eagle harbor v. ford motor co; jmol

FORDS MOTION FOR JUDGMENT AS A MATTER OF LAW - 1 No. 3:11-cv-05503-BHS

SAVITT BRUCE & WILLEY LLP 1425 Fourth Avenue Suite 800 Seattle, Washington 98101-2272 (206) 749-0500

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The Honorable Benjamin H. Settle

UNITED STATES DISTRICT COURT WESTERN DISTRICT OF WASHINGTON AT TACOMA

EAGLE HARBOR HOLDINGS, LLC, and MEDIUSTECH, LLC, Plaintiffs, v. FORD MOTOR COMPANY, Defendant.

Case No. 3:11-cv-05503-BHS FORD MOTOR COMPANYS MOTION FOR JUDGMENT AS A MATTER OF LAW NOTE ON MOTION CALENDAR: March 17, 2015

Pursuant to Fed. R. Civ. P. 50(a), Defendant Ford Motor Company (Ford)

respectfully submits the following Motion For Judgment As A Matter Of Law (JMOL).

JMOL is appropriate when, viewing the evidence in a light most favorable to the non-moving

party, reasonable minds could come to but one conclusion in favor of the moving party. Behne

v. 3M Microtouch Sys., Inc., 11 F. Appx 856, 858-59 (9th Cir. 2001) (judgment as a matter of

law is proper if the evidence, construed in the light most favorable to the non-moving party,

allows only one reasonable conclusion).

Here, JMOL should enter that:

1. Ford has not infringed U.S. Patent No. 6,615,137 (the 137 patent).


Case 3:11-cv-05503-BHS Document 611 Filed 03/17/15 Page 1 of 22


SAVITT BRUCE & WILLEY LLP 1425 Fourth Avenue Suite 800

Seattle, Washington 98101-2272 (206) 749-0500

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5. Eagle Harbors evidence is insufficient to support its claim for a reasonable

royalty.

6. Eagle Harbors claim for damages is excessive.

I. FORD IS ENTITLED TO JUDGMENT OF NON-INFRINGEMENT OF THE 137 PATENT

Asserted claim 29 of the 137 patent is a method claim. Plaintiffs allege that Ford is

liable for inducing infringement of the 137 patent under 35 U.S.C. 271 by users of its vehicles

by making, selling, and/or offering for sale vehicles equipped with Active Park Assist (APA).

(Dkt. 61 [2d Amended Compl.] 20.) To prevail on its claim, Plaintiffs must prove (1) that

Fords APA system directly infringes the 137 patent, either literally or under the doctrine of

equivalents, (2) that a third party actually uses the APA system in a manner that infringes claim

29, and (3) that Ford specifically intended its customers to infringe the 137 patent. See 35

U.S.C. 271(b); Vita-Mix Corp. v. Basic Holding, Inc., 581 F.3d 1317, 1328 (Fed. Cir. 2009).

Plaintiffs have been fully heard on these issues, and no reasonable jury could have a legally

sufficient evidentiary basis to find for Plaintiffs.

A. No Reasonable Jury Could Find That Plaintiffs Have Met Their Burden to Prove Direct Infringement

Plaintiffs have failed to prove direct infringement either literally or under the doctrine

of equivalents. Plaintiffs presented one witnessDr. Paul Minto testify regarding Fords

alleged infringement of claim 29. Dr. Min, however, failed to demonstrate that Fords APA

system meets either the steering queue limitation or the identifying limitation of the claim.

First, claim 29 of the 137 patent requires a steering queue. (137 patent, claim 29,

generating a steering queue that provides a direction for the local vehicle to move to avoid the

identified object.) The Court has construed the term steering queue to mean a steering

signal and has determined that the step of generating a steering queue that provides a





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direction for the local vehicle to move to avoid the identified object must occur after the step

in which the comparison indicates a possible collision condition exists between the identified

object and the local vehicle. (Dkt. 165 [Order of Special Master] at 18; Dkt. 184 [Order

Adopting Special Masters Claim Constructions].)

At trial, Dr. Min testified that APA provides two different so-called steering queues,

but neither satisfies this claim limitation as construed by the Court. Dr. Mins first theory,

which was presented for the first time at trial, asserts that the steering queue limitation is

satisfied by the steering signals sent by APA to correct the APAs parking trajectory during a

parking maneuver. (3/11 Tr. at 218:19-219:11.) Dr. Mins second theory asserts that the

steering queue limitation is satisfied by the pull forward prompt (together with automatic

steering), which is issued to the driver when the system has determined that the vehicle needs

to move forward to complete a parallel parking maneuver. (3/11 Tr. at 219:12-17.) Neither of

these alleged steering queues satisfies this limitation as construed by this Court.

With respect to the first alleged steering queuesignals to correct the parking

trajectorythere is no evidence that (a) such a correction is generated after a warning

indication as required by claim 29, or (b) such a correction to the parking trajectory is

calculated to avoid [an] identified object. Dr. Min failed to identify any alleged warning

indication related to his first steering queue theory. The only alleged warning indication that

Dr. Min identified is the one APA gives when the driver is backing up and nearing the object

behind it.

Q. The next step is generating a warning indication when the comparison indicates

a possible collision condition between the identified object and the local vehicle. How is that satisfied by APA?

A. . . . So the comparison continues to determine whether or not the vehicle is following the trajectory, then reaches the end of the trajectory. At that point the APA system would warn the driver to stop and pull forward, otherwise it will collide with a vehicle thats parked in the back.

Q. So if you turn to page 33 of Exhibit 112. What is shown there with respect to warnings that are generated when a possible collision condition exists?





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A. . . . So it says, end of the rear move, the message the warning indication would be given to the driver saying: Stop and put in drive going forward. Otherwise youll collide.

(3/11 Tr. at 217:15-218:18.) Thus, the first alleged steering queue comes before any

warning indication, contrary to the claim requirements. In addition, there is no evidence that

any correction to the parking trajectory (initial rearward move) is to avoid an identified

object. Dr. Mins testimony on this requirement is conclusory and unsupported by

documentary evidence. Indeed, the only document Dr. Min references in support of this

infringement theory is a Ford press release summarizing how APA works. This document does

not address any supposed correction to the parking trajectory, let alone confirm that its

purpose is to avoid an identified object. (3/11 Tr. at 205:22-207:11 (testifying about

PX1892).) To the contrary, the APA system keeps the vehicle on the calculated path to

maneuver it into the parking space.

Dr. Mins second steering queue theorythe forward promptsimilarly fails. There

is no evidence that the prompt is generated in order to avoid that collision as the claim requires.

Indeed, Dr. Min conceded that there is no collision condition at the time the forward prompt is

issued because the vehicle has stopped:

Q. . . . Now, at the time the driver stops, there is no collision condition, correct?

A. Yes. If the vehicle has stopped, there is no collision condition . . .

Q. And we both can agree that in APAyou have APA in mind, correct?

A. Yes.

Q. The forward prompt, the move forward, occurs only after the driver has stopped the car, correct?

A. Yes, thats right.

(3/12 Tr. at 43:9-44:7; see also id.at 47:23-15.) In sum, Dr. Min failed to provide any

competent evidence that the use of APA meets the steering queue limitation of claim 29.





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Second, claim 29 of the 137 patent requires identifying an object in the sensor data.

(137 patent, claim 29.) Plaintiffs, however, have failed to meet their burden of demonstrating

that Fords APA system identifies objects.

Dr. Mins contention that the APA system can identify what the obstacles surrounding a

parking space are is entirely conclusory. His testimony is based on one document, PX-444,

which describes how to set up or arrange vehicles to test the APA system. The document does

not address whether APA can identify the surrounding obstacles. To the contrary, the

document confirms that APA cannot identify surrounding objects. APA can only measure

distance to detect where objects are present in relation to the drivers vehicle, not what any

object is. In other words, the APA system cannot identify whether an object surrounding the

vehicle is a tree, a dumpster, a motorcycle, or a car. The APA system cannot even determine

whether the object detected by the system is one large object or several smaller objects. Dr.

Min appeared to concede this when he testified that the ultrasonic sensors in the APA system

measure empty space. (3/11 Tr. at 206:13-21 (Activate ultrasonic sensors to measure and

identify a feasible parallel parking space. And you do this by having the vehicle drive slowly

along the side to park the vehicle. And youll see that the sensor, the blue wiggly form, is

transmitting to the side identifying, at this point, there is an empty space there, and made a

determination that that spot is large enough for the red vehicle that is performing the parallel

parking, to safely maneuver into that space.).) As a result, no reasonable jury could find

infringement of the claim.

Further, Plaintiffs offered no proof in support of infringement under the doctrine of

equivalents at trial. Accordingly, Ford is entitled to judgment as a matter of law on this issue.

B. No Reasonable Jury Could Find that Plaintiffs Have Met Their Burden to Prove Infringement By a Third Party

A claim for inducement requires proof that a third party directly infringed the claim.

Plaintiffs, however, have failed to prove any use of the APA system in a manner that infringes

claim 29. Dr. Min and Mr. Wagner failed to identify any individuals who have actually used





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the APA system in a manner that would infringe the 137 patent. The Court has already

deemed insufficient Plaintiffs theory that the APA system infringes whenever the driver uses

the system for its intended purpose to prove actual use. (Dkt. 597 [Order Denying Plaintiffs

Motion for Reconsideration].) This Court has also rejected Plaintiffs argument that any Ford

customer who elects to pay over $300 for the APA system can be assumed to have actually

used the system. Because of Plaintiffs complete failure of proof on this point, judgment as a

matter of law is appropriate. Lucent Techs. Inc. v. Gateway, Inc., 580 F.3d 1301, 1334-35 (Fed.

Cir. 2009) (vacating the damages portion of the verdict because, beyond the circumstantial

evidence of at least one infringing use, all the jury had was speculation . . . there was an

absence of evidence describing how many Microsoft Outlook users had ever performed the

patented method or how many times).

C. No Reasonable Jury Could Find that Plaintiffs Have Met Their Burden to Prove Specific Intent

A claim for inducement requires proof that Ford affirmatively intends for its APA

customers to infringe the 137 patent. See, e.g., DSU Med. Corp. v. JMS Co. Ltd., 471 F.3d

1293, 1305-06 (Fed. Cir. 2006) (Beyond that threshold knowledge, the inducer must have an

affirmative intent to cause direct infringement. Accordingly, inducement requires evidence

of culpable conduct, directed to encouraging anothers infringement, not merely that the

inducer had knowledge of the direct infringers activities.). Plaintiffs, however, have provided

no evidence that Ford specifically intended its customers to directly infringe the 137 patent.

Plaintiffs presented one witness by deposition, Michelle Moody, purportedly to

establish specific intent. But all Ms. Moody testified was that Ford provides instructions and

may provide how-to videos regarding the use of APA. (3/13 Tr. at 167:13-169:16.) This

evidence is not enough. It is well-settled that merely instructing users how to use a product,

without more, is insufficient to establish affirmative intent. See Vita-Mix Corp., 581 F.3d at

1329 n.2 (evidence that a user following the instructions may end up using the device in an

infringing way is insufficient to state a claim for inducement); Unisone Strategic IP, Inc. v.





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Life Tech. Corp., No. 3:13-CV-1278, 2013 WL 5729487, at *3 (S.D. Cal. Oct. 22, 2013)

(allegation that Defendant provides instruction, technical support, and training for use of its

product insufficient to establish affirmative intent to induce infringement); Straight Path IP

Grp., Inc. v. Vonage Holdings Corp., No. 14-502, 2014 WL 3345618, at *2 (D.N.J. July 7,

2014) (allegations that the defendants induced customers by instructing them how to use the

accused products insufficient to establish that Defendants specifically intended for the induced

acts to infringe) (emphasis in original); Intellectual Ventures I LLC v. Bank of Am., Corp., No.

3:13-CV-358, 2014 WL 868713, at *2 (W.D.N.C. Mar. 5, 2014) (To survive a motion to

dismiss for an induced infringement claim, Plaintiffs complaint should have alleged facts that

plausibly demonstrated that Ford not only intended its customers to infringe the 137 patent,

but also knew that the customers acts constituted infringement.

Instead, Plaintiffs merely argued that Ford advertised the accused products on its

website. This argument fails to mention any facts that demonstrate that Ford specifically

intended for its customers to infringe the asserted patent. Additionally, Plaintiffs do not point

to specific portions of Fords website establishing that Ford knew its customers used APA in an

infringing manner. Metro-Goldwyn-Mayer Studios Inc. v. Grokster, Ltd., 545 U.S. 913, 937

(2005) (ordinary acts incident to product distribution, such as offering customers technical

support or product updates would not support liability for inducement in and of themselves).

In short, there is no evidence of the specific intent necessary to prove inducement. Judgment as

a matter of law on inducement is appropriate.

II. FORD IS ENTITLED TO JUDGMENT OF NON-INFRINGEMENT OF THE PROCESSOR PATENTS

Ford respectfully requests judgment as a matter of law of noninfringement of the 260,

739, and 119 patents. Plaintiffs have failed to meet their burden of demonstrating that the

accused SYNC system infringes any of the asserted claims of the Processor Patents literally or

under the doctrine of equivalents.





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Plaintiffs presented only Dr. Paul Min to testify regarding Fords alleged infringement.

(3/11 Tr. at 104:10-13; 3/12 Tr. at 15:15-21.) But Dr. Min failed to demonstrate that Fords

SYNC system meets the limitations of claim 9 of the 260 patent; claims 1 and 3 of the 739

patent; or claim 1 of the 119 patent, for the reasons that follow.

A. Plaintiffs have failed to present sufficient evidence to prove that SYNC meets multiple limitations of claim 9 of the 260 patent

1. Plaintiffs have failed to present sufficient evidence to prove that SYNC includes the required configuration manager of claim 9 of the 260 patent

Claim 9 of the 260 patent requires multiple processors that include a configuration

manager that will reconfigure[] the multiprocessor system to run the real-time car

applications on different ones of the multiple on-board processors. The claim thus requires:

(1) multiple processors that each run a dynamic configuration system including a

configuration manager, and (2) the configuration manager must reconfigure[] the

multiprocessor systemi.e., change the systems current configurationso that the real-time

car applications run on different processors in the system.

Dr. Min admitted during cross examination, however, that he had not identified any

applications in SYNC that are run on one processor, then reconfigured to run on a different

processor. (3/12 Tr. at 60:6-11 (Q. [Y]ou have in mind Claim 9, correct? A, Yes. Q, Im

going to ask you a question about the SYNC system. True or false. You have not identified

any applications in SYNC that are run on one processor, then reconfigured to run on a

different processor, correct? A. Thats right. Thats what I said then, and thats what I just

told you.).) In addition, Dr. Min has not identified any configuration manager in the ACM

that reconfigures the multiprocessor system. Indeed, Dr. Min has not identified any software

module that he contends is the claimed configuration manager. (3/12 Tr. at 61-25-62:24.)

Because Plaintiffs have provided no competent evidence that Fords SYNC system

includes the required configuration manager of 260 patent, claim 9, no reasonable juror

could find that SYNC infringes this claim, and Ford is entitled to judgment as a matter of law.





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2. Plaintiffs have failed to present sufficient evidence to prove that SYNC includes the required device manager of claim 9 of the 260 patent

Dr. Min has not identified a device manager for automatically detecting and adding

new hardware devices to the on-board multiprocessor system that runs on multiple different

ones of the multiple on-board processors, as required by claim 9 of the 260 patent. Dr. Min

does not point to anything on the ACM that automatically detect[s] and add[s] new hardware

devices to the SYNC system. Instead, Dr. Min says only that a message from the APIM is

communicated to the ACM. (3/11 Tr. at 161:2-22.) Nowhere does Dr. Min say a device

manager within the ACM itself includes the claimed device manager.

3. Plaintiffs have failed to present sufficient evidence to prove that SYNC includes the different communication links recited in claim 9 of the 260 patent

Claim 9 of the 260 patent requires different communication links coupling the

multiple processors together. Dr. Min has not, however, identified the required different

communications links. Dr. Min instead points to a single linkthe MS_CAN Network. (3/11

Tr. at 159:2-14.) Dr. Min argues that this single MSCAN link has multiple wires where the

data channels are redundant or complementary to each other. Id. However, the CAN bus

is a single link as that term has been construed by the Court (a data communications

channel, which can be wired or wireless, connecting two points or entities); see also PX-70 at

19.

4. Plaintiffs have failed to present sufficient evidence to prove that SYNC is a distributed processing system under the Courts construction, as required by claim 1 of the 119 patent

Claim 1 of the 119 patent requires a distributed processing system. The Court

adopted the Special Masters construction of distributed processing systemi.e., a

multiprocessor system in which processing tasks for applications can be distributed among

multiple processors. (Dkt. 165 at 45; Dkt. 184 at 2-3, 11.) Consistent with the specifications

and the alleged novelty of the Processor Patents, this claim construction requires that the

claimed system be capable of moving or re-allocating processing tasks for applications between

processors. It is undisputed, however, that all SYNC software runs on predetermined,





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dedicated processors, and no task for an application is ever moved from one processor to

another. Under the Courts claim construction, therefore, SYNC is not a distributed

processing system.

Dr. Mins trial testimony does not prove otherwise. Instead, Dr. Min interprets the

Courts construction to require only that the multiple processors work[] together. (3/11 Tr. at

190:13-14.) Dr. Min testified that SYNC meets the distributed processing system limitation

because the processors in the APIM and ACM work together when receiving a phone call.

(3/11 Tr. at 190:23-193:1.) Dr. Min failed to identify any application or task in the SYNC

system that can move from one processor to another processor or be distributed among multiple

processors. Faced with this absence of evidence, no reasonable juror could find that SYNC is a

distributed processing system as required by claim 1 of the 119 patent, and SYNC does not

infringe.

5. Plaintiffs have failed to present sufficient evidence to prove that SYNC download[s] or move[s] an application from memory as required by claims 1 and 3 of the 739 patent and claim 1 of the 119 patent, as the Court has construed those terms

Claims 1 and 3 of the 739 patent require that the claimed system automatically move

the second software application from the memory to a particular processor after the

connection of a new device. Claim 1 of the 119 patent includes a similar limitation, requiring

that the system download the stored application from memory into the processing system

after connecting a new device.

Dr. Min identified an alleged phone book application that he contended is the second

software application of claims 1 and 3 of the 739 patent. He testified that the system has no

reason to have a phone book application running on the SYNC system before a phone is

connected, and will copy the portion of the software to the memory location so that the

CCPU can actually run the software. (3/11 Tr. [Min] at 181:13-182:6.) Dr. Min makes an

even more conclusory argument with respect to claim 1 of the 119 patent, citing absolutely no

evidence of the alleged application. (3/11 Tr. [Min] at 197:19-23 (If it is phone book data,





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phone book application here. If you say music, music application here, so forth. And then

after that the application gets downloaded into the memory.).) There are three problems with

Dr. Mins testimony on these claim terms.

a. The thread Dr. Min identifies is not an application.

First, the only evidence of a phone book application that Dr. Min cites is a single

reference in a log file that refers to an UpdatePhoneBookGrammarThread. Dr. Min conceded

that while the patent uses both the terms application and thread, the claim uses only the

word application and a [t]hread is not part of the claim term. 3/12 Tr. at 65:17-66:3; see

also id. at 66:15-17, 68:21-25 ([Q.] Again, what you highlighted yesterday was a thread,

correct? A. Yes. Its identified as a TID.). Indeed, even the Special Masterwhose

constructions the Court adopted and found that he had provided a thorough explanation for his

constructions (Dkt. 345 at 6)expressly stated that [i]n every case, the claims expressly

require downloading or moving an application, not instructions threads, or some other

indicator of a subset of an application (Dkt. 333 at 18-19). The Court recognized that in light

of this statement, this issue may be subject to determination as a matter of law. (Dkt. 530 at

12 n. 4.) Further, Dr. Min conceded that he identified only a portion of software or page

that is copied to a memory location (3/11 Tr. at 181:23-24, 183:9-11), and he never made any

attempt to establish how many instructions are actually downloaded under his theory. (See

Dkt. 530 at 13 (Once Dr. Mins terminology is further clarified as to how many instructions

are actually downloaded, Ford may move for judgment as a matter of law that either the term

application can not be construed to meet this minimal amount of code or no reasonable juror

could ever find that this amount of code infringes the relevant patents.).)

As mentioned above, with respect to claim 1 of the 119 patent Dr. Min simply refers

back to his earlier scenario and otherwise provides completely unsupported testimony. (See

3/11 Tr. [Min] at 197:19-23.)

b. Dr. Min has not shown that the thread he contends is the application is downloaded or moved in response to connecting a new device to the system





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Second, even putting aside whether a thread may be considered an application or how

much of an application must be downloaded, Dr. Min has failed to establish when the software

he identifies is allegedly downloaded. It is undisputed that claim 1 of the 739 patent and

claim 1 of the 119 patent require an application to be moved/downloaded before a phone is

connected. (3/11 Tr. at 175:25-176:2 (Theres no reason for SYNC system to run phone book

when the phone is not connected. So when the phone gets connected, now this time it needs to

run that.).) However, Dr. Min only speculates the system has no reason to have a phone

book application running on the SYNC system before the phone gets connected. (3/11 Tr.

at 181:15-19.) Dr. Min cites no concrete evidence demonstrating that phone book

applicationwhich, to be clear, does not exist and is not referenced in any evidenceis

move[d] as the Court has construed that term in response to a phone being connected.

Furthermore, because the UpdatePhoneBookGrammarThreadwhich Dr. Min says is a phone

book applicationis actually part of the PhoneApp (as shown in Dr. Mins demonstrative at

slide 61 (PhoneApp|UpdatePhoneBookGrammarThread), it is indisputably are downloaded

or moved before any phone is connected to the system, and cannot meet these limitations.

c. Dr. Min points to separate software to meet the same second application

Finally, Dr. Min appears to identify different applications for different claim

limitations, when those limitations refer to the same application. For example, with respect to

the limitation identify a second software application, Dr. Min identifies only a media

player. 3/11 tr. [Min] at 174:23-175:2 (And the second software application, the media

player, as a part of SYNC system, is identified and clearly that application is in a memory

within the SYNC system. . . .). However, when Dr. Min provides his opinion regarding the

limitation that requires the system to automatically move the second software application, Dr.

Min identifies the alleged phone book application. 3/11 Tr. [Min] at 181:2-6, 15-19.

The Special Master made clear that [i]n every case, the claims expressly require

downloading or moving an application, not instructions threads, or some other indicator of a





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subset of an application. (Dkt. 333 at 18-19.) The Court recognized that this issue may be

subject to determination as a matter of law. (Dkt. 530 at 12 n. 4.) Plaintiffs also have failed to

show that any purported application is made available in an address space after a new device is

connected.

6. Plaintiffs have failed to present sufficient evidence to prove that SYNC selects a particular processor to which to download or move applications, as required by claims 1 and 3 of the 739 patent

Claims 1 and 3 of the 739 patent require that the claimed multiprocessor system select

a particular one of the on-board processors for operating the application that is being

downloaded or moved in order to process data from a new device.

Although the Special Master concluded that the select a processor limitation need not

be construed, he explained that the parties agreed that select and choose are synonymous,

and that the claim language plainly refers to multiple processors. (Dkt. 165 at 51-52.) Thus,

under the Special Masters analysis, the select a processor limitation requires that the system

can choose a processor from among multiple processors to operate the second software

application.

In SYNC, however, each application runs on a specific, predetermined processor, and

the system therefore never selects a processor on which an application should run. In SYNC,

there is no choice.

Faced with these facts, Dr. Min presented a theory directly contrary to the Special

Masters reasoning. Dr. Min instead argued that SYNC infringes because, for example, the

CCPU processor allegedly selects itself to run one of its own predetermined applications.

(3/12 Tr. at 179:21-180:8 (the CCPU has a corresponding software, so it [the CCPU] selects

itself to run the program.).) This argument is nonsensical; where a processor is indisputably

the only processor capable of running an application, there is no choice, and thus, no selection.

Similarly, Dr. Min argues only that the CCPU let[s the] ACM know that it needs to run its

own application. . . . (3/12 Tr. at 180:9-14.)





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No reasonable juror could find that SYNC meets the select a processor limitations of

the asserted claims. SYNC therefore does not infringe claims 1 and 3 of the 739 patent.

7. Plaintiffs have failed to present sufficient evidence that SYNC meets the claimed security limitations of claim 1 of the 119 patent

Claim 1 of the 119 patent includes two limitations regarding security: the first requires

the system to identify a security attribute; and the second requires the system to use the

identified security attribute to prevent an unauthorized application or unauthorized data from

being processed by the system. Dr. Mins testimony regarding how SYNC allegedly meets the

security limitations of the 119 patent is insufficient to demonstrate infringement.

Dr. Min testified that both a link key and Bluetooth profiles are required to meet the

identify a security attribute limitation, but referred to only the link key with respect to

the use the identified security attribute limitation (3/11 Tr. at 196:13-24). This is fatal to Dr.

Mins analysis because claim 1 of the 119 patent requires the same security attribute to be

identified and used. (PX-4 [119 patent] at claim 1 (identify a security attribute. . . . use

the identified security attribute. . . .).) Moreover, Dr. Min never explained how a Bluetooth

profile provides any form of security in SYNC. Indeed, Dr. Min identified the Bluetooth

profiles as a communications protocola separate limitation that was construed by the

Court. (3/11 Tr. at 193:18-21.)

For at least these reasons, no reasonable juror could find that SYNC meets the security

limitations of claim 1 of the 119 patent, and there, SYNC does not infringe the 119 patent.

8. Plaintiffs have failed to present sufficient evidence to prove that SYNC takes over control and operation of a mobile device, as required by claims 1 and 3 of the 739 patent

Claims 1 and 3 of the 739 patent require that the claimed multiprocessor system take

over control and operation of a connected device. The Special Master concluded that the

take over control limitation requires the system to take over control and operation of the

device such that the new device cannot be controlled and operated directly, outside the

multiprocessor system. (Dkt. 165 at 71.) Indeed, Dr. Min dodged Plaintiffs own questions





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on direct when asked whether SYNC prevent[s] a user from using the phone outside the

context of the multiprocessor system (3/11 Tr. at 184:9-10), as required under the plain

meaning articulated by the Speecial Master, answering only that the phone must operate

within the context of the SYNC system (id. at 184:11-12).

SYNC does not take over control and operation of any device. Although mobile

devices can connect to and communicate with SYNC, a device connected to the SYNC system

continues to be controllable and operable directly, outside the SYNC system, and Dr. Min

provided no evidence to the contrary.

Dr. Mins testimony, while conclusory, nevertheless fails to even contend that a phone

connected to SYNC cannot be controlled and operated directly, outside the multiprocessor

system. (See Dkt. 165 at 71; 3/12 Tr. [Min] at 183:2-22 ([W]hen a new phone gets

connected, it is really no longer a phone as it existed on this phone. It is now a part of the

SYNC system. So even if you press the same button on the same phone before it was

connected, it would not be the same way after it is connected.).) Dr. Min never addresses

Fords argument that a user can continue to control and operate their devices directly using the

devices interface even when the devices are connected to SYNC, a fact which Dr. Min

admitted during his deposition. See Dkt. 377, Ex. 12 [Min Dep. (Vol. II)] at 699:10-22 (Q.

Now, Dr. Min, have you ever tested whether a person can continue to control and operate a

device directly through that devices user interface while its connected to SYNC? A. Yeah,

you can still use the control on the device. But it still acts, behave as a part of the SYNC

system, not independent anymore. The behavior has certainly changed by being connected to

the SYNC system, even after even if the device can use its own panel to control.)

In sum, Dr. Min, the only one of Plaintiffs witnesses to testify regarding Fords alleged

infringement, failed to provide competent evidence that SYNC takes over control and

operation of a new device, as required by claims 1 and 3 of the 739 patent. As such, no

reasonable juror could find that Ford infringes these claims.





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9. Plaintiffs have failed to prove that SYNC configure[s] the particular one of the on-board processors to run the second software application moved from the memory as required by the 739 patent, claims 1and 3

Claims 1 and 3 of the 739 patent require that the claimed system configure the

particular one of the on-board processors to run the second software application moved from

the memory. Plaintiffs have offered no evidence that SYNC meets this element, and indeed,

Dr. Min failed to address this element when testifying regarding claim 1 of the 739 patent. See

3/11 Tr. [Min] at 180:20-183:16 (skipping from automatically move the second software

application from the memory in the multiprocessor network to the particular one of the on-

board processors selected by the data manager limitation (180:20-23) to wherein running the

second software application causes the particular one of the on-board processors to take over

control and operation of the new device limitation (183:15-19) with no discussion of the

intervening limitation (configure[s] the particular one of the on-board processors to run the

second software application moved from the memory)).

Because Plaintiffs have presented no evidence that Ford satisfies the configure the

particular one of the on-board processors limitation, they have not carried their burden of

proof to show that SYNC meets each and every element of the asserted claims. As a result, no

reasonable juror could find that SYNC infringes claims 1 or 3 of the 739 patent, and a

judgment of noninfringement in Fords favor is warranted.

B. Ford is Entitled to Judgment of No Infringement of the 260 Patent, 739 Patent, and 119 Patent Under the Doctrine of Equivalents

Plaintiffs offered no proof of infringement under the doctrine of equivalents at trial.

Specifically, Dr. MinPlaintiffs only witness regarding infringementdid not provide any

testimony or evidence regarding the doctrine of equivalents at trial. Accordingly, Ford is

entitled to judgment as a matter of law on this issue.





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III. DAMAGES

A. Eagle Harbor Has Failed To Prove A Reasonable Royalty For The 137 Patent

Mr. Wagner provided insufficient evidence with respect to a reasonable royalty on APA

for at least two reasons.

First, Plaintiffs are asserting a single method claim against Fords APA system. The

Federal Circuit requires that damages for alleged infringement of a method claim be tied to

evidence of use. Lucent Technologies, Inc. v. Gateway, Inc., 580 F.3d 1301, 1334 (Fed. Cir.

2009) (rejecting damages award for infringement of patented method where the evidence of

record is conspicuously devoid of any data about how often consumers use the patented

invention). Cardiac Pacemakers, Inc. v. St. Jude Med., Inc., 576 F.3d 1348, 1359 (Fed. Cir.

2009) ([Plaintiff] can only receive infringement damages on those devices that actually

performed the patented method during the relevant infringement period.). This principle was

confirmed by the Federal Circuit in Mirror Worlds, LLC v. Apple Inc., 692 F.3d 1361 (Fed. Cir.

2012). In Mirrorworlds, the Federal Circuit found no indirect infringement, and therefore no

damages, where the plaintiff failed to offer any evidence that the patented method at issue in

that case was actually used. The Court held that capability of infringement, without evidence of

actual use is not sufficient to find inducement of infringement of a method patent. Id.

Instead, the Federal Circuit held that [e]vidence of actual use of each limitation is required.

Id.

Neither Mr. Wagner nor Dr. Min, on whom Mr. Wagner relies for his opinions related

to APA and the 137 patent, have offered any evidence at trial regarding evidence of actual use

of each limitation in Claim 29 of the 137 patent. (Trial Day 3; Trial Day 5.) The Court

correctly excluded Mr. Wagners ultimate conclusion of APA damages as a result of his failure

to cite any evidence of actual use of the patented method in his expert reports. (Dkt. No. 575 at

5.) Because Eagle Harbor has offered no evidence at trial that the asserted method in the 137

patent is actually used, the Court should grant judgment as a matter of law that Plaintiffs have

failed to prove damages or a reasonable royalty for the 137 patent.





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Second, Mr. Wagner failed to apportion patented features from non-patented features in

the APA system. Mr. Wagner testified that APA includes features, such as automated steering,

that are not alleged to infringe the 137 patent. (Trial Day 5.) Mr. Wagner also testified that he

included in his damages calculation a number of other hardware components of APA, including

the APA ultrasonic sensors, steering angle sensors, and other wiring components, that Plaintiffs

did not invent. (Id.) Accordingly, Ford is entitled to judgment as a matter of law that Mr.

Wagner has failed to prove damages or a reasonable royalty related the 137 patent for this

additional reason.

B. Eagle Harbors Failure Of Proof As To A Reasonable Royalty With Respect To The 260, 739 And 119 Patents

Judgment as a matter of law on Eagle Harbors $246.5 million damages claim related to

SYNC damages related to SYNC is appropriate because Eagle Harbor has failed to provide a

sufficient legal or evidentiary basis for its damages claim.

In calculating damages for a multi-component product like SYNC, the Federal Circuit

has held that the governing rule is that the ultimate combination of royalty base and royalty

rate must reflect the value attributable to the infringing features of the product, and no more.

Ericsson, Inc. v. D-Link Sys., Inc., 773 F.3d 1201, 1226 (Fed. Cir. 2014). Here, both sides agree that that the alleged patented technology does not drive demand for Fords vehicles.

(Trial Day 5.) As a result, Federal Circuit precedent requires Mr. Wagner to identify the

smallest salable patent practicing unit, and then apportion the SSPPU to reflect the value of the

claimed technology. LaserDynamics, Inc. v. Quanta Computer, Inc., 694 F.3d 51, 67 (Fed. Cir.

2012) (We reaffirm that in any case involving multi-component products, patentees may not

calculate damages based on sales of the entire product, as opposed to the smallest salable

patent-practicing unit); VirnetX v. Cisco Sys., Inc., 767 F.3d 1308, 1329 (Fed. Cir. 2014)

(The law requires patentees to apportion the royalty down to a reasonable estimate of the

value of its claimed technology, or else establish that its patented technology drove demand for

the entire product.). Eagle Harbor has failed to meet this burden as a matter of law.





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First, Mr. Wagner conceded in his testimony at trial that he did not perform any

analysis to determine the SSPPU for SYNC. (Trial Day 5.) As a result, his conclusions do not

comply with the fundamental rule of identifying the SSPPU and apportioning the SSPPU to

reflect only the value of the patented features. While Mr. Wagner purported to rely on Dr. Min

to supply his conclusion that the SYNC system is the SSPPU, (id.) Dr. Min did not address this

issue in his trial testimony (id.). Accordingly, Mr. Wagner and Eagle Harbor have failed to

establish the SSPPU as a matter of law. See e.g., Tokio Marine & Fire Ins. Co. v. Norfolk &

Western Ry.Co., 172 F.3d 44, 199 WL 12931 at *4 (4th Cir. 1999) (one expert may not give

the opinion of another expert who does not testify).

Second, Mr. Wagner failed to apportion damages as required by Federal Circuit law.

Ericsson, 773 F.3d at 1233 (patentee should only be compensated for the benefit derived from

his invention and nothing more). SYNC is a system comprised of both hardware and software

components. (Trial Day 5.) Mr. Wagner testified that his damages opinion is based on his

calculation of incremental profits for the entire SYNC system, including hardware components.

(Id.) Yet, he admitted that Plaintiffs did not invent any of the hardware, including the

processors and other hardware modules, that make up the SYNC system. (Id.) Mr. Wagners

failure to exclude these hardware components renders his royalty conclusion unsupportable as a

matter of law. VirnetX, 767 F.3d at 1328 (vacating damages award where expert failed to

apportion various features indisputably not claimed by [Plaintiff], e.g., touchscreen, camera,

processor, speaker, and microphone, to name but a few).

Third, Mr. Wagners royalty conclusions for SYNCwhich are not based on any

calculation and rest on Mr. Wagners professional judgment are insufficient to prove

damages as a matter of law. (Trial Day 5.) In General Elec. Co. v. Joiner, the Supreme Court

held that nothing in either Daubert or the Federal Rules of Evidence requires a district court to

admit opinion evidence that is connected to existing data only by the ipse dixit of the expert.

522 U.S. 136, 146 (1997). But ipse dixit is all Mr. Wagner has offered here, and his damages





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opinions are therefore legally insufficient. See GPNE Corp. v. Apple, Inc 12-cv-02885, 2014

WL 1494247, at *4-*5 (N.D. Cal. Apr. 16, 2014) (Mr. Danskys analysis is an impermissible

black box without sound economic and factual predicates. Mr. Danskys 30 years of

experience does not constitute sufficient facts or data, or reliable principles and methods.).

C. Eagle Harbors Claim For Damages Is Excessive

Eagle Harbor seeks $24 per SYNC unit totaling more than $246 million in damages

for alleged infringement of the 260, 739 and 119 patents by the SYNC system. If awarded,

such a verdict would far exceed the real-world value of Eagle Harbors patents. For example,

Mr. Wagner testified that his $24 per unit royalty for the 260, 739 and 119 patents is more

than 100 times greater than the royalty rates set forth in Fords license agreement with Richard

Himmelstein. (Trial Day 5.) Mr. Wagner similarly testified that his $246 million damages

claim is twenty-times greater than the $12 million price that Eagle Harbor paid to Medius, Inc.

for the Medius patent portfolio in an arms-length transaction, and nearly fifty times greater than

the next highest offer to purchase the Medius patent portfolio. (Id.) In addition, while it has

been precluded from presenting a damages number with respect to APA, Eagle Harbor has

requested a rate of $70 per unit 14 times the royalty in Fords license with Continental Teves,

which Dr. Min admits is marginally technically comparable to the 137 patent. (Id.) A

damages award consistent with Mr. Wagners opinions would be excessive because it exceeds

the maximum amount that a reasonable jury could find to be compensatory. See Atlas-Pac.

Engg Co. v. Geo. W. Ashlock Co., 339 F.2d 288, 289-90 (9th Cir. 1964) (finding that

reasonable royalty damages based on Defendants total income from rental of the infringing

machines was excessive and clearly erroneous).

IV. DROPPED CLAIMS

In addition to the foregoing, Ford also seeks a judgment of noninfringement with

respect to the previously-asserted patent claims that Plaintiffs have dropped during the course

of the litigation. Ford intends to file a supplemental brief with respect to this issue, and will

provide the Court with a list of the previously-asserted claims at that time.





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DATED: March 17, 2015 By: /s/ Michael J. Summersgill

SAVITT BRUCE & WILLEY LLP Duncan E. Manville, WSBA #30304 Tel.: (206) 749-0500

Fax: (206) 749-0600 Email: [email protected]

WILMER CUTLER PICKERING HALE AND DORR LLP Michael J. Summersgill (pro hac vice) Sarah Beigbeder Petty (pro hac vice) 60 State Street Boston, Massachusetts 02109 Tel.: (617) 526-6000 Fax: (617) 526-5000 Email: [email protected] [email protected] WILMER CUTLER PICKERING HALE AND DORR LLP Todd C. Zubler (pro hac vice) Grant K. Rowan (pro hac vice) Nina S. Tallon (pro hac vice) 1875 Pennsylvania Avenue, N.W. Washington, D.C. 20006 Tel.: (202) 663-6636 Fax: (202) 663-6363 Email: [email protected] [email protected]

BROOKS KUSHMAN P.C. Frank A. Angileri (pro hac vice) John S. Le Roy (pro hac vice) 1000 Town Center, 22nd Floor Southfield, Michigan 48075 Tel.: (248) 358-4400 Fax: (248) 358-3351 Email: [email protected] [email protected]

Attorneys for Defendant Ford Motor Company


CERTIFICATE OF SERVICE No. 3:11-cv-05503-BHS



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CERTIFICATE OF SERVICE

I certify that a copy of the foregoing document was filed electronically with the Court

and thus served simultaneously upon all counsel of record, this 17th day of March, 2015.

/s/ Rebecca Izzo Rebecca Izzo


I. FORD IS ENTITLED TO JUDGMENT OF NON-INFRINGEMENT OF THE 137 PATENTA. No Reasonable Jury Could Find That Plaintiffs Have Met Their Burden to Prove Direct InfringementB. No Reasonable Jury Could Find that Plaintiffs Have Met Their Burden to Prove Infringement By a Third PartyC. No Reasonable Jury Could Find that Plaintiffs Have Met Their Burden to Prove Specific Intent

II. FORD IS ENTITLED TO JUDGMENT OF NON-INFRINGEMENT OF THE PROCESSOR PATENTSA. Plaintiffs have failed to present sufficient evidence to prove that SYNC meets multiple limitations of claim 9 of the 260 patent1. Plaintiffs have failed to present sufficient evidence to prove that SYNC includes the required configuration manager of claim 9 of the 260 patent2. Plaintiffs have failed to present sufficient evidence to prove that SYNC includes the required device manager of claim 9 of the 260 patent3. Plaintiffs have failed to present sufficient evidence to prove that SYNC includes the different communication links recited in claim 9 of the 260 patent4. Plaintiffs have failed to present sufficient evidence to prove that SYNC is a distributed processing system under the Courts construction, as required by claim 1 of the 119 patent5. Plaintiffs have failed to present sufficient evidence to prove that SYNC download[s] or move[s] an application from memory as required by claims 1 and 3 of the 739 patent and claim 1 of the 119 patent, as the Court has construed those termsa. The thread Dr. Min identifies is not an application.b. Dr. Min has not shown that the thread he contends is the application is downloaded or moved in response to connecting a new device to the systemc. Dr. Min points to separate software to meet the same second application

6. Plaintiffs have failed to present sufficient evidence to prove that SYNC selects a particular processor to which to download or move applications, as required by claims 1 and 3 of the 739 patent7. Plaintiffs have failed to present sufficient evidence that SYNC meets the claimed security limitations of claim 1 of the 119 patent8. Plaintiffs have failed to present sufficient evidence to prove that SYNC takes over control and operation of a mobile device, as required by claims 1 and 3 of the 739 patent9. Plaintiffs have failed to prove that SYNC configure[s] the particular one of the on-board processors to run the second software application moved from the memory as required by the 739 patent, claims 1and 3

B. Ford is Entitled to Judgment of No Infringement of the 260 Patent, 739 Patent, and 119 Patent Under the Doctrine of Equivalents

III. DAMAGESA. Eagle Harbor Has Failed To Prove A Reasonable Royalty For The 137 PatentB. Eagle Harbors Failure Of Proof As To A Reasonable Royalty With Respect To The 260, 739 And 119 PatentsC. Eagle Harbors Claim For Damages Is Excessive

IV. DROPPED CLAIMS

eagle harbor v. ford motor co; jmol

Documents

patent asserted claim

judgment of

infringement of claim

fords motion

direct infringement

bhs ford motor companys

matter of law jmol

fords apa system