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Improved Search LLC v. Microsoft Corp.

United States District Court, D. Delaware

May 28, 2019

IMPROVED SEARCH LLC, Plaintiffs,
v.
MICROSOFT CORPORATION., Defendant.

          MEMORANDUM AND ORDER

          JOSEPH F. BATAILLON SENIOR UNITED STATES DISTRICT JUDGE.

         This matter is before the Court on the plaintiff's motion for a summary judgment of no ninfringement (D.I. 85) and defendant's opposition thereto and purported cross-motion for summary judgment on its affirmative defenses.[1] D.I. 88. This is an action for patent infringement, pursuant to 35 U.S.C. § 271 et seq.

         I. FACTS

         In its complaint, plaintiff Improved Search LLC (“Improved”) alleges Microsoft Corporation (“Microsoft”) infringes two related patents, U.S. Patent Nos. 6, 604, 101 (the “101 Patent”) and 7, 516, 154 (“the '154 patent”) (collectively, “the Asserted Patents”) (D.I. 1, Complaint at 4). The patents improve the usability of searching over the internet and are directed to cross-language translation of query and search information as well as retrieval of multilingual information over a computer network. The '101 patent generally relates to methods and systems of for translating queries from a source language to a target language, and the '154 patent generally relates to methods of and systems for providing cross language advertising services over the Internet. Id. at 4. In the answer to Improved's complaint, Microsoft asserted several affirmative defenses, including noninfringement and invalidity. D.I. 7, Answer at 11-12. Microsoft did not assert any counterclaims for declaratory relief. Id.

         On April 2, 2018, United States Magistrate Judge Sherry R. Fallon filed a Report and Recommendation (“R&R”) which, among other things, adopted defendant Microsoft's proposed definition of “dialectal standardization.”[2] D.I. 68, R&R at 7. The term or a variant of it appears in all of the independent claims of the '101 patent. Id.; D.I. 1-1, '101 patent at cols. 7 - 10. This Court adopted the Report and Recommendation on August 21, 2018. D.I. 76, Memorandum and Order at 8. In a related motion, Improved moved to dismiss its claims alleging infringement of the '154 patent under Federal Rule of Civil Procedure 41, based on the Court's claim construction and on a purported agreement between the parties. D.I. 95. The Court granted the motion and Improved's claims of infringement of the '154 patent were dismissed, with prejudice, under Federal Rule of Civil Procedure 41(b). (D.I. 102). Any asserted claims or defenses by defendant Microsoft were dismissed without prejudice. Id.

         Improved now moves for summary judgment, seeking a determination that Microsoft does not infringe the '101 patent.[3] D.I. 85. Improved concedes that “based on the currently available documents, it cannot, in good faith, pursue their infringement claim under the Court's construction of ‘dialectal standardization.'” D.I. 86, Brief at 1. It candidly admits that it seeks summary judgment in order to move forward with a direct appeal to the Federal Circuit. Id. at 3.

         Microsoft agrees that a summary judgment of noninfringement of the '101 Patent should be granted. D.I. 88, Brief at 1. Microsoft, however, also seeks a ruling in its favor on the merits of its affirmative defenses of noninfringement, both literally and under the doctrine of equivalents, and invalidity.[4] D.I. 88, Brief. It contends that there is no genuine dispute that none of the accused systems or methods infringe any of the currently asserted claims of the '101 Patent. It argues that it seeks summary judgment “based on five separate claim requirements not specifically mentioned in Plaintiff's motion but for which Plaintiff cannot advance evidence sufficient to support a jury finding in its favor.” Id. Microsoft submits evidence in support of its position. D.I. 89-2, Exs. 1-5.

         In response to Microsoft's arguments, Improved states that there are genuine issues of material fact on whether Microsoft would be entitled to a summary judgment on any grounds other than under the claim construction at issue. It asks the court to enter a summary judgment of noninfringement, but to deny Microsoft's motion to the extent it seeks a judgment of noninfringement on any grounds other than those relating to the Court's construction of dialectical standardization and related terms. D.I. 93, Reply Brief at 9.

         II. LAW

         “The court shall grant summary judgment 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 initial burden of demonstrating the absence of a genuine issue of material fact. Celotex Corp. v. Catrett, 477 U.S. 317, 323 (1986). The moving party “is entitled to a judgment as a matter of law [when] the nonmoving party has failed to make a sufficient showing on an essential element of her case with respect to which she has the burden of proof.” Id. (internal quotation marks omitted). The moving party need only show “that there is an absence of evidence to support the nonmoving party's case.” Id. at 325.

         If the moving party has carried its burden, the nonmovant must then “come forward with specific facts showing that there is a genuine issue for trial.” Matsushita Elec. Indus. Co. v. Zenith Radio Corp., 475 U.S. 574, 587 (1986) (internal quotation marks omitted). The court will “draw all reasonable inferences in favor of the nonmoving party, and it may not make credibility determinations or weigh the evidence.” Reeves v. Sanderson Plumbing Prods., Inc., 530 U.S. 133, 150 (2000). Infringement, whether literal or under the doctrine of equivalents, is a question of fact. Ferguson Beauregard/Logic v. Mega Sys., Inc., 350 F.3d 1327, 1338 (Fed.Cir.2003).

         A determination of infringement is a two-step process. Wright Med. Tech., Inc. v. Osteonics Corp., 122 F.3d 1440, 1443 (Fed. Cir. 1997). The first step is claim construction, which is a question of law to be determined by the court. Id. The second step is an analysis of infringement, in which it must be determined whether a particular device infringes a properly construed claim. Id. This analysis is a question of fact. Id.

         A ruling on claim construction after a Markman hearing is not a final, appealable order, in the absence of a resolution of all of the factual issues of infringement or validity dependent thereon. Nystrom v. TREX Co., Inc., 339 F.3d 1347, 1350 (Fed. Cir. 2003) (sua sponte dismissing appeal of a finding of noninfringement and invalidity of certain claims of a patent for lack of jurisdiction where a declaratory-judgment counterclaim for invalidity and unenforceability remained pending as to other claims of the patent and had been stayed). “Piecemeal litigation is as strictly precluded by the rule of finality for patent cases as it is for any other case.” Id. Under the finality rule, parties may only appeal a “final decision of a district court.” Id.A final judgment “is a decision by the district court that ‘ends the litigation on the merits and leaves nothing for the court to do but execute the judgment.'” Pause Tech. LLC v. TiVo Inc., 401 F.3d 1290, 1292 (Fed. Cir. 2005) (quoting Catlin v. United States, 324 U.S. 229, 233 (1945)). “[W]hether an order constitutes a final judgment ‘depends upon whether the judge has or has not clearly declared his intention in this respect in his opinion.'” Pandrol USA, LP v. Airboss Ry. Prod., Inc., 320 F.3d 1354, 1362 (Fed. Cir. 2003) (quoting United States v. F. & M. Schaefer Brewing Co., 356 U.S. 227, 232 (1958) (citation omitted)). “A ‘judgment that does not dispose of pending counterclaims is not a final judgment.'” Pause Tech LLC, 401 F.3d at 1293.

         To be appealable a claim construction order must preclude a finding of infringement-a required element of the plaintiff's cause of action. Princeton Digital Image Corp. v. Office Depot Inc., 913 F.3d 1342, 1348 (Fed. Cir. 2019). Such preclusion of infringement may be established by the patent owner's binding admission that the accused activities are not infringing under the adopted claim construction. Id. (noting that where a claim construction order does not resolve the issue of infringement, it is not a final decision, and, accordingly, is not appealable); see alsoWilson Sporting Goods Co. v. Hillerich & Bradsby Co., 442 F.3d 1322, 1326 (Fed. Cir. 2006) (“[F]inal judgment in a patent case will usually ...


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