throbber
Case 3:14-cv-00757-REP-DJN Document 602 Filed 12/16/15 Page 1 of 38 PageID# 36308
`
`IN THE UNITED STATES DISTRICT COURT
`
`FOR THE EASTERN DISTRICT OF VIRGINIA
`
`Richmond Division
`
`I
`
`L
`
`DEC I 6 L .
`
`CLERK. U.S. DISTRICT COUHl
`RICHt.iOND. VA
`
`SAMSUNG ELECTRONICS CO., LTD,
`et al. ,
`
`Plaintiffs,
`
`V.
`
`Civil Action No. 3:14cv757
`
`NVIDIA CORPORATION,
`et al.,
`
`Defendants.
`
`MEMORANDUM OPINION
`
`This matter
`
`is
`
`before
`
`the Court
`
`on Defendant NVIDIA's
`
`MOTION FOR PARTIAL SUMMARY JUDGMENT
`
`(Docket No. 294). For
`
`the
`
`reasons set forth below,
`
`the motion will be granted in part and
`
`denied in part.
`
`I . BACKGROUND
`
`Samsung Electronics Co.,
`
`Ltd.
`
`and
`
`Samsung Electronics
`
`America,
`
`Inc.
`
`("Samsung")
`
`filed
`
`this
`
`case
`
`against
`
`NVIDIA
`
`Corporation, Old Micro,
`
`Inc.
`
`f/k/a Velocity Micro,
`
`Inc.
`
`and
`
`Velocity Holdings, LLC ("NVIDIA") alleging violation of several
`
`claims of several patents.
`
`(Compl., Docket No. 1). Discovery is
`
`now complete
`
`and
`
`the parties
`
`have
`
`filed cross-motions
`
`for
`
`partial
`
`summary judgment, although Samsung subsequently withdrew
`
`its motion for partial summary judgment.
`
`

`
`Case 3:14-cv-00757-REP-DJN Document 602 Filed 12/16/15 Page 2 of 38 PageID# 36309
`
`The papers
`
`relevant
`
`to this motion are DEFENDANTS' MOTION
`
`FOR
`
`PARTIAL
`
`SUMMARY
`
`JUDGMENT
`
`(Docket No.
`
`294),
`
`DEFENDANTS'
`
`MEMORANDUM OF LAW IN SUPPORT OF THEIR MOTION FOR PARTIAL SUMMARY
`
`JUDGMENT
`
`(Docket Nos. 295 and 307)
`
`(Def.'s PSJ Mem.),
`
`SAMSUNG'S
`
`OPPOSITION TO DEFENDANTS' MOTION FOR PARTIAL SUMMARY JUDGMENT
`
`(Docket Nos.
`
`367
`
`and 429)
`
`(Pl.'s PSJ 0pp.),
`
`and DEFENDANTS'
`
`REPLY IN SUPPORT OF
`
`ITS MOTION FOR PARTIAL SUMMARY
`
`JUDGMENT
`
`(Docket Nos. 440 and 443)
`
`(Def.'s PSJ Reply).^
`
`NVIDIA alleges
`
`that
`
`it
`
`is entitled to partial
`
`summary
`
`I I .
`
`ISSUES
`
`judgment on three grounds:
`
`(1)
`
`In inter partes proceedings against
`
`the Patent Trial and
`
`Appeal Board
`
`("PTAB"),
`
`Samsung made
`
`several
`
`statements
`
`that,
`
`in NVIDIA's view,
`
`contradict
`
`the positions
`
`that
`
`Samsung has
`
`taken in this case,
`
`such that Samsung
`
`is
`
`judicially estopped from asserting a
`
`contrary position
`
`here.
`
`NVIDIA further contends
`
`that,
`
`if Samsung cannot
`
`assert
`
`that
`
`contrary position
`
`in
`
`this
`
`case
`
`due
`
`to
`
`judicial estoppel,
`
`then the
`
`^602 patent
`
`is invalid for
`
`lack of written description.
`
`(Def.'s PSJ Mem. 3-11);
`
`' These docket numbers reflect the unsealed and sealed versions
`of the papers.
`
`2
`
`

`
`Case 3:14-cv-00757-REP-DJN Document 602 Filed 12/16/15 Page 3 of 38 PageID# 36310
`
`(2)
`
`Samsung is not entitled to pre-suit damages
`
`for the *902
`
`or
`
`'675 patents because NVIDIA lacked actual notice that
`
`NVIDIA was
`
`importing infringing products,
`
`and is thus
`
`protected from pre-suit
`
`damages under
`
`the
`
`safe harbor
`
`provision of 35 U.S.C.
`
`§ 287(b)(1).
`
`(Def.'s PSJ Mem. 11-
`
`21); and
`
`(3)
`
`The
`
`'902 patent
`
`is predated by certain prior art,
`
`and
`
`Samsung
`
`cannot
`
`establish
`
`conception
`
`and
`
`diligent
`
`reduction to practice of the '902 patent
`
`to antedate that
`
`prior art.
`
`(Def.'s PSJ Mem. 21-29).
`
`Samsung's responses state,
`
`in brief,
`
`that:
`
`(1)
`
`(A)
`
`Samsung's
`
`statements
`
`before
`
`the
`
`PTAB
`
`are
`
`not
`
`inconsistent
`
`and
`
`do
`
`not
`
`evince
`
`intent
`
`to deceive
`
`a
`
`tribunal,
`
`such that
`
`judicial estoppel
`
`is in applicable.
`
`(B) Moreover,
`
`even if Samsung is estopped from arguing
`
`that
`
`'602
`
`covers
`
`the use of memory data buffers,
`
`the
`
`patent need not disclose every embodiment,
`
`and is thus
`
`not
`
`invalid for
`
`lack of written description.
`
`(Pl.'s PSJ
`
`0pp. 1-10);
`
`(2)
`
`There
`
`is
`
`a
`
`genuine
`
`dispute
`
`of material
`
`fact
`
`about
`
`NVIDIA's
`
`control over
`
`its overseas manufacturer which
`
`precludes
`
`summary judgment on the availability of pre-
`
`suit damages.
`
`(Pl.'s PSJ 0pp. 11-22); and
`
`

`
`Case 3:14-cv-00757-REP-DJN Document 602 Filed 12/16/15 Page 4 of 38 PageID# 36311
`
`(3)
`
`There
`
`is
`
`a
`
`genuine
`
`dispute
`
`of material
`
`fact
`
`about
`
`Samsung's
`
`diligence
`
`in
`
`reduction
`
`to
`
`practice which
`
`precludes
`
`summary
`
`judgment
`
`on
`
`antedating the asserted
`
`prior art. {Pl.'s PSJ 0pp. 22-30).
`
`I I I . LEGAL STANDARD FOR SUMMARY JUDGMENT
`
`The
`
`standard principles for
`
`resolving motions
`
`for
`
`summary
`
`judgment govern the analysis made here.
`
`Pursuant
`
`to Federal Rule of Civil Procedure 56,
`
`a party may
`
`move for
`
`summary judgment,
`
`and the Court must ascertain whether
`
`the case contains sufficient evidence from which a
`
`jury could
`
`reasonably find for the nonmoving party. See Anderson v. Liberty
`
`Lobby,
`
`Inc.. 477 U.S. 242, 248,
`
`106 S. Ct. 2505,
`
`91 L. Ed.
`
`2d
`
`202
`
`(1986).
`
`In essence,
`
`the Court must determine whether
`
`a
`
`genuine dispute of material
`
`fact exists
`
`to prevent
`
`factually
`
`unsupported claims
`
`and defenses
`
`from proceeding to trial. See
`
`Hostettler v. Auto-Owners
`
`Ins. Co.,
`
`744
`
`F. Supp.
`
`2d 543,
`
`545
`
`(E.D. Va. 2010). If "the record taken as a whole could not
`
`lead
`
`a
`
`rational
`
`trier of
`
`fact
`
`to find for
`
`the non-moving party,
`
`disposition by summary judgment
`
`is appropriate." U.S. v. Lee.
`
`943 F.2d 366, 368 (4th Cir. 1991).
`
`In reviewing a
`
`summary judgment motion,
`
`a court "must draw
`
`all
`
`justifiable inferences
`
`in favor of
`
`the nonmoving party."
`
`

`
`Case 3:14-cv-00757-REP-DJN Document 602 Filed 12/16/15 Page 5 of 38 PageID# 36312
`
`United States v. Carolina Transformer Co./
`
`978 F.2d 832,
`
`835
`
`(4th Cir.
`
`1992)
`
`(citing Anderson,
`
`477 U.S. at 255). However,
`
`a
`
`mere scintilla of evidence will not preclude summary judgment.
`
`Anderson,
`
`477 U.S. at 251
`
`(citing Improvement Co. v. Munson,
`
`81
`
`U.S.
`
`(14 Wall.) 442, 448, 20 L.Ed. 867
`
`(1872)).
`
`" MTjhere is a
`
`preliminary
`
`question
`
`for
`
`the
`
`judge,
`
`not whether
`
`there
`
`is
`
`literally no evidence, but whether
`
`there is any upon which a
`
`jury could properly proceed to find a verdict
`
`for
`
`the party . . .
`
`upon whom the onus of proof
`
`is imposed.'" Id.
`
`(quoting Munson,
`
`81 U.S. at 448) .
`
`IV.
`
`JUDICIAL ESTOPPEL AND LACK OF WRITTEN DESCRIPTION ('602)
`
`A.
`
`Judicial Estoppel
`
`The
`
`law of
`
`the regional circuit governs
`
`the analysis of
`
`judicial estoppel. Minnesota Min. & Mfq. Co. v. Chemque,
`
`Inc.,
`
`303 F.3d 1294,
`
`1302-03
`
`(Fed. Cir. 2002). As explained by the
`
`Fourth Circuit:
`
`is a principle developed
`[jJudicial estoppel
`to prevent
`a party from talcing a position in
`a
`judicial proceeding that
`is inconsistent
`with a stance previously taken in court
`....
`Three
`elements must
`be
`satisfied before
`judicial
`estoppel will
`be
`applied. First,
`the party sought
`to be
`estopped must
`be
`seeking
`to
`adopt
`a
`position
`that
`is
`inconsistent with a
`stance taken in prior
`litigation .... The position at
`issue must
`be one of
`fact as opposed to one of
`law or
`legal
`theory
`....
`Second,
`the
`prior
`inconsistent
`position
`must
`have
`been
`
`

`
`Case 3:14-cv-00757-REP-DJN Document 602 Filed 12/16/15 Page 6 of 38 PageID# 36313
`
`the party
`.... Lastly,
`accepted by the court
`is
`to be
`against
`whom judicial
`estoppel
`applied must have
`intentionally misled the
`court
`to gain unfair advantage .... This bad
`faith
`requirement
`is
`the
`determinative
`factor.
`
`Zinkand v. Brown,
`
`478 F.3d 634,
`
`638
`
`(4th Cir.
`
`2007)
`
`(internal
`
`quotations omitted);
`
`see also Whitten v. Fred's,
`
`Inc.,
`
`601 F.3d
`
`231, 241-42, abrogated on other grounds by Vance v. Ball State
`
`Univ.,
`
`133 S. Ct.
`
`2434, L.Ed.
`
`2d 565
`
`(2013)
`
`("Nothing in the
`
`record
`
`....
`
`suggests
`
`any
`
`bad
`
`faith
`
`on Whitten's
`
`part").
`
`Additionally, "ta]s an equitable doctrine,
`
`judicial estoppel
`
`is
`
`invoked in the discretion of
`
`the district court
`
`and with the
`
`recognition that each application must be decided upon its own
`
`specific facts
`
`and circumstances." King v. Herbert
`
`J.
`
`Thomas
`
`Memorial Hosp.,
`
`159 F.3d 192,
`
`197
`
`(4th Cir.
`
`1998);
`
`see also
`
`Whitten, 601 F.3d at 242.
`
`NVIDIA's argument, briefly stated,
`
`is that:
`
`(1)
`
`In this proceeding, Samsung stated that
`
`the *602 patent
`
`covers
`
`use of
`
`"data
`
`strobe buffers" when
`
`those data
`
`strobe buffers are part of memory controllers;
`
`(2)
`
`In a PTAB proceeding, Samsung stated that
`
`the *602 patent
`
`does
`
`not
`
`disclose
`
`data
`
`strobe
`
`buffers
`
`in memory
`
`controllers;
`
`the PTAB relied on this statement making a
`
`decision in an inter partes decision; and
`
`

`
`Case 3:14-cv-00757-REP-DJN Document 602 Filed 12/16/15 Page 7 of 38 PageID# 36314
`
`(3)
`
`Samsung should be judicially estopped from asserting that
`
`the
`
`^602 patent covers use of data strobe buffers when
`
`those data strobe buffers are part of memory controllers.
`
`{Def.'s PSJ Mem. 3).
`
`Samsung takes issue with all three factual contentions, and
`
`argues that as
`
`a matter of
`
`law NVIDIA has not adequately pled
`
`any of
`
`the three elements required for
`
`judicial estoppel under
`
`Fourth Circuit precedent.
`
`1.
`
`Samsung's Assertedly Inconsistent Statements
`
`On April 30,
`
`2015
`
`(after Samsung initiated this lawsuit),
`
`NVIDIA filed a
`
`request
`
`for
`
`inter partes
`
`review ("IPR")
`
`of
`
`another Samsung patent
`
`("the
`
`^734 patent"),
`
`alleging that
`
`the
`
`W34 patent was obvious in light of the '602 patent.
`
`(Def.'s PSJ
`
`Mem, 4; Pl.'s PSJ 0pp. 2). NVIDIA states that,
`
`as part of
`
`the
`
`IPR,
`
`[does
`'602 patent
`the
`argued that
`Samsung
`'734
`any claim of
`the
`not
`render]
`obvious
`not
`'602 patent
`"does
`patent
`because
`the
`disclose a data strobe buffer
`for
`a memory
`controller"
`.... Rather,
`Samsung
`asserted
`that
`the '602 patent
`is "directed at
`a data
`strobe buffer for use in a memory device."
`
`(Def.'s PSJ Mem. 4-5)
`
`(emphasis in memorandum). NVIDIA contends
`
`that,
`
`in this case, Samsung argues a contrary position that
`
`the
`
`'602 patent discloses
`
`embodiments
`
`that may
`
`be
`
`used
`
`in both
`
`

`
`Case 3:14-cv-00757-REP-DJN Document 602 Filed 12/16/15 Page 8 of 38 PageID# 36315
`
`memory devices and in a memory controller. {Def.'s PSJ Mem. 5,
`
`8) .
`
`Samsung does not believe that
`
`there is any contradiction
`
`between its two positions.
`
`In its statement of additional facts,
`
`Samsung points out
`
`that,
`
`in context,
`
`Samsung's
`
`I PR argument
`
`actually stated that
`
`the '602 patent only covered a particular
`
`type of data strobe buffers, whereas the ^734 patent covered the
`
`use of
`
`that particular
`
`type of data
`
`strobe buffers
`
`in the
`
`context of
`
`a memory controller,
`
`such that
`
`'734 had claims not
`
`found in '602 and '602 did not
`
`render
`
`'734 obvious.
`
`(Pl.'s PSJ
`
`Mem. 2-8)In this case, Samsung is arguing that any use of the
`
`particular
`
`type of data strobe buffer
`
`infringes
`
`'602, whether
`
`that particular type of data strobe buffer is used alone, used
`
`^ Samsung characterizes its position in simple terms as:
`
`1
`Patent
`hypothetical
`if
`analogy,
`simple
`of
`way
`By
`1
`a bicycle, but not
`tassels. Patent
`generally discloses
`would not anticipate or render obvious the claims of Patent
`2, which specifically claims
`a bicycle with tassels
`....
`The asserted '602 Patent claims recite only a data strobe
`buffer
`(a bicycle) . The
`fact
`that Samsung may have argued
`that
`the '602 Patent does not disclose a data strobe buffer
`in a memory controller
`(a bicycle with tassels), does not
`preclude
`the
`claims, which
`require
`only a
`data
`strobe
`buffer
`(a bicycle)
`from being infringed by a data strobe
`buffer that happens to be in a memory controller {a bicycle
`that happens to have tassels."
`
`it argued
`(Pl.'s PSJ Mem. 7). Samsung argues that before PTAB,
`that Patent
`1 does not
`render Patent
`2 obvious,
`and in this
`case,
`it
`is arguing that
`infringement of Patent
`1 plus
`some
`additional feature infringes Patent 1.
`(Pl.'s PSJ Mem. 7-8).
`8
`
`

`
`Case 3:14-cv-00757-REP-DJN Document 602 Filed 12/16/15 Page 9 of 38 PageID# 36316
`
`in the context of
`
`a memory controller, or used in any other
`
`context.
`
`Stated somewhat simply, Samsung's position is that:
`
`• The
`
`^602 patent claims (X). Any use of
`
`(X), whether it be
`
`plain (X) or
`
`(X)+Z or
`
`(X)+A,
`
`is infringement;
`
`•
`
`In the IPR, Samsung claimed that
`
`the '602 patent did not
`
`render
`
`^734 obvious, because, while the *602 claimed (X),
`
`the '734 claimed (X)+Z. The addition of Z makes
`
`'734 non-
`
`obvious in light of
`
`'602;
`
`•
`
`Samsung accuses NVIDIA of
`
`infringing its '602 patent by
`
`way of
`
`(X)+Z, which necessarily involves using (X) along
`
`the way; and
`
`• The fact
`
`that Samsung stated that "'602 teaches (X).
`
`''602
`
`does not
`
`teach (X)+Z,
`
`so *734 is not obvious in light of
`
`'602" during the IPR does not mean that
`
`*602 does not
`
`protect
`
`(X) when (X)
`
`is used in the context of
`
`{X)-fZ: it
`
`just means that
`
`(X)+Z is not obvious in light of
`
`(X)
`
`if later, would anticipate,
`^ As a rule, "[t]hat which infringes,
`if earlier." Peters v. Active Mfq. Co., 129 U.S. 530, 537,
`9 S.
`Ct. 389, 392, 32 L. Ed. 738 (1889). However,
`there is not enough
`information in NVIDIA or Samsung's briefing to tell whether
`NVIDIA is infringing '602 in exactly the same way that
`'734 was
`anticipated (or made obvious) by *602.
`the
`argued
`Samsung
`that
`In
`its Reply,
`NVIDIA argues
`difference between
`*602
`and
`*734 was
`"fundamental,"
`and that
`Samsung
`is now arguing that
`the difference between
`*602
`and
`9
`
`

`
`Case 3:14-cv-00757-REP-DJN Document 602 Filed 12/16/15 Page 10 of 38 PageID# 36317
`
`Thus,
`
`from the
`
`undisputed
`
`facts
`
`on
`
`the
`
`record,
`
`Samsung's
`
`statements before the PTAB and i t s statements in this case do
`
`not appear contradictory or
`
`inconsistent. This means
`
`that
`
`the
`
`first requirement of judicial estoppel
`
`is not met. E.g., Sedlack
`
`V. Braswell Servs. Grp.,
`
`Inc.,
`
`134 F.3d 219,
`
`224
`
`("Since these
`
`positions are not
`
`inconsistent,
`
`judicial estoppel cannot apply.)
`
`2. Whether The PTAB "Accepted" Samsung's Position
`
`Even if Samsung's arguments were inconsistent, NVIDIA would
`
`have
`
`to satisfy the second requirement of
`
`judicial estoppel:
`
`that
`
`the
`
`PTAB accepted the assertedly inconsistent position.
`
`NVIDIA argues that PTAB "adopted Samsung's position as its sole
`
`basis
`
`for declining to institute the IPR requested by NVIDIA
`
`[regarding obviousness of the '734 patent]." {Def.'s PSJ Mem. 6,
`
`9).
`
`Samsung argues,
`
`essentially,
`
`that
`
`the PTAB accepted "'602
`
`does not
`
`teach memory controllers
`
`(such that
`
`it does not make
`
`'734's patent on
`
`''602 plus memory controllers obvious')," but
`
`that
`
`PTAB did
`
`not
`
`base
`
`its decision on NVIDIA's
`
`erroneous
`
`misrepresentation that "'602 is never
`
`infringed when used in the
`
`context of a memory controller." (Pl.'s PSJ 0pp. 3).
`
`is "trivial." (Def.'s PSJ Reply 1). However,
`NVIDIA's process
`because NVIDIA does not argue that NVIDIA's process is identical
`to '734,
`it is not
`inconsistent
`for Samsung to argue that "the
`difference
`between
`'734
`and
`'602
`is
`fundamental,
`but
`the
`difference between NVIDIA's process and '602 is trivial."
`10
`
`

`
`Case 3:14-cv-00757-REP-DJN Document 602 Filed 12/16/15 Page 11 of 38 PageID# 36318
`
`Because Samsung's statements before the PTAB and this Court
`
`were not
`
`inconsistent,
`
`the PTAB cannot possibly have relied upon
`
`an
`
`inconsistent
`
`statement. Moreover,
`
`even
`
`if
`
`Samsung's
`
`statements
`
`are
`
`inconsistent,
`
`it
`
`appears
`
`that
`
`Samsung's
`
`description of
`
`the PTAB decision is the correct one.
`
`In either
`
`event,
`
`NVIDIA has
`
`not
`
`demonstrated
`
`the
`
`second
`
`element
`
`of
`
`judicial estoppel.
`
`3. Whether NVIDIA Has Established That Samsung Acted
`With Bad Faith Or Intent To Mislead This Court
`
`Even if NVIDIA had established that Samsung took contrary
`
`positions before the PTAB on which the PTAB relied,
`
`judicial
`
`estoppel
`
`is
`
`not
`
`applicable
`
`here
`
`because
`
`NVIDIA
`
`has
`
`not
`
`established the third element of judicial estoppel: bad faith or
`
`intent to mislead.
`
`NVIDIA emphasizes that it "repeatedly notified Samsung that
`
`[Samsung]
`
`had taken inconsistent
`
`factual positions," and that
`
`Samsung's
`
`receipt of
`
`this notice proves
`
`that Samsung acted in
`
`bad faith or with intent
`
`to mislead this Court.
`
`(Def.'s PSJ Mem.
`
`5, 9-10). However, NVIDIA has established at most
`
`that Samsung
`
`knowingly took contradictory positions, not
`
`that Samsung acted
`
`with intent
`
`to mislead the Court or with bad faith.'' NVIDIA also
`
`^ Additionally, Samsung points out
`different
`arguments
`in district
`11
`
`that parties "frequently raise
`courts
`than they do
`in PTAB
`
`

`
`Case 3:14-cv-00757-REP-DJN Document 602 Filed 12/16/15 Page 12 of 38 PageID# 36319
`
`dropped
`
`the
`
`"intent
`
`to mislead"
`
`argument
`
`from its
`
`reply
`
`briefing.
`
`(Def.'s PSJ Reply 1-4).
`
`At
`
`the hearing on this motion, NVIDIA's counsel conceded
`
`that NVIDIA had no evidence of subjective bad faith, but stated
`
`that bad faith could be inferred from Samsung's act of knowing
`
`contradiction.
`
`(Tr. Dec.
`
`1,
`
`2015 Hr'g 7:13-9:21). The Fourth
`
`Circuit sometimes permits an inference of bad faith or intent
`
`to
`
`mislead the court where
`
`a party continues
`
`to assert
`
`factually
`
`contradictory positions which "indicate that
`
`[party's] position
`
`was deliberately and not
`
`inadvertently taken." King, 159 F.3d at
`
`197-98;
`
`see
`
`also,
`
`e.g., Vanderheyden
`
`v.
`
`Peninsula Airport
`
`Comm'n, No. 4:12cv46,
`
`2013 WL 30065, at *12
`
`(E.D. VA.
`
`Jan. 2.,
`
`2013)
`
`(noting that
`
`judicial estoppel
`
`is commonly used when
`
`a
`
`debtor knows that he has a legal claim, fails to comply with the
`
`statutory duty to disclose that claim in bankruptcy,
`
`and then
`
`attempts
`
`to sue on the basis of
`
`that
`
`claim) .
`
`In cases where
`
`courts infer bad faith, however,
`
`the inconsistent positions tend
`
`to be stark and factually obvious:
`
`a person is able to do a job
`
`or is not able to do a
`
`job;
`
`a person knows of a
`
`legal claim or
`
`does not
`
`know of
`
`a
`
`legal claim.
`
`In such cases,
`
`bad faith is
`
`inferred
`
`because
`
`the
`
`different
`
`factual
`
`positions
`
`are
`
`so
`
`proceedings because the PTAB and district courts" have different
`standards and purposes.
`(Pl.'s PSJ 0pp. 8-9).
`12
`
`

`
`Case 3:14-cv-00757-REP-DJN Document 602 Filed 12/16/15 Page 13 of 38 PageID# 36320
`
`obviously contradictory that
`
`the party could only be asserting
`
`them intending to mislead the court.
`
`Such an inference is not appropriate in this case because
`
`Samsung's positions are not clearly inconsistent.
`
`In this case,
`
`even if Samsung's positions were inconsistent,
`
`they were not so
`
`inconsistent
`
`that a
`
`reasonable person could not believe that
`
`the
`
`positions were legally consistent.® In other words, Samsung could
`
`plausibly and reasonably taken the positions in question before
`
`the PTAB and this Court
`
`in good faith. On
`
`this record, NVIDIA
`
`has not adequately proven bad faith or
`
`intent
`
`to mislead the
`
`Court under
`
`the Fourth Circuit's rules
`
`for
`
`judicial estoppel,
`
`even if Samsung's positions are factually inconsistent.
`
`4. Conclusion on Judicial Estoppel
`
`For the reasons stated above,
`
`the Court finds that NVIDIA
`
`has not carried its burden to show judicial estoppel. The Court,
`
`exercising its discretion to grant equitable relief, declines to
`
`apply judicial estoppel there.
`
`the positions were not
`that
`supra,
`^ The Court's own conclusion,
`legally inconsistent
`is
`prima
`facie
`evidence
`that
`reasonable
`minds could, without bad faith or
`intend to mislead,
`conclude
`that Samsung's positions were legally consistent.
`13
`
`

`
`Case 3:14-cv-00757-REP-DJN Document 602 Filed 12/16/15 Page 14 of 38 PageID# 36321
`
`B. Whether The
`Description
`
`^602 Patent
`
`Is
`
`Invalid For Lack Of Written
`
`NVIDIA argues that,
`
`if judicial estoppel
`
`forecloses Samsung
`
`from asserting a position contrary to "the '602 patent does not
`
`disclose use of the '602 technology (a data strobe buffer)
`
`in a
`
`memory controller," then the '602 patent
`
`is invalid for
`
`lack of
`
`written description,
`
`because
`
`the
`
`claims
`
`(use of data
`
`strobe
`
`buffers in any context,
`
`including memory devices or controller
`
`devices) would exceed the scope of the written description (data
`
`strobe buffers only in the context of memory devices).
`
`(Def.'s
`
`PSJ Mem.
`
`10) .
`
`Because
`
`judicial
`
`estoppel
`
`has
`
`not
`
`been
`
`established,
`
`this argument need not be addressed.
`
`Moreover, Samsung's
`
`inability to talce
`
`that position would
`
`not
`
`invalidate the patent
`
`for
`
`lack of written description even
`
`if
`
`judicial
`
`estoppel
`
`foreclosed Samsung
`
`from asserting that
`
`"'602 does not disclose the use of
`
`a data strobe buffer
`
`in a
`
`the
`
`'602
`
`memory
`
`controller." NVIDIA does
`
`not
`
`contend
`
`that
`
`written
`
`description
`
`does
`
`not
`
`teach
`
`how
`
`to
`
`carry
`
`out
`
`the
`
`method/process
`
`used
`
`to
`
`make
`
`memory
`
`strobe
`
`buffers,
`
`the
`
`method/process
`
`claimed.
`
`Instead, NVIDIA argues
`
`that
`
`the
`
`'602
`
`written
`
`description
`
`does
`
`not
`
`teach
`
`how to
`
`carry
`
`out
`
`the
`
`method/process used to make memory strobe buffers and then use
`
`those
`
`memory
`
`strobe
`
`buffers
`
`in
`
`the
`
`context
`
`of
`
`memory
`
`controllers.
`
`(Def.'s PSJ Mem. 11). This argument
`
`is irrelevant.
`
`14
`
`

`
`Case 3:14-cv-00757-REP-DJN Document 602 Filed 12/16/15 Page 15 of 38 PageID# 36322
`
`The written description describes
`
`a process
`
`for making memory
`
`strobe buffers, and the claims claim a method for making memory
`
`strobe buffers. Samsung did not need to claim every possible use
`
`for
`
`those memory
`
`strobe buffers
`
`in the written description.
`
`Samsung correctly identifies the rule that:
`
`specification often describes
`although the
`very specific embodiments of
`the invention,
`[the Federal Circuit has]
`repeatedly warned
`against
`confining
`the
`claims
`to
`those
`embodiments
`....
`In particular,
`[the Federal
`Circuit
`has]
`expressly
`rejected
`the
`contention that if a patent describes only a
`single embodiment,
`the claims of
`the patent
`must be construed as being limited to that
`embodiment.
`
`Phillips V. AWH Corp., 415 F.3d 1303, 1323 {Fed. Cir. 2005). ® So
`
`long as
`
`the written description enables
`
`a person of ordinary
`
`skill
`
`in the art
`
`to practice all
`
`the claims,
`
`so long as a claim
`
`does
`
`not
`
`run
`
`counter
`
`to
`
`the
`
`purposes
`
`stated
`
`in
`
`the
`
`specifications, and so long as persons of ordinary skill in the
`
`art
`
`would
`
`not
`
`confine
`
`the
`
`claim terms
`
`to
`
`the
`
`exact
`
`representations
`
`depicted
`
`in
`
`the
`
`environments,
`
`the written
`
`description should not
`
`impose
`
`additional
`
`limitations
`
`on
`
`the
`
`claims.
`
`Id.
`
`®NVIDIA mischaracterizes Samsung's source of law, characterizing
`Samsung as relying on the Manual of Patent Examining Procedure.
`{Def.'s PSJ Reply 5).
`Samsung does cite the manual,
`but
`its
`argument ultimately rests on Phillips, which applies here.
`15
`
`

`
`Case 3:14-cv-00757-REP-DJN Document 602 Filed 12/16/15 Page 16 of 38 PageID# 36323
`
`LizardTech,
`
`Inc. v. Earth Resources Mapping,
`
`Inc.,
`
`424 F.3d
`
`1336, 1345 (Fed. Cir. 2005), on which NVIDIA relies,
`
`is not
`
`to
`
`the contrary.
`
`In LizardTech,
`
`the
`
`issue was
`
`that
`
`the written
`
`description taught one specific process, but did not
`
`teach the
`
`broader process
`
`recited in one of
`
`the claims. LizardTech,
`
`424
`
`F.3d at 1344
`
`("The problem is that
`
`the specification provides
`
`only one method
`
`for
`
`creating a
`
`seamless
`
`DWT, which
`
`is
`
`to
`
`^maintain
`
`updated
`
`sums'
`
`of
`
`DWT
`
`coefficients.
`
`That
`
`is
`
`the
`
`procedure recited by claim 1. Yet claim 21 is broader than claim
`
`1 because it
`
`lacks
`
`the
`
`^maintain updated sums'
`
`limitation.").
`
`NVIDIA does not argue that Samsung's written description does
`
`not
`
`enable
`
`the
`
`^602
`
`claims
`
`at
`
`issue,
`
`so
`
`LizardTech
`
`is
`
`inapplicable.
`
`Analogizing to Phillips, Samsung has a patent
`
`for making a
`
`lightbulb, with adequate claims and written description.
`
`It is
`
`said that NVIDIA infringes by making the lightbulb,
`
`and then
`
`sticking the
`
`lightbulb in a
`
`flashlight.
`
`Samsung's
`
`lightbulb
`
`patent would not be inadequate for
`
`lack of written description
`
`for
`
`failure to mention "and the lightbulb may be placed in a
`
`flashlight."
`
`Thus,
`
`even assuming that
`
`judicial estoppel
`
`should apply,
`
`the ^602 patent is not
`
`invalid for lack of written description.
`
`16
`
`

`
`Case 3:14-cv-00757-REP-DJN Document 602 Filed 12/16/15 Page 17 of 38 PageID# 36324
`
`V. PRE-SUIT DAMAGES
`
`('902 AND '675)
`
`A.
`
`Direct and Contributory Infringement
`
`NVIDIA originally challenged the availability of pre-trial
`
`damages
`
`under
`
`35 U.S.C.
`
`§
`
`271(b)
`
`(induced infringement),
`
`35
`
`U.S.C.
`
`§ 271(c)
`
`(contributory infringement),
`
`and 35 U.S.C.
`
`§
`
`271(g)
`
`(importation of
`
`a product-by-process).
`
`(Def.'s PSJ Mem.
`
`14-15) . After NVIDIA filed its Motion
`
`for Partial
`
`Summary
`
`Judgment, Samsung amended its damages
`
`report
`
`to remove pre-suit
`
`damages
`
`for any violations of § 271(b) or § 271(c).
`
`(Def.'s PSJ
`
`Reply
`
`10) .
`
`In
`
`its memorandum in opposition to this motion,
`
`Samsung confirmed that it does not
`
`seek damages
`
`for
`
`induced or
`
`contributory infringement.
`
`(Pl.'s PSJ Br. 21-22),
`
`Hence,
`
`that
`
`aspect of NVIDIA's motion for partial
`
`summary judgment will be
`
`granted.
`
`B.
`
`Infringement By Importation
`
`Samsung has not, however, yielded on the issue of pre-trial
`
`damages for importation of the product-by-process.
`
`NVIDIA argues
`
`that
`
`it
`
`is entitled to use the safe harbor
`
`provision of 35 U.S.C.
`
`§ 287(b), which would preclude Samsung
`
`from seelcing pre-trial damages
`
`for NVIDIA's
`
`importation of
`
`an
`
`infringing product-by-process under
`
`§
`
`271(g) prior
`
`to NVIDIA
`
`receiving actual
`
`Icnowledge that
`
`the imported product-by-process
`
`was created by an infringing process.
`
`(Def.'s PSJ Mem. 11-12).
`
`17
`
`

`
`Case 3:14-cv-00757-REP-DJN Document 602 Filed 12/16/15 Page 18 of 38 PageID# 36325
`
`The parties
`
`do not dispute
`
`that NVIDIA received notice when
`
`Samsung filed this action on November 12, 2014. {Def.'s PSJ Mem.
`
`11-12) .
`
`Samsung
`
`argues
`
`that
`
`it
`
`is entitled to pre-suit
`
`damages
`
`because:
`
`(1)
`
`the "actual knowledge" standard is inapplicable to
`
`NVIDIA's
`
`circumstances
`
`because
`
`the patents
`
`in question
`
`are
`
`process patents;
`
`(2) NVIDIA's direction or control of
`
`third-
`
`party TSMC makes it ineligible for
`
`§ 287(b) protection due to
`
`the limitations of §287{b)(l), and/or
`
`(3)
`
`§ 287(b)(2) protects
`
`only infringers who
`
`take possession of
`
`a product made with a
`
`patent process and NVIDIA never takes possession of the products
`
`in question.
`
`1.
`
`Applicable Law: The § 287(b) Safe Harbor
`
`As a general matter, patentees are entitled to damages not
`
`less than a
`
`reasonable royalty.
`
`35 U.S.C.
`
`§ 284. Section 287,
`
`however, places limitations on damages.
`
`to all
`(1) An infringer under 271(g) shall be subject
`provisions
`of
`this
`title relating to damages
`and
`injunctions except
`to the extent
`those remedies are
`modified by this subsection or
`...
`the Process Patent
`Amendments Act. The modifications of remedies provided
`in this
`subsection shall
`not
`be
`available
`to any
`person who -
`(A) practiced the patented process;
`(B)
`owns or controls, or
`is owned or controlled
`by,
`the
`person
`who
`practiced
`the
`patented
`process; or
`a
`that
`(C) had knowledge before the infringement
`patented process was used to make the product
`the
`
`18
`
`

`
`Case 3:14-cv-00757-REP-DJN Document 602 Filed 12/16/15 Page 19 of 38 PageID# 36326
`
`or
`
`sale,
`for
`offer
`use,
`importation,
`which constitutes the infringement.
`(2) No
`remedies
`for
`infringement under section 271(g)
`shall be available with respect
`to any product
`in the
`possession of, or in transit
`to,
`the person subject
`to
`liability under
`such section before that person had
`notice of
`infringement with respect
`to that product.
`The person subject
`to liability shall bear the burden
`of proving any such possession or transit.
`
`sale of
`
`35 U.S.C.
`
`§ 287(b).
`
`2.
`
`Argument
`Harbor
`
`and Application of
`
`the §
`
`287 (b) Safe
`
`NVIDIA complains
`
`that Samsung's damages claim encompasses
`
`sales of products manufactured by allegedly infringing processes
`
`between 2009 and November 12,
`
`2014,
`
`the date on which NVIDIA
`
`received (by way of
`
`service in this action)
`
`actual
`
`knowledge
`
`that
`
`the products NVIDIA imports
`
`and sells allegedly violate
`
`Samsung's
`
`^902 and '675 patents.
`
`(Def.'s PSJ Mem. 11-12). NVIDIA
`
`states
`
`that
`
`the
`
`infringing products
`
`are manufactured
`
`by
`
`a
`
`contractor, Taiwan Semiconductor Manufacturing Company
`
`("TSMC").
`
`(Def.'s PSJ Mem. 13). The parties agree that NVIDIA does not own
`
`TSMC, or vice-versa.
`
`(Def.'s PSJ Mem. 13; Pl.'s PSJ 0pp. 11).
`
`NVIDIA asserts,
`
`though Samsung disputes,
`
`that NVIDIA does not
`
`control TSMC.
`
`(Def.'s PSJ Mem. 13; Pl.'s PSJ 0pp. 11). NVIDIA
`
`states
`
`that
`
`TSMC treats
`
`its fabrication processes
`
`as highly
`
`confidential
`
`and discloses
`
`"limited"
`
`information about
`
`those
`
`processes to customers,
`
`such that NVIDIA did not know that TSMC
`
`19
`
`

`
`Case 3:14-cv-00757-REP-DJN Document 602 Filed 12/16/15 Page 20 of 38 PageID# 36327
`
`practiced the claims of
`
`the '675 patent until Samsung filed the
`
`instant suit.
`
`(Def.'s PSJ Mem. 13-14; Pl.'s PSJ 0pp. 11-12).
`
`NVIDIA
`
`argues
`
`that,
`
`because
`
`it
`
`has
`
`been
`
`accused
`
`of
`
`importing a product-made-by-infringing-process under
`
`§ 271(g),
`
`it
`
`cannot
`
`be held
`
`liable
`
`for pre-notice
`
`damages
`
`under
`
`the
`
`protections of
`
`§
`
`287 (b)
`
`unless NVIDIA falls
`
`into one of
`
`the
`
`three
`
`exceptions
`
`laid out
`
`in §
`
`287(b)(1):
`
`(A)
`
`that NVIDIA
`
`practiced the patented process itself;
`
`(B)
`
`that NVIDIA owns or
`
`controls TSMC (or vice versa) ; or
`
`(C)
`
`that NVIDIA had knowledge
`
`that
`
`the process infringed.
`
`Samsung agrees
`
`that exceptions
`
`(A)
`
`and
`
`(C)
`
`do not apply.
`
`Samsung
`
`does
`
`argue
`
`that:
`
`(1)
`
`NVIDIA controls
`
`TSMC under
`
`§
`
`287(b)(1)(B)
`
`such
`
`that NVIDIA is
`
`not
`
`exempt
`
`from pre-suit
`
`damages;
`
`and
`
`(2) NVIDIA never
`
`took possession of
`
`the products
`
`under § 287(b) (2),
`
`so that NVIDIA is not
`
`exempt
`
`from pre-suit
`
`damages.
`
`a.
`
`Samsung Has Pled Acts Sufficient To Raise A
`Material Dispute About NVIDIA's "Control" Of
`TSMC, And Thus About NVIDIA's Eligibility
`For The § 287(b) Safe Harbor
`
`In defining the legal standard for "ownership or control,"
`
`NVIDIA argues that "control" in the context of § 287 (b) (1) (B)'s
`
`"own or
`
`control" means
`
`that NVIDIA must
`
`have
`
`a
`
`controlling
`
`interest
`
`in
`
`TSMC
`
`(or
`
`vice-versa)
`
`for
`
`the
`
`§
`
`287(b)(1)(B)
`
`exception to apply.
`
`(Def.'s
`
`PSJ Mem.
`
`16-17). NVIDIA mostly
`
`20
`
`

`
`Case 3:14-cv-00757-REP-DJN Document 602 Filed 12/16/15 Page 21 of 38 PageID# 36328
`
`argues
`
`that
`
`"control"
`
`in this
`
`context
`
`should mean
`
`corporate
`
`ownership.
`
`(Def.'s PSJ Mem. 16).^
`
`NVIDIA's corporate ownership interpretation of "control" in
`
`the
`
`context
`
`of
`
`the
`
`statute would
`
`render
`
`the
`
`term "own"
`
`superfluous.
`
`That, of course,
`
`is an unacceptable approach to
`
`statutory construction. E.g., Marx v. Gen. Revenue Corp., 133 S.
`
`Ct.
`
`1166,
`
`1178,
`
`185 L. Ed.
`
`2d
`
`242
`
`(2013)
`
`{noting the canon
`
`against surplusage).
`
`Indeed,
`
`the rules of construction require
`
`that each term of a statute be given effect if at all possible.
`
`E.g., Lamie v. U.S. Tr.,
`
`540 U.S. 526,
`
`536,
`
`124 S. Ct.
`
`1023,
`
`1031,
`
`157 L.
`
`Ed.
`
`2d
`
`1024
`
`(2004)
`
`(noting that
`
`canon against
`
`surplusage
`
`is
`
`important
`
`though not absolute). Anti-surplusage
`
`canons of statutory construction alone teach that "control" is
`
`different than "own."
`
`In its original briefing, NVIDIA pulled its definition for "own
`'
`or control" from the section of
`the U.S. Code dealing with the
`liability of parent companies
`for sanctions violations.
`(Def.'s
`PSJ Mem. 16 n. 3)
`(citing 22 U.S.C. § 8725(a)(2)).
`In its reply
`brief, NVIDIA found a Federal Circuit case which states that "a
`parent
`corporation
`clearly
`'directly or
`indirectly owns
`or
`controls'
`its subsidiaries."
`(Def.'s
`PSJ Reply
`13)
`(quoting
`Union Pac. Corp. v. United States,
`5 F.3d 523,
`526
`(Fed. Cir.
`1993)). The citation to the Federal Circuit, without context,
`is
`slightly misleading because Union Pacific is a
`tax case,
`rather
`than a patent
`case. More
`importantly,
`in context
`the quote
`simply
`stands
`for
`the
`proposition
`that
`parent
`corporations
`necessarily own
`and
`control
`their
`subsidiaries
`-
`not
`that
`ownership or control can only be established in situations of
`complete corporate ownership/control.
`21
`
`

`
`Case 3:14-cv-00757-REP-DJN Document 602 Filed 12/16/15 Page 22 of 38 PageID# 36329
`
`Additionally, as Samsung pointed out
`
`in its briefing and at
`
`the oral
`
`argument,
`
`the
`
`legislative history of
`
`the Process
`
`Patents Amendments Act contains elaboration on the meaning of
`
`ownership
`
`and
`
`control,
`
`making
`
`resort
`
`to
`
`other
`
`statutes
`
`unnecessary.
`
`(Tr. Dec. 1, 2015 Hr'g, 33:13-34:17; Pl.'s PSJ 0pp.
`
`17-18}
`
`(relying on S. Rep. 100-83, Process Patents Amendments
`
`Act of 1987 (June 23, 1987)}. The legislative history of the Act
`
`shows that § 287(b} is meant
`
`to "shelter only purchasers who are
`
`remote
`
`from the manufacturer
`
`and are not
`
`in the position to
`
`protect
`
`themselves
`
`in contracts with the party who is actually
`
`using the [patented] process."
`
`(Pl.'s PSJ 0pp. 17-18)
`
`(relying
`
`on S. Rep. No. 100-83, at 42). NVIDIA actually quotes the same
`
`report for a similar proposition,
`
`that "Mt]hose who are closely
`
`connected with carrying out
`
`the process in the manner outlined'
`
`cannot avail
`
`themselves of
`
`the § 287(b)
`
`safe harbor."
`
`(Def.'s
`
`PSJ Mem.
`
`16)
`
`(quoting S. Rep.
`
`100-83,
`
`at 52). The parties,
`
`accordingly, both acknowledge that an importer which is "closely
`
`connected"
`
`to the party using the patented process cannot use
`
`the safe harbor provision.®
`
`in its Reply, where it
`® NVIDIA reneges on this acknowledgement
`argues purely that "[c]ontrol
`in the statutory phrase
`^own or
`control'
`r

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