalties for these licenses. Accordingly, the Parties have agreed to forego any royalties or other payment of any kind for those patents subject to the cross licenses, 3.3 Concerning the Licensed Ar~ascape Patents and the Licensed Sony Patents there is no payment of any klnd which Is due or which would become due or Is to be made hereafter bebNeen Sony and the Anascape Parties, other than the payment to the Anascape Parties pursuant to Section 3.1.
4. REPRESENTATIONS AND WARRANTIES

4.1 Sony acknowledges that the issued Licensed Anascape Patent~ are valid. 4.2 Anascape Parties represent and warrant that (a) Anascape and Armstrong either own or have the right to license the Licensed Anascape Patents without restriction, (b) Anascape and Armstrong have the right to grant the licenses and releases hereunder, (c) they have the right to enter into this Agreement, (d) they are not parties to any agreements or obligations inconsistent with this Agreement, (e) they do not believe or suspect that Sony is infringing any patents, other than the Licensed Anascape Patents, In which the Anascape Parties have a financial or ownership Interest, (f) any future license under or assignment of the Licensed Anascape Patents shall be subject to the licenses and releases granted hereunder, (g) Schedule A lists all of the current patents that Anascape or Armstrong own or have a right to license, and (h) the Licensed Anascape Patents have not been held to be invalid, non-Infringed or unenforceable by any court. 4.3 SCEA and SCEI represent and warrant that (a) they have the right to grant the licenses hereunder, (b) they have the right to enter into this Agreement, and (c) they are not parties to any agreements or obligations Inconsistent with thls Agreement. 4.4 This license does not and shall not be Interpreted or construed by either party to include any warranty or representation as to the enforceability, Infringement, validity, fitness for a partlcular purpose, merchantability, or scope of any Licensed Anascape Patent or Licensed Sony Patent. Other than the express warranties granted herein, neither party shall be liable for any claim

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or relating to the use, or the inability to use, the Licensed Anascape Patents or Licensed Sony Patents.
arising from

5, PUBLICITY

5.1 Each Party has the right to disclose to third parties that Sony acknowledged that the issued Licensed Anascape Patents are valid, that It Is a licensee of Anascape, and that it obtained an exclusive license from Anascape under the '606 patent. Further, the Anascape Parties have the right to disclose (1) to the United States Patent and Trademark Office that Sony has paid millions of dollars to Anascape under this Agreement; and (2) to third parties who the Anascape Parties believe to be infringing on the Licensed Anascape Patents and who have entered Into a confidentlalibt agreement with the Anascape Parties, the payment terms of sections 3.1-3.3 herein. Other than such disclosures, neither Party shall disclose, expressly or by Implication, any other term of this Agreement or payments hereunder unless such disclosure; (a) is to a financial auditor, potential investor, potential acqulrer, financial advisor or legal advisor of the party, who is contractually or legally obligated not to disclose the terms or payments of this Agreement and has a need to know the terms and payments herein, (b) comprises Information already available to the public without breach of this Agreement, (c) for use by either of the Parties in any lawsuit provided that a protective order has been entered In such lawsuit, or (d) is required to be disclosed under applicable law or other demand under lawful process provided that (I) the other Party Is given prior notice of the required disclosure, (ii) the disclosing Party cooperates with the other Party In seeking reasonable protective arrangements, and (iii) in no event shall the disclosing Party be required to take any action which, on the advice of the disclosing Party's counsel, could result In the imposition of any sanctions or other penalties against the disclosing Party. This paragraph shall survtve termination of the Agreement. 6. OTH ER 6.1 Term. The rights and obligatlons of this Agreement shall be effective during the Term. 6.2 Relationship of Parties. Except as may be expressly set forth In this Agreement, neither Party will have the right or authority to assume or create any obligations or to make any representations, warranties or commitments on behalf of the other Party, whether express or implled, or to bind the other Party In any -6-

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respect whatsoever. Nothing In this Agreement shall be construed as forming any partnershlp, Joint venture, agency, employment, franchise, distributorship, dealership or other similar or special relationship between the Parties. 6.3 Construction. As used in this Agreement, (a) the words "herein," "hereunder" and other words of similar import refer to this Agreement as a whole, Including all exhibits and schedules as the same may be modlfled from time to time; (b) the word "including" or any variation thereof means "lncludlng, without limitation" and shall not be construed to limit any general statement that tt follows to the specific or similar items or matters immediately following it; (c) descriptive headings and titles are Inserted for convenience of reference only and do not constitute a part of and shall not be utilized tn interpreting this Agreement; and (d) explicit references to a particular section shall be deemed to Include a reference to Its subsections, If any and (e) the word "third party" means an entity other than a party to this Agreement. Thls Acjreement shall be fairly Interpreted in accordance with Its terms and without any presumption In favor of or against either party regardless of the drafter. 6~4 Assignment. Except for the transfer to Sony of all rights to the '606 patent In section 2.2 of this agreement, the Parties hereto have entered this Agreement with the Intention that the rlghts granted hereunder not extend to other entities without the other Parties' express written consent. Accordingly, neither this Agreement nor any of Anascape's rights or obligations hereunder shall be assigned or transferred (in Insolvency proceedings, by mergers, acquisitions or otherwise) by Anascape without Sony's consent. Except for the transfer to Sony of all rights to the '606 patent In section 2.2 of this agreement, Sony shall not have the right to assign or transfer any of Its rights and obttgatlons under this Agreement (in Insolvency proceedings, by mergers, acquisitions, sale of a business or product line, or otherwise) without Anascape Parties' written consent, except that Sony may assign this Agreement to an Afflllate of Sony. Any assignment or other transfer which Is Inconsistent with the foregoing shall be null and void ab Inltio. 6.5 Notice. Unless otherwise provided in this Agreement, all n0tlces, consents, approvals, waivers and the Itke made hereunder shall be In written English to the following addresses, shall reference this Agreement and shall be sent by any of the following methods: (a) certified mall, postage-prepaid, return-receipt

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requested, (b) a delivery service which requires proof of delivery signed by the recipient or (c) properly-transmitted facsimile followed by written confirmation In accordance with methods (a), (b) or first-class U.S. mall. The date of notice shall be deemed to be the date it was received or refused (in the case of method (c) above, the date of notice shall be deemed to be the date the facsimile copy is received). A Party may change its address for notice by written no~Ice tn accordance with thi~ paragraph. If to Sony, then to both: Riley R. Russell, Esq. Sony Computer Entertainment America Inc. 9],9 East HIIIsdale B~vd. 2nd Floor Foster City, CA 94404 Gregory S. Gewirtz, Esq. Lerner, David, Llttenberg, Krumholz & Mentlik, LLP 600 South Avenue West Westfield, NJ 07090

If to Anascape, then to both:

Brad A, Armstrong P.O. Box 2048 Carson City, NV 89702

Kelly Tyler 13950 Via De Jamul ]amul, CA 91935

6.6 Assertion of Unenforceability. In the event that any provision of this Agreement other than provisions 2.1 through 2.5 and 3.1 through 3.3 Is deemed illegal or unenforceablet the remainder of this Agreement shall be valid and enforceable to the extent permissible by law and the offending provision shall be replaced, to the extent possible, with a provision which most closely reflects the purpose of the offending provision. Both Parties further agree to use their reasonable efforts to agree on such a replacement. 6.7 Successors and Assignees. This Agreement is binding on all successors and assignees to the .Parties;, subject to the limitations on assignment as described in Paragraph 6.4. 6.8 Applicable Law and Venue. This Agreement shall be governed by and construed In accordance with the laws of California without regard to its conflicts of law rules. 3"he venue for any dispute shall be In California.

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6.9 Entire Agreement; No Modification or Waiver. This Agreement Constitutes the entlre agreement between the Parties concerning its subject matter and supersedes all prior written or oral negotiations, correspondencer understandings and agreements between the Parties respecting such subject matter. Prior unexecuted drafts of this Agreement If any, may not be used to interpret the intentions of the parties to this Agreement and the Fact that certain provisions may have been added, removed or modified during negotiations shall have no interpretive significance. This Agreement shall not be modified or rescinded, except by a writing signed by both Parties. WHEREFORE, the parties hereby acknowledge their agreement and consent to the terms and conditions set forth above through their respective signatures as contained below;

-Signatures on Following Page-

ANS0004675

SONY COMPUTER ENTERTAINMENT INC.

By:

rag i " f~" President & Chief Executive Officer

SONY COMPOTER ENTERTAINMENT AMERICA INC.

Dated: O-LM~ ~ , 2004

By:

vice President, Legal and Business Affa its ANASCAPE, a Nevada limited partnership

Dated: ~, 2004

By: Armstrong, qeral Partner

Dated: ~ 2 , 2004

A. Armstrong,

Dated; ~u~£ 3 , 2004

Kelly Tyler, Indivldually

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SCHEDULE A Licensed Anascape Patents

USPN i. 5,56'~;'891 2. 5,589,828

Title

Inventor

Issue Date

Six De,redes Of Freedom Brad A. Armstrong October 15, 1996 Graphics Co~_n.troller 6 Degrees Of Freedom Brad A. Armstrong December 31, 1996 Controller With Capability Of Tactile : ~eedb~ck Variable-Conductance Brad A. Armstrong December7' ~999 Game Controller With Bred A. Armstrong August ls, 2oo0 Analog Pressure Sensor(s) Variable-conductance Brad A, Armstrong October" 24, 2000 Sensor With Ela~omeric Dome-Cap Computer House With' :' Brad A. Armstrong M~rch 6, 200i Enhance Control ~utt:on(s) Remote Controller With =~rad A. Armstron'g M~rch 27, 200"~ Analog Button(s) Image Controllers With Brad A. Armstrong April 24, 2001 Sheet Connected Sensors Displacement Joystick Brad A. Armstrong September 4, 2001 With CompressionSensi'dve sensors Multi-Plane Sheet Brad A. Armstrong October 30, 2001 Connected Sensors Game Control With Brad A. Armstrong F~brua;~/5, 2002 Analo~l Pressure Sensor Vartable Sensor With Brad A. Armstrong February 5, 2002 Tectlle Feedback Analog Contrels Housed Brad A, Armstrong February 1% 200'2 '" With Electronic Displays Variabie-conductance Brad A, Armstrong February 26, 2002 Sensor Remote Controller With Brad A. Armstrong June 4, 2002 Analog Pressure Sensor(.s_~ Analog Controls Housed Brad A. Armstrong .lune 11, 2002 With Electronic Displays ,~gr Voice Recorders Analog Controls Housed B~*ad A:"Armstrong " ~ul~, 9,' 2002 With Electronic Displays For COffee Makers

5. 6,135,886 d, ~'i9S,473 7. 6,208,271

~, 6,z22,525

10.6,310,606 11.6,343,99~

~3.6,347,997

15.6,400,303

16.6,404,584
17, 6,415,707

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Variable Rate On-Off Brad A. Armstrong July 23, 2002 Messagin~ ~ystem A'~alog Cor~trols Housed ~r~ A. Armstrong September 24, 2002 :19, 6456~78 ..... With EtecLronlc D~splays For Video Recorde~ And G#mer~. Analog Controls Housed Brad A. Armstrong 20.6,469,69~ October 22, 2002 With ElectronJ~ Displays For Hand-Held Web = ~row~er~ 2Z. 6,470~078 A~alog Co~trols Housed ~;:~'~ A. Armstrong October 22j 2002 With Ele~nlc Displays For Telephones Analog Controls Housed 22.6,496,449 Brad A. Armstrong December 17, 2002 With Electronic Displays ........... For..~loc~ .... L Brad" ~~~ stro n g" Janu 'r , 0o3 ...... 23.6,5~,527 Anal~ Controls Housed Wl~h Electronic Displays . FoE 0.mguter Analog Controls Housed B~d A. Armstrong February 1=1, 2003 2~.6,5~8,953 With Electronic Displays For Remote Con~rolle~ Having Feedback Display ~.~creeps 25.5,529~85 ~alog Controls Housed Brad A. Armstrong March 4, 2003 With Electronic Displays For Electronlc~ooks 25.6,532,000 Analog Controls Housed Brad A. Armstrong March 11, 2003 With Electronic Displays For Global Positioning Systems ~?. 5,538,638 Analog Controls Housed Br~dA. Armstron~ March 25~ 2003 With Electronic Displays For Pagers Analog Controls Housed Brad A. ArmstrOng Nay 6, 2003 With Elecl:ronic Displays For Personal Digital ~18.6,424,336 29.6,563,415 30, 6,693,625 ... Analog Sensor(s) Wlth Snap-Through Tactile Feedback Controller With Variable Sensor(s) Brad A. Armstrong Brad A. Armstrong May 13,'200~~ February~i 2004

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Brad A. Armstrong PENDING PATENT APPLICATIONS as of Hay 25, 2004 Filing Date Title Inventor Hand-Held Control=With Brad A. Armstrong April I8, 2000 Analog Pressure Sensor(s) Brad A~ Arm.~tro'~g I May ~2, 2003 Analog Sensor(s) With Tactile Feedback RemOte Controller" With 3une 5, ~b02 Bra~ A. Armstrong Analog Button(s) Image Controller Brad A. Armstrong June 2~6, 2601 controller With Analog Brad A. ArmsEo~g .lune 29, 2001 30 ContrOller With
Vibration Sheet Connecte(~"Sensors With Vibration 30 Controller With Tactile Feedback

1, 09/551,$13 2. ~0/437,395

4, 09iB93,292 5, 09/8~J6,680 6. 09/7~5~32

Brad A. Armstrong Brad A. Armstrong

Novembe;~6, 2000 November 22, 2000

8. 09/710~557 ~'.' 09/754,477 10.10/773,025

Brad A. Arm'st'ro~'{~' ' ' November 8, 2000 Brad A. Armstrong 3anuaw 4, 2001 Brad A, Armstrong February'4, 2004

~Compu~er HOuse WRh Specialized image Controller

1)

PCT Application, International Application PCT/US00/12607 filed May g, 2000 "HAND-Ht~LD CONTROL WIDTH ANALOG PRESSURE SENSOR(S)" International Publication Number WO 01/30470 A1. The National Phase has been entered In ~]apan, Corresponding Patent Document Number 2001 532880

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