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Parallel Networks Licensing LLC v. International Business Machines Corp.

United States District Court, D. Delaware

February 22, 2017

PARALLEL NETWORKS LICENSING, LLC, Plaintiff,
v.
INTERNATIONAL BUSINESS MACHINES CORPORATION, Defendants.

          Adam W. Poff, Esq., Pilar G. Kraman, Esq., Young Conaway Stargatt & Taylor, Counsel for Plaintiffs

          Of Counsel: Douglas A. Cawley, Esq., Christopher T. Bovenkamp, Esq., Eric S.

          Hansen, Esq., Avery R. Williams, Esq., Justin W. Allen, Esq., McKool Smith, PC, Angela M. Vorpahl, Esq., McKool Smith, PC, John B. Campbell, Esq., Leah Bhimani Buratti, Esq., Kevin P. Hess, Esq., McKool Smith, PC,

          Martina Tyreus Hufhal, Esq., Nitika Gupta, Esq., Ronald P. Golden, III, Esq., Fish & Richardson PC, Juanita R. Brooks, Esq., Jason W. Wolff, Esq., Joanna M. Fuller, Esq., Fish & Richardson PC, Stephen A. Marshall, Esq., Fish & Richardson PC, Counsel for Defendants

          Of Counsel: John M. Desmarais, Esq., Jon T. Hohenthaner, Esq., Andrew G. Heinz, Esq., Jeffrey S. Seddon, II, Esq., William D. Findlay, Esq., Desmarais LLP,

          MEMORANDUM OPINION

          JORDAN, Circuit Judge

         I. Introduction

         There are four motions pending in this patent case: IBM's motion for summary judgment of non-infringement, Parallel Networks' motion for summary judgment to reject IBM's invalidity theories, and IBM's two Daubert motions. I heard oral argument on these motions on January 4, 2017. ("Tr.") For the reasons that follow, I will grant-in-part and deny-in-part both summary judgment motions, and will deny the Daubert motions.

         Parallel Networks filed this action on December 20, 2013, alleging that IBM infringed U.S. Patent Nos. 5, 894, 554 ("the '554 patent") and 6, 415, 335 ("the '335 patent"). (Docket Item ("D.I.") 1.) The '554 patent was filed on April 23, 1996, and issued on April 13, 1999. On July 24, 2012, the PTO issued an ex parte reexamination certificate cancelling the first 11 claims of the '554 patent and adding new claims 12-49. (See D.I. 278 at ¶ 21.)[1] The '554 patent generally discloses methods for load-balancing dynamic web page generation requests across multiple page-servers in an Internet-based system.

         The '335 patent was filed on January 19, 1999 and issued on July 2, 2002. On July 17, 2012, the PTO issued an ex parte reexamination certificate cancelling the first 29 claims and adding new claims 30-85. (See D.I. 278 at ¶ 45-46.)[2] It shares a specification with the '554 patent. (See id.)

         Parallel Networks accuses IBM of infringing (both directly and indirectly) six independent claims and 14 dependent claims of the patents-in-suit (D.I. 277 at 6 & n.3.) The asserted claims come in two flavors: "method" claims, which disclose a "method for managing a dynamic Web page generation request to a Web server, " and "machine readable medium" claims, which disclose "a machine readable medium having stored thereon data representing sequences of instructions, which when executed by a computer system, cause said computer system to perform the steps" of the method claims.

         Claim 12 of the '554 patent is representative:

         12. A computer-implemented method for managing a dynamic Web page generation request to a Web server, said computer-implemented method comprising the steps of:

Routing said request from said Web server to a selected page server, said selected page server receiving said request and releasing said Web server to process other requests, wherein said routing step further includes the steps of intercepting said request at said Web server, routing said request from said Web server to a dispatcher, and dispatching, by said dispatcher, said request to said selected page server;
Processing said request, said processing being performed by said selected page server while said Web server concurrently processes said other requests; and
Dynamically generating a Web page by said selected page server in response to said request, said Web page including data dynamically retrieved from one or more data sources; and
wherein dispatching includes:
examining said request to make a selection of which page server should process said request from among a plurality of page servers that can each generate said Web page requested by said request;
selecting one of said plurality of page servers to dynamically generate said Web page;
wherein said selection is based on examining dynamic information regarding a load associated with each of said plurality of page servers; and
sending said request to said selected page server based on said examination.

('554 patent.)

         II. Legal Standards

         Summary judgment is proper only if "the movant shows that there is no genuine dispute as to any material fact and the movant is entitled to judgment as a matter of law." Fed.R.Civ.P. 56(a). The moving party bears the burden of proving that no genuine issue of material fact exists. See Matsushita Elec. Indus. Co. v. Zenith Radio Corp., 475 U.S. 574, 585 n.10 (1986); Rockwell Int'l Corp. v. United States, 147-F.3d 1358, 1362 (Fed. Cir. 1998). "A dispute about a material fact is genuine if the evidence is such that a reasonable jury could return a verdict for the nonmoving party." Schering Corp. v. GenevaPharm., Inc., 339 F.3d 1373, 1381 (Fed. Cir. 2003) (internal citations omitted).

         If the moving party has demonstrated an absence of material fact, the nonmoving party then "must come forward with 'specific facts showing that there is a genuine issue for trial:" Matsushita, 475 U.S. at 587 (quoting Fed.R.Civ.P. 56(e) (1968)). The court will "view the evidence in a light most favorable to the non-movant, and draw all reasonable inferences in its favor." Group One, Ltd. v. Hallmark Cards, Inc., 254 F.3d 1041, 1045 (Fed. Cir. 2001). The mere existence of some evidence in support of the nonmoving party, however, will not be sufficient for denial of a motion for summary judgment; there must be enough evidence to enable a reasonable jury to find for the nonmoving party on that issue. See Anderson v. Liberty Lobby, Inc., 477 U.S. 242, 249 (1986). If the nonmoving party fails to make a sufficient showing on an essential element of its case with respect to which it has the burden of proof, the moving party is entitled to judgment as a matter of law. See Celotex Corp. v. Catrett, 477 U.S. 317, 322 (1986).

         III. IBM's Motion for Summary Judgment of Non-Infringement

         Parallel Networks offers both direct and indirect infringement theories. It argues that IBM directly infringed the asserted claims by selling the accused products, [3] by testing the accused products, and by hosting IBM's website. It argues that IBM is liable for indirect infringement on theories of induced infringement and contributory infringement. For the reasons that follow, I will grant IBM's motion with respect to indirect infringement and with respect to direct infringement as it pertains to the sale of the accused products and IBM's product tests. But I will deny IBM's motion with respect to the direct infringement theory based on the operation of its own website, A. Direct Infringement

         A party directly infringes a patent if it "makes, uses, offers to sell, or sells" the patented invention without permission. 35 U.S.C. § 271(a). In order to prove infringement, a plaintiff must show that the accused product meets each limitation of the asserted claims. See Microsoft Corp. v. AT&T Corp., 550 U.S. 437, 443 (2007); Rotec Indus., Inc. v. Mitsubishi Corp., 215 F.3d 1246, 1252 n.2 (Fed. Cir. 2000).

         Parallel Networks asserts that IBM infringed its patents by selling the accused products, by testing the accused products, and by operating IBM's website.

         1. Sale of IBM's WebSphere Application Server

         Parallel Networks alleges that IBM directly infringed the "machine readable medium" claims of the '554 patent (claims 20, 46, and 48) by selling the accused products. IBM argues that it is entitled to summary judgment because Parallel Networks has failed to produce sufficient evidence to show that the accused products satisfy each limitation of the asserted claims. Specifically, IBM argues that, as sold, the accused products do not have multiple application servers, do not route requests from a web server to multiple application servers, and do not dynamically generate web pages with data that is dynamically retrieved. (D.I. 277 at 13.)

         Parallel Networks points to three places in the record that, in its view, show that the accused products ship with multiple page servers. First, Parallel Networks points to a description of the WebSphere Application Server, which indicates that the Server includes an application server, an HTTP server, and web-server plugins. (D.I. 307 at 19 (citing D.I. 308 Ex. 38 at 20, Ex. 39 at 26).) But that description does not indicate how many page servers, if any, are included with the accused products. In fact, even Parallel Networks' own expert, Dr. Mark Jones, agrees that the WebSphere Application Server comes with, at most, one page server. (See D.I. 308 at Ex. 2 ¶¶ 188-92 (explaining that, while a WebSphere Application Server is a page server, the HTTP server and web-server plug-ins are not page servers, but are instead used to route requests to page servers).)

         Second, Parallel Networks argues that Dr. Jones "specifically identified the sequences of instructions" in the accused products for routing web requests to one of a plurality of page servers. (D.I. 307 at 5, 19.) That, however, is a significant overstatement. The alleged "identification" of instructions is wholly inadequate, consisting of an incomprehensible 200 page spreadsheet with nothing more than claim language and directory locations of source code files. (D.I. 308 Ex. 3.) Moreover, Parallel Networks' argument would be inadequate even if it had identified the source code instructions. The asserted claims disclose a machine readable medium containing a series of instructions that, when executed, cause the system to select one of a plurality of page servers. (See '554 patent; '335 patent.) In order to select one of a plurality of page servers, there must necessarily be a plurality of page servers. The content of IBM's source code does not appear to speak to that limitation.

         Third, Parallel Networks argues that "it is clear that Websphere Application Server (as sold) includes multiple application servers" because "[f]he capability of deploying multiple application servers is present in the product upon download by the customer." (D.I. 307 at 20.) That argument rests on faulty logic. The fact that the accused products may be used to create application servers does not mean that the products, as sold, include application servers, as is required by the claims. (See D.I. 278 Ex. 9 at ¶ 819 (Eric Covener, a senior software engineer who worked on the WebSphere product, explaining that "[c]ompanies have the option to create multiple application servers, " but that "multiple application servers are not deployed by default") (emphasis added).)

         While each of Parallel Networks' record-based arguments fails to show that the accused products satisfy the "plurality of page servers" limitation, there is one more argument to consider. Parallel Networks suggests that the "plurality of page servers" is implicitly built into the accused products, such that one need only "install, " "activate, " or "deploy" the product to satisfy the claim limitation. (See Di. 307 at 19 (relying on Finjan, Inc. v. Secure Computing Corp., 626 F.3d 1197, 1205 (Fed. Cir. 2010) ("The fact that users needed to 'activate the functions programmed' by purchasing keys does not... nullify the existence of the claimed structure in the accused software.") and Versata Software, Inc. v. SAP Am., Inc., Ill. F.3d 1255, 1262 (Fed. Cir. 2013) (recognizing that accused products infringe even if the product only meets claim limitations upon activation)).) That argument, though, is not supported by the record.

         Parallel Networks does not identify any evidence showing that the installation or configuration of the accused products will necessarily result in multiple page servers. There is no evidence in the record showing that the accused products, as sold, contain multiple page servers, as required by the claims. To the contrary, there is persuasive evidence showing that a customer who purchases the accused products must take deliberate steps to instantiate and configure page servers. (See D J. 278 Ex. 3 at ¶ 97-98 (explaining how to create and configure page servers, and thus showing that page servers are not created by default).) IBM points to its product manuals to show that there are several ways to install, configure, activate, or deploy the accused products without using or creating multiple page servers. (See Id. at A94 (depicting a system with only one page server and providing configuration instructions), A98 (depicting a system that can have one or more page servers, and providing instructions that allow users to choose the number of page servers); Ex. 9 at ¶ 819 (Eric Covener explaining that the accused product does not contain multiple page servers by default).)

         The complexity involved in the installation of the accused products (see Id. Ex. 9 at ¶ 761-62 (IBM's expert, Dr. Philip Greenspun, explaining that "the product must be installed in a larger system, which is a complex task generally undertaken by a team of professionals"), A819 (Eric Covener, explaining that "[d]eploying multiple application servers ... is significantly more complicated"), in tandem with the many non-infringing configurations, shows that this is not a case in which the only gap between the product-as-sold and the product-as-infringing is the press of a button, a simple activation, or the word "go." Cf. Finjan, Inc., 626 F.3d at 1205 (recognizing that a product can infringe even if the accused functionality must be "activated"); Versata Software, Inc., Ill. F.3d at 1262 ...


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