Factory Direct Wholesale, LLC v. Office Kick, Inc.

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FACTORY DIRECT WHOLESALE, LLC, Plaintiff, v. OFFICE KICK, INC., and CKNAPP SALES, INC. Defendants.

OFFICE KICK, INC., and CKNAPP SALES, INC., Counterclaim Plaintiffs v. FACTORY DIRECT WHOLESALE, LLC, DEFU USA, LLC, and HANPING LIU, Counterclaim Defendant/ Third Party Counterclaim Defendants.

No. CV421-368

United States District Court, S.D. Georgia, Savannah Division

July 5, 2023

REPORT AND RECOMMENDATION

CHRISTOPHER L. RAY UNITED STATES MAGISTRATE JUDGE

Plaintiff Factory Direct Wholesale, LLC sells adjustable standing desk converter units which allow users to either stand or sit while using the work surface. Doc. 15 at 5 (First Amended Complaint). It has sold various desk converters models on Amazon.com. Id. at 6, 29-30. Defendant CKNAPP Sales, Inc., also known as “Vivo,” is a parent company of Defendant Office Kick, Inc. (“Office Kick”). Id. at 3. Vivo and Office Kick are competitors of Plaintiff, and they sell desk converters on their own websites. Id. at 4.

According to United States Patent Office (“USPO”) records Office Kick holds three desk converter patents: (1) Patent No. 11,134,773 (the “773 Patent”), (2) Patent No 11,134,774 (the “774 Patent”), and (3) Patent No. 10,575,630 (the “630 Patent,” and, collectively with the 773 and 774 Patents, the “Patents”). Doc. 15 at 7-8, 22, 25; see also doc. 15-6 (630 Patent); doc. 15-1 (773 Patent); doc. 15-5 (774 Patent). Plaintiff asserts that although the 774 Patent purports to be a continuation of the 773 Patent, and the 773 Patent purports to be a continuation of the 630 Patent, the 774 Patent and 773 Patent are actually “continuations-in-part” because they add substantive content. Doc. 71 at 6 n.3 (noting that this distinction does not impact the Court's claim construction analysis); see also doc. 73 at 5 (The Patents “are related, sharing a common priority date, specification, and title[.]”). Plaintiff alleges that Defendants' counsel wrote to Amazon demanding that it remove two of Plaintiff's models because they infringed the 773 Patent; Amazon subsequently removed the models. Doc. 15 at 6-9. Amazon eventually removed more of Plaintiff's models at Defendants' request because they purportedly infringed one of the Patents. Id. at 19-30.

Plaintiff brought this action against Defendants asserting claims for tortious interference, civil conspiracy, declaratory judgment of noninfringement of the Patents, and declaratory judgment of invalidity of the Patents. See doc. 15 at 30-43.^[1] Consistent with Rule 6.3 of the Local Patent Rules of the Northern District of Georgia (“LPRs”),^[2] the parties filed a Joint Claim Construction Statement containing, inter alia, their respective proposed constructions of disputed patent claim terms. Doc. 62; see also doc. 63 (first amended joint statement); doc. 72 (second amended statement). Plaintiff proposes constructions for eleven disputed terms, doc. 72-1 at 1-8; Defendants contend that “[n]o construction is necessary” for any of the terms. Doc. 77 at 26. The parties filed opening claim construction briefs, docs. 71 & 73, and responsive briefs, docs. 77 & 78. See LPR 6.5. The Court held a claim construction hearing, doc. 82 (Minute Entry); doc. 86 (Transcript), and the claim construction issues are ripe for disposition.

STANDARD

“It is a bedrock principle of patent law that the claims of a patent define the invention to which the patentee is entitled the right to exclude.” Phillips v. AWH Corp. 415 F.3d 1303, 1312 (Fed. Cir. 2005) (en banc) (internal quotations and citation omitted).^[3] “[A] district court's duty at the claim construction stage is, simply, the one that [the Federal Circuit] described . . . many times before: to resolve a dispute about claim scope that has been raised by the parties.” Eon Corp. IP Holdings v. Silver Spring Networks, 815 F.3d 1314, 1319 (Fed. Cir. 2016). Claim construction is a matter of law. Markman v. Westview Instruments, Inc., 52 F.3d 967, 979 (Fed. Cir. 1995).

“When a court is presented with a purported dispute as to the meaning and scope of patent claim terms, the threshold question must be whether claim construction is truly necessary.” Britax Child Safety, Inc. v. Nuna Int'l B.V., 2019 WL 7161687, at *3 (E.D. Pa. Dec. 23, 2019); see also U.S. Surgical Corp. v. Ethicon, Inc., 103 F.3d 1554, 1568 (Fed. Cir. 1997) (“Claim construction is a matter of resolution of disputed meanings and technical scope, to clarify and when necessary to explain what the patentee covered by the claims[.]” (emphasis added)). Claim construction is necessary “[w]hen the parties raise an actual dispute regarding the proper scope of claims.” Kaufman v. Microsoft Corp., 34 F.4th 1360, 1369 (Fed. Cir. 2022) (quoting O2 Micro Int'l Ltd. v. Beyond Innovation Tech. Co., 521 F.3d 1351, 1360 (Fed. Cir. 2008) (emphasis added)).

“Determining whether there exists a genuine dispute as to the scope of a claim term must be resolved by first considering the ‘ordinary and customary meaning' of the term.” Britax, 2019 WL 7161687, at *3 (quoting FenF, LLC v. SmartThingz, Inc., 601 Fed.Appx. 950, 952 (Fed. Cir. 2015)). In patent cases, “the ordinary and customary meaning . . . is the meaning that the term would have to a person of ordinary skill in the art in question at the time of invention.” Phillips, 415 F.3d at 1313; see also Sci. Applications Int'l Corp. v. United States, 161 Fed.Cl. 373, 376 (2022) (referring to a person of ordinary skill in the art as a “POSITA”).^[4] In some cases, “the ordinary meaning of claim language as understood by a [POSITA] may be readily apparent even to lay judges, and claim construction in such cases involves little more than the application of the widely accepted meaning of commonly understood words.” Phillips, 415 F.3d at 1314; see also Keurig, Inc. v. JBR, Inc., 2013 WL 1213061, at *3 (D. Mass. Mar. 22, 2013) (citing O2 Micro, 521 F.3d at 1361) (“[I]t is well-established that a court may construe a claim term to have its plain meaning when such a construction resolves a dispute between the parties.”); id. at *6 (“[T]he Court is not required to provide additional language construing a claim if its ordinary meaning can be readily understood by a layperson and adopting it would resolve the parties' dispute concerning interpretation.”); Truinject Corp. v. Galderma, S.A., 2020 WL 3287047, at *1 (D. Del. June 18, 2020) (“Where the meaning is not readily apparent, however, the court may look to those sources available to the public that show what a person of skill in the art would have understood disputed claim language to mean.” (quotations and citation omitted)). However, “[a] determination that a claim term ‘needs no construction' or has the ‘plain and ordinary meaning' may be inadequate when a term has more than one ‘ordinary' meaning or when reliance on a term's ‘ordinary' meaning does not resolve the parties' dispute.” O2 Micro, 521 F.3d at 1361.^[5]

“Where claim construction is determined to be necessary, the court must abide by the same standard in construing the disputed claim term as in determining whether construction is necessary in the first place: the disputed term must be given its ordinary and customary meaning, that is, the meaning the term would have to a [POSITA] who has read the entire patent at the time of the invention.” Britax, 2019 WL 7161687, at *3.

“Importantly, the [POSITA] is deemed to read the claim term not only in the context of the particular claim in which the disputed term appears, but in the context of the entire patent[.]” Phillips, 415 F.3d at 1313. Therefore, although “[t]he claim construction inquiry . . . begins and ends in all cases with the actual words of the claim,” Renishaw PLC v. Marposs Societa' per Azioni, 158 F.3d 1243, 1248 (Fed. Cir. 1998), courts must also consider “the remainder of the specification, the prosecution history, and extrinsic evidence concerning relevant scientific principles, the meaning of technical terms, and the state of the art.” Phillips, 415 F.3d at 1314 (quoting Innova/Pure Water, Inc. v. Safari Water Filtration Sys., Inc., 381 F.3d 1111, 1116 (Fed. Cir. 2004)). “Further, a court construing patent claim terms need not adopt the constructions proposed by the parties, and should determine its own constructions if it determines the parties' proposals to be legally flawed.” Holmberg v. United States, 124 Fed.Cl. 610, 613 (2016).

“[T]he specification ‘is always highly relevant to the claim construction analysis. Usually, it is dispositive; it is the single best guide to the meaning of a disputed term.' ” Phillips, 415 F.3d at 1315 (quoting Vitronics Corp. v. Conceptronic, Inc., 90 F.3d 1576, 1582 (Fed. Cir. 1996)). Courts, however, must “us[e] the specification [only] to interpret the meaning of a claim”, and may not “import[ ] limitations from the specification into the claim.” Phillips, 415 F.3d at 1323. “[T]he court may also consider the prosecution history of the patent, if in evidence.” Vitronics Corp, 90 F.3d at 1582. The prosecution history consists of “all the proceedings before the Patent and Trademark Office, including any express representations made by the applicant regarding the scope of the claims.” Id. However, since the “prosecution history represents an ongoing negotiation between the PTO and the applicant, rather than the final product of that negotiation, it often lacks the clarity of the specification and thus is less useful for claim construction purposes.” Phillips, 415 F.3d at 1317. Courts may also examine “extrinsic evidence,” e.g., dictionaries, treatises, and expert testimony, id. at 1318; however, extrinsic evidence is “less significant than the intrinsic record”, and “cannot alter any claim meaning discernible from intrinsic evidence.” C.R. Bard, Inc. v. U.S. Surgical Corp., 388 F.3d 858, 862 (Fed....