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Orion Energy Systems Inc. v. Energy Bank Inc.

United States District Court, E.D. Wisconsin

October 23, 2017

ORION ENERGY SYSTEMS INC., Plaintiff,
v.
ENERGY BANK INC. and NEAL R. VERFUERTH, Defendants. ENERGY BANK INC., Counterclaim-Plaintiff,
v.
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          DECISION ON CLAIM CONSTRUCTION

          William C. Griesbach, Chief Judge

         In this action for patent infringement, Plaintiff Orion Energy Systems Inc. accuses Defendant Energy Bank Inc. of infringing its patents: U.S. Patent No. 8, 337, 043 (the ‘043 Patent) and No. 8, 858, 018 (the ‘018 Patent). The case is before the court for claim construction.

         PRELIMINARY MATTERS

         Before addressing the parties' claim construction arguments, the court will address Energy Bank's contention that Orion did not sufficiently plead facts related to infringement of all claims. In its complaint, Orion asserts that Energy Bank infringed and will continue to infringe one or more claims of the ‘043 Patent. Compl. ¶ 23, ECF No. 1. The complaint makes specific allegations that Energy Bank infringed at least claim 16 of the ‘043 Patent. Id. ¶ 28. As to the ‘018 Patent, Orion alleges that Energy Bank infringed and will continue to infringe one or more claims of the ‘018 Patent and that it has at least infringed claim 1 of the Patent. Id. ¶¶ 33, 38. On June 16, 2017, two months before Energy Bank's claim construction brief was due, Orion disclosed to Energy Bank that it asserted claims 9 11 and 14 20 of the ‘043 Patent and claims 1 5, 8 13, 1726, and 32 36 of the ‘018 Patent.

         Energy Bank argues that because Orion pleaded infringement of only claim 16 of the ‘043 Patent and claim 1 of the ‘018 Patent in its complaint, it must be prevented from attempting to litigate other claims from those patents. Citing Oil-Dri Corp. of America v. Nestle Purina, No. 15-cv-1067, 2017 WL 1197096 (N.D. Ill. Mar. 31, 2017), Energy Bank contends that “it is not possible to satisfy accepted pleading standards of infringement of other patent claims by providing allegations as to infringement of only one patent claim if the claims are materially different.” Def.'s Sur-reply Br. at 2, ECF No. 62.

         In Oil-Dri, the court dismissed many of the plaintiff's infringement claims without prejudice because it failed “to plead sufficient facts supporting [its] infringement allegations with respect to each asserted patent claim.” Id. at *5. While the court noted that the plaintiff's complaint only made specific allegations regarding infringement of claim 1, this claim did not include the same limitations included in the other claims it later asserted. The court concluded that a plaintiff should not be able to plead infringement as to one patent claim then proceed in the litigation asserting claims that are materially different than the one asserted in the complaint. Id. at *4. It explained, “Such a result sidesteps Twombly and Iqbal's plausibility requirements, up-ends the notice-pleading requirements that remain in place post-Twombly, subjects the defendant to potentially unnecessary and unwarranted discovery costs, and wastes judicial resources by preventing Rule 12(b)(6) motions from narrowing the focus of the case to issues for which the plaintiff has shown it has a plausible chance of success.” Id. at *5. A number of other courts have come to the same conclusion. See, e.g., Wright's Well Control Servs., LLC v. Oceaneering Int'l, Inc., No. 15-1720, 2017 WL 568781 (E.D. La. Feb. 13, 2017) (concluding that “simply putting defendants on notice that their product allegedly infringes at least one of the claims within WWCS's patents, without more, does not satisfy the plausibility standard”); Werteks Closed Joint Stock Co. v. Vitacost.com, Inc., No. 16-cv-60695-GAYLES, 2016 WL 5076169, at *3 (S.D. Fla. Sept. 20, 2016) (noting that although plaintiffs' complaint addressed elements of claim 1 of patent, they were “required to put forth facts that, at the very least allow the Court to make a reasonable inference that the Defendants have infringed on claims 2 and 3”); Scripps Research Inst. v. Illumina, Inc., No. 16-cv-661 JLS (BGS), 2016 WL 6834024, at *5 n.3 (S.D. Cal. Nov. 21, 2016) (“while under Twombly a patentee need only plausibly allege direct infringement of one asserted claim for its complaint to survive a motion to dismiss, a patentee must plausibly allege direct infringement as to all asserted claims in its complaint in order for those asserted claims to likewise survive a motion to dismiss” (emphasis in original)).

         Conversely, Orion relies on cases which have concluded that a plaintiff is only required to plead sufficient facts to make a showing that it is plausible that every limitation of at least one claim of the asserted patent is met by the accused product. See, e.g., Iron Gate Security, Inc. v. Lowe's Cos., Inc., No. 15-8814 (SAS), 2016 WL 1070853, at *3 (S.D.N.Y. Mar. 16, 2016) (“A plaintiff is not required to list which of the claims in the patent have been infringed in its pleading; as the Federal Circuit has recently reiterated, ‘a plaintiff need not even identify which claims are being infringed.'” (quoting In re Bill of Lading Transmission & Processing Sys. Patent Litig., 681 F.3d 1323, 1334 35 (Fed. Cir. 2012)); Semcon IP Inc. v. Huawei Device USA Inc., No. 2:16-cv-00437-JRG-RSP (E.D. Tex. Feb. 21, 2017), report and recommendation adopted, No. 2:16-CV-437-JRG-RSP, 2017 WL 1001286 (E.D. Tex. Mar. 15, 2017); see also Cont'l Circuits, LLC v. Intel Corp., No. CV16-2026 PHX DGC, 2017 WL 679116 (D. Ariz. Feb. 21, 2017); CG Tech. Dev., LLC v. Zynga, Inc., No. 2:16-cv-859-RCJ-VCF, 2017 WL 662489 (D. Nev. Feb. 17, 2017); Solocron Educ., LLC v. Healthstream, Inc., No. 2:16-cv-16-JRG, 2016 WL 9137458 (E.D. Tex. June 7, 2016).

         The holdings in this latter line of cases that a party need not plead facts supporting infringement allegations for each asserted claim seem to comport with the pleading standards set forth in Twombly and Iqbal. After all, Twombly and Iqbal sought to prevent plaintiffs from filing lawsuits based on claims that are merely conceivable or possible and then forcing the defendant to expend time and resources to allow the plaintiff to discover their way into a plausible claim. See Bell Atl. Corp. v. Twombly, 550 U.S. 544, 569 (2007) (“Because the plaintiffs have not nudged their claims across the line from conceivable to plausible, their complaint must be dismissed.”); Ashcroft v. Iqbal, 556 U.S. 662, 681 (2009) (“It is the conclusory nature of respondent's allegations, rather than their extravagantly fanciful nature, that disentitles them to the presumption of truth.”). The “plausibility” standard articulated in Twombly, however, is not akin to a “probability requirement at the pleading stage; it simply calls for enough fact to raise a reasonable expectation that discovery will reveal” that the defendant is liable for the alleged conduct. Twombly, 550 U.S. at 556; see also Bill of Lading, 681 F.3d at 1341 (“[The defendant] is essentially arguing that, at the pleading stage, [the plaintiff] must allege facts that prove all aspects of its claims, or at the very least make those claims probable. But that is not what is required.”). Requiring plaintiffs to allege infringement of all asserted claims would be contrary to the spirit of Rules 1 and 8 of the Federal Rules of Civil Procedure. See Fed. R. Civ. P. 1 (“These rules govern the procedure in all civil actions and proceedings in the United States district courts . . . . They should be construed, administered, and employed by the court and the parties to secure the just, speedy, and inexpensive determination of every action and proceeding.”); see also Solocron Educ., LLC, 2016 WL 9137458, at *2 (declining to “infuse Federal Rule of Civil Procedure 8(a)'s well-established pleading standard with such a heightened burden at the initial pleading stage”). It would also necessitate unduly detailed complaints or, alternatively, repeated amendments as discovery disclosed that the accused product infringed other claims as well as those originally asserted. This is not what the Twombly/Iqbal standard or the Federal Rules contemplate or require. Accordingly, a complaint alleging patent infringement must merely include “a short and plain statement of the claim showing that the pleader is entitled to relief.” Fed.R.Civ.P. 8(a)(2).

         Orion has met this standard. Its complaint sufficiently alleges plausible infringement claims of the ‘043 and ‘018 Patents against Energy Bank. Two months before Energy Bank's claim construction brief was due, Orion disclosed its asserted claims to Energy Bank. Orion has given Energy Bank “fair notice of what the . . . claim is and the grounds upon which it rests.” Conley v. Gibson, 355 U.S. 41, 47 (1957); Twombly, 550 U.S. at 555. Energy Bank has not shown that it has been prejudiced by the fact that Orion did not allege all of the asserted claims in its complaint. In sum, the court finds that Orion may proceed on all of its asserted claims. The court will now turn to the parties' claim construction arguments.

         LEGAL STANDARD GOVERNING CLAIM CONSTRUCTION

         A patent includes both a written description of the invention and claims. The written description, which usually includes figures, is often referred to as the “specification” of the patent.

         The specification ends with one or more numbered sentences that are the patent's “claims.” These claims describe the invention and set forth the metes and bounds of the patent.

         Claim construction is an issue of law for the court. If a material issue in the case, such as infringement or validity, involves a dispute about the meaning of certain claim language, the court needs to construe that disputed claim language. See Markman v. Westview Instruments, Inc., 52 F.3d 967, 97071 (Fed. Cir. 1995) (en banc), aff'd, 517 U.S. 370 (1996). The only claim language that needs to be construed is the language “in controversy, and only to the extent necessary to resolve the controversy.” Vivid Techs., Inc. v. Am. Sci. & Eng'g, Inc., 200 F.3d 795, 803 (Fed. Cir. 1999).

         Claim construction begins with and focuses on the words of the claim. See Bell Commc'ns Research, Inc. v. Vitalink Commc'ns Corp., 55 F.3d 615, 61920 (Fed. Cir. 1995). How a person of ordinary skill in the art understands those claim terms provides an objective baseline for claim construction. Phillips v. AWH Corp., 415 F.3d 1303, 1312 13 (Fed. Cir. 2005) (en banc). In attempting to determine the meaning of disputed claim language, the court must look to “those sources available to the public that show what a person of skill in the art would have understood disputed claim language to mean.” Id. at 1314. “Those sources include the words of the claims themselves, the remainder of the specifications, the prosecution history, and extrinsic evidence concerning relevant scientific principles, the meaning of technical terms, and the state of the art.” Id. (internal quotation marks omitted). Extrinsic evidence includes sources such as the testimony of experts and knowledgeable technical witnesses, dictionaries, and learned treaties. Id. at 1317 18. Extrinsic evidence is “less significant” and “less reliable” than the intrinsic record in determining the meaning of the claim language. Id. Thus, to the extent that the court considers extrinsic evidence, it does so in the context of the intrinsic evidence and is cognizant of “the flaws inherent” in such evidence. Id. at 1319.

         “The claims, not specification embodiments, define the scope of patent protection. The patentee is entitled to the full scope of his claims” and is not limited “to his preferred embodiment” and the court will not “import a limitation from the specification into the claims.” Kara Tech. Inc. v. Stamps.com Inc., 582 F.3d 1341, 1348 (Fed. Cir. 2009); Comaper Corp. v. Antec, Inc., 596 F.3d 1343, 1348 (Fed. Cir. 2010) (cautioning “against confining the claims to [preferred] embodiments”). Even where “a patent describes only a single embodiment, the claims should not be construed as limited to that embodiment” absent a clear disavowal of claim scope. Phillips, 415 F.3d at 1323; see also Linear Tech Corp. v. ITC, 566 F.3d 1049, 1057 58 (Fed. Cir. 2009) (explaining that it is improper to limit a claim to embodiments described in the specification where “there is no clear intention to limit the claim scope”).

         The court may also consider the patent's prosecution history, including reexamination proceedings. Phillips, 415 F.3d at 1317. The prosecution history, which is part of the “intrinsic evidence, ” consists of the “complete record of the proceedings before the USPTO and includes the prior art cited during the examination of the patent.” Id. “[T]he prosecution history can often inform the meaning of the claim language by demonstrating how the inventor understood the invention and whether the inventor limited the invention in the course of prosecution, making the claim scope narrower than it would otherwise be.” Id. The prosecution history includes any arguments or amendments made by the applicant in securing patent rights and these arguments and amendments may be considered during the claim construction process. Southwall Techs. Inc. v. Cardinal IG Co., 54 F.3d 1570, 1576 (Fed. Cir. 1995). The correct claim construction must be consistent with the arguments the applicant made to overcome a prior art rejection. See id.

         CLAIM CONSTRUCTION AND ANALYSIS

         The ‘043 and ‘018 Patents, both entitled “Modular Light Fixture with Power Pack, ” relate to modular power input connectors for light fixtures. The parties have disputes over certain terms in the patents, as will be discussed below.

         A. The ‘043 Patent

         1. “Preassembled”

Claim Term
Plaintiff's Proposed Construction
Defendant's Proposed Construction
Court's Construction

preassembled

Plain and ordinary meaning

Alternatively: something that is assembled beforehand

Assembled at a factory

Plain and ordinary meaning

         The term “preassembled” appears in claim 16 of the ‘043 Patent. Orion argues that no construction is necessary for this phrase, while Energy Bank asserts that it means “assembled at a factory.” For support, Energy Bank cites to intrinsic evidence in the specification, which indicates, for example, that “the light fixtures may be preassembled at a factory with a socket (or plug) portion of the connector within the ballast cover, and then shipped to the building, installed at the appropriate locations in the building, and then electrically connected . . . .” ‘043 Patent col. 11 ll. 15 19. Yet, as Orion contends, limitations from examples in the specification cannot be used to rewrite claim language. See Thorner v. Sony Computer Entm't Am. LLC, 669 F.3d 1362, 1366 (Fed. Cir. 2012) (“We do not read limitations from the specification into claims; we do not redefine words.”); Ericsson, Inc. v. D-Link Sys., Inc., 773 F.3d 1201, 1218 (Fed. Cir. 2014) (“Although the claims must be read in light of the specification, it is important that we avoid importing limitations from the specification into the claims.” (internal citation and quotation omitted)). Tellingly, the language Energy Bank relies upon follows the phrase “in one embodiment, ” which demonstrates that the specification is merely giving an example, rather than limiting or redefining the term itself. In short, I will give this term its plain and ordinary meaning.

         2. “Light Fixture”

Claim Term
Plaintiff's Proposed Construction
Defendant's Proposed Construction
Court's Construction

light fixture

Plain and ordinary meaning

Light fixture driven by a ballast

Plain and ordinary meaning

         Claims 9 through 11, 14 through 16, and 19 of the ‘043 Patent use the term “light fixture.” Energy Bank argues that the term “light fixture” in the ‘043 Patent refers to a “light fixture driven by a ballast, ” as supported by the intrinsic evidence. Def.'s Resp. Br. at 13, ECF No. 52. Orion argues that the phrase needs no special interpretation and stands on its own.

         Energy Bank's proposed construction reads limitations from the specification into the claim. The specification explicitly states, “It should be noted that the present invention can be employed with other fixtures, and the invention is not limited to the light fixture shown and described herein.” ‘043 Patent col. 7 ll. 1118. Moreover, this limitation does not exist in the claim language. For example, claim 1 of the ‘043 Patent reads in pertinent part: “A light fixture comprising . . . a cover provided over at least one ballast, the ballast output wiring, and the power input wiring, wherein the cover is coupled to the first and second raceways and has a modular power input connector coupled thereto that is configured to allow a power cord to supply power to the light fixture without removing the cover.” Id. col. 15 ll. 9, 2530. However, claim 16 of the patent does not require that the light fixture include a ballast:

A method comprising: providing a preassembled light fixture, wherein the light fixture comprises a first raceway and a second raceway configured to have a power pack extending at least partially between the first and second raceway, a detachable cover provided over the power pack and extending between the first and second raceways, and a power input connector coupled to the detachable cover and configured to receive power from a power source and to direct power to the power pack, the power input connector configured to be coupled to the power source without removing the detachable cover from the light fixture; and connecting the power input connector to a power supply line electrically coupled to the power source without removing the detachable cover.

Id. col. 16 ll. 32 47. In short, neither the claims nor the specification in the ‘043 Patent restrict the meaning of “light fixture” in the way Energy Bank suggests. Accordingly, I will give the term its plain meaning.

         3. ...


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