Shuffle Master, Inc. v. Mp Games LLC, 3:04-CV-00407-ECR (RAM).

• Citation: 553 F.Supp.2d 1202
• Decision Date: 21 March 2008
• Docket Number: No. 3:04-CV-00407-ECR (RAM).,3:04-CV-00407-ECR (RAM).
• Parties: SHUFFLE MASTER, INC., and IGT, Plaintiffs, v. MP GAMES LLC d/b/a Mindplay Games, Robert Mouchou, Alliance Gaming Corp. d/b/a Bally Gaming and Systems and Bally Gaming, Inc., Defendants.
• Court: United States District Courts. 9th Circuit. United States District Courts. 9th Circuit. District of Nevada

553 F.Supp.2d 1202

SHUFFLE MASTER, INC., and IGT, Plaintiffs, v. MP GAMES LLC d/b/a Mindplay Games, Robert Mouchou, Alliance Gaming Corp. d/b/a Bally Gaming and Systems and Bally Gaming, Inc., Defendants.

No. 3:04-CV-00407-ECR (RAM).

United States District Court, D. Nevada.

March 21, 2008.

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Adam J. Gill, Barry F. Irwin, Michael P. Bregenzer, Jared E. Hedman, Kirkland & Ellis LLP, Chicago, IL, Daniel T. Hayward, Wayne A. Shaffer, Laxalt & Nomura, Ltd, Reno, NV, for Plaintiffs.

Andrea Pallios Roberts, Quinn Emanuel Urquhart Oliver & Hedges, LLP, Redwood Shores, CA, Brad M. Johnston, Hale Lane Peek, Dennison & Howard, Reno, NV, Charles K. Verhoeven, David A. Perlson, Jennifer A. Kash, Rachel H. Smith Quinn Emanuel Urguhart Oliver & Hedges, San Francisco, CA, J. Stephen Peek, Hale Lane Peek, et al., Las Vegas, NV, for Defendants.

ORDER

EDWARD C. REED, JR., District Judge.

Plaintiffs Shuffle Master, Inc., and International Game Technology ("IGT", collectively "Plaintiffs") originally sued Defendants MP Games, Robert Mouchou, Alliance Gaming Corp., and Bally Gaming Inc. (collectively "Defendants"), claiming that Defendants' MP21 game system infringed several patents held by Shuffle Master. (Complaint (# 1).), Plaintiffs' First Amended Complaint (# 42) alleges eleven causes of action, respectively for: (1) infringement of U.S. Patent 6,313,871 ('871); (2) infringement of U.S. Patent 5,781,647 ('647); (3) correction of the named inventor of U.S. Patent 6,517,436 ('436); (4) correction of the named inventor of U.S. Patent 6,520,857 ('857); (5) correction of the named inventor of U.S. Patent 6,527,271 ('271); (6) correction of the named inventor of U.S. Patent 6,530,836 ('836); (7) correction of the named inventor of U.S. Patent 6,712,696 ('696); (8) correction of the named inventor of U.S. Patent 6,579,180 ('180); (9) correction of the named inventor of U.S. Patent 6,579,181 ('181); (10) misappropriation of trade secrets; and (11) a finding that this is an exceptional case pursuant to 35 U.S.C. § 285.

Defendants counter-claimed against Shuffle Master for infringement of several MindPlay patents by Shuffle Master's SmartTable game monitoring system and for misappropriation of trade secrets. The counterclaims alleged in their Answer (# 45) to the amended complaint are respectively for: (1) a declaratory judgment that the '871 patent is invalid and not infringed; (2) a declaratory judgment that the '647 patent is invalid and not infringed; (3) misappropriation of trade secrets; (4) breach of contract; (5) infringement of the '436 patent; (6) infringement of the '857 patent; (7) infringement of the '836 patent; and (8) infringement of the 6,530,837 patent. In turn, Plaintiffs then counterclaimed, alleging that three patents owned by MindPlay ('436, '857, and '836) interfere with the '871 patent, and that these patents, as well as U.S. Patent No. '837 patent, are invalid in light of prior art. (P.s' Fourth Amended Reply' to D.s' Counterclaims to First Amended Complaint for Patent Infringement and Affirmative Defenses and Counterclaims in Reply Thereto (# 556).)

The Court dismissed (# 207) without prejudice Defendants' breach of contract claim (count IV(# 45)) on April 19, 2005. The parties then stipulated to the dismissal (# 565) of the misappropriation of trade secrets claims on October 2, 2006.

The Court entered its Order (# 322) construing the disputed claim terms in the '647 and '871 patents on December 20, 2005. The dispositive motions currently pending before the Court are:

1. Defendants' Motion for Summary Judgment of Non-Infringement and Invalidity 5,781,647 (# 580, # 742);

2. Defendants' Motion for Summary Judgment of Non-Infringement and Invalidity of U.S. Patent No. 6,313,871 (# 566, # 743);

3. Defendants' Motion for Summary Judgment of Invalidity of U.S. Patent No. 6,313,871 Due to Failure to Join Co-Inventor William Florschuetz (# 575);

4. Plaintiffs' Cross Motion for Summary Judgment (set forth in Plaintiffs' Opposition to Defendants' [Seventh] Motion for Summary Judgment of Invalidity of U.S. Patent No. 6,313,871 Due to Failure to Joint Co-Inventor William Florschuetz) (# 672);

5. Defendants' Motion for Summary Judgment on Shuffle Master's Claim for Correction of Inventorship in Counts III through IX of the First Amended Complaint (# 578).

6. Plaintiff Shuffle Master's Motion for Summary Judgment of Invalidity of the Asserted Claims of U.S. Patent Nos. 6,517,436 and 6,520,857 (# 577); and

7. Defendants' Motion for Summary Judgment of Plaintiffs' Counts I-III of Counterclaims for Interference (# 572).

Each motion has been fully briefed, and following the Supreme Court's decision in KSR Int'l Co. v. Teleflex Inc., ___ U.S. ___, 127 S.Ct. 1727, 167 L.Ed.2d 705 (2007), the Court allowed for additional briefing regarding the effects of KSR on the pending dispositive motions. (Order of June 14, 2007 (# 817).) The Court heard oral argument on the pending motions on February 28 and 29, 2008.

Defendants have filed the following motions to strike and evidentiary objections:

1. Objection (# 767) to the Declaration of Jared E. Hedman in Support of Plaintiffs' Motion for Summary Judgment of Invalidity of U.S. Patents 5,781,647 and 6,313,871;

2. Objection (# 766) to the Declaration of Christopher M. Kaiser in Support of Plaintiffs' Opposition to Defendants' Motion for Summary Judgment of Invalidity of U.S. Patent No. 6, 313,871 Due to Failure to Join Co-Inventor William Florschuetz;

3. Objection (# 765) to the Declaration of Michael P. Bregenzer in Support of Shuffle Master's Opposition to Defendants' Motions for Summary Judgment of Non-Infringement of U.S. Patent No. 6,313,871;

4. Objection (# 764) to the Declaration of Christopher M. Kaiser in Support of Plaintiffs' Opposition to Defendants' Motion for Summary Judgment on Shuffle Master's Claim for Correction of Inventorship in Counts III through IX of the First Amended Complaint (# 764);

5. Objection (# 763) to the Declaration of Michael P. Bregenzer in Support of Shuffle Master's Motion for Summary Judgment of Invalidity of the Asserted Claims of the U.S. Patent Nos. 6,517,436 and 6,529,857 (# 763);

6. Objection (# 761) to the Declaration of John Strisower in Support of Plaintiffs' Opposition to Defendants' Motions for Summary Judgment of Invalidity of U.S. Patent Nos. 5,781,647 and 6,313,871 (# 761);

7. Objection (# 760) to the Declaration of Jared E. Hedman In Support of Shuffle Master's Motion for Summary Judgment of Invalidity of the Asserted Claims of U.S. Patent Nos. 6,517,436 and 6,529,857;

8. Objection (# 759) to the Declaration of Dr. Kenneth Castleman in Support of Plaintiffs' Opposition to Defendants' Motions for Summary Judgment of Non-Infringement of U.S. Patents Nos. 5,781,647 and 6,313,871;

9. Objection (# 758) to the Declaration of Oliver Schubert in Support of Plaintiffs' Opposition to Defendants' Motion for Summary Judgment on Shuffle Master's Claim for Corrections of Inventorship in Counts III through IX of the First Amended Complaint;

10. Objection (# 756) to the Declaration of James T. Carmichael in Support of Plaintiffs' Memoranda in Opposition to Defendants' Eighth Motion for Summary Judgment of Plaintiffs' Counts I-III of Counterclaims for Interference and Defendants' Ninth Motion for Summary Judgment on Shuffle Master's Claim for Correction of Inventorship in Counts III-IX of the First Amended Complaint (# 756);

11. Objection (# 748) to the Declarations of Oliver Schubert and Willy Florschuetz in Support of Plaintiffs' Opposition to Defendants' Motion for Summary Judgment of Invalidity of U.S. Patent No. 6,313,871 for Failure to Join Co-Inventor Willy Florschuetz;

12. Defendants' Motion (# 824) to Strike the Supplemental Expert Report of James T. Carmichael and the Portions of the Supplemental Expert Report of John Strisower Addressing Plaintiffs' Interference Claim for Violation of the Court's June 14, 2007 Order.

Plaintiffs have filed the following evidentiary objections and motions to strike:

13. Plaintiffs' Objections to Defendants' Summary Judgment Declarations (# 802);

14. Plaintiffs' Motion to Strike [886] Errata (# 891);

15. Plaintiffs' Motion for Leave to File Shuffle Masters Motion For Leave To File Responses To Defendants Supplemental Statements Of Undisputed Facts In Support Of Defendants Motions for Summary Judgment of Non-Infringement and (# 885).

I. Evidentiary and Procedural Objections

The Court's rulings on the evidentiary objections and motions to strike are as follows:

1. Plaintiffs' Motion to Strike [886] Errata (# 891) and Plaintiffs' Motion for Leave to File Responses (# 885) are DENIED. The Motion to Strike is meritless and the Motion for Leave to File Responses is effectively a motion for reconsideration that the Court will deny for the reasons already stated.

2. Defendants' Motion (# 824) to Strike the Supplemental Expert Report of James T. Carmichael and the Portions of the Supplemental Expert Report of John Strisower Addressing Plaintiffs' Interference Claim for Violation of the Court's June 14, 2007 Order is DENIED as to Strisower but GRANTED as to Carmichael. The "evidence" submitted by Carmichael is improper and irrelevant in this case.

Although Carmichael was educated as both an attorney and an engineer, the opinions he offers are legal conclusions that stem from his experience working at the United States Patent and Trademark Office (PTO). Plaintiffs are entirely correct that Carmichael's legal opinions cannot properly be considered as factual evidence in this case. See, e.g., Endress + Hauser, Inc. v. Hawk Measurement Systems Pty. Ltd., 122 F.3d 1040, 1042 (Fed. Cir.1997) ("this court has on numerous occasions noted the impropriety of patent lawyers testifying as expert witnesses and giving their opinion regarding the proper interpretation of a claim as a matter of law"); Aguilar v. International Longshoremen's...