Marine Travelift Inc v. ASCOM SpA et al

Filing 265

ORDER signed by Chief Judge William C Griesbach on 12-13-16 denying 238 Motion for Sanctions; granting 242 Motion to Seal Document ; granting 245 Motion to Seal Document ; granting 251 Motion to Seal Document ; denying 257 Motion for Reconsideration ; granting in part and denying in part 257 Motion to clarify; granting 259 Motion to Seal Document ; denying 260 Motion to clarify. (cc: all counsel) (Griesbach, William)

UNITED STATES DISTRICT COURT
EASTERN DISTRICT OF WISCONSIN
MARINE TRAVELIFT, INC.,
Plaintiff,
v.

Case No. 14-C-443

ASCOM SpA, and INTERNATIONAL
BOATLIFT EXCHANGE, INC.
Defendants.

DECISION ON MOTIONS FOR RECONSIDERATION

Following this court’s decision on summary judgment, both sides filed motions seeking
reconsideration and / or clarification of certain aspects of the court’s decision. I address the parties’
arguments below.
I. MTI’s Motion for Reconsideration / Clarification
A. Stopping Angular Movement versus Drive Movement
MTI’s patent discloses a safety feature whereby movement of the crane’s wheels is stopped
if the controller senses a wheel is out of position. (ECF No. 98-4 at 2:15-21.) MTI first argues that
this court erred by failing to recognize that, although the accused machines do not stop angular
movement (that is, rotation around a vertical axis), they nevertheless do stop drive movement when
the machine senses a wheel is out of position. (Drive movement is what moves the wheels forward
and backward, while angular movement is what turns the wheel to change direction.) Because
ASCOM’s cranes do stop drive movement of the wheels, they should be found to infringe.
As the Defendants note, however, this issue was presented and even discussed in the
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summary judgment opinion itself. (ECF No. 255 at 32- 33.) In that opinion, I concluded that for
something to be “stopped,” it must be fully at rest. Because ASCOM’s cranes did not stop the
angular movement of the wheels, I concluded that their cranes’ wheels were not “stopped” in the
sense used in the claim terms, and thus did not infringe. MTI argues this was error.
The central problem for MTI is that its claim language is not broad enough to encompass
both angular and drive movement. Instead, it is clear the claim provides protection only for a device
that stops angular movement of the wheels when they are out of their intended position—a function
that ASCOM’s cranes do not perform. The specification supports this narrower reading, and so
does the claim language itself. First, Claim 15 describes a “steering system.” A “steering system,”
of course, is synonymous with a system for turning the wheels in an angular fashion because that
is what “steering” is. Because a steering system would only involve the turning of the wheels in an
angular fashion (i.e., steering or turning the crane), we would not expect the claim to disclose
anything about the drive movement of the wheels in a forward or reverse manner. Thus, when the
claim describes monitoring the “position” of the wheels, we must assume it means it is monitoring
the angular position of the wheels. In other words, the controller is asking itself whether the wheels
are properly turned to the right angle and, if not, the controller will stop the wheels from turning
further.

It does not say that it stops drive movement of the wheels when any wheel is out of

position. This is most clearly set forth in the specification, which explains that “when one of the
wheels exceeds a predetermined distance between its sensed position and programmed position (this
can happen if a wheel is in a rut) the controller stops angular movement of the remaining wheels
until the . . . wheel is at its programmed position.” (ECF No. 98-4, 2:16-21) (italics added).
Because ASCOM’s cranes do not stop angular movement of the wheels, they do not infringe.
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In addition, the specification further explains that the safety feature is concerned with wheel
position in an angular, rather than drive, sense. If a wheel is out of position by a predetermined
amount “(e.g., three degrees) for any wheel, the controller 110 stops turning the other wheels to
their programmed position until the situation is corrected. . . . In this manner, the wheel that moved
the least (i.e., the stuck wheel) will determine the desired position of the other steering wheels.”
(ECF No. 98-4, 9:46-54) (italics added). By using a threshold of “three degrees” as an example, it
is clear that the patentee was describing angular position (measured in degrees) of the wheels rather
than the drive position. It is equally clear that the controller is programmed to stop turning the other
wheels, rather than to stop the drive movement of the other wheels. Thus, the only thing that the
patent discloses is stopping the turning, or angular, movement of the wheels.
The claim language bears this out. What it discloses is a controller that monitors
the position of the plurality of wheels, and to control movement of the plurality of
wheels in response to a selected steering mode, wherein the controller is further
configured such that when at least one wheel has a sensed position a predetermined
distance from a programmed position the controller stops movement of the
remaining wheels.
(ECF No. 98-4, 13: 8-16.)
The key question is what the claim means by “stops movement.” Although the claim itself
does not use the adjective “angular” to describe the movement being stopped, it is clear that such
was its intent.

As noted above, the specification quite clearly explains that this means “stops

angular movement.” (ECF No. 98-4, 2:16-21). This is not an instance in which a party is asking
to narrow a claim term by importing a limitation from the specification. Instead, the court is being
asked to construe the somewhat vague term “movement” in accordance with how the term is used
in the specification. Metabolite Labs., Inc. v. Lab. Corp. of Am. Holdings, 370 F.3d 1354, 1360
(Fed.Cir. 2004) (“In most cases, the best source for discerning the proper context of claim terms is
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the patent specification wherein the patent applicant describes the invention.”); see also, e.g., Kinik
Co. v. Int'l Trade Comm'n, 362 F.3d 1359, 1365 (Fed.Cir. 2004) (“The words of patent claims have
the meaning and scope with which they are used in the specification and the prosecution history.”)
The claim language itself independently supports this conclusion as well. First, as described above,
the claim is disclosing a steering system, something that is inherently concerned with angular, rather
than drive, movement. Second, it would not make sense to interpret the claim in the fashion MTI
proposes. The claim states that it “stops movement of the remaining wheels.” (Id.) Implicit in such
a function is that the stuck wheel is allowed to keep moving forward. It would not make sense to
stop drive movement of remaining wheels while allowing the fourth, misaligned, wheel to keep
driving. Instead, the claim only makes sense if the movement being stopped is the angular, or
turning, movement of the remaining wheels. As the specification explains, the purpose of stopping
angular movement is that the “wheel that moved the least (i.e., the stuck wheel) will determine the
desired position of the other steering wheels.” (ECF No. 98-4, 9:46-54). In other words, if one
wheel gets stuck at 18 degrees, the controller will halt the turning of the other wheels, so that the
stuck wheel is the limiting factor.
In sum, when read in proper context, the term “stops movement” means that the invention
stops angular movement of the wheels when one or more wheels is sensed to be out of position.
ASCOM’s cranes do not perform that function. The fact that ASCOM machines might stop drive
movement if a wheel becomes misaligned does not mean they infringe MTI’s patent. The motion
for reconsideration will therefore be denied.
B. Clarification of Infringement
MTI also asks that the court enter an order specifically identifying certain claims that are
infringed.

Although this court made rulings relating to these claims in its summary judgment
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decision, the court did not specifically set forth the claims that were infringed.
The Defendants oppose such a ruling, primarily because the court found most of the claims
at issue to be invalid. As such, they believe it would not make sense to issue an order regarding the
infringement of invalid patents.

Although that argument has a certain common-sense appeal, it

ignores the fact that judicial economy would be well-served in the event the determination of
invalidity is reversed on appeal.

“Acting in the interest of judicial economy, the trial court

proceeded to decide, correctly, the infringement issue, while fully recognizing that infringement of
an invalid patent can create no legal liability.” Connell v. Sears, Roebuck & Co., 722 F.2d 1542,
1550 (Fed. Cir. 1983). “When presented with patent validity and infringement issues, trial courts
should, as Judge Boyle did here, decide both. First, the parties, witnesses and exhibits involved in
both issues are before the court. If a judgment limited to one issue is reversed, it may become
necessary to again call many of the same persons before the court for trial or argument on the other.”
Stratoflex, Inc. v. Aeroquip Corp., 713 F.2d 1530, 1540–41 (Fed. Cir. 1983). Accordingly, there
is nothing to prevent the court from entering an appropriate order acknowledging the findings that
flow from the court’s decisions, even if such ruling does not become a part of a final judgment. I
therefore conclude that the accused products sold to the following customers infringe on the
Plaintiff’s patents: Island Cove Marina and Resort, General Motors LLC, River Forest Yachting
Center, GE Transportation, Shelter Island Boatyard, Houston Pilots, and Fred Wahl Marine
Construction. (ECF No. 258 at 18-20.) As set forth below, however, fact issues appear to remain
with respect to the cranes sold to Diamond Services.
There remain a few other claims. Specifically, MTI argues that the Defendants infringe
claims 21-36 of the ‘362 patent and 21-23 of the ‘274 patent with machines sold to customers
Diamond Services, Island Cove Marina, and General Motors. ASCOM responds that factual issues
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remain, which means an entry of summary judgment on infringement would be premature. For
example, it states that machines sold to Diamond Services did not have carousel-turning mode of
the “short-turn” variety, a key teaching of the patents in suit, and in fact the machines did not have
carousel steering ability at all.
This is a variation on an argument the Defendants made at the summary judgment stage.
I rejected this line of argument on the basis that even if the cranes currently lacked certain key
functionality, it appeared that they possessed that functionality in the past, or at least that they had
the capability for such functionality given their design, etc.

In truth, it is difficult to track the

various features the Diamond Services cranes had at various periods of time. I concluded at the
summary judgment stage that the Plaintiff had established the possibility of showing that the
ASCOM cranes infringed, either at the time of sale or at some other time. However, although I
rejected ASCOM’s argument that it did not infringe, I did not explicitly conclude it did infringe,
either. Given the factual complexity of the infringement question, especially with respect to the two
cranes sold to Diamond Services, I remain convinced that factual issues remain to be resolved, and
accordingly I will deny the motion seeking clarification on that point. A jury will have to make the
ultimate call. MTI’s motion for clarification on that point is therefore denied.
ASCOM’s other arguments are unavailing, however. For example, it reads the summary
judgment opinion as leaving the door open to the question of whether its controllers control
movement “in response to placing the apparatus in the carousel steering mode.” (ECF No. 98-1,
11:20-21.) But the sentence it cites is taken out of context. Reading the opinion in its full context,
it is clear that I rejected ASCOM’s narrow reading of the phrase “in response to,” finding that the
distinction it made did not save the accused products from infringement. Because I rejected its
construction of the claim term, I did not leave the door open for further factual development. From
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the limited briefing on this topic, it appears that this means MTI is entitled to summary judgment
of infringement as to the Island Cove and General Motors machines.
In sum, the motion for clarification is denied in part, as set forth above. It is granted to the
extent the court finds the following:
1. The Defendants have infringed claims 1-3 of the ‘362 patent by making, using or selling
a BHT 40 ES to Island Cove Marina and Resort; two CLS 45 ES cranes to General Motors LLC;
a BHT 60 ES to River Forest Yachting Center; two SPE 50 ES cranes to GE Transportation; a BHT
70 ES and BHT 150 ES to Shelter Island Boatyard; a BHT 480 ES to Houston Pilots; and a BHT
480 ES to Fred Wahl Marine Construction.
2. The Defendants have infringed claims 7-8 and 12- 17 of the ‘362 patent by making, using
or selling a BHT 40 ES to Island Cove Marina and Resort; two CLS 45 ES cranes to General Motors
LLC; a BHT 150 ES to Shelter Island Boatyard; a BHT 480 ES to Houston Pilots; and a BHT 480
ES to Fred Wahl Marine Construction.
3. The Defendants have infringed claims 21-36 of the ‘362 patent and claims 21-23 of the
‘274 patent by making, using or selling a BHT 40 ES to Island Cove Marina and Resort and two
CLS 45 ES cranes to General Motors LLC.1
II. Defendants’ Motion for Clarification of Invalidity of Claims of the ‘299 Patent
In this court’s summary judgment decision, I concluded that the Mi-Jack 850P prior art crane
anticipated all of the relevant asserted claims. However, I found that the record was spotty as to
which claims were specifically impacted. (ECF No. 255 at 15-16.) The Defendants now wish to
add clarity by identifying exactly the claims that are invalidated.

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Of course, to the extent any of these infringements involve invalid claims, no liability

attaches.
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In the summary judgment decision, I concluded that the Mi-Jack crane had a feature
requiring it to be in a stopped position before carousel turning mode could be activated. (Id. at 1112.) This finding invalidated certain claims of the ‘362 patent. The Defendants argue that it follows
from that conclusion that the asserted claims of the ‘299 patent (claims 9, 10, 17, 18, 23 and 24)
should be invalidated as well. Those claims, in one way or another, include a teaching that the
controller is programmed to disable an engine drive prior to positioning the wheels in the selected
steering mode and then enabling the drive once the wheels are properly positioned. (ECF No. 24-9
at 12:35-38.) In the Defendants’ view, my conclusion that the Mi-Jack machine had to be in a
stopped position before carousel mode could be activated applies to these claims as well.

In

essence, they argue that a feature disabling the engine drive prior to activating carousel steering is
the same as a feature requiring that the crane must be in a stopped position. They note that,
elsewhere in the summary judgment opinion, this court took a broad view of the term “disable,”
finding that it would apply to any means of stopping an engine drive. (ECF No. 255 at 39.)
However, as the Plaintiff points out, this is not how the question was argued at the summary
judgment stage. Instead, the claims of the ‘299 patent were alleged to be invalid in light of the
Skaalen patent, as well as obvious in light of the Mi-Jack crane. Now, the Defendants appear to be
arguing that the Mi-Jack crane actually anticipates the asserted ‘299 claims in the same manner they
anticipated the ‘362 claims. That is not an appropriate argument to be made in a motion seeking
“clarification” of a previous order. Moreover, it is not at all clear that the requirement of being in
a stopped position before entering carousel mode is synonymous with having a controller that is
programmed to disable the engine drive. It is possible that such is the case, but such a conclusion
could be reached only after an express and well-supported argument to that effect is made during
summary judgment briefing. That did not occur here. Accordingly, the motion for clarification will
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be denied.
III. Sanctions
Also currently pending is the Plaintiff’s motion for sanctions, which is based on what it
views as the Defendant’s unacceptable discovery conduct.

Specifically, it alleges that the

Defendants improperly delayed disclosing the fact that they bid on a marine lift sale for the J.
Goodison Co. in July 2015. Over the course of several years, ASCOM made a number of bids to
Goodison for a new mobile boat hoist. It disclosed several of these bids during the normal course
of discovery, but failed to disclose its final bid, from July 2015, until the very end of discovery, in
February 2016. MTI argues that even though it ultimately won the contract with Goodison, it had
to settle for a much lower profit due to ASCOM’s infringement and the fact that MTI had to
compete with ASCOM’s aggressive prices.

And, although it knew about most of ASCOM’s

previous bids, it did not know that ASCOM bid only $2,725,400 to produce a hoist that was much
larger than MTI’s—something MTI views as strong evidence of price erosion.
ASCOM describes the unproduced document as a one-off oversight, a single document in
a massive case involving thousands of attorney hours, fifty depositions and multiple motions.

In

fact, the document was produced during the discovery period, and so there is not even a violation
of any Federal Rules. Instead of sitting on it, ASCOM produced the document within days of
learning from MTI that it had not been produced. Moreover, ASCOM does not believe MTI is
prejudiced in any way by the disclosure.
I conclude that the motion for sanctions should be denied. Based on the record before me,
it is scarcely possible to determine that the single bid was disclosed late in the discovery process due
to some kind of deliberate litigation strategy. James Alfieri, ASCOM’s sales agent, testified that
he simply missed the document until a final review he made at the request of ASCOM’s own
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lawyers. It is unclear what possible strategy Mr. Alfieri might have had in mind by withholding a
single document until late in the process. To the extent it is relevant, the document relates to the
damages the Plaintiff allegedly suffered, and there is no indication that Alfieri understood its
importance to that issue.
I also conclude that prejudice is not established here. The document was disclosed in
February 2016, long before any trial (which is not yet scheduled). Although summary judgment
filings were pending, those motions did not address the issue of damages. Accordingly, to the
extent the bid is material to damages, the Plaintiff is not foreclosed from relying on it during its trial
presentation. In addition, by the time a trial occurs, the Plaintiff will have had more than a year to
digest the information. Any conceivable prejudice should have evaporated by then. The motion
for sanctions will therefore be denied.
IV. Motions to Seal Documents
Both sides have filed motions to seal documents. They have filed redacted versions of briefs
and ask the court to seal the unredacted versions of those briefs. In addition, they ask to seal certain
exhibits that contain confidential business information, including information about bids.

I have

reviewed the documents in question and conclude that both sides have narrowly restricted their
requests to confidential information that may be sealed. For example, they propose to redact only
a few sentences within the entire 72-page expert report of Bruce Farber. (See ECF No. 251-5.) The
motions will therefore be granted.

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V. Conclusion
The motion for sanctions [238] is DENIED.

The motion for reconsideration and

clarification [257] is GRANTED in part and DENIED in part. The motion for clarification [260]
is DENIED. The motions to seal [242, 245, 251, 259] are GRANTED. The unredacted versions
of the documents found at ECF Nos. 243, 246, and 261 will remain under seal. In addition, Exhibits
3-14 of ECF No. 244 will remain under seal. The original docket filings corresponding to the
attachments filed at ECF No. 251 and 252 will also be sealed, with the unredacted versions being
made available on the docket.
The clerk will set the matter on the calendar for a telephonic scheduling conference to set
pretrial and trial dates.
SO ORDERED this 13th day of December, 2016.
/s William C. Griesbach
William C. Griesbach, Chief Judge
United States District Court

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