Case 1:16-cv-04586-LTS Document 23 Filed 02/01/17 Page 1 of 7
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`BROADSIGN INTERNATIONAL, LLC,
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`UNITED STATES DISTRICT COURT
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`Civil Action No.: 1:16-cv-04586 (LTS)
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`JURY TRIAL REQUESTED
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`T-REX PROPERTY AB,
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`Defendant.
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`Plaintiff,
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`v.
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`DECLARATION OF SANDRA BEAUCHESNE IN OPPOSITION
`TO DEFENDANT T-REX PROPERTY AB’S MOTION
`TO DISMISS THE AMENDED COMPLAINT
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`I, Sandra Beauchesne, hereby declare as follows:
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`I am a Canadian patent agent and a principal at IPDELTA Inc, a patent consulting
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`1.
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`firm located in Montreal, Canada. I am an advisor on intellectual property matters to plaintiff
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`BroadSign International LLC (“BroadSign”). As such, I am fully familiar with the facts and
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`circumstances set forth below. I make this declaration based on my personal knowledge, in
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`opposition to the motion by Defendant T-Rex Property, AB ("T-Rex) to dismiss the Amended
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`Complaint in this action.
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`T-Rex Has Accused BroadSign's Products of Infringing the Patents-in-Suit
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`2.
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`BroadSign supplies hardware and software solutions to its customers, which are
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`considered the end users of these products, including operators of networks of digital displays.
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`3.
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`Since 2012, T-Rex Property AB has filed at least 59 cases against digital signage
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`media owners and vendors alleging infringement of one or more of the following patents: U.S.
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`2
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`Case 1:16-cv-04586-LTS Document 23 Filed 02/01/17 Page 2 of 7
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`Patent Number 6,430,603 (“’603 Patent”), U.S. Patent Number 7,382,334 (“’334 Patent”), and
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`U.S. Patent Number RE39,470 (“’470 Patent”) (collectively, the “patents-in-suit”).
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`4.
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`To date, T-Rex has filed at least seven patent-infringement lawsuits against
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`BroadSign's customers. These suits include: T-Rex Property AB v. ContextMedia Health, LLC,
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`Case No. 1:16-cv-04826 (N.D. Ill. July 11, 2016); T-Rex Property AB v. Admirable, LLC, Case
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`No. 1:16-cv-6915 (N.D. Ill. July 1, 2016); T-Rex Property AB v. Health Media Network, LLC,
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`Case No. 1:16-cv-05673 (N.D. Ill. May 27, 2016); T-Rex Property AB v. Adaptive Micro
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`Systems, LLC, Case No. 1:16-cv-05667 (N.D. Ill. May 27, 2016); T-Rex Property AB v.
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`JCDecaux North America, Inc. et. al., Case No. 4:16-cv-303 (E.D. Tex. May 9, 2016); T-Rex
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`Property AB v. Blue Outdoor, LLC et al., 1:16-cv-733 (S.D.N.Y. February 1, 2016); and. T-Rex
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`Property AB v. Adspace Networks, Inc., Case No. 1:15-cv-09073 (S.D.N.Y. November 18,
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`2015). Public records indicate that T-Rex has settled 5 of these cases; only the cases against
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`Adaptive Micro Systems and ContextMedia Health are still pending.
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`5.
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`In the case against ContextMedia Health, the Amended Complaint, a copy of
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`which is annexed as Exhibit A, T-Rex specifically accuses BroadSign's "Digital Waiting Room
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`Screen" as infringing each of the three patents-in-suit. Exh. A at ¶¶ 49, 55, 64, 69 and 78.
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`BroadSign sold the hardware and software comprising the “Digital Waiting Room Screen” to
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`ContextMedia Health. BroadSign confirmed to me that it is the only supplier of that Accused
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`Product for ContextMedia Health.
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`6.
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`In the case against Admirable, T-Rex identified the infringing devices and
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`systems only as the “digital signage network.” A copy of the Complaint is annexed as Exhibit B;
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`see ¶¶ 48, 56, and 63. While T-Rex did not identify a specific product, BroadSign sold and
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`delivered what can be characterized as a “digital signage network” system to Admirable. It is
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`Case 1:16-cv-04586-LTS Document 23 Filed 02/01/17 Page 3 of 7
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`apparent that BroadSign's product was the target of T-Rex's infringement allegations against
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`Admirable.
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`7.
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`In the case against Health Media Network ("HMN"), T-Rex identified the
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`infringing devices and systems only as the “digital health media advertising network.” A copy
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`of the Complaint is annexed as Exhibit C; see ¶¶ 48, 49, 55, 56, 61, and 62. While T-Rex did not
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`identify a specific product in the Complaint, by letter dated July 21, 2016, HMN's counsel
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`advised BroadSign that "HMN's platform for its digital advertising network is the software that it
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`has licensed from Broadsign." A copy of that letter is annexed as Exhibit D.
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`8.
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`In the case against Adaptive Micro Systems, T-Rex identified the infringing
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`devices and systems “digital network that uses Ooh! Media software.” A copy of the Complaint
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`is annexed as Exhibit E; see ¶¶ 48, 56, and 63. While T-Rex did not identify a specific product,
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`BroadSign sold and delivered what can be characterized as a “digital network” to Adaptive
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`Micro Systems. It is apparent that BroadSign's product was the target of T-Rex's infringement
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`allegations against Adaptive Micro Systems.
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`9.
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`In the case against JCDecaux, the Complaint, a copy of which is annexed as
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`Exhibit F, specifically accuses BroadSign's “Showscreens,” the “Mallscape network,” “digital
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`billboards,” and the “digital airport advertising network, including the Prestige network” as
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`infringing each of the three patents-in-suit. Exh. F at ¶¶ 30, 31, 48, 49, 64, and 65. BroadSign
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`sold the hardware and software comprising these products to JCDecaux.
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`10.
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`In the case against Blue Outdoor, T-Rex identified the infringing devices and
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`systems as a “digital place-based media network.” A copy of the Complaint is annexed as
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`Exhibit G; see ¶¶ 35, 51 and 65. While T-Rex did not identify a specific product, BroadSign
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`sold and delivered what can be characterized as a “digital place-based media network” to Blue
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`Outdoor. Again, it is apparent that BroadSign's product was the target of T-Rex's infringement
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`allegations against Blue Outdoor.
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`11.
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`In the case against Adspace, T-Rex identified the infringing devices and systems
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`only as the “Digital Mall Network.” .” A copy of the Complaint is annexed as Exhibit H; see ¶¶
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`21 and 29. BroadSign sold the hardware and software comprising these products to Adspace,
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`and it is apparent that BroadSign's product was the target of T-Rex's infringement allegations
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`against Adspace.
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`12.
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`T-Rex's accusations of patent infringement and threats of litigation, as well as
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`actual lawsuits filed by T-Rex against companies in the digital display industry, has harmed
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`BroadSign’s relationships with its customers and interfered with BroadSign's ability to do
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`business under the cloud of potential litigation.
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`13.
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`Several of BroadSign's customers who have been sued by T-Rex including
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`JCDecaux, ContextMedia Health, and HMN have written to BroadSign to put it on notice of the
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`suit, and have demanded that BroadSign defend and/or indemnify them against the claims
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`asserted by T-Rex, identifying provisions in their respective license agreements that support their
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`requests. Copies of such letters sent on behalf of JC Decaux and ContextMedia Health are
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`annexed as Exhibit I and J respectively. A copy of the letter sent on behalf of HMN is Exh, D.
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`14.
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`Other suppliers with whom BroadSign competes, including Prismview LLC,
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`Quality Systems Technology, Inc., and Time-O-Matic, LLC d/b/a Watchfire have been sued for
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`patent infringement by T-Rex. See Exhs. K, L, and M respectively. In addition to Prismview
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`and Watchfire entering into settlement agreements with T-Rex, at least two other suppliers
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`including Daktronics, Inc. and Formetco, Inc. have entered into license agreements and/or
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`covenants-not-to-sue with T-Rex. Copies of statements made on the suppliers' websites and
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`copies of articles in LEDs Magazine and Billboard Insider discussing these agreements are
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`annexed collectively as Exhibit N.
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`T-Rex Demanded That BroadSign Take a License
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`15.
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`On June 21, 2016, I contacted T-Rex to request a meeting with T-Rex to discuss a
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`potential business arrangement. A copy of my e-mail is annexed as Exhibit O. BroadSign's
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`President and CEO, Burr Smith, and I met with T-Rex’s CEO, Mats Hylin on June 28, 2016, in a
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`meeting room in Landvetter Airport Conference, Gothenburg, Sweden. At the meeting, Mr.
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`Smith explained that some of the companies sued by T-Rex are BroadSign’s customers. We
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`discussed, among other things, prior art I had found that we believe invalidates the patents-in-suit
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`and other T-Rex patents, and BroadSign’s business proposal that, based on the strength of that
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`art, whether T-Rex would agree to dismiss its pending lawsuits against BroadSign's customers
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`and give BroadSign a covenant not to sue that would cover BroadSign and its customers.
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`BroadSign agreed to provide the prior art to T-Rex for its appraisal. There was no discussion of a
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`license agreement at that meeting. T-Rex and BroadSign continued the discussions by e-mail and
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`phone.
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`16.
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`In the first week of July, 2016, and without prior discussion of a license, Mats
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`Hylin sent BroadSign a "Patent Agreement" agreement (a copy of which is annexed as Exhibit
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`P). Under that agreement, in exchange for an undetermined payment by BroadSign, T-Rex
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`would give BroadSign a fully paid up non-exclusive license to practice the ’603, ’334 and ’470
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`Patents as well as "all other Patents that are now owned or controlled by T-Rex in the United
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`States and Canada . . . and all current and future counterparts, parent applications, originals,
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`divisionals, continuations, continuations-in-part, continuation prosecution applications,
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`provisional applications, reissues, re-examinations or extensions of any of the foregoing and all
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`patents and patent applications claiming priority based on any of the foregoing, that are owned or
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`controlled by T-Rex." Exh. P at §1.1. The agreement expressly provides that one of the
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`purposes for the parties entering it is so BroadSign can obtain from T-Rex a covenant not to sue
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`its customers to the extent they operate digital display systems consisting of BroadSign's
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`products. Exh. P at 1. T-Rex assured BroadSign that agreeing to take a license was the only way
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`to protect BroadSign and its customers from litigation and future law suits.
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`17.
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` It is my understanding that in its motion to dismiss, T-Rex contends that
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`"BroadSign . . . asked T-Rex to provide it with a sample agreement." D.I. 15 at 5. As a
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`participant in the meeting between T-Rex and BroadSign, as well as in all prior and subsequent
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`communications between T-Rex and BroadSign, I categorically dispute this statement. At no
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`time did BroadSign ask T-Rex for a draft or form of license agreement. Rather, BroadSign was
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`surprised to receive the agreement, and from the clear language of the document, understood it
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`to be a demand for payment in exchange for T-Rex ceasing its patent infringement campaign
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`directed against BroadSign and its customers.
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`18. On July 16, 2016, I sent an email to Mats Hylin explaining BroadSign’s
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`disappointment with the turn of events. In that email I indicated that T-Rex's patent-
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`infringement lawsuit filed on July 11, 2016 against ContextMedia Health targets directly
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`another BroadSign customer and gave BroadSign doubts about T-Rex's intentions to reach an
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`agreement. A copy of that e-mail is annexed as Exhibit P. Based on my discussions with
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`BroadSign's principals, BroadSign understood that lawsuit, coupled with the license agreement,
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`to be a veiled threat that if BroadSign did not take a license, T-Rex would continue to sue
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`BroadSign's customers and perhaps BroadSign itself.
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`19. On July 17, 2016, Mats Hylin replied to my email of July 16, 2017, and wrote:
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`“Our priority continues to be a prompt resolution beneficial to both parties, and we will of
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`course be happy to discuss a ‘business agreement’. If that is to be meaningful, however, we will
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`have to ask you to be clearer on what expectations BroadSign has on the content of such an
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`agreement – in particular, what does BroadSign have to offer to T-Rex in return, in addition to a
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`reasonable license fee, to make this a business agreement rather than simply a license? The only
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`thing we have seen from you so far is a Japanese patent application that we consider weak and
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`irrelevant to our discussions.” See Exh. Q.
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`Conclusion
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`20.
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`As a result of the numerous lawsuits T-Rex has filed against BroadSign’s
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`customers accusing BroadSign’s products of infringing the patents-in-suit; T-Rex’s lawsuits
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`against display hardware and software suppliers similar to BroadSign; T-Rex's demands that
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`BroadSign take a license to the patents-in-suit in; and the numerous requests for indemnification
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`BroadSign has received from its customers, a real and immediate controversy exists between T-
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`Rex and BroadSign. T-Rex's litigious record and threats of future litigation has placed a cloud
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`over BroadSign's business that has harmed BroadSign's relationships with its customers who are
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`concerned about being sued for patent infringement by T-Rex if they purchase BroadSign's
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`products and services. BroadSign cannot simply stand by while its business suffers irreparable
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`harm.
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`21.
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`I declare under penalty of perjury that all statements made herein of my
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`knowledge are true, and that all statements made on information and belief are believed by me to
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`be true.
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`Date: January 31, 2017
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`__________________________
`Sandra Beauchesne
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`8
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