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April 23, 2014

FedEx Becomes Second Carrier to Deliver Patent Declaratory Judgment Complaint to Eclipse IP LLC

Eclipse IP LLC (“Eclipse”), which is used to being the plaintiff in a series of lawsuits asserting patents purporting to cover computer-based notification systems, has for the second time found itself a defendant over those patents.

On January 25, 2013, FedEx Corporate Services, Inc. (“FedEx”) filed a declaratory judgment action against Eclipse in the U.S. District Court for the Northern District of Georgia, Atlanta Division, seeking declarations of noninfringement and invalidity of U.S. Patents Nos. 7,119,716 (“the ’716 Patent”), 7,479,899 (“the ’899 Patent”), 7,482,952 (“the ’952 Patent”), 7,319,414 (“the ’414 Patent”), and 7,876,239 (“the ’239 Patent”) (collectively, “the Patents-in-Suit”).

As reported in a Law360 article, counsel for Eclipse indicated that its patents “relate in part to systems for keeping individuals apprised of the whereabouts of a ‘mobile thing’ – a package, vehicle, or even a person,” and that the technology covered is even broader.[1]  The Patents-in-Suit are related to one another as shown in the chart below, reciting patent issue dates and the annotations “CON” and “DIV,” indicating, respectively, that the descending patent issued from an application that was filed as a continuation or divisional application from its predecessor.[2]

FedEx alleges that Eclipse demanded patent licenses from certain of FedEx’s customers, and has in some instances sued them over the Patents-in-Suit.  For instance, the complaint alleges that on January 13, 2012, Eclipse sent a letter to General Counsel for Bass Pro, Inc., demanding payment of a $150,000 fee to get licensed under all of Eclipse’s patents, and accusing Bass Pro of infringing the Patents-in-Suit.  Other examples alleged by FedEx include actual lawsuits filed by Eclipse against FedEx customers Brickhouse Electronics, LLC and 1st in Video-Music World, Inc.

Eclipse has, in fact, filed a number of infringement actions involving the five Patents-In-Suit (or a subset thereof), identified in the table below.  Status assessed as of time of this writing.

Case Name and Number

District Court

Date Filed

Status

Eclipse IP LLC v. Steve Madden, Ltd. et al.,

No. 9-11-cv-80553

S.D. Fla.

05/12/11

Terminated

Eclipse IP LLC v. Hautelook, Inc. et al.,

No. 9-11-cv-80555

S.D. Fla.

05/13/11

Terminated

Eclipse IP, LLC v. Aldo U.S. Inc. et al.,

No. 1-11-cv-03392

N.D. Ill.

05/19/11

Terminated

Eclipse IP LLC v. Dick’s Sporting Goods, Inc.,

No. 2-12-cv-00294

E.D. Tex.

05/17/12

Pending

Eclipse IP LLC v. JP Boden USA LLC,

No. 5-12-cv-00075

N.D. W.Va.

05/31/12

Terminated

Eclipse IP LLC v. Brickhouse Electronics, LLC,

No. 3-12-cv-00351

W.D.N.C.

06/12/12

Terminated

Eclipse IP LLC v. Cydea, Inc.,

No. 3-12-cv-03027

N.D. Cal.

06/12/12

Terminated

Eclipse IP LLC v. Kellwood Company,

No. 2-12-cv-07572

C.D. Cal.

09/05/12

Terminated

Eclipse IP LLC v. Provide Commerce, Inc.,

No. 3-12-cv-02184

S.D. Cal.

09/05/12

Terminated

Eclipse IP, LLC v. 1st in Video-Music World, Inc.,

No. 3-12-cv-00581

W.D.N.C.

09/07/12

Pending

Eclipse IP, LLC v. Omaha Steaks Int’l, Inc.,

No. 3-12-cv-04727

N.D. Cal.

09/11/12

Terminated

Eclipse IP, LLC v. Cornerstone Brands, Inc.,

No. 5-12-cv-00144

N.D. W.Va.

09/28/12

Pending

Eclipse IP, LLC v. Lucy Activewear, Inc.,

No. 5-12-cv-00147

N.D. W.Va.

10/02/12

Pending

Eclipse IP, LLC v. Nordstrom, Inc.,

No. 2-12-cv-06615

S.D. W. Va.

10/16/12

Terminated

Eclipse IP, LLC v. ECCO USA, Inc.,

No. 5-12-cv-00160

N.D. W.Va.

10/23/12

Pending

Eclipse IP, LLC v. Callaway Golf Co.,

No. 3-12-cv-00707

W.D. Ky.

10/23/12

Terminated

Eclipse IP, LLC v. Wayfair, Inc.,

No. 1-12-cv-08866

N.D. Ill.

11/06/12

Terminated

Included among FedEx’s other asserted bases for invalidity of the Patents-In-Suit are the allegations that the sole named inventor on those patents “did not himself invent the subject matter sought,” and that one or more of the claims are invalid “because they are indefinite, not enabled, and/or lack sufficient written description.”

FedEx is not the first to assertively challenge the validity of the Patents-In-Suit.  Its chief competitor United Parcel Service, Inc. (“UPS”) filed a similar declaratory judgment complaint against Eclipse on June 30, 2011, also in the Northern District of Georgia.[3]  In a manner similar to FedEx’s complaint, UPS alleges that Eclipse filed infringement lawsuits against UPS’ customers over the subject patents.  Citing the May 2011 Law360 article,[4] UPS refers to a statement from Eclipse’s counsel stating that two earlier lawsuits “were the first Eclipse has filed, but will likely not be the last,” and that “‘Eclipse is enthused about and looks forward to licensing and enforcing its 13 patents that cover core technologies used widely in the online retail market.’”[5]  UPS’ complaint asserts invalidity theories identical to those asserted by FedEx against all of the Patents-In-Suit except for the ’952 Patent.  In ¶ 9 of its complaint, UPS alleges: “Upon information and belief, Eclipse is a non-practicing patent entity and does not manufacture, produce and/or sell any products or services.”  Eclipse admitted that allegation.[6]

On September 20, 2012, Eclipse moved to dismiss UPS’ complaint for lack of subject matter jurisdiction, attaching a covenant not to sue as an exhibit.[7]  UPS opposed that motion,[8] which remains pending as of the time of this writing.

The case is FedEx Corporate Services, Inc. v. Eclipse IP LLC, No. 1:13-cv-0275-AT, filed 01/25/13 in the U.S. District Court for the Northern District of Georgia, Atlanta Division, assigned to U.S. District Judge Amy Totenberg.


[1] Ben James, Steve Madden, Nespresso Sued Over Package-Tracking IP, Law360.com (May 16, 2011).

[2] “A ‘continuation’ application claims the same invention claimed in an earlier application, although there may be some variation in the scope of the subject matter claimed.”  Transco Prods. Inc. v. Performance Contracting, Inc., 38 F.3d 551, 555 (Fed. Cir. 1994) (citation omitted).  “A ‘divisional’ application, on the other hand, is one carved out of an earlier application which disclosed and claimed more than one independent invention, the result being that the divisional application claims only one or more, but not all, of the independent inventions of the earlier application.”  Id. (citation omitted).

[3] That case is United Parcel Service, Inc. v. Eclipse IP LLC, No. 1:11-cv-2138-CAP, U.S. District Court for the Northern District of Georgia, Atlanta Division, assigned to U.S. District Judge Charles A. Pannell, Jr.

[4] See Footnote 1, supra.

[5] UPS Complaint at ¶ 31.

[6] United Parcel Service, Inc. v. Eclipse IP LLC at Dkt. 27, Answer to United Parcel Service Inc.’s Complaint for Declaratory Judgment of Patent Noninfringement, Invalidity and Unenforceability, at ¶ 9 (08/15/12).  The title of UPS’ complaint recites the words “and Unenforceability,” but UPS’ complaint does not recite an unenforceability count.

[7] Id. at Dkt. 29.

[8] Id. at Dkt. 33.

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