Velocity Patent LLC v. FCA US LLC

• Decision Date: 07 August 2018
• Docket Number: No. 13 C 8419,13 C 8419
• Citation: 319 F.Supp.3d 950
• Parties: VELOCITY PATENT LLC, Plaintiff, v. FCA US LLC, Defendant.
• Court: U.S. District Court — Northern District of Illinois

319 F.Supp.3d 950

VELOCITY PATENT LLC, Plaintiff,

v.FCA US LLC, Defendant.

No. 13 C 8419

United States District Court, N.D. Illinois, Eastern Division.

Signed August 7, 2018

James A. Shimota, Aaron Charles Taggart, Howard E. Levin, Haynes and Boone, LLP, Chicago, IL, Jason Lao, Pro Hac Vice, Haynes and Boone LLP, Costa Mesa, CA, Nicholas Martini, Pro Hac Vice, Nicole Elizabeth Johnson, Pro Hac Vice, Haynes and Boone, LLP, Palo Alto, CA, Phillip Brett Philbin, Pro Hac Vice, Haynes and Boone, LLP, Dallas, TX, for Plaintiff.

Alper T. Ertas, Pro Hac Vice, Venable LLP, San Francisco, CA, Jonathan L. Falkler, Pro Hac Vice, Leslie Ann Lee, Pro Hac Vice, Frank C. Cimino, Jr., Megan S. Woodworth, Venable LLP, Washington, DC, Joshua Erik Bidzinski, P. Stephen Fardy, Troy M. Sphar, Swanson, Martin & Bell, LLP, Chicago, IL, for Defendant.

MEMORANDUM OPINION AND ORDER

Honorable Thomas M. Durkin, United States District Judge

Plaintiff Velocity Patent LLC brings this action against Defendant FCA US LLC for its alleged infringement of United States Patent No. 5,954,781 (the "781 patent" or the "patent"). R. 185, Second Am. Compl. FCA (or Fiat Chrysler Automobiles US LLC) advertises, markets, and distributes automobiles under the Chrysler, Ram, Dodge, Jeep, and Fiat brands. See R. 195, Ans. to Second Am. Compl., ¶ 4. Velocity's patent uses a processor subsystem and a series of "notification circuits" to notify car drivers of certain driving conditions. Velocity alleges FCA has infringed Claims 1, 17, 18, 19, 28, 33, 34, 42, 59, 60, 64, 69, and 76-79 of the patent.¹ Judge Darrah, the previous judge on this case, issued a claims construction order on September 21, 2016. R. 114.

Both parties have now moved for partial summary judgment.² In its motion for partial summary judgment, FCA makes four arguments. First, it argues that certain features in its vehicles—which provide notifications to drivers of certain driving conditions—do not infringe on Velocity's patent. R. 342. Second, FCA argues that several of Velocity's claims (Claims 69, 76-79) are invalid as improperly broadened claims. R. 349. Third, FCA argues that Claim 28 should be construed as a means-plus-function claim. Id. Finally, FCA argues Velocity cannot show that FCA willfully infringed Velocity's patent. R. 342. Velocity brings a summary judgment motion as to an element of damages, arguing that a non-infringing alternative identified by FCA is not an acceptable non-infringing alternative as a matter of law. R. 338. For the following reasons, FCA's motion for summary judgment is granted in part and denied in part. The Court reserves ruling on Velocity's motion until after Daubert motions are decided.

LEGAL STANDARD

Summary judgment must be granted "if the movant shows that there is no genuine dispute as to any material fact and the movant is entitled to judgment as a matter of law." Fed. R. Civ. P. 56(a). A genuine issue of material fact exists if "the evidence is such that a reasonable jury could return a verdict for the nonmoving party." Anderson v. Liberty Lobby, Inc. , 477 U.S. 242, 248, 106 S.Ct. 2505, 91 L.Ed.2d 202 (1986) ; Intercontinental Great Brands LLC v. Kellogg N. Am. Co., 869 F.3d 1336, 1343 (Fed. Cir. 2017). In evaluating summary judgment motions, courts must view the facts and draw reasonable inferences in the light most favorable to the non-moving party. Scott v. Harris , 550 U.S. 372, 378, 127 S.Ct. 1769, 167 L.Ed.2d 686 (2007) ; Crown Operations Int'l, Ltd. v. Solutia Inc. , 289 F.3d 1367, 1375 (Fed. Cir. 2002). When both parties move for summary judgment, the Court must draw reasonable inferences in Velocity's favor on FCA's motion, and vice-versa on Velocity's motion. The Court may not weigh conflicting evidence and make credibility determinations, Omnicare, Inc. v. UnitedHealth Grp., Inc. , 629 F.3d 697, 704 (7th Cir. 2011), and must consider only evidence that can "be presented in a form that would be admissible in evidence." Fed. R. Civ. P. 56(c)(2) ; Crown Operations , 289 F.3d at 1375. The party seeking summary judgment has the initial burden of showing that there is no genuine dispute and that she is entitled to judgment as a matter of law. Carmichael v. Vill. of Palatine , 605 F.3d 451, 460 (7th Cir. 2010) ; see also Celotex Corp. v. Catrett , 477 U.S. 317, 323, 106 S.Ct. 2548, 91 L.Ed.2d 265 (1986). If this burden is met, the adverse party must then "set forth specific facts showing that there is a genuine issue for trial." Anderson , 477 U.S. at 256, 106 S.Ct. 2505 ; Crown Operations , 289 F.3d at 1375.

BACKGROUND ³

The '781 Patent was issued on September 21, 1999. The patent is entitled "METHOD AND APPARATUS FOR OPTIMIZING VEHICLE OPERATION" and describes a system that "notifies the driver of recommended corrections in vehicle operation and, under certain conditions, automatically initiates selected corrective action." R. 344-1, '781 Pat. at 1:7-10. The patent generally claims several sensors, a memory subsystem, a processor subsystem, and notification circuits.

As shown in the image below, the '781 patent describes a processor subsystem that receives data from sensors and activates various circuits to notify the driver of certain conditions affecting the car. Those circuits include a fuel overinjection notification circuit, an upshift notification circuit, a downshift notification circuit, and a vehicle proximity alarm circuit. Relevant to this opinion, the sensors monitor road speed, engine speed (in rotations per minute or "RPM"), manifold pressure, and throttle position.

The notification circuits provide warnings to the driver that certain conditions are present. At issue in most of this opinion is the fuel overinjection notification circuit, represented in box 38 of the above diagram.⁴ As the '781 patent explains, the fuel overinjection notification circuit "notif[ies] the driver that, in order to optimize vehicle operation, the amount of fuel being supplied to the engine should be reduced." R. 344-1, '781 Pat. at 12:13-15. This notification essentially tells the driver when the vehicle is and is not being operated in a fuel-efficient manner. Id. at 13:41-45. The term "overinjection notification circuit" was construed as: "A circuit that notifies a driver that more fuel is being supplied to the engine than is necessary." R. 114. at 9.

In its claims construction order, the Court determined that the term "processor subsystem"—used in the patent for describing the various notification circuits—was construed with a "means-plus-function" limitation governed by 35 U.S.C. § 112(f). That statute states that "an element in a claim for a combination may be expressed as a means or step for performing a specified function without the recital of structure, material, or acts in support thereof, and such claim shall be construed to cover the corresponding structure, material, or acts described in the specification and equivalents thereof." The Court held that the claim language states that the processor subsystem "determines" whether to activate a notification circuit. R. 114 at 13. But because the claim does not provide sufficient structure for performing the functions recited in the claims, i.e. , determining whether to activate the notification circuit, § 112(f) applied and the claim required an algorithm. Id. The Court then adopted the following algorithm that describes when to activate the fuel overinjection notification circuit:

Activating the Fuel Overinjection Notification Circuit When:

1. Road speed is increasing; and

2. Throttle position is increasing; and

3. Manifold pressure is above a manifold pressure setpoint;

Or:

1. Road speed is decreasing; and

2. Throttle position is increasing; and

3. Manifold pressure is increasing; and

4. Engine speed is decreasing.

Id. at 14-17. The Court based its ruling on the algorithm as described in the patent, R. 344-1, '781 Pat. at 11:13-13:7, and figures 2A and 2B in the patent, id. at 4-5. Figures 2A and 2B are reproduced below:

For clarity, the Court will refer to each step (i.e. "road speed is increasing") as a "parameter" of the algorithm. The Court will refer to each scenario (i.e. , "road speed is increasing, throttle position is increasing, and manifold pressure is above a manifold pressuring setpoint") as a "condition." Velocity's expert, Christopher Wilson, calls the two conditions the "acceleration" scenario and the "lugging" scenario, respectively. R. 348-1, Expert Report of Christopher Wilson, ¶ 307.⁵ The Court adopts those references here.

The algorithm describes the "process subsystem" for the various circuits of the patent. The Court compares the patent's algorithm as described by the claims construction order to the infringing products. If the infringing products utilize the patent's algorithm, they infringe the patent. However, if the infringing products do not utilize the patent's algorithm, they do not infringe.

ANALYSIS

The parties' summary judgment motions ask the Court to resolve issues related to infringement, invalidity, construction of claims, and damages. The Court will address each in turn.

I. WHETHER FCA'S PRODUCT FEATURES INFRINGE ON VELOCITY'S PATENT

"To prove literal infringement, a plaintiff must show that the accused device contains each and every limitation of the asserted claims." Presidio Components, Inc. v. Am. Tech. Ceramics Corp. , 702 F.3d 1351, 1358 (Fed. Cir. 2012). In infringement cases, the Court first interprets the claims to determine their scope and meaning; then the fact-finder compares the properly construed claims to the allegedly infringing device. Id. If any claim is missing from the accused device, there is no literal infringement of that claim as a matter of law. Id. "A patentee claiming infringement must present proof that the accused product meets each and every claim limitation." Forest Laboratories, Inc. v. Abbott Laboratories , 239 F.3d 1305, 1310 (Fed. Cir. 2001). Summary judgment is appropriate "where the patentee's proof is deficient in meeting an essential...