Adc Telecommunications, Inc. v. Siecor Corp.

Decision Date07 February 1997
Docket NumberCivil Action No. 95-813 MMS.
Citation954 F.Supp. 820
PartiesADC TELECOMMUNICATIONS, INC., Plaintiff, v. SIECOR CORPORATION, Defendant.
CourtU.S. District Court — District of Delaware

William J. Marsden, and Joanne Ceballos, of Potter Anderson & Corroon, Wilmington, Delaware; of counsel: Douglas J. Williams, Timothy A. Lindquist, and Steven J. Pollinger, Merchant, Gould, Smith, Edell, Welter & Schmidt, P.A., Minneapolis, Minnesota, for plaintiff.

Jeffrey B. Bove, Connolly, Bove, Lodge & Hutz, Wilmington, Delaware; of counsel: C. Joseph Laughon, II, and Kevin J. Arquit, of Rogers & Wells, New York City, for defendant.

OPINION

MURRAY M. SCHWARTZ, Senior District Judge.

I. INTRODUCTION

This action arises out of Siecor Corp.'s ("Siecor") alleged infringement of ADC Telecommunications, Inc.'s ("ADC") U.S. Patent No. 5,363,465 ("the `465 patent") purportedly covering new telecommunications technology which made fiber-optic management and storage components "idiot-proof." The `465 patent was issued on November 8, 1994 and ADC filed suit for infringement shortly after Christmas in 1995. Discovery is now complete and Siecor has filed a motion for summary judgment. Jurisdiction is founded upon 28 U.S.C. § 1338(a). For the reasons below, Siecor's motion will be denied.

II. FACTUAL BACKGROUND
A. Modules and the `465 Patent

The `465 patent is directed generally at fiber optic management and storage components; specifically, the patent is entitled "Fiber Optic Connector Module." Docket Item ("D.I.") 55 at 105.1 Modules are used in the telecommunications industry; they are generally manufactured by companies like Siecor and ADC and bought by, among others, long-distance carriers. Id. at 111, col. 1, ln. 10-11. The modules at issue in this case are rectangular devices approximately eight inches long, six inches wide, and an inch high. They slide into a larger cabinet-like framework, referred to as a chassis. The chassis involved in this litigation is approximately twenty inches long, and stands about seven and one-half inches high. It has two columns of slots, into which the modules are fitted. Hooks run down each of the left and right edges of the chassis framework.

Angled connectors are attached to the front end of each module. The angled connectors are aptly named; they are short, hollow protuberances which point to either the right or left side of the module. Once the modules are inserted into the slots of the chassis, fiber optic cables wind through the angled connectors of the module and through the hooks on one side of the chassis. Id. at ln. 11-14.

As the telecommunications industry grew, the use of fiber optics increased. Problems with the chassis arose. As noted earlier, the fiber optic cables had to wind through the angled connectors of the module, then through the hooks of the chassis. Assume a customer, understandably vexed at the tangle of fiber-optic cables confronting him, inserted a module upside down into a two-column chassis. Then the cables would snake out of the angled connectors pointed toward one side (say, the left side of the module), and follow a sharp angle through the hooks located on the other side of the chassis (say, the right side). If inserted this way and connected correctly, the cables would still work. But the contortions of the cables would often sap the signal strength and cause the cables to weaken and eventually break. Id. at ln. 15-30.

Further, the number of necessary connections soon outpaced the technical dexterity and patience of customers. Mismatched cables and wires led to the malfunction of equipment. To combat this problem, the industry developed cartridges. Cable connections were aligned in cartridges. Several cartridges were placed in one module. The module, in turn, was fitted into a slot of a chassis. But further compartmentalization did not remedy all of the industry's problems with the chassis. Unless the modules were inserted correctly into the chassis, an unwary customer would soon find itself confronted by the myriad evils discussed earlier—missed connections, broken cables, and faulty equipment. Id. at ln. 30-40.

ADC recognized these difficulties and sought to cure them with the technology of the `465 patent. ADC invented a module— dubbed the Value Added Module ("VAM" or "VAM module")—which was configured so that it could only be inserted correctly; that is, so the angled connectors of the module were pointed toward the hooks on the appropriate side of the chassis. ADC accomplished this by making the overhanging edges of the module asymmetrical; it attached a top cover to the module which extends further over one side of the module than the other. Specifically, one flange extends approximately 5/8 of an inch over the body of the module while the other flange extends only approximately ¼ of an inch over the module. The slots in the chassis are made to accommodate the unequal flanges, making it impossible to insert the module into the chassis unless the respective flanges fit the appropriate chassis slot. For the angled connectors to face the hooks on the closest side of the chassis, the module can simply be fitted into the slots of the chassis. For the angled connectors to lead toward the hooks on the far side of the chassis, the module must be inverted. If the module is not inverted, it will not fit into the chassis. Thus, the designs of the module and the chassis ensure the angled connectors of the module are always aligned toward the appropriate hooks of the chassis.

The `465 patent has ten claims. Both parties differ over the scope and meaning of four of those claims. ADC contends the first six claims are directed to the module-chassis combination and the last four claims pertain solely to the module. Siecor, on the other hand, argues that all claims of the `465 patent are combination claims covering the module and the two-column chassis. This issue will be more fully explored in the discussion of Siecor's claim of noninfringement.

B. Sprint Enters the Picture & The Bidding War Begins

In December of 1994, MCI, one of ADC's customers, asked Siecor if it could supply modules to fit an ADC chassis.2 Jeff Grissom, Siecor's Product Manager for Optical Hardware, and Joe Dodd, a Siecor engineer, obtained an ADC chassis and assorted ADC VAM literature. Dodd reviewed this information, as well as a demonstration sample of an ADC module, and sketched a module that would fit an ADC chassis. Siecor asserts there was no indication of any patent or potential patent on the demonstration sample — either the module or the chassis. Indeed, ADC did not order marking of the chassis until December 1995, just prior to this litigation.3 D.I. 50 at Exh. B, pp. 14-16. Among the ADC sales literature, a January 1995 sales catalog contained information on an unrelated ADC module patent, U.S. Patent No. 5,123,219 ("the `219 patent"), but not the `465 patent.4 D.I. 51 at Exh. F, p. 53. Thus, Siecor produced a self-described ADC module "clone,"5 D.I. 55 at 141, but alleges it had no idea such a clone would violate any ADC patents.6

ADC sells its patented modules to, among others, Sprint Long Distance Division ("Sprint"). Until September of 1995, ADC sold modules to Sprint at a price of $708.40 per module—a discount of 30% intended to foster a mutually beneficial, if not exclusive, business relationship between ADC and Sprint. D.I. 55 at 28. Around that same time—September of 1995—Siecor tried to siphon off some of ADC's business with Sprint. Siecor made and delivered at least two modules, so-called "ADC VAM module clone[s]", D.I. 55 at 141, to Sprint and offered Sprint 1,500 modules at a price of $610 per module — nearly $100 less per module than ADC's offer. D.I. 55 at 141-42. On September 29, 1995, Siecor lowered its offer even further, to $595 per module. D.I. 55 at 142. Excerpts from an internal Siecor memorandum, authored by a sales representative, vividly reveal the method to this price-slashing madness: "My gut feeling is that we [Siecor] will attract much attention with our pricing, and perhaps win 50% of the order. ADC will in turn likely lower their price when they get wind of our pricing levels and the erosion of their business." D.I. 55 at 141.

ADC quickly learned of Siecor's designs. Steve Smythe, an ADC sales representative, was visiting Sprint's offices in the "late summer, early fall" of 1995. D.I. 55 at 19. While he was at Sprint, Smythe observed a Siecor module—the "ADC VAM clone"—on display. D.I. 55 at 19, 23, 31, 33. Smythe was also informed by a Sprint engineer that Siecor had vowed to match or beat ADC's module prices. D.I. 55 at 13-14.

At about the same time, Siecor obtained an October 1995 ADC catalog advertising all of ADC's fiber optic products, including the modules at issue in this suit. As with its January 1995 catalog, the October catalog listed the `219 patent as the only patent applicable to ADC's module products. D.I. 51 at Exh. F, p. 46. This further bolstered Siecor's belief, it asserts, that no patents covered the "clone" they had produced.

ADC was not content to fiddle idly, however, while its deal with Sprint burned. ADC notified Sprint that ADC would drop its price to $595 to match Siecor's price. D.I. 55 at 96. On November 3, 1995, Sprint issued invitations for bids—called Requests for Quotation ("RFQ") in the industry—on 1500 modules for delivery by the close of 1995. D.I. 55 at 146. The endgame dictated desperate tactics. ADC knew Siecor would bid on the RFQ, and knew Siecor would lower the price it had previously quoted to Sprint—$595. D.I. 55 at 30. What ADC did not know, however, was how low Siecor was willing to go. Accordingly, ADC gambled on a preemptive strike: it submitted a bid on November 10, 1996, offering Sprint modules for $529 each. D.I. 55 at 192.

Meanwhile, after it received the RFQ on November 3, Siecor concluded it would have to obtain component parts from third parties in order to...

To continue reading

Request your trial
6 cases
  • Mediacom Corp. v. Rates Technology, Inc.
    • United States
    • U.S. District Court — District of Massachusetts
    • April 16, 1998
    ...(Fed. Cir.1997); Dow Coming Wright Corp. v. Osteonics Corp., 939 F.Supp. 65 (D.Mass.1996) (O'Toole, J.); ADC Telecommunications, Inc. v. Siecor Corp., 954 F.Supp. 820 (D.Del.1997); Allied Gator, Inc. v. NPK Construction Equipment, Inc., 937 F.Supp. 694 (N.D.Ohio 1996); American Bank Note Ho......
  • Fisher-Price, Inc. v. Safety 1ST, Inc.
    • United States
    • U.S. District Court — District of Delaware
    • August 28, 2003
    ...Eng'g Corp., 6 F.3d 1523, 1537 (Fed.Cir.1993). Compliance with the marking statute is a question of fact, ADC Telcoms. v. Siecor Corp., 954 F.Supp. 820, 832 (D.Del.1997), which the plaintiff must prove by a preponderance of the evidence. Nike, Inc. v. Stores, Inc., 138 F.3d 1437, 1446 (Fed.......
  • Boehringer Ingelheim Animal Health v. Schering-Plough
    • United States
    • U.S. District Court — District of New Jersey
    • October 6, 1997
    ...typifies a situation where the court found that a preamble clearly defined an element of the claim. See ADC Telecommunications, Inc. v. Siecor, 954 F.Supp. 820, 829 (D.Del.1997). In the instant case, the claim speaks of a "a method of growing and isolating swine infertility and respiratory ......
  • Novartis Corp. v. Teva Pharmaceuticals Usa, Inc.
    • United States
    • U.S. District Court — District of New Jersey
    • July 16, 2008
    ...hearings to determine proper claim construction are inappropriate prior to completion of discovery."); ADC Telecomm., Inc. v. Siecor Corp., 954 F.Supp. 820, 821, 826-31 (D.Del.1997); S.S. White Burs, Inc. v. Neo-Flo, Inc., No. Civ. A. 02-3656, 2003 WL 21250553, at *3 (E.D.Pa. May 2, A funda......
  • Request a trial to view additional results

VLEX uses login cookies to provide you with a better browsing experience. If you click on 'Accept' or continue browsing this site we consider that you accept our cookie policy. ACCEPT