Newriver, Inc. v. Newkirk Products, Inc.

Decision Date16 December 2009
Docket NumberCivil Action No. 06-12146-WGY.
Citation674 F.Supp.2d 320
PartiesNEWRIVER, INC., Plaintiff v. NEWKIRK PRODUCTS, INC., Defendant.
CourtU.S. District Court — District of Massachusetts

Michael A. Albert Wolf, Ilan N. Barzilay Wolf, Greenfield & Sacks, PC, Boston, MA, for Plaintiff.

Edward J. Dailey, Kimberly J. Seluga, Robert L. Kann, Kerry L. Timbers, Sunstein Kann Murphy & Timbers LLP, John L. Strand Wolf, Greenfield & Sacks, PC, Boston, MA, Robert E. Heslin, Brett M. Hutton, Lee Palmateer, Heslin, Rothenberg, Farley, & Mesiti, P.C., Albany, NY, for Defendant.


YOUNG, District Judge.

"The forms of action we have buried," wrote the great legal historian Frederick W. Maitland. "But," he added, "they still rule us from their graves."1

This case illustrates that, despite the unequivocal command of Federal Rule of Civil Procedure 2 that "there is one form of action—the civil action," there is, for good or ill, another—the patent case.


The plaintiff NewRiver, Inc. ("NewRiver") brought a patent infringement and breach of contract action against the defendant Newkirk Products, Inc. ("Newkirk"). NewRiver is the owner and assignee of the United States Patent No. 6,122,635 (the "`635 Patent") for the Mapping Compliance Information Useable Format. The invention pertains to a computer-assisted method for manipulating securities information in the United States Securities and Exchange Commission ("SEC") Electronic Data Gathering, Analysis, and Retrieval system ("EDGAR") database to extract only certain information, such as mutual fund prospecti. See '635 Patent col.1 l.6-12 (filed Feb. 13, 1998).

On April 7, 2009, the jury returned a verdict finding that Newkirk infringed claims 9-11, that its infringement was not willful, but that certain of the claims in suit, specifically including the crucial claims 9-11 which had been found infringed, '635 Patent claims 1, 3-5, and 8-11, were invalid as obvious. Jury Verdict (Doc. No. 301). In addition, the jury found that Newkirk did not breach its contract with NewRiver. Id.

On April 22, 2009, Newkirk, having achieved a clean sweep with the jury but apparently enamored of a true belt and suspenders approach, filed a renewed motion for judgment as matter of law that it did not infringe '635 patent claims 9-11 (Doc. No. 305), and filed a motion for judgment as matter of law that '635 patent claims 6, 13-15, and 19-21 are invalid (Doc. No. 308). On April 23, 2009, NewRiver filed three motions: 1) a motion for judgment as matter of law that '635 patent claims 9-11 are valid and not obvious (Doc. No. 312); 2) a motion for judgment as matter of law that Newkirk infringes '635 patent claims 13-15 and 19-21 (Doc. No. 315); and 3) a motion for a new trial. (Doc. No. 317).


The '635 patent was issued to NewRiver's predecessor, InUnity Corp., on September 19, 2000. '635 Patent, at [45] (filed February 13, 1998). The '635 patent is a system for providing access to compliance information acquired from securities database sources. Id. at [57]. According to the '635 patent, compliance information for a mutual fund can include, but is not limited to, mutual fund prospecti and their supplements, statements of additional information and their supplements, annual and semi-annual reports, as well as certain sales and marketing information. '635 Patent col.3 1.2-13.

The patented system extracts compliance information, e.g., a mutual fund prospectus, from the specific fund, and provides access through a subsystem to a computer-readable file of the extracted compliance information. '635 Patent, at [57]. The patented system performs a series of functions. It acquires data from documents in the database associated with a particular fund company using a code called a "central index key" (matching funds to a particular stock ticker or Committee on Uniform Security Identification Procedures ("CUSIP") identifier). '635 Patent col.11 l.20-25. The patented system searches the data to identify and extract compliance information. '635 Patent col.11 l.27-32. It also determines the operative or "effective" date of the compliance information and whether it supersedes older compliance information. '635 Patent col.11 l.35-41. The patented system catalogs the compliance information it has extracted. '635 Patent col.11 l.60-66. The patented system stores the processed compliance information and makes the compliance information accessible to users via a network connection. '635 Patent col.13 1.4-10.

Patentee NewRiver alleges that the two parties entered into a binding contract on January 31, 2001 for NewRiver to provide certain electronic securities information obtainment and delivery services. Compl. ¶¶ 6-8 (Doc. No. 1). NewRiver further alleges that since the contract's termination, Newkirk has breached the contract provisions and infringed the '635 patent through selling products and services to third parties that generate filings from the SEC EDGAR database in violation of the '635 patent. Compl. ¶¶ 9-10, 17. Newkirk offers a service called Newkirk Fund Central which "facilitates access to information filed with the SEC" but otherwise denies that it infringes NewRiver's '635 patent. Answer ¶ 17 (Doc. No. 11). Newkirk raised affirmative defenses including non-infringement and invalidity.

A. Judgment As Matter of Law

The evidence required to sustain a jury verdict is "such relevant evidence as a reasonable mind might accept as adequate to support a conclusion." Titan Tire Corp. v. Case New Holland, Inc., 566 F.3d 1372, 1379 (Fed.Cir.2009).

A party requesting judgment as matter of law "must show that substantial evidence did not support the jury's findings, where substantial evidence is `such relevant evidence from the record taken as a whole as might be accepted by a reasonable mind as adequate to support the finding under review.'" Koito Manufacturing Co., Ltd. v. Turn-Key-Tech, LLC, 381 F.3d 1142, 1149 (Fed.Cir.2004) (quoting Texas Instruments Inc. v. Cypress Semiconductor Corp., 90 F.3d 1558, 1563 (Fed. Cir.1996)). "Substantial evidence is `more than a mere scintilla' and is `such relevant evidence as a reasonable mind might accept as adequate to support a conclusion.'" Monolithic Power Systems, Inc. v. O2 Micro Intern. Ltd., 558 F.3d 1341, 1349 (Fed. Cir.2009) (quoting z4 Technologies, Inc. v. Microsoft Corp., 507 F.3d 1340, 1353 (Fed. Cir.2007)). "The Court must also consider all the evidence before the jury and draw all reasonable inferences from the evidence in the light most favorable to the prevailing party on that issue, i.e., the non-movant." Koito, 381 F.3d at 1149.

Theoretically, each of the cases cited above ought stand for the same proposition. In practice, they may not, though the distinction is subtle and unacknowledged. The distinction appears to have crept in since the Federal Circuit has concluded that general and conclusory testimony "does not suffice as substantial evidence of invalidity." Koito, 381 F.3d at 1152.

B. Infringement of Claims 13-15 & 19-21
1. Standard for Infringement

Infringement analysis requires two steps. First, the court must construe the claims to determine their scope and meaning. Markman v. Westview Instr., Inc., 52 F.3d 967, 976, aff'd, 517 U.S. 370, 116 S.Ct. 1384, 134 L.Ed.2d 577 (1996). "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) (quoting Innova/Pure Water, Inc. v. Safari Water Filtration Systems, Inc., 381 F.3d 1111, 1115 (Fed.Cir.2004)). This Court construed the '635 patent claims in related litigation and issued its Markman Order on March 21, 2007. NewRiver, Inc. v. Mobular Technologies, Inc., 478 F.Supp.2d 158, 162-64 (D.Mass.2007). On May 28, 2008, the Court ruled that its March 21, 2007 NewRiver v. Mobular claim construction would govern. "Once a district court has construed the relevant claim terms, and unless altered by the district court, then that legal determination governs for purposes of trial." Exergen Corp. v. Wal-Mart Stores, Inc., 575 F.3d 1312, 1321 (Fed.Cir.2009).

Next, the analysis compares the properly construed claims to the accused product or process to assess whether each of the claim limitations is met, either literally or equivalently, in the alleged infringing invention. CCS Fitness, Inc. v. Brunswick Corp., 288 F.3d 1359, 1365 (Fed.Cir.2002). Patents may be infringed either literally or under the doctrine of equivalents. Carnegie Mellon University v. Hoffmann-La Roche Inc., 541 F.3d 1115, 1129 (Fed.Cir. 2008). NewRiver's expert testimony fell short of the evidentiary requirements for proof of infringement under the doctrine of equivalents and the Court thus removed the doctrine of equivalents from the jury's consideration. Compare this case with Amgen Inc. v. F. Hoffman-La Roche Ltd., 581 F.Supp.2d 160, 205 (D.Mass.2008), where this Court followed precisely the same procedure for precisely the same reason. The Federal Circuit approved.2 Thus, in this case, the jury only considered literal infringement and found challenger Newkirk infringed on '635 Patent claims 9-11, albeit not willfully.

2. The Jury's Verdict of Non-Infringement of '635 Patent Claims 13-15 and 19-21 is Supported by Substantial Evidence

NewRiver moved for judgment as matter of law that Newkirk infringes '635 patent claims 13-15 and 19-21. The limitations in claims 13-15 are related to NewRiver's computer-readable data storage device comprising computer executable instructions which assist a human operator in performing a series of steps including identifying a subset of recently submitted filing documents and extracting compliance information from the EDGAR database. Claim 13 recites:

A computer-readable data storage device comprising...

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