Sonix Tech. Co. v. Publications Int'l, Ltd.

• Decision Date: 05 January 2017
• Docket Number: 2016-1449
• Parties: Sonix Technology Co., Ltd., Plaintiff-Appellant v. Publications International, Ltd., SD-X Interactive, Inc., Encyclopedia Brittannica, Inc., Herff Jones, Inc., Defendants-Appellees
• Court: U.S. Court of Appeals — Federal Circuit

844 F.3d 1370

121 U.S.P.Q.2d 1247

Sonix Technology Co., Ltd., Plaintiff-Appellant

v.Publications International, Ltd., SD-X Interactive, Inc., Encyclopedia Brittannica, Inc., Herff Jones, Inc., Defendants-Appellees

2016-1449

United States Court of Appeals, Federal Circuit.

Decided: January 5, 2017

Jonathan Hangartner , X-Patents, APC, La Jolla, CA, argued for plaintiff-appellant. Also represented by Steven P. Fallon , Greer, Burns & Crain, Ltd., Chicago, IL.

Jacob Daniel Koering , Miller, Canfield, Paddock, & Stone, PLC, Chicago, IL, argued for defendants-appellees. Also represented by Terrence Joseph Sheahan, Freeborn & Peters, LLP, Chicago, IL.

Before Lourie, O'Malley, and Taranto, Circuit Judges.

Lourie, Circuit Judge.

Sonix Technology Co., Ltd. ("Sonix") appeals from the district court's grant of summary judgment following its determination that claims 9, 25, 35–36, 52–55, 57–60, 62–64, 66, 68, 71–77, 79–82, and 85–90 ("the asserted claims") of Sonix's U.S. Patent 7,328,845 ("the '845 patent") are invalid as indefinite. See Sonix Tech. Co. v. Publ'ns. Int'l, Ltd. , No. 13–cv–2082, 2015 WL 8153600, at *9–17 (N.D. Ill. Dec. 8. 2015) (" Opinion "). Specifically, the district court concluded that the term "visually negligible" rendered the asserted claims indefinite under 35 U.S.C. § 112 ¶ 2.¹ For the reasons that follow, we reverse the determination of indefiniteness and hence the summary judgment of invalidity.

BACKGROUND

Sonix owns the '845 patent, which describes a system and method for using a "graphical indicator" (e.g. , a matrix of small dots) to encode information on the surface of an object. See '845 patent, col. 3 ll. 6–43. The surface may feature additional information as well; for example, illustrations or icons in a children's book. Id. col. 7 ll. 1–6. The invention also includes an "optical device" that can read the graphical indicator and output further information. Id. col. 7 ll. 18–32. Figure 5 illustrates an example:

Id. fig.5. In this example, an icon showing a person riding a horse (511) is printed on the page of a book (51). Id. col. 7 ll. 1–10. The graphical indicator (512) is printed in the same area as the icon. Id. col. 7 ll. 18–21. The optical device (311) captures an image that includes the graphical indicator. Id. col. 7 ll. 21–24. The processing device (312) retrieves the indicator from the image and outputs additional information. Id. In this particular example, holding the optical device over the horse icon could cause the device to output "audio information, such as pronunciations of horse in English." Id. col. 7 ll. 27–32.

Of course, encoding information on the surface of an object is not new. The '845 patent admits that information has been recorded on the surface of objects "[d]ating back to ancient time[s]," id. col. 1 ll. 15–16, and lists a bar code as a "conventional" example of a graphical indicator, id. col. 9 ll. 46–57. The '845 patent purports to improve on conventional methods by rendering the graphical indicator "visually negligible." Id. col. 3 ll. 5–11. The patent uses a book cover to illustrate the difference between a conventional bar code and the claimed indicator:

Id. figs.12(A) & 12(B). The graphical indicator (10002) in figure 12(B) stores the same information as the bar code (10001) in figure 12(A), but in a manner that does not "interfere with the other main information on the surface." Id. col. 9 ll. 47–57.

The "[e]xemplary [d]esign," id. col. 3 l. 5, of the claimed indicator "includes multiple graphical micro-units arranged in a layout." Id. col. 3 ll. 14–15. In one embodiment the micro-units are dots, arranged in a matrix. Id. col. 3 ll. 15–25. Each cell in the matrix either contains or does not contain a dot, resulting in a unique pattern that can store information. Id. col. 3 ll. 38–30, col. 4 ll. 13–41.

The written description also discloses differentiability, brightness, and homogeneity "requirements for the graphical indicators being negligible to human eyes." Id. col. 4 ll. 60–61. First, the indicator must be so small that "human eyes cannot differentiate one graphical indicator from others."Id. col. 4 ll. 61–63. The patent indicates that "[f]or best result, the graphical micro-unit must be so tiny that only a microscope apparatus can detect it." Id. col. 3 ll. 24–25. Second, the patent advises that the number of micro-units should be reduced based on "the size of the graphical micro-unit, the pitch between micro-unit, and the desired visual effect," so that they "have little influence on the brightness of the surface of the object." Id. col. 4 l. 67–col. 5 l. 1. Finally, the "number of graphical micro-units of each graphical indicator" should be "substantially equal to each other," so that "the graphical indicators look more homogenous to human eyes and become invisible to human eyes." Id. col. 5 ll. 1–5.

The written description also gives two examples of visually-negligible indicators. In the first, each square centimeter contains 3,000 matrix cells, of which less than 70% contain graphical micro-units, and where each micro-unit occupies less than 80% of the cell. Id. col. 5 ll. 6–10. The second is similar, but requires each square centimeter to include 6,000 cells. Id. col. 5 ll. 11–15.

In 2010, Sonix alleged that children's books using dot pattern technology produced by GeneralPlus, a Taiwanese company, infringed the '845 patent. In response, SunPlus Technology Co. Ltd. ("SunPlus"), GeneralPlus's parent company, requested ex parte reexamination of the '845 patent ("the first reexamination") by the U.S. Patent and Trademark Office ("USPTO"). On December 27, 2011, the USPTO confirmed the patentability of, inter alia , asserted claims 9, 25, and 35–36, and allowed new, and now asserted, claims 52–55, 57–60, 62–64, 66, 68, 71–77, 79–82, and 85–90, among others. J.A. 94–96.

Less than one month later, GeneralPlus requested another ex parte reexamination ("the second reexamination"). J.A. 1937. One of the central disputed issues during this second reexamination was whether the combination of U.S. Patent 5,416,312 ("Lamoure") and U.S. Patent 5,329,107 ("Priddy") would have led to a visually-negligible indicator, as the examiner initially rejected all pending claims over that combination. See , e.g. , J.A. 2328–31. Sonix responded to that rejection with a declaration from Serjer Serjersen ("Serjersen"), an expert with more than thirty years of experience. J.A. 2337. Serjersen declared that he created graphical indicators using the processes described by the '845 patent and by the cited references, and determined that only the indicator produced using the process of the '845 patent was visually negligible. J.A. 2338–44, 5313–25. The examiner confirmed the patentability of the asserted claims on the basis of Serjersen's declaration, specifically indicating that the combination of cited references did not disclose a visually-negligible graphical indicator. J.A. 2362–65.

In 2013, Sonix alleged that Publications International, Ltd., SD-X Interactive, Inc., Encyclopedia Brittannica, Inc., and Herff Jones, Inc. (collectively, "Appellees") infringed the asserted claims. Appellees' initial invalidity contentions identified twenty-six claim limitations that they believed to be indefinite; however, that list did not include the term "visually negligible." See J.A. 2637–41. In their final invalidity contentions, Appellees contended that two additional claim limitations were indefinite, but again did not question "visually negligible." J.A. 3031.

During claim construction, Appellees initially asked the district court to construe "visually negligible," J.A. 2430, but, when they retained new counsel, proposed that the term be given its ordinary meaning, J.A. 2434–36. Sonix agreed with an ordinary-meaning construction, and so the district court did not construe "visually negligible."

Even so, "visually negligible" was used repeatedly in the expert reports. For example, Sonix's expert, Dr. Ashok, opined that the accused products included visually-negligible indicators, J.A. 3087–88, and that the cited prior art did not, J.A. 3539–41, 3547. Appellees' expert, Dr. Engels, also applied "visually negligible" throughout his reports, and even agreed that "the dot patterns in the specific products reviewed by Dr. Ashok in his Report are visually negligible...." J.A. 4210–11. On validity, Dr. Engels repeatedly opined that the indicators disclosed in Lamoure and Priddy—the same references at issue in the second reexamination—were visually negligible. See J.A. 5348–49, 5355–56, 5418, 5430–31. But Dr. Engels did not opine that "visually negligible" was indefinite. See id. Elsewhere in his report, Dr. Engels contended that alternatives to the claimed invention would have been available because "it would be a simple matter to ensure that any pattern being used would be printed in a manner that would be visually negligible compared to the main information on a page." J.A. 4228.

At Dr. Ashok's deposition, after the close of fact discovery and after the parties agreed to an ordinary meaning for "visually negligible," he was asked to explain "what does [‘visually negligible’] mean to you?" J.A. 4755 at 46:25–47:1. Dr. Ashok indicated that he understood it "to mean that if these dot patterns are imprinted on a surface, with a cursory look, I will not notice that." Id. at 47:2–7. Dr. Ashok was then asked whether there was "any sort of objective standard" for visual negligibility. J.A. 4756 at 49:11. Dr. Ashok explained that visibility depended on the ink used, the printing pattern, and the size of the dot, but that there "is not a universal standard by any means because it depends on the visual acuity of the observer." Id. at 50:24–51:4. Even so, Dr. Ashok indicated that his "method of determining visual negligibility would be [to] print at the magnification desired and look at it," because he "would imagine that would be representative of most people looking at it." Id. at 51:5–8.

In response, Dr....