The JM Smucker Company v. Lodsys LLC

Filing 1

COMPLAINT with Jury Demand; against Lodsys LLC by The JM Smucker Company. ( Filing Fee PAID $350 receipt number 0757-1414096) (Attachments: # 1 Exhibit A - Patent #5,999,908, # 2 Exhibit B - Patent #7,133,834, # 3 Exhibit C - Patent #7,222,078, # 4 Exhibit D - Patent #7,620,565, # 5 Exhibit E - Letter dated 11/9/11, # 6 Summons, # 7 Civil Cover Sheet)

UNITED STATES DISTRICT COURT
EASTERN DISTRICT OF WISCONSIN
______________________________________________________________________________
THE J. M. SMUCKER COMPANY,
Plaintiff,

v.

Case No.___________________

LODSYS, LLC,
Defendant.
______________________________________________________________________________
COMPLAINT FOR DECLARATORY JUDGMENT
______________________________________________________________________________

Plaintiff, The J. M. Smucker Company (“Smucker”), by and through the undersigned
counsel, files this complaint for a declaratory judgment against Defendant, Lodsys, LLC
(“Lodsys”), and alleges as follows:
NATURE OF ACTION
1.

This is an action for a declaratory judgment that Smucker does not infringe any

valid claim of United States Patent Nos. 5,999,908 (the “‘908 patent”), 7,133,834 (the “‘834
patent”), 7,222,078 (the “‘078 patent”), and 7,620,565 (the “‘565 patent”) (collectively, the
“Asserted Patents”), and for a declaratory judgment that the claims of each of the Asserted
Patents are invalid.
2.

A true and correct copy of the ‘908 patent is attached hereto as Exhibit A.

3.

A true and correct copy of the ‘834 patent is attached hereto as Exhibit B.

4.

A true and correct copy of the ‘078 patent is attached hereto as Exhibit C.

5.

A true and correct copy of the ‘565 patent is attached hereto as Exhibit D.

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THE PARTIES
6.

Plaintiff, Smucker, is incorporated in Ohio and has a principal place of business at

1 Strawberry Lane, Orrville, OH 44667. Smucker is a manufacturer of fruit spreads, ice cream
toppings, beverages, shortening, peanut butter and other products.
7.

On information and belief, Defendant, Lodsys, is a Texas limited liability

company and claims to have a principal place of business at 505 East Travis Street, Suite 207,
Marshall, Texas, 75670. The Texas Secretary of State lists the corporate address of Lodsys as
800 Brazos, Suite 400, Austin, Texas 74701.
8.

On information and belief, Lodsys owns the Asserted Patents.

9.

On information and belief, Mark Small is the Chief Executive Officer of Lodsys.

10.

On information and belief, Mr. Small conducts Lodsys’s business from an office

located in Oconomowoc, Wisconsin, within this jurisdictional district. Accordingly, on
information and belief, Lodsys’s primary place of business and/or headquarters is located within
this judicial district.
11.

On information and belief, Mr. Small lives and works in Wisconsin, holds a

Wisconsin driver’s license, is registered to vote in Wisconsin, and is a resident and citizen of
Wisconsin.
JURISDICTION AND VENUE
12.

This action arises under the patent laws of the United States, Title 35 of the

United States Code (35 U.S.C. § 1, et seq.), and under the Federal Declaratory Judgment Act (28
U.S.C. §§ 2201 and 2202).
13.

This Court has subject matter jurisdiction over this action pursuant to 28 U.S.C.

§§ 1331 (federal question) and 1338(a) (action arising under an Act of Congress relating to
patents).
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14.

This Court has personal jurisdiction over Lodsys because it has constitutionally

sufficient contacts with Wisconsin so as to make personal jurisdiction proper in this Court.
Lodsys maintains an office within this district and conducts or solicits business within this
district.
15.

Venue is proper in this district pursuant to 28 U.S.C. §§ 1391(b), (c) and 1400(b).

16.

There are presently pending in this District five declaratory judgment actions

against Lodsys relating to the Asserted Patents. They are: RightNow Technologies Inc. v. Lodsys
LLC, Wolfram Alpha LLC et al. v. Lodsys LLC, LivePerson Inc. v. Lodsys LLC, PC Drivers
Headquarters 1 Inc. et al. v. Lodsys LLC, and PCS Sales (USA) Inc. v. Lodsys LLC.
Additionally, two more declaratory judgment actions against Lodsys relating to the Asserted
Patents were pending in this District but have been closed: Eset LLC v. Lodsys LLC and ForeSee
Results Inc. v. Lodsys LLC.
THE PRESENCE OF AN ACTUAL CONTROVERSY
17.

On November 9, 2011, Mr. Small sent a letter to Ms. Jeanette L. Knudsen, Vice

President, General Counsel and Corporate Secretary, of Smucker. A copy of this letter is
attached hereto as Exhibit E.
18.

The November 9, 2011 letter stated:

[w]e have reviewed your use of the Lodsys Patents and have prepared the
enclosed claim chart demonstrating at least one instance of how you
utilize the inventions embodied in the Lodsys Patents. The images used in
the charts are representative only and in addition to the charted claim of
the referenced patent, you should consider the remaining claims of that
patent and the other Lodsys patents both with respect to the charted
utilization and to other products and services offered by you.
19.

The November 9, 2011 letter also stated:

[w]e are interested in reaching a negotiated non-litigation licensing
arrangement with you for all of your uses of the Lodsys Patents under
your brand names and would like to discuss this matter with you within 21
days of your receipt of this letter.
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20.

The November 9, 2011 letter also stated that Lodsys has “retained the firms of

Kelley, Donion, Gill, Huck & Goldfarb PLLC (www.kdg-law.com) based in Seattle,
Washington, and The Davis Firm, P.C. (www.bdfirm.com) based in Longview, Texas, to assist
the company in licensing of the Lodsys Patents.”
21.

The November 9, 2011 letter also stated:

Lodsys LLC reserves all rights with regard to the ‘908, ‘834, ‘078, and
‘565 patents, including: (1) the right to seek damages anytime within the
last six years that your company started to make use of Lodsys’ patented
technology; (2) the right to change its royalty rates at any time; (3) the
right to change this licensing program at any time without notice,
including variance to conform to applicable laws. You should not rely on
any communication or lack of communication from Lodsys, Kelley,
Donion, Gill, Huck & Goldfarb, PLLC, or The Davis Firm Group as a
relinquishment of any of Lodsys’ rights.
22.

The November 9, 2011 letter also included an “Infringement Claim Chart,”

setting forth how Smucker’s “Online Store Questions” form, on its website, allegedly infringes
claim 1 of the ‘078 patent.
23.

On November 23, 2011, Jaclyn A. Bryk, Corporate Attorney – Litigation at

Smucker, responded to Mark Small’s letter. She requested that Mr. Small contact her at his
earliest convenience to discuss the matter further.
24.

On December 7, 2011, Harry Snodgrass, Licensing Executive at Lodsys,

responded to Ms. Bryk’s letter via email. Mr. Snodgrass wrote that if Ms. Bryk wanted to
discuss licensing, that is Mr. Snodgrass’s “area,” but if Ms. Bryk wanted to discuss “any specific
areas of the patent and infringement” then he could “get [Lodsys’s] in-house counsel and patent
expert on the call.” Mr. Snodgrass’s email further commented that he normally “like[s] to
discuss the licensing program and pricing before proceeding with a claims review as it can offer
a reference point for further conversations.”

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25.

Upon information and belief, Lodsys is solely a licensing entity, and without

enforcement it receives no benefits from the Asserted Patents.
26.

On February 11, 2011, Lodsys filed a lawsuit against 12 companies alleging

infringement of the Asserted Patents. That case is styled Lodsys, LLC v. Brother International
Corporation, et al., Case No. 2:11-cv-90 and is pending in the Eastern District of Texas,
Marshall Division.
27.

On May 31, 2011, Lodsys filed another lawsuit in the Eastern District of Texas

against ten additional companies, all developers of Apple Inc. iPhone applications, alleging
infringement of the Asserted Patents. The case is styled Lodsys, LLC v. Combay, Inc., et al.,
C.A. No. 2:11-cv-272.
28.

On June 10, 2011, Lodsys filed another lawsuit in the Eastern District of Texas

against ten additional companies, alleging infringement of the Asserted Patents. The case is
styled Lodsys, LLC v. Adidas America, Inc., et al., C.A. No. 2:11-cv-283.
29.

On July 7, 2011, Lodsys filed another lawsuit in the Eastern District of Texas

against six additional companies, alleging infringement of the Asserted Patents. The case is
styled Lodsys, LLC v. DriveTime Automotive Group, Inc. et al., C.A. No. 2:11-cv-309.
30.

In all four Texas cases, counsel of record to Lodsys are Kelley, Donion, Gill,

Huck & Goldfarb, PLLC, based in Seattle, WA, and The Davis Firm, P.C., based in Longview,
Texas.
31.

By virtue of Lodsys’s actions, Smucker is in reasonable apprehension of an

imminent patent infringement suit relating to the Asserted Patents.

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32.

Smucker denies that it infringes any valid claim of the Asserted Patents. Smucker

now seeks a declaratory judgment that it does not infringe any valid claim of the Asserted
Patents.
COUNT I
DECLARATORY JUDGMENT OF NON-INFRINGEMENT OF THE ‘908 PATENT
33.

The allegations of paragraphs 1-32 are incorporated by reference as if fully set

forth herein.
34.

Smucker’s website does not infringe any valid claim of the ’908 Patent.

35.

An actual controversy exists between Smucker and the Defendant as to whether or

not Smucker has infringed, or is infringing, the ‘908 Patent; has contributed to infringement, or is
contributing to infringement of the ‘908 Patent; and has induced infringement, or is inducing
infringement of the ‘908 Patent.
36.

The controversy is such that, pursuant to Federal Rule of Civil Procedure 57 and

28 U.S.C. § 2201 et seq., Smucker is entitled to a declaration, in the form of a judgment, that by
its activities Smucker has not infringed and is not infringing any valid and enforceable claim of
the ‘908 Patent; has not contributed to infringement and is not contributing to infringement of the
‘908 Patent; and/or has not induced infringement and is not inducing infringement of the ‘908
Patent. Such a determination and declaration is necessary and appropriate at this time.
COUNT II
DECLARATORY JUDGMENT OF NON-INFRINGEMENT OF THE ‘834 PATENT
37.

The allegations of paragraphs 1-32 are incorporated by reference as if fully set

forth herein.
38.

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Smucker’s website does not infringe any valid claim of the ’834 Patent.

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39.

An actual controversy exists between Smucker and the Defendant as to whether or

not Smucker has infringed, or is infringing, the ‘834 Patent; has contributed to infringement, or is
contributing to infringement of the ‘834 Patent; and has induced infringement, or is inducing
infringement of the ‘834 Patent.
40.

The controversy is such that, pursuant to Federal Rule of Civil Procedure 57 and

28 U.S.C. § 2201 et seq., Smucker is entitled to a declaration, in the form of a judgment, that by
its activities Smucker has not infringed and is not infringing any valid and enforceable claim of
the ‘834 Patent; has not contributed to infringement and is not contributing to infringement of the
‘834 Patent; and/or has not induced infringement and is not inducing infringement of the ‘834
Patent. Such a determination and declaration is necessary and appropriate at this time.
COUNT III
DECLARATORY JUDGMENT OF NON-INFRINGEMENT OF THE ‘078 PATENT
41.

The allegations of paragraphs 1-32 are incorporated by reference as if fully set

forth herein.
42.

Smucker’s website does not infringe any valid claim of the ’078 Patent.

43.

An actual controversy exists between Smucker and the Defendant as to whether or

not Smucker has infringed, or is infringing, the ‘078 Patent; has contributed to infringement, or is
contributing to infringement of the ‘078 Patent; and has induced infringement, or is inducing
infringement of the ‘078 Patent.
44.

The controversy is such that, pursuant to Federal Rule of Civil Procedure 57 and

28 U.S.C. § 2201 et seq., Smucker is entitled to a declaration, in the form of a judgment, that by
its activities Smucker has not infringed and is not infringing any valid and enforceable claim of
the ‘078 Patent; has not contributed to infringement and is not contributing to infringement of the

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‘078 Patent; and/or has not induced infringement and is not inducing infringement of the ‘078
Patent. Such a determination and declaration is necessary and appropriate at this time.
COUNT IV
DECLARATORY JUDGMENT OF NON-INFRINGEMENT OF THE ‘565 PATENT
45.

The allegations of paragraphs 1-32 are incorporated by reference as if fully set

forth herein.
46.

Smucker’s website does not infringe any valid claim of the ’565 Patent.

47.

An actual controversy exists between Smucker and the Defendant as to whether or

not Smucker has infringed, or is infringing, the ‘565 Patent; has contributed to infringement, or is
contributing to infringement of the ‘565 Patent; and has induced infringement, or is inducing
infringement of the ‘565 Patent.
48.

The controversy is such that, pursuant to Federal Rule of Civil Procedure 57 and

28 U.S.C. § 2201 et seq., Smucker is entitled to a declaration, in the form of a judgment, that by
its activities Smucker has not infringed and is not infringing any valid and enforceable claim of
the ‘565 Patent; has not contributed to infringement and is not contributing to infringement of the
‘565 Patent; and/or has not induced infringement and is not inducing infringement of the ‘565
Patent. Such a determination and declaration is necessary and appropriate at this time.
COUNT V
DECLARATORY JUDGMENT OF INVALIDITY OF THE ‘908 PATENT
49.

The allegations of paragraphs 1-32 are incorporated by reference as if fully set

forth herein.
50.

Based on the above-stated conduct, Smucker is informed and believes that the

Defendant contends that Smucker infringes one or more claims of the ‘908 Patent.

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51.

Smucker denies that it infringes any valid and enforceable claim of the ‘908

Patent, and avers that the assertions of infringement cannot be maintained consistently with
statutory conditions of patentability and the statutory requirements for disclosure and claiming
that must be satisfied for patent validity under at least one of 35 U.S.C. §§ 101, 102, 103, and
112.
52.

Accordingly, an actual controversy exists between Smucker and the Defendant as

to the validity of the ‘908 Patent. The controversy is such that, pursuant to Federal Rules of
Civil Procedure 57 and 28 U.S.C. § 2201 et seq., Smucker is entitled to a declaration, in the form
of a judgment, that the ‘908 Patent is invalid. Such a determination and declaration is necessary
and appropriate at this time.
COUNT VI
DECLARATORY JUDGMENT OF INVALIDITY OF THE ‘834 PATENT
53.

The allegations of paragraphs 1-32 are incorporated by reference as if fully set

forth herein.
54.

Based on the above-stated conduct, Smucker is informed and believes that the

Defendant contends that Smucker infringes one or more claims of the ‘834 Patent.
55.

Smucker denies that it infringes any valid and enforceable claim of the ‘834

Patent, and avers that the assertions of infringement cannot be maintained consistently with
statutory conditions of patentability and the statutory requirements for disclosure and claiming
that must be satisfied for patent validity under at least one of 35 U.S.C. §§ 101, 102, 103, and
112.
56.

Accordingly, an actual controversy exists between Smucker and the Defendant as

to the validity of the ‘834 Patent. The controversy is such that, pursuant to Federal Rules of

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Civil Procedure 57 and 28 U.S.C. § 2201 et seq., Smucker is entitled to a declaration, in the form
of a judgment, that the ‘908 Patent is invalid. Such a determination and declaration is necessary
and appropriate at this time.
COUNT VII
DECLARATORY JUDGMENT OF INVALIDITY OF THE ‘078 PATENT
57.

The allegations of paragraphs 1-32 are incorporated by reference as if fully set

forth herein.
58.

Based on the above-stated conduct, Smucker is informed and believes that the

Defendant contends that Smucker infringes one or more claims of the ‘078 Patent.
59.

Smucker denies that it infringes any valid and enforceable claim of the ‘078

Patent, and avers that the assertions of infringement cannot be maintained consistently with
statutory conditions of patentability and the statutory requirements for disclosure and claiming
that must be satisfied for patent validity under at least one of 35 U.S.C. §§ 101, 102, 103, and
112.
60.

Accordingly, an actual controversy exists between Smucker and the Defendant as

to the validity of the ‘078 Patent. The controversy is such that, pursuant to Federal Rules of
Civil Procedure 57 and 28 U.S.C. § 2201 et seq., Smucker is entitled to a declaration, in the form
of a judgment, that the ‘908 Patent is invalid. Such a determination and declaration is necessary
and appropriate at this time.
COUNT VIII
DECLARATORY JUDGMENT OF INVALIDITY OF THE ‘565 PATENT
61.

The allegations of paragraphs 1-32 are incorporated by reference as if fully set

forth herein.

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62.

Based on the above-stated conduct, Smucker is informed and believes that the

Defendant contends that Smucker infringes one or more claims of the ‘565 Patent.
63.

Smucker denies that it infringes any valid and enforceable claim of the ‘565

Patent, and avers that the assertions of infringement cannot be maintained consistently with
statutory conditions of patentability and the statutory requirements for disclosure and claiming
that must be satisfied for patent validity under at least one of 35 U.S.C. §§ 101, 102, 103, and
112.
64.

Accordingly, an actual controversy exists between Smucker and the Defendant as

to the validity of the ‘565 Patent. The controversy is such that, pursuant to Federal Rules of
Civil Procedure 57 and 28 U.S.C. § 2201 et seq., Smucker is entitled to a declaration, in the form
of a judgment, that the ‘908 Patent is invalid. Such a determination and declaration is necessary
and appropriate at this time.
PRAYER FOR RELIEF
WHEREFORE, plaintiff Smucker prays that:
A.

The Court declare that Smucker’s website does not infringe any valid claim of the
’908 patent;

B.

The Court declare that the claims of the ‘908 patent are invalid under one or more
of 35 U.S.C. §§ 101, 102, 103, and 112;

C.

The Court declare that Smucker’s website does not infringe any valid claim of the
’834 patent;

D.

The Court declare that the claims of the ‘834 patent are invalid under one or more
of 35 U.S.C. §§ 101, 102, 103, and 112;

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E.

The Court declare that Smucker’s website does not infringe any valid claim of the
’078 patent;

F.

The Court declare that the claims of the ‘078 patent are invalid under one or more
of 35 U.S.C. §§ 101, 102, 103, and 112;

G.

The Court declare that Smucker’s website does not infringe any valid claim of the
’565 patent;

H.

The Court declare that the claims of the ‘565 patent are invalid under one or more
of 35 U.S.C. §§ 101, 102, 103, and 112;

I.

Smucker be awarded its costs in this action;

J.

Smucker be awarded its attorneys fees pursuant to 35 U.S.C. § 285; and

K.

Smucker be awarded such other and further relief as this Court deems is just and

proper.
DEMAND FOR A JURY TRIAL
Smucker hereby demands a trial by jury in this action.

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Dated: January 4, 2012

Respectfully Submitted,

/s/ Eugenia G. Carter
Eugenia G. Carter
WI State Bar ID No. 1011447
[e-mail]
WHYTE HIRSCHBOECK DUDEK S.C.
P.O. BOX 1379
33 East Main Street, Suite 300
Madison, WI 53701
[phone] (telephone)
[phone] (facsimile)
and
Steven Lieberman
[e-mail]
Brian Rosenbloom
[e-mail]
Jenny L. Colgate
[e-mail]
ROTHWELL, FIGG, ERNST & MANBECK, PC
1425 K Street, N.W., Suite 800
Washington, D.C. 20005
[phone] (telephone)
[phone] (facsimile)
Attorneys for Plaintiff
The J. M. Smucker Company

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