LEONARD P. STARK, District Judge.
Pending before the Court are Wi-LAN Inc.'s ("Wi-LAN" or "Plaintiff") motion for entry of final judgment of noninfringement under Federal Rule of Civil Procedure 54(b) (D.I. 502) and Defendants Sharp Electronics Corporation ("SEC") and Vizio, Inc.'s ("Vizio" and, collectively with SEC, "Defendants") motion for judgment of noninfringement of U.S. Patent No. 6,490,250, or in the alternative, to dismiss Wi-LAN's infringement claim (D.I. 499).
While initially a three-patent case, there are no longer any viable infringement claims in this action.
In November 2017, Plaintiff voluntarily dismissed U.S. Patent No. 5,847,774. (D.I. 216)
On February 14, 2019, the Court granted summary judgment of noninfringement of U.S. Patent No. 6,359,654 (the "'654 patent"). (See D.I. 487, 488)
In the meantime, after the Court issued its claim construction opinion and order on April 27, 2018 (D.I. 280, 281), Plaintiff on May 15, 2018 indicated to Defendants its willingness to stipulate to noninfringement of U.S. Patent No. 6,490,250 (the "'250 patent"). (See D.I. 503 Ex. A) Although the parties soon thereafter stopped actively litigating the '250 patent, the parties were never able to agree on how to terminate the case with respect to the '250 patent. On March 6, 2019, Plaintiff unilaterally filed a proposed stipulation of noninfringement ("Stipulation"). (See D.I. 496) The next day, Defendants wrote to advise the Court they did not agree with the Stipulation, which in their view contained "inaccurate information" and "`undisputed facts' that are not agreed to by the parties." (D.I. 497) The Court then directed the parties to file "any motions for judgment or dismissal with respect to the '250 patent" (D.I. 498), which they subsequently did. Those motions are now fully briefed (see, e.g., D.I. 500, 502, 506-07, 509-10) and ripe for resolution.
Plaintiff "agrees, based on the Court's Memorandum Opinion on Claim Construction and the current record, that it cannot prove that the accused products meet certain limitations of [the '250 patent]." (D.I. 502 at 1) Plaintiff, thus, requests that the Court enter final judgment on Plaintiff's claims for infringement of the '654 and '250 patents and Defendants' counterclaims of noninfringement, and dismiss without prejudice Defendants' counterclaims for invalidity of the '654 and '250 patents. (Id. at 1-2) Defendants contend that Plaintiff's motion is procedurally improper, factually inaccurate, and legally unsupportable. (See generally D.I. 507)
The Court may grant a Rule 54(b) motion if (1) there is a "final judgment" or "an ultimate disposition of an individual claim entered in the course of a multiple claims action," and (2) "there are no just reasons to delay the appeal of individual final judgments." Curtiss-Wright Corp. v. Gen. Elec. Co., 446 U.S. 1, 7-8 (1980).
The record before the Court includes a signed Stipulation by Plaintiff to which Defendants refused to consent. The Stipulation provides Plaintiff's concession that, pursuant to the constructions of two claim terms — "a multimedia processor, coupled to the data rate analyzer" and "output multimedia data stream" — Plaintiff "cannot prove infringement of claims 1, 4, and 6 of the '250 patent." (D.I. 496 at 3) Plaintiff bases its concession on two purportedly "undisputed facts" (see id.) that, by contrast, Defendants contend are disputed (D.I. 507 at 3-8). First, according to Plaintiff, the "data rate analyzer" of the accused products is "embedded within the `multimedia processor,'" and the "combined audio and video stream" is "located within the `multimedia processor.'" (D.I. 496 at 3) Defendants counter argue that these statements are inaccurate and not supported by any evidence. (See D.I. 507 at 4-5) Defendants also insist that there are several other claim limitations Plaintiff cannot prove are present in the accused products and, further, that Plaintiff has incorrectly defined "the '250 Accused Products." (See id. at 6)
Entry of final judgment pursuant to Rule 54(b) requires a record that sufficiently explains the factual basis for the judgment (e.g., explanation of the factual basis for a finding of noninfringement, such as that particular claim constructions make infringement impossible). See Jang v. Bos. Sci. Corp., 532 F.3d 1330, 1337-38 (Fed. Cir. 2008). As long as the Court of Appeals will be able to ascertain from the record the basis for a patentee's concession of noninfringement, then a Rule 54(b) judgment may be entered and an appeal can be taken. See id. Here, notwithstanding the parties' disagreements as to certain aspects of what Plaintiff proposed to include in its Stipulation, the Federal Circuit should have no difficulty gleaning the basis for the judgment Wi-LAN may challenge on appeal. As Wi-LAN concedes, it cannot meet (at least) the claim limitations corresponding to the two claim constructions cited in its proposed Stipulation, on which it lost in the Court's claim construction order: "a multimedia processor, coupled to the data rate analyzer" and "output multimedia data stream." (D.I. 496 at 3; D.I. 502 Exs. 1-2) Because Plaintiff cannot prove at least these two limitations are present in the accused products, it cannot prevail on its infringement case. Disputes as to whether Plaintiff's failure of proof could also be articulated in different ways (preferred by Defendants), and whether additional failures by Plaintiff would also justify a judgment of noninfringement, do not make the record on which the Court is entering a Rule 54(b) judgment somehow deficient or inappropriate for appellate review.
The Court understands that Defendants do not agree that certain statements in Plaintiffs' Stipulation are "undisputed." (See, e.g., D.I. 507 at 3-4) This disagreement does not make Plaintiffs' requested relief unjustified. No doubt Defendants will have an opportunity to explain their position even further on appeal. And as is clear from the briefing, "Wi-LAN is not trying to force the Court [to] accept as true the contested statements in Wi-LAN's stipulation." (D.I. 509 at 4) (internal quotation marks omitted)
What is key for this Court's purposes is that it is undisputed that Plaintiff cannot prove infringement of the two claim elements on which it lost the claim construction disputes identified in the Stipulation. The Court disagrees with Defendants' contention that "[w]ithout the[] contested statements, Wi-LAN's `stipulation' is devoid of any factual predicate for the appellate court to consider when deciding issues on appeal." (D.I. 507 at 10) The necessary factual predicate is that Plaintiff concedes it cannot prove by a preponderance of the evidence that any of the '250 Accused Products have a "multimedia processor, coupled to a data rate analyzer" or an "output multimedia data stream," so long as the Court's construction of those two terms stands.
In similar circumstances, courts have often permitted a party to consent to final judgment to allow for expeditious appeals of claim construction orders and to conserve party and court resources. See York Prods., Inc. v. Cent. Tractor Farm & Family Ctr., 99 F.3d 1568, 1571 (Fed. Cir. 1996) (finding proper a party's consent to adverse party's JMOL so it could appeal claim construction order, so as "to expedite its appeal and to conserve both its client's and the court's resources"); Otsuka Pharm. Co., Ltd. v. Zydus Pharm. USA, Inc., 314 F.R.D. 372, 377-78 (D.N.J. 2016), aff'd, 694 Fed.App'x 808 (Fed. Cir. 2017) (granting Rule 54(b) motion where stipulated judgments of noninfringement filed after claim construction "left no litigable issues" and "fully disposed of Otsuka's infringement claims"); Sport Dimension, Inc. v. Coleman Co., Inc., 2015 WL 12732711, at *2-5 (C.D. Cal. Mar. 18, 2015), vacated and remanded on other issues, 820 F.3d 1316 (Fed. Cir. 2016) (granting Rule 54(b) motion for entry of judgment of noninfringement following claim construction order because "request effectively ends the litigation on this issue [of infringement] and leaves nothing left for the Court to do on this cause of action but execute the judgment").
The instant case is similar to Schering Corp. v. Amgen, Inc., 35 F.Supp.2d 375, 377 (D. Del. 1999), in which this Court confronted a "situation in which both parties agree[d] that a judgment of noninfringement of the [patent] should be entered against the plaintiffs" but disagreed "upon the means by which this action should be accomplished." As has occurred here, in Schering the plaintiffs filed a motion for entry of judgment while the defendant filed a motion for summary judgment. See id. The Court decided "[t]he prudent course of action" was to enter judgment in favor of the defendant and dismiss the invalidity counterclaims as moot in order to facilitate the plaintiffs' appeal of the claim construction decision and to preserve the resources of the parties and the Court. See id. at 378. The same course of action is appropriate here.
Determining whether there is "no just reason for delay" of an appeal is a matter addressed to the discretion of the district court. See Curtiss-Wright, 446 U.S. at 10. In resolving this issue, the district court must take into account "judicial administrative interests as well as the equities involved." Id. at 8. In a patent case, the district court must "consider such factors as whether the claims under review [are] separable from the others remaining to be adjudicated and whether the nature of the claims already determined [is] such that no appellate court would have to decide the same issues more than once even if there were subsequent appeals." W.L. Gore & Assocs., Inc. v. Int'l Med. Prosthetics Research Assocs., Inc., 975 F.2d 858, 862 (Fed. Cir. 1992).
The Court agrees with Plaintiff that, here, there is no just reason to delay Plaintiff's appeal.
As Plaintiff writes: "The parties agree that the Court's Claim Construction Order precludes a finding of infringement for the accused products and that judgment of non-infringement is appropriate." (D.I. 509 at 1) The Court further agrees with Plaintiff that its motion offers "the most efficient and direct manner for finally resolving all claims in these cases and placing them in position for appeal." (Id. at 1-2)
Defendants move for summary judgment of noninfringement pursuant to Federal Rule of Civil Procedure 56 or, in the alternative, for dismissal for failure to prosecute under Federal Rule of Civil Procedure 41(b). (D.I. 499)
The Court will deny summary judgment without prejudice.
The Court will deny Defendants' request for dismissal due to failure to prosecute. In determining whether dismissal is warranted, the Court considers:
Poulis v. State Farm Fire and Cas. Co., 747 F.2d 863, 868 (3d Cir. 1984). Application of these factors here does not warrant dismissal. As Wi-LAN accurately explains:
(D.I. 506 at 11-12)
For the reasons given above, the Court will grant Plaintiff's motion for entry of judgment pursuant to Rule 54(b). The Court will also enter modified versions of Plaintiff's proposed orders. The Court's amendments to Plaintiff's proposals make clear that it is not just the proposed Stipulation but the record more broadly which demonstrates that there are no litigable issues regarding the conceded bases for noninfringement as to the '250 patent.
The Court will deny Defendants' motion for summary judgment without prejudice to renew if this case is remanded following an appeal and proceeds on a different claim construction. The Court will deny Defendants' motion for dismissal due to lack of prosecution.