R+L Carriers, Inc. v. Drivertech LLC (In re Bill of Lading Transmission & Processing Sys. Patent Litig.)

• Decision Date: 07 June 2012
• Docket Number: 2010-1494,2011-1102,2010-1495,2011-1101,2010-1493,2010-1496
• Parties: IN RE BILL OF LADING TRANSMISSION AND PROCESSING SYSTEM PATENT LITIGATION R+L CARRIERS, INC., Plaintiff-Appellant, v. DRIVERTECH LLC, Defendant-Appellee, and PEOPLENET COMMUNICATIONS CORPORATION, QUALCOMM, INC., and MICRODEA, INC., Defendants-Appellees, and INTERMEC TECHNOLOGIES CORP., Defendant-Appellee, and AFFILIATED COMPUTER SERVICES, INC., Defendant-Appellee, and INTERSTATE DISTRIBUTOR COMPANY, Defendant-Appellee, and PITT OHIO EXPRESS INC. and BERRY & SMITH TRUCKING LTD., Defendants.
• Court: U.S. Court of Appeals — Federal Circuit

IN RE BILL OF LADING TRANSMISSION AND PROCESSING SYSTEM PATENT LITIGATION

R+L CARRIERS, INC., Plaintiff-Appellant, v. DRIVERTECH LLC, Defendant-Appellee, and PEOPLENET COMMUNICATIONS CORPORATION, QUALCOMM, INC., and MICRODEA, INC., Defendants-Appellees, and INTERMEC TECHNOLOGIES CORP., Defendant-Appellee,

and AFFILIATED COMPUTER SERVICES, INC., Defendant-Appellee,

and INTERSTATE DISTRIBUTOR COMPANY, Defendant-Appellee,

and PITT OHIO EXPRESS INC. and BERRY & SMITH TRUCKING LTD., Defendants.

2010-1493

2010-1494

2010-1495

2010-1496

2011-1101

2011-1102

United States Court of Appeals for the Federal Circuit

Decided: June 7, 2012

Appeals from the United States District Court for the Southern District of Ohio in case nos. 09-MD-2050, 09-CV-0532,-09-CV-0818, 09-CV-0445,-09-CV-0179, 09-CV-0502, and 09-CV-0472, Senior Judge Sandra S. Beckwith.

ANTHONY C. WHITE, Thompson Hine LLP, of Columbus, Ohio, argued for plaintiff-appellant. With him on the brief was O. JUDSON SCHEAF, III.

JONATHAN S. FRANKLIN, Fulbright & Jaworski L.L.P., of Washingto, DC, argued for all defendants-appellees. With him on the brief for defendants-appellees Qualcomm, Inc., et al was TILLMAN J. BRECKENRIDGE; and RICHARD S. ZEMBEK, of Dallas Texas. Of counsel was LAURA J. BORST, of Minneapolis, Minnesota. On the brief for defendant-appellee DriverTech, LLC, was SCOTT M. PETERSEN and PHILIP D. DRACHT, Fabian & Clendenin, P.C., of Salt Lake City, Utah.

CARSON P. VEACH, Freeborn & Peters LLP, of Chicago, Illinois, for defendant-appellee Intermec Technologies Corp. With him on the brief was JACOB D. KOERING.

THOMAS H. SHUNK, Baker & Hostetler LLP, of Cleveland, Ohio, for defendant-appellee Affiliated Computer Services, Inc.

Before NEWMAN, PROST, and O'MALLEY, Circuit Judges.

Opinion for the court filed by Circuit Judge O'MALLEY.

Dissenting in part and concurring in part opinion filed by Circuit Judge NEWMAN.

O’MALLEY, Circuit Judge.

In this patent infringement action, R+L Carriers, Inc. ("R+L") appeals the district court's dismissal with prejudice of its amended complaints and counterclaims against DriverTech LLC ("DriverTech"), Affiliated Computer Services, Inc. ("ACS"), PeopleNet Communications Corp. ("PeopleNet"), Intermec Technologies Corp. ("Intermec"), Microdea, Inc. ("Microdea"), and Qualcomm, Inc. ("Qualcomm").¹ R+L alleged that the Appellees each indirectly infringed United States Patent No. 6,401,078 (filed Apr. 3, 2000) ("the '078 patent"). The district court dismissed the amended complaints because it believed they failed to state a claim to relief that was plausible on its face as required by Bell Atlantic Corp. v. Twombly, 550 U.S. 544 (2007) and Ashcroft v. Iqbal, 556 U.S. 662 (2009). Because we agree that R+L failed to state a claim of contributory infringement against the Appellees, but find that R+L adequately stated a claim of induced infringement, we affirm-in-part, reverse-in-part and remand.

I. BACKGROUND

A. Factual Background

The '078 patent relates to the less-than-a-load trucking industry. R+L, the owner of the '078 patent, is a major less-than-a-load carrier that utilizes the '078's patented method in its business. Order Granting Joint Mot. to Dismiss at 2, In Re Bill of Lading Transmission & Processing Sys. Patent Litig., No. 1:09-md-2050 (S.D. Ohio July 15, 2010), ECF No. 162 ("July 15, 2010 Order"). As explained by the patent, carriers in this industry pick up freight from several different customers, which is often destined for different locations around the country. Because the freight is intended for different locations, to enable efficient delivery, the freight must be sorted and placed onto trucks with freight that is destined for a similar location. To accomplish this sorting, the freight is taken to a terminal where it is unloaded from the truck and consolidated with other freight headed in the same direction. After consolidation, the freight is reloaded onto trucks. These trucks then either deliver the freight to its destination, or transport the freight to a distribution terminal in another city to be re-sorted and re-consolidated for delivery. '078 patent col.1 ll.34-48.

To more efficiently enable delivery in the less-than-a-load trucking industry, the '078 patent claims a method that "automates the process of receiving transportation documentation and producing advance loading manifests therefrom to optimize load planning and dynamic product shipment and delivery control." Id. at abstract. The patented method enables shipping documents to be sent directly from the truck driver to a common point, such as a terminal, so billing and load planning can occur while the driver is en route with the freight. Id. at col.1 ll. 15-20. Claim 1, the patent's only independent claim, recites seven steps:

A method for transferring shipping documentation data for a package from a transporting vehicle to a remote processing center:

placing a package on the transporting vehicle;

using a portable document scanner to scan an image of the documentation data for the package, said image including shipping details of the package;

providing a portable image processor capable of wirelessly transferring the image from the transporting vehicle;

wirelessly sending the image to a remote processing center;

receiving the image at said remote processing center; and

prior to the package being removed from the transporting vehicle, utilizing said documentation data at said remote processing center to prepare a loading manifest which includes said package for further transport of the package on another transporting vehicle.

Id. at col.13 l.40-col.14 l.12.

B. Procedural History Prior to Dismissal of the Amended Complaints

In 2008, R+L learned that several of the Appellees and their customers were likely infringing the '078 patent. In response, R+L sent cease-and-desist letters to DriverTech, PeopleNet, and several companies R+L suspected of direct infringement. July 15, 2010 Order at2. After receiving the letters, DriverTech and PeopleNet filed declaratory judgment actions in their home districts, seeking judgments of invalidity and non-infringement. R+L answered and filed counterclaims in those courts. In addition, R+L initiated lawsuits in the Southern District of Ohio against the remaining Appellees and several alleged direct infringers.

Because these lawsuits were spread throughout three federal district courts, R+L moved to have the cases consolidated and transferred to the Southern District of Ohio. Joint Appendix ("J.A.") 229-30. Granting the motion, the Judicial Panel on Multidistrict Litigation transferred the cases² to the Southern District of Ohio and assigned them to Judge Sandra Beckwith. The cases were consolidated for discovery and all pretrial proceedings, including claim construction.

After the cases were consolidated, ten of the alleged indirect infringers filed motions to dismiss or motions for judgment on the pleadings. July 15, 2010 Order at 3. After reviewing the briefing and conducting oral argument, the district court granted all of those motions. Id. The district court granted R+L leave to amend its claims, however. Id. R+L elected to file amended complaints against each of the six Appellees. Id.

While each of the amended complaints contains the same allegations with respect to the "nature of action," "jurisdiction and venue," and "infringed patent sections," they contain unique allegations as to the actions that allegedly give rise to the individual complaints. In thediscussion section of this opinion, we discuss these factual differences and the sufficiency of each individual amended complaint. Here, we briefly summarize the general nature of R+L's allegations, providing greater detail in Section II, as appropriate.

The amended complaints contain detailed factual allegations and, including attached exhibits, are each over one-hundred pages in length. Each outlines various products sold by the individual Appellees for use in the trucking industry. On the basis of quotations from Appellees' websites, advertising, and industry publications, R+L alleges facts about these products. The amended complaints also contain allegations about Appellees' strategic partnerships with other companies, their advertising, and their involvement at trade shows. Following these factual allegations, R+L asserts a series of "reasonable inferences," which it alleges can be drawn from the facts pled. Based on these inferences and factual allegations, R+L asserts that each Appellee is liable for inducing infringement and contributory infringement of the '078 patent.

C. Procedural History Culminating in Dismissal of the Amended Complaints

In response to the amended complaints, Appellees filed a joint motion to dismiss under Federal Rule of Civil Procedure 12(b)(6) for failure to state a claim, arguing that the amended complaints failed to plausibly allege either direct infringement or indirect infringement. After briefly summarizing the contents of the amended complaints, the district court addressed the merits of the joint motion to dismiss. With respect to direct infringement, the district court concluded that the Intermec Amended Complaint failed to state a claim because it did not identify a specific Intermec customer who directly infringedthe '078 patent. Id. at 27. The district court then concluded that the other five amended complaints also failed to state a claim of direct infringement. Id. at 31. Although these complaints named specific customers that R+L asserted were directly infringing the '078 patent, the district court concluded that the "reasonable inferences" contained in the complaints regarding direct infringement by those customers were not, in fact, reasonable. Id. at 31.

Though a claim of indirect infringement can only arise where there is direct infringement and the district court concluded that no adequate claim of direct infringement had been pled, the court alternatively addressed whether the amended complaints adequately pled indirect...