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Riverbed Technology, Inc. v. Silver Peak Systems, Inc.

United States District Court, D. Delaware

September 12, 2014

RIVERBED TECHNOLOGY, INC., Plaintiff,
v.
SILVER PEAK SYSTEMS, INC., Defendant.

Thomas C. Grimm, Esq., MORRIS, NICHOLS, ARSHT & TUNNELL LLP, Wilmington, DE; Matthew B. Lehr, Esq., (argued), DAVIS POLK & WARDWELL LLP, Menlo Park, CA., Attorneys for Plaintiff Riverbed Technology, Inc.

Bindu A. Palapura, Esq., POTTER ANDERSON & CORROON LLP, Wilmington, DE; Michael J. Sacksteder, Esq., (argued), FENWICK & WEST LLP, San Francisco, CA; Bryan A. Kohm, Esq., (argued), FENWICK & WEST LLP, San Francisco, CA., Attorneys for Defendant Silver Peak Systems, Inc.

MEMORANDUM OPINION

RICHARD G. ANDREWS, District Judge.

Three post-trial motions are currently before the Court. Silver Peak Systems, Inc. filed a motion for a permanent injunction pursuant to 35 U.S.C. § 283. (D.I. 287). Riverbed Technology, Inc. filed a motion to strike the declarations of two witnesses offered by Silver Peak in support of its permanent injunction motion. (D.I. 299). In addition, Riverbed filed for renewed judgment as a matter of law. (D.I. 297). The briefing is complete, and the Court received the benefit of oral argument on August 20, 2014. (D.I. 325). For the reasons outlined below, Riverbed's JMOL motion and Silver Peak's motion for a permanent injunction are denied. Riverbed's motion to strike the declarations Silver Peak submitted in support of its motion is dismissed as moot.

I. BACKGROUND

This case pits two companies in the Wide Area Network ("WAN") optimization market against each other. Companies in the WAN optimization market utilize hardware and virtual appliances[1] to minimize the application performance problems caused by bandwidth constraints. (D.I. 291-7 at 2). There are numerous types of deployments, but the two pertinent ones for this case are data-center-to-data-center deployments and branch office deployments. Riverbed entered the market first and focused on the branch office deployments, whereas Silver Peak directed its efforts towards the data center deployments.

Riverbed filed suit against Silver Peak on June 1, 2011, alleging infringement of four U.S. patents. (D.I. 1). The Court entered a Scheduling Order bifurcating the case into separate damages and liability portions, with the discovery into damages yet to commence. (D.I. 21). Riverbed subsequently amended its complaint on December 19, 2011 to assert infringement of a fifth patent. (D.I. 38). In November 2012, Riverbed dismissed two of the patents. (D.I. 114) The Court later stayed Riverbed's case involving the three other patents pending a potential appeal of an inter partes re-examination that rejected all of the relevant independent claims for two of the patents. (D.I. 170). Riverbed has not wanted to proceed alone on the third of the remaining patents. Riverbed's claims remain stayed. ( Id. ).

On August 17, 2011, Silver Peak counterclaimed and asserted that Riverbed infringed three patents: U.S. Patent Nos. 7, 945, 736 ("the '736 patent"), 7, 948, 921 ("the '921 patent" and collectively, "the Silver Peak patents"), and 7, 630, 295.[2] (D.I. 13). The disputed terms in the Silver Peak patents have been construed. (D.I. 158 & 260).

A series of summary judgment motions followed. The parties filed cross-motions for summary judgment of infringement and non-infringement of the '736 patent (D.I. 171 & 188), and Silver Peak filed a separate motion seeking summary judgment of infringement of the '921 patent. (D.I. 184). On January 24, 2014, the Court granted partial summary judgment of infringement of the '921 patent for Ri0S[3] versions 5.0.0 and higher, but reserved for trial a determination of the corresponding hardware that contains the infringing software. (D.I. 233, p. 12; D.I. 234). The cross-motions for summary judgment on the '736 patent were denied. (D.I. 234).

The Court held a five-day jury trial, commencing on March 24, 2014. (D.I. 274, 275, 276, 277 & 278). At the conclusion of the trial, the jury returned a verdict largely in Silver Peak's favor. The jury concluded that: 1) Riverbed does not literally infringe claims 1, 2, 8, 9, 10, and 17 of the '736 patent, but Riverbed does infringe those claims under the doctrine of equivalents; 2) Riverbed contributorily infringes claims 1, 2, 8, 9, 10, and 17 of the '736 patent; and 3) Riverbed induced infringement of claim 1 of the '921 patent. (D.I. 271 at 2-3). The jury also found that claim 1 of the '921 patent is not invalid as anticipated. ( Id. at 4).

The parties then submitted post-trial motions. Riverbed filed a renewed motion for judgment as a matter of law, seeking this Court's determination that Silver Peak failed to adduce sufficient evidence upon which a reasonable jury could conclude that Riverbed indirectly infringed the '736 and '921 patents. (D.I. 297). In addition, Riverbed seeks judgment as a matter of law that it does not infringe the '736 patent under the doctrine of equivalents, and that the '921 patent is invalid as anticipated. ( Id. ). Silver Peak moves the Court for a permanent injunction under § 283. (D.I. 287). Riverbed filed a subsequent motion to strike the declarations of Silver Peak's CEO and Senior Vice President that were submitted by Silver Peak in connection with its motion for a permanent injunction. (D.I. 299). Each of these will be addressed in turn.

II. LEGAL STANDARD

A. Judgment as a Matter of Law

Judgment as a matter of law is appropriate if "the court finds that a reasonable jury would not have a legally sufficient evidentiary basis to find for [a] party" on an issue. FED. R. cry. P. 50(a)(1). "Entry of judgment as a matter of law is a sparingly' invoked remedy, granted only if, viewing the evidence in the light most favorable to the nonmovant and giving it the advantage of every fair and reasonable inference, there is insufficient evidence from which a jury reasonably could find liability." Marra v. Phila. Hous. Auth., 497 F.3d 286, 300 (3d Cir. 2007) (internal citation omitted).

To prevail on a renewed motion for judgment as a matter of law following a jury trial, the moving party "must show that the jury's findings, presumed or express, are not supported by substantial evidence or, if they were, that the legal conclusion(s) implied [by] the jury's verdict cannot in law be supported by those findings." Pannu v. Iolab Corp., 155 F.3d 1344, 1348 (Fed. Cir. 1998) (alteration in original). "Substantial' evidence is such relevant evidence from the record taken as a whole as might be accepted by a reasonable mind as adequate to support the finding under review." Perkin-Elmer Corp. v. Computervision Corp., 732 F.2d 888, 893 (Fed. Cir. 1984).

In assessing the sufficiency of the evidence, the court must give the non-moving party, "as [the] verdict winner, the benefit of all logical inferences that could be drawn from the evidence presented, resolve all conflicts in the evidence in his favor and, in general, view the record in the light most favorable to him." Williamson v. Consol. Rail Corp., 926 F.2d 1344, 1348 (3d Cir. 1991); Perkin-Elmer Corp., 732 F.2d at 893. The court may not determine the credibility of the witnesses nor "substitute its choice for that of the jury between conflicting elements in the evidence." Perkin-Elmer Corp., 732 F.2d at 893. Rather, the court must determine whether the evidence supports the jury's verdict. See Dawn Equip. Co. v. Ky. Farms Inc., 140 F.3d 1009, 1014 (Fed. Cir. 1998); Gomez v. Allegheny Health Servs. Inc., 71 F.3d 1079, 1083 (3d Cir. 1995) (describing standard as "whether there is evidence upon which a reasonable jury could properly have found its verdict"); 9B CHARLES ALAN WRIGHT & ARTHUR R. MILLER, FEDERAL PRACTICE AND PROCEDURE § 2524 (3d ed. 2008) ("The question is not whether there is literally no evidence supporting the party against whom the motion is directed but whether there is evidence upon which the jury might reasonably find a verdict for that party.").

Where the moving party bears the burden of proof, the Third Circuit applies a different standard. This standard "requires the judge to test the body of evidence not for its insufficiency to support a finding, but rather for its overwhelming effect.'" Fireman's Fund Ins. Co. v. Videfreeze Corp., 540 F.2d 1171, 1177 (3d Cir. 1976) (quoting Mihalchak v. Am. Dredging Co., 266 F.2d 875, 877 (3d Cir. 1959)). The Court "must be able to say not only that there is sufficient evidence to support the finding, even though other evidence could support as well a contrary finding, but additionally that there is insufficient evidence for permitting any different finding.'" Id. (quoting Mihalchak, 266 F.2d at 877).

B. Permanent Injunction

The Patent Act vests in this Court the power to "grant injunctions in accordance with the principles of equity to prevent the violation of any right secured by patent, on such terms as the court deems reasonable." 35 U.S.C. § 283. In order to succeed on a motion for a permanent injunction, the plaintiff must satisfy the four-factor test articulated in eBay :

A plaintiff must demonstrate: (1) that it has suffered an irreparable injury; (2) that remedies available at law, such as monetary damages, are inadequate to compensate for that injury; (3) that, considering the balance of hardships between the plaintiff and defendant, a remedy in equity is warranted; and (4) that the public interest would not be disserved by a permanent injunction.

eBay Inc. v. MercExchange, L.L.C., 547 U.S. 388, 391 (2006). An injunction should not be granted lightly, as the Supreme Court has cautioned, because it is a "drastic and extraordinary remedy." Monsanto Co. v. Geertson Seed Farms, 561 U.S. 139, 165 (2010). Indeed, if the plaintiffs injury can be adequately redressed with a less severe remedy, "recourse to the additional and extraordinary relief of an injunction" is not warranted. Id. at 166.

III. DISCUSSION

The parties' post-trial briefing raises four main issues: whether Silver Peak adduced sufficient evidence on which a reasonable jury could conclude Riverbed indirectly infringed the '736 and '921 patents; whether the testimony of Silver Peak's expert witness was sufficient to support the jury's finding of infringement of the '736 patent under the doctrine of equivalents[4]; whether claim 1 of the '921 patent is invalid as anticipated; and whether Silver ...


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