CellTrust Corporation v. ionLake, LLC

Background

CellTrust Corporation alleged that ionLake, LLC, Derrick Girard, and Wade Girard infringed claims in United States Patent Nos. 9,775,012 and 10,778,837. The patents concern systems and methods for tracking communications sent through mobile devices, including archiving communications for compliance, reporting, auditing, and electronic discovery. CellTrust alleged that ionLake’s MyRepChat product or service infringed the patents directly or indirectly. CellTrust also asserted infringement-related claims against Derrick Girard and Wade Girard. ionLake and Derrick Girard brought counterclaims seeking declarations that the patents were not infringed and were invalid.

The parties disputed 13 claim terms: seven in the ’012 Patent and six in the ’837 Patent. They also filed cross-motions for summary judgment concerning defendants’ patent-invalidity counterclaims and defenses, and cross-motions to exclude expert testimony.

Claim construction

Claim construction is the court’s interpretation of what patent claims mean and how broad they are. The court ruled as follows:

- For both patents, “electronic discovery” means the discovery of electronically stored information to meet requirements imposed by civil or criminal litigation, regulatory oversight, or administrative proceedings. The court rejected ionLake’s narrower proposed definition. - “Electronic-discovery system” in the ’012 Patent has its plain and ordinary meaning and requires no special construction. The court rejected both parties’ proposed definitions. - “Email archiving system” in the ’012 Patent means a computer system that receives and stores emails. The court adopted ionLake’s definition and rejected CellTrust’s proposed additional requirements concerning fast retrieval and particular purposes. - “Mobile application” in the ’012 Patent means a computer program or application for any device configured to transmit and receive electronic communications. The court rejected CellTrust’s proposed limitation to applications running on smartphones or tablet computers or communicating through a mobile-carrier network. - “Server” in the ’012 Patent means a networked computer that manages access to a computer resource or service. The court adopted ionLake’s definition. - “Mobile application that is associated with the virtual number” means a virtual number linked with a computer program or application for any device configured to transmit and receive electronic communications. The parties agreed that a virtual number is a telephone number not locked to a specific phone that can route a voice call or text message to any phone or workflow. - The phrase “wherein the electronic-discovery system is configured for at least one of preserving, searching, reviewing and producing communications for electronic discovery” means that the system has been designed or combined with other elements so it can perform at least one of those functions in the context of electronic discovery. The court rejected ionLake’s proposed interpretation that configuring the system was a step that had to be performed during the patented method. - In the ’837 Patent, “a subscriber” means a user. The court rejected CellTrust’s proposed requirement that the person pay for or be licensed to receive a service. - “Subscriber business number” means a phone number used by a subscriber, meaning a user, for business purposes. The court rejected ionLake’s definition because it would give no meaning to the word “business.” - “Subscriber software module” means a software component or part of a program containing one or more routines used by a subscriber, meaning a user. - “Electronic discovery” in the ’837 Patent has the same definition the court adopted for the ’012 Patent. - “Enterprise Information Archiving system” means a computer system usable by an organization that can store and access electronic information. The court rejected CellTrust’s proposed requirement that the system include basic electronic-discovery tools. - “Wherein the Enterprise Information Archiving system is configured for electronic discovery” means an Enterprise Information Archiving system that has been designed or combined with other elements so it can perform electronic discovery as defined by the court. The court combined its definitions of the component phrases rather than adopting either party’s proposed combined definition.

Summary judgment on patent validity

Summary judgment is a decision without a trial when the evidence shows that no legally important factual dispute requires a jury’s decision. The court denied defendants’ motion for summary judgment on invalidity and granted in part CellTrust’s motion for partial summary judgment on invalidity, except as to obviousness.

The court denied CellTrust’s argument that defendants’ prior-art statement was inadequate because CellTrust raised that discovery-related challenge too late. The parties had exchanged timely prior-art statements, and CellTrust had not moved to strike or compel a more detailed statement during discovery.

On obviousness under 35 U.S.C. § 103, the court denied defendants’ motion. Defendants relied on Moshir ’564 and the opinions of Brad Pedersen, but the court found Pedersen’s obviousness opinion conclusory and lacking a factual basis for combining prior-art references or showing a reasonable expectation of success. The court also denied CellTrust’s motion concerning an alternative obviousness theory based on Attanasio ’747 and several Google products because defendants’ technical expert, Alexandre Antonov, identified evidence that created a genuine factual dispute.

On anticipation under 35 U.S.C. § 102, the court granted CellTrust’s motion for partial summary judgment and denied defendants’ motion. Defendants relied on Moshir ’564 but had not specifically identified it as an anticipating reference in their prior-art statement. The court also concluded that Moshir ’564 did not disclose every limitation of the asserted claims in a single reference.

On the argument that the patents claimed abstract ideas under 35 U.S.C. § 101, the court granted CellTrust’s motion for partial summary judgment. Defendants did not identify evidence or legal arguments supporting that defense and relied only on conclusory allegations.

Under 35 U.S.C. § 112, the court granted CellTrust’s motion for partial summary judgment on defendants’ written-description, enablement, and indefiniteness theories. The court found defendants’ reliance on a single vague and conclusory interrogatory response insufficient to create a genuine factual dispute.

The court also granted CellTrust’s motion for partial summary judgment on defendants’ prosecution-history-estoppel theory. Defendants did not identify evidence of a clear and unmistakable disclaimer or otherwise show a factual dispute on that issue.

Expert testimony

The court granted in part and denied in part CellTrust’s motion to exclude expert testimony. It granted the motion as to Brad Pedersen, defendants’ patent-law expert. The court excluded his opinions explaining patent-law concepts because legal opinions are for the court, not an expert witness. It also excluded his invalidity opinions because they were not relevant to the remaining issues and because he lacked the technical qualifications needed to testify about the relevant level of skill in the art.

As to Alexandre Antonov, defendants’ technical expert, the court granted CellTrust’s motion in part and denied it in all other respects. The court excluded only noninfringement opinions suggesting that an infringing system had to be able to direct or control the configuration of an electronic-discovery system or Enterprise Information Archiving system, because those opinions conflicted with the court’s claim constructions. The court allowed Antonov’s other obviousness and noninfringement opinions, concluding that CellTrust’s challenges generally concerned their credibility and weight rather than admissibility.

The court denied CellTrust’s motion to exclude Kevin H. Besikof’s damages opinions. Besikof could testify about lost profits and reasonable royalties, including his use of allegedly comparable licenses, although CellTrust could challenge those opinions through cross-examination and contrary evidence.

The court denied defendants’ motion to exclude Bryce R. Cook’s damages opinions. Cook could testify about lost profits and reasonable royalties. The court concluded that defendants’ criticisms generally concerned the factual support, credibility, or weight of Cook’s opinions rather than whether the opinions were admissible.

Order

The court construed the disputed patent terms as described in the opinion; granted in part CellTrust’s motion for partial summary judgment on invalidity, on all bases except obviousness; denied defendants’ motion for summary judgment; granted in part and denied in part CellTrust’s motion to exclude expert testimony; and denied defendants’ motion to exclude expert testimony. Judge Wilhelmina M. Wright signed the order.