April 20, 2014

Northern District of Georgia Adopts Special Master’s Patent Claim Construction and Summary Judgment Denial Recommendations Over Sprint’s Objections

In an order entered on February 5, 2013, the Northern District of Georgia adopted the Report and Recommendation of a Special Master concerning disputed patent claim interpretation issues.  This marks the second time in less than a month that the Northern District of Georgia issued this type of a ruling.

A webpage describes as “a managed service provider of bill payment and distribution services to wireless carriers and their agents, including Verizon Wireless and AT&T Mobility.”  On January 16, 2009, Atlanta-based Datascape, Inc. (“Datascape”) sued Sprint Spectrum, L.P. and Sprint Solutions, Inc, (collectively “Sprint”), accusing Sprint of infringing five patents, namely, U.S. Patents Nos. 5,742,845 (“the ’845 patent”), 5,905,908, 6,366,967, 6,684,269 and 6,745,259 (collectively “the patents-in-suit”).  “The patents-in-suit are generally drawn to a system or method of processing or communicating with ‘non-standard I/O devices’ over an open network using an ‘extended open network protocol.’”[1]  The ’845 patent describes a need for a way for a processing center to communicate over an open network with “non-standard I/O devices such as credit card terminals, [PDA’s], an screen phone terminals,” or with such devices coupled to an open network through a PC.[2]  

On March 2, 2009, Sprint answered Datascape’s complaint and counterclaimed for declaratory judgments of noninfringement, invalidity, and unenforceability.

On September 16, 2009, Datascape moved for appointment of Mr. Gale Peterson as a Special Master to resolve claim construction issues.  While the parties were in their Markman proceeding briefing period, the court granted Datascape’s motion.[3]

Sprint, in addition to filing its Markman briefs, brought a motion for summary judgment that Datascape’s asserted claims were invalid for indefiniteness under 35 U.S.C. § 112, ¶ 2.

On October 22, 2010, Mr. Peterson conducted a hearing regarding Markman issues and Sprint’s summary judgment motion.  On November 30, 2011, Mr. Peterson issued two Reports and Recommendations, one setting forth his claim construction findings, and one recommending that the Court deny Sprint’s motion.  On January 19, 2012, Sprint filed objections to both Reports, while Datascape filed a motion for the Court to adopt the Markman Report and Recommendation, and to modify it in a minor aspect.[4]  The parties proceeded with discovery, filing several discovery-related certificates of service in the ensuring months.

On February 5, 2013, the Northern District of Georgia issued its Order as to both Reports and Recommendations.  The Court acknowledged that it was “obligated to conduct a de novo review of the portions of the Reports and Recommendations to which objections have been made, as claim construction and indefiniteness are decided as a matter of law.”[5]  Nevertheless, the Court overruled Sprint’s objections, adopted both Reports and Recommendations, and granted Datascape’s motions to adopt the Markman report and recommendation, with the aforementioned minor modification.

As to the Markman Report and Recommendation, the Court concluded it is “well-founded, consistent with the evidence presented, and supported by the law.”  Also, added the Court, it “accurately relies on and applies the proper rules of construction.”[6]

The Court used the same words to characterize the Report and Recommendation concerning Sprint’s summary judgment motion, finding it, too, “well-founded, consistent with the evidence presented, and supported by the law.”[7]  Proceeding further, it stated: “The Court finds that the claims at issue, which are presumed valid, have not been shown to be insolubly ambiguous, and the Defendants have not met their burden of showing facts that would support a conclusion of invalidity by clear and convincing evidence.”[8]  Notably, the Court also upheld the Special Master’s recommendation to correct certain “obvious errors” in one or more of the asserted patents, referring to “well-established law holding that a patent should not be invalidated based on an obvious administrative error.”

The decision is Datascape, Inc. v. Sprint Spectrum, L.P. and Sprint Solutions, Inc., No. 1:09-cv-0136-CC (N.D. Ga. Feb. 5, 2013), written by U.S. District Judge Clarence Cooper.

[1] Datascape, Inc. v. Sprint Spectrum, L.P. and Sprint Solutions, Inc., No. 1:09-cv-0136-CC (N.D. Ga.) at Dkt. No. 71, Report and Recommendation, at 1.  “The patents-in-suit issued from continuation applications ultimately based on the ‘845 patent.  Accordingly, the patents-in-suit share the same or substantially the same specification and drawings.”  Id.

[2] ’845 patent at Col. 5, lns. 22-27.

[3] Notably, Mr. Peterson was also the claim construction Special Master in another patent case.  See prior post.

[4] The requested modification was to add the word “extended” to the “recommended constructions of ‘Extended Hypertext Transfer Protocol (HTTP) Statements’ and ‘Extended Hypertext Markup Language (HTML Command Statement(s)’.”  Datascape, supra, at Dkt. No. 122 (Order), at 4.

[5] Id. at 2.

[6] Id. at 3.

[7] Id. at 5.

[8] Id. at 5-6.

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