United States District Court, W.D. Wisconsin
ULTRATEC, INC. and CAPTEL, INC., Plaintiffs,
SORENSON COMMUNICATIONS, INC. and CAPTIONCALL, LLC, Defendants.
OPINION & ORDER
D. PETERSON District Judge
Ultratec, Inc. and CapTel, Inc. asserted U.S. Patent No. 7,
660, 398 (the '398 patent) against defendants Sorenson
Communications, Inc. and CaptionCall, LLC. Defendants
stipulated to infringement, Dkt. 602, at 3:11-4:20, and the
case went to trial on validity and damages. The jury found
that the asserted claims were not obvious, Dkt. 564, and it
awarded damages of $5, 443, 484.61 for infringement, Dkt.
575. The court entered judgment on October 15, 2016. Dkt.
motions from both sides are now before the court. Plaintiffs
ask to seal portions of the trial transcript to protect
competitively sensitive information. Dkt. 616. The court will
grant this motion. Plaintiffs also have submitted a bill of
costs, Dkt. 591, and they seek a permanent injunction or an
enhanced ongoing royalty, Dkt. 609, an award of supplemental
damages, pre-judgment interest, post-judgment interest, and
an accounting of defendants' minutes of use, Dkt. 612.
These are reasonable requests from a prevailing plaintiff
that the court would likely grant, at least in part. But the
court will deny these requests, because the court will grant
defendants' motion for judgment as a matter of law that
the '398 patent is invalid as obvious. Dkt. 606.
Defendants also move for judgment as a matter of law on
damages. Dkt. 605. Although this motion could be regarded as
moot, the court will deny it on the merits because doing so
will allow the issue to be addressed on appeal.
court will not repeat here the general background to the
'398 patent, which is set out in the court's decision
on summary judgment. Dkt. 478.
development after that decision is important to the damages
issue, because it affects the number of captioned calls that
infringe the '398 patent. After summary judgment, the
court clarified its decision to give the claim term
“cancel the voice of the assisted user from the second
telephone line so that the relay does not hear the voice of
the assisted user, so the relay can caption all the words on
the second telephone line” its plain meaning. Dkt. 507.
At trial, the court instructed the jury that the “claim
limitation is satisfied so long as a call assistant with
normal hearing would not hear the words spoken by the
assisted user while captioning a call.” Dkt. 567, at 8.
development affects the invalidity issue. The court
determined during trial that the one-line CapTel trials were
a commercial use of that technology, and thus the one-line
CapTel trials are prior art to the '398 patent.
Defendants' motions on validity and damages
move for judgment as a matter of law under Federal Rule of
Civil Procedure 50 and for a new trial under Rule
They contend that the patent is invalid as obvious, Dkt. 606,
and that the basis for plaintiffs' damages calculations
is speculative, Dkt. 605.
standards applicable to these motions are not matters unique
to patent law, so the court applies the law of its regional
circuit. ABT Sys., LLC v. Emerson Elec. Co., 797
F.3d 1350, 1354 (Fed. Cir. 2015). “In deciding a Rule
50 motion, the court construes the evidence strictly in favor
of the party who prevailed before the jury and examines the
evidence only to determine whether the jury's verdict
could reasonably be based on that evidence.”
Passananti v. Cook County, 689 F.3d 655, 659 (7th
Cir. 2012). The court reviews the entire record but does not
reweigh the evidence, make credibility determinations, or
consider evidence favorable to the moving party that the jury
was not required to believe. Id. Thus, defendants
are entitled to judgment as a matter of law only if the jury
did not have a “legally sufficient evidentiary
basis” to find in plaintiffs' favor. Id.;
trial is appropriate under Rule 59 “if the verdict is
against the weight of the evidence, the damages are
excessive, or if for other reasons the trial was not fair to
the moving party.” Tapia v. City of Greenwood,
965 F.2d 336, 338 (7th Cir. 1992). Likewise, a motion to
amend the judgment under Rule 59(e) “will be successful
only where the movant clearly establishes: ‘(1) that
the court committed a manifest error of law or fact, or (2)
that newly discovered evidence precluded entry of
judgment.'” Cincinnati Life Ins. Co. v.
Beyrer, 722 F.3d 939, 954 (7th Cir. 2013) (quoting
Blue v. Hartford Life & Accident Ins. Co., 698
F.3d 587, 598 (7th Cir. 2012)). “A ‘manifest
error' is not demonstrated by the disappointment of the
losing party. It is the ‘wholesale disregard,
misapplication, or failure to recognize controlling
precedent.'” Oto v. Metro. Life Ins. Co.,
224 F.3d 601, 606 (7th Cir. 2000) (quoting Sedrak v.
Callahan, 987 F.Supp. 1063, 1069 (N.D. Ill. 1997)).
move for judgment as a matter of law that the '398 patent
is invalid as obvious. Dkt. 606.
standard applicable to determining patent validity is
governed by Federal Circuit law. ABT Sys., 797 F.3d
at 1354. A patent is invalid if a person of ordinary skill in
the art would have found the invention obvious in light of
the prior art at the time of the filing date. 35 U.S.C.
§ 103. Defendants “must ‘demonstrate by
clear and convincing evidence that a skilled artisan would
have been motivated to combine the teachings of the prior art
references to achieve the claimed invention, and that the
skilled artisan would have had a reasonable expectation of
success in doing so.'” Kinetic Concepts, Inc.
v. Smith & Nephew, Inc., 688 F.3d 1342, 1360 (Fed.
Cir. 2012) (quoting Procter & Gamble Co. v. Teva
Pharm. USA, Inc., 566 F.3d 989, 994 (Fed. Cir. 2009)).
is ultimately a question of law, based on underlying facts.
Ohio Willow Wood Co. v. Alps S., LLC, 735 F.3d 1333,
1343 (Fed. Cir. 2013). The inquiry is guided by the familiar
Graham factors: (1) the scope and content of the
prior art; (2) the level of ordinary skill in the art; (3)
the differences between the prior art and the claims at
issue; and (4) the objective indicia of non-obviousness.
Id. After a jury verdict on the issue of
obviousness, the court will review the jury's explicit
and implicit factual findings for substantial evidence. Then
the court will consider the legal conclusion of obviousness
in light of the factual findings that are adequately
supported. ABT Sys., 797 F.3d at 1354.
Scope and content of prior art
case, defendants presented five pieces of prior art: U.S.
Patent Publication No. 2002/0085685 to Engelke et al. (the
'685 publication), U.S. Patent No. 6, 504, 910 to Engelke
et al. (the '910 patent), U.S. Patent No. 6, 141, 415 to
Tandhoni S. Rao (the Rao patent), a textbook titled Advanced
Signal Processing and Noise Reduction by Saeed V. Vaseghi
(the Vaseghi reference), and the CapTel trials.
parties had only immaterial disputes about the content of the
prior art. Plaintiffs contend that the '910 patent does
not disclose a two-line captioned telephone. But this
position is belied by the text of the specification, which
has a full paragraph discussing a two-line arrangement.
defendants' reply brief, they contend that the
obviousness of the '398 patent is demonstrated with a
single combination: the '685 publication with the CapTel
trials. The court agrees that this combination is sufficient,
and, accordingly, its analysis here will focus on those two
pieces of prior art. The other references, especially the Rao
patent and the Vaseghi reference, demonstrate that echo
cancellation and other noise-cancelling technologies were
widely known and available to one of skill in the art. The
other references would be helpful to the obviousness case,
but they are not necessary.
'685 publication discloses a two-line caption telephone
arrangement in which a call assistant revoices the words of
the remote user to a text-recognition device so the assisted
user can see the captions in nearly real time. In the
two-line arrangement, the assisted user is connected by one
phone line directly to the ...