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Vehicle Operation Technologies LLC v. American Honda Motor Co. Inc.

United States District Court, D. Delaware

September 12, 2014

Vehicle Operation Technologies LLC, Plaintiff,
v.
American Honda Motor Co. Inc., Defendant. Vehicle Operation Technologies LLC, Plaintiff,
v.
BMW of North America LLC, Defendant. Vehicle Operation Technologies LLC, Plaintiff,
v.
Ford Motor Company, Defendant. Vehicle Operation Technologies LLC, Plaintiff,
v.
General Motors LLC, Defendant. Vehicle Operation Technologies LLC, Plaintiff,
v.
Nissan North America Inc., Defendant. Vehicle Operation Technologies LLC, Plaintiff,
v.
Porsche Cars North America Inc., Defendant. Vehicle Operation Technologies LLC, Plaintiff,
v.
Mitsubishi Motors North America Inc., Defendant

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[Copyrighted Material Omitted]

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Richard D. Kirk, Esq., and Stephen B. Brauerman, Esq., Bayard, P.A., Wilmington, DE; Eric M. Buether, Esq. (argued), Buether Joe & Carpenter, LLC, Dallas TX, counsel for Plaintiff Vehicle. Operation Technologies LLC.

Stephanie Roberts, Esq., Steptoe & Johnson LLP, Washington DC, counsel for Defendant American Honda Motor Co. Inc.

Frederick L. Cottrell, III, Esq., Richards, Layton & Finger, Wilmington, DE; Kristina N. Hendricks, Esq., Kirkland & Ellis LLP, Chicago, IL, counsel for Defendant Porsche Cars North America.

Benjamin J. Schladweiler, Esq., Seitz, Ross, Aronstam & Moritz LLP, Wilmington, DE, counsel for Defendants Nissan North America and Ford Motor Company.

Reginald J. Hill, Esq., Jenner & Block, Washington DC, counsel for Defendant Nissan North America.

Jason R. Mudd, Esq., Erise IP, P.A., Kansas City, KS, counsel for Defendant Ford Motor Company.

Sean T. O'Kelly, Esq., O'Kelly Ernst & Bielli, Wilmington, DE; Charles Gorenstein, Esq., Birch Stewart Kolasch & Birch LLP, Falls Church, VA, counsel for Defendant Mitsubishi North America.

Richard L. Horwitz, Esq., Potter, Anderson & Carroon LLP, Wilmington, DE; Marc A. Cantor, Esq., and Matthew M. Jakubowski, Esq., Brooks Kushman LLP, Detroit, MI, counsel for Defendant General Motors LLC.

Jeffrey T. Castellano, Esq., Shaw Keller LLP, Wilmington, DE; Lionel M. Lavenue, Esq. (argued), Finnegan, Henderson, Farabow, Garrett & Dunner, Reston, VA; R. Benjamin Cassady, Esq., Finnegan, Henderson, Farabow, Garrett & Dunner, Washington DC, counsel for Defendant BMW.

Page 640

MEMORANDUM OPINION

RICHARD G ANDREWS, UNITED STATES DISTRICT JUDGE.

Presently before the Court for disposition are Defendants BMW of North America LLC, Ford Motor Company, General Motors LLC, Nissan North America Inc., Porsche Cars North America Inc., and Mitsubishi Motors North America Inc.'s Motions for Rule 11 Sanctions. (1:13-cv-00538-RGA D.I. 21; 1:13-cv-00539-RGA D.I. 21; 1:13-cv-00540-RGA D.I. 25; 1:13-cv-00541-RGA D.I. 22; 1 :13-cv-00542-RGA D.I. 22; 1 :13-cv-00712-RGA D.I. 24). These matters have been fully briefed. (1:13-cv-00538-RGA D.I. 22, 26, 28, 31, 56; 1:13-cv-00539 D.I. 23, 27, 29, 56; 1:13-cv-00540 D.I. 27, 31, 33, 57; 1:13-cv-00541 D.I. 53; 1:13-cv-00542 D.I. 23, 24, 27, 29, 56; 1: 13-cv-00712 D.I. 25, 29, 31, 35, 58). The Court heard oral argument on June 27,2014. (1:13-cv-00538-RGA D.I. 52). For the reasons set forth herein, the Defendants' Motions for Rule 11 Sanctions are GRANTED IN PART AND DENIED IN PART.

PROCEDURAL BACKGROUND

On April 5, 2013, Vehicle Operation Technologies (" VOT" ) brought six separate actions against Honda, BMW, Ford, General Motors, Nissan, and Porsche alleging infringement of U.S. Patent No. 7,145,442. VOT filed an additional suit against Mitsubishi on April23, 2013. An initial scheduling conference was held on August 6, 2013. During the conference, counsel for BMW informed VOT that due to claim scope disavowal the case was ripe for immediate dismissal. BMW also requested leave from the Court to file a Rule 11 motion, which the Court granted.

On September 30, 2013, Mitsubishi, Porsche, BMW, Ford, Nissan, and General Motors filed motions for violation of Rule 11

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by the Plaintiff and Plaintiffs attorneys. (1: 13-cv-00712-RGA D.I. 24; 1: 13-cv-00539-RGA D.I. 21; 1: 13-cv-00541 D.I. 22). Honda did not join in the motions for violation of Rule 11. (1:13-cv-00538-RGA D.I. 52 at 20). On September 25,2013, five days prior to the Defendants bringing their Rule 11 motions, Plaintiff's pro hac vice attorneys, Marc A. Fenster, Esq., Alexander C. D. Giza, Esq., and John P. Hely, Esq., of Russ August & Kabat, withdrew from the case. (1 :13-cv-00538-RGA D.l. 20).[1] On October 2, 2013, two days after the Defendants filed their Rule 11 motions, Eric W. Buether, Esq., Christopher M. Joe, Esq., Brian A. Carpenter, Esq., and Monica Tavakoli, Esq., of Buether Joe & Carpenter LLC filed for pro hac vice admission to represent the Plaintiff. (1: 13-cv-00538-RGA D.l. 23). The Court granted this motion on October 10, 2013. Throughout this litigation, lawyers from Bayard, P.A. have served as local counsel for the Plaintiff. (1:13-cv-00538 D.l. 1 at 5).

ANALYSIS

BMW and Mitsubishi move the Court to dismiss the case and to award attorney's fees and costs pursuant to Rule 11 for filing the present suit without the proper pre-suit investigation. (1: 13-cv-00538-RGA D.l. 22). Ford, General Motors, and Porsche move the Court to dismiss for the same Rule 11 violation. (1: 13-cv-00540-RGA D.l. 27). Nissan[2] joined BMW and Mitsubishi' s motion for both dismissal and an award of attorney's fees and costs. ( 1: 13-cv-00541, D.l. 22).

Plaintiff and Plaintiff's Attorneys Violated Rule 11

The determination of whether the Plaintiff and the Plaintiff's attorneys violated Rule 11 requires the determination of whether an objective pre-suit investigation would have disclosed that the accused products did not infringe the patent's claims. The Court will address this in two parts: First, the Court will determine whether there exists a prosecution disclaimer that would read out the accused vehicles' displays and thus prevent any infringement claim under the '442 patent. Second, the Court will determine whether an objective pre-suit investigation would have disclosed the prosecution disclaimer and that the accused products did not use dedicated displays.

1) Was there a prosecution disclaimer that would read out the accused vehicles' displays?

a. Prosecution Disclaimer

I have already ruled on the issue of prosecution disclaimer and adopt those findings here. (1:13-cv-00538 D.I. 52 at 5-12). In sum, " The doctrine of prosecution disclaimer is well established in Supreme Court precedent, precluding patentees from recapturing through claim interpretation specific meanings disclaimed during prosecution." Omega Eng'g, Inc, v. Raytek Corp., 334 F.3d 1314, 1323 (Fed. Cir. 2003) (internal citations omitted). With this in mind, I found that here the prosecution history is clear. " The inventor repeatedly and unambiguously disclaimed

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the plain reading of the term 'display" ' and specifically disclaimed any type of display other than a " dedicated display." (D.I. 52 at 8, 9). Furthermore, in an attempt to overcome a prior art reference, the inventor unmistakably indicated that the " dedicated display" had to present the relevant information " at all times."

b. Literal Infringement

" To show infringement of a patent, a patentee must supply sufficient evidence to prove that the accused product or process contains, either literally or under the doctrine of equivalents, every limitation of the properly construed claim." Seal-Flex, Inc. v. Athletic Track & Court Canst., 172 F.3d 836, 842 (Fed. Cir. 1999). A patent claim is literally infringed when " every limitation recited in the claim is found in the accused device, i.e., when the properly construed claim reads on the accused device exactly." Engel Indus., Inc. v. Lockformer Co., 96 F.3d 1398, 1405 (Fed. Cir. 1996). " The absence of even a single limitation of [a claim] from the accused device precludes a finding of literal infringement." Kahn v. Gen. Motors Corp., 135 F.3d 1472, 1477 (Fed. Cir. 1998).

The Plaintiffs complaints accuse Defendants' products of infringing the '442 patent. Specifically, the Plaintiff, by example, accuses the following cars and technologies:

o BMW: X5 M and X6 vehicles when equipped with the " Super Handling-All Wheel Drive System." (1:13-cv-00537-RGA D.I. 1)
o Nissan: Nissan Juke and all of Nissan's other vehicles that are equipped with Nissan's " Torque Vectoring" system. (1 :13-cv-00541-RGA).
o Ford: Ford Focus Electric, Ford C-Max hybrid, Ford Fusion Hybrid, Ford MKZ Hybrid, Ford Escape hybrid, and all of Ford's vehicles equipped with Ford's all wheel drive. (1: 13-cv-00539-RGA).
o General Motors: Chevy Volt. (1: 13-cv-00540-RGA).
o Porsche: 911 Carrera 4/4s all-wheel-drive models and other Porsche vehicles equipped with the Porsche Traction Management System. (1: 13-cv-00542-RGA).
o Mitsubishi: Vehicles equipped with " Super All Wheel Control Systems. (1: 13-cv-00712-RGA).

The Defendants argue that for each example vehicle there is no dedicated display, and as a dedicated display is required by each patent claim, there can be no literal infringement. The Court agrees.[3]

Porsche

The Plaintiff argues that the Porsche vehicles named in the complaint " include an apparatus that ...


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