Netscape Communications Corp. v. VALUECLICK, INC.Netscape Communications Corp. v. VALUECLICK, INC.
MEMORANDUM OPINION
In this patent infringement suit, plaintiff claims that defendants
1
wilfully infringed, and continue to infringe, U.S. Patent No. 5,774,670 (“the '670 patent”), colloquially known as the “Internet cookies” patent. Following full briefing and argument, the disputed patent claim terms were construed pursuant to
Markman v. Westview Instruments, Inc.,
I.
Under the Supreme Court’s seminal decision in
Pfaff v. Wells Electronics, Inc.,
After considering the parties’ pleadings, memoranda and exhibits submitted in support of their various motions for summary judgment, and the representations made by counsel in the course of the September 25, 2009 and December 18, 2009 hearings, the Memorandum Opinion found certain facts to be undisputed and material with respect to the on-sale bar analysis.
See Netscape II,
In its motion for reconsideration, plaintiff argues that there was insufficient evidence of identity between the method disclosed in claim 1 and the subject of the offer to MCI, but does not challenge the fact of a commercial offer. Moreover, plaintiff contends that the invention was not “ready for patenting” prior to October 6, 1994. Notably, in moving for reconsideration plaintiff relies on some arguments rejected in the Memorandum Opinion, and additionally makes new arguments not raised in the earlier summary judgment briefs, including chiefly the application of the evidentiary corroboration requirement. 3 The parties fully briefed and argued the issues at a March 26, 2010 hearing, at which time the motion was taken under advisement. Accordingly, the matter is ripe for disposition.
II.
At the threshold, the parties challenge the proper standard of review applicable to plaintiff’s motion for reconsideration. Plaintiff moves for reconsideration under Rules 54(b), 59(e), and 60(b)(6), Fed. R.Civ.P. Motions for reconsideration pursuant to Rules 59(e) and 60(b)(6) are considered to be requests for an “extraordinary remedy” reserved only for “extraordinary circumstances” in which: (i) there is an intervening change in the law; (ii) new evidence not available at trial has been discovered; or (iii) a clear error of law must be corrected in order to prevent manifest injustice.
See Pac. Ins. Co. v. Am. Nat’l Fire Ins. Co.,
The Fourth Circuit has made clear that where, as here, the entry of partial summary judgment fails to resolve all claims in a suit, Rule 54(d)—not Rule 59(e) or 60(b)—governs a motion for reconsideration:
[A]n order of partial summary judgment is interlocutory in nature. See, e.g., 11 Moore’s Federal Practice § 56.40[3] (Matthew Bender 3d ed.) (“A partial summary judgment order is interlocutory. ...”). Motions for reconsideration of interlocutory orders are not subject to the strict standards applicable to motions for reconsideration of a final judgment. See 12 Moore’s Federal Practice § 60.23 (“Rule 60(b) does not govern relief from interlocutory orders.... ”).
Accordingly, the motion at bar is properly brought only pursuant to Rule 54(d), Fed.R.Civ.P., and therefore plaintiff is not required to make a showing of extraordinary circumstances. Instead, the goal here “is to reach the correct judgment under law.” Id.
III.
Plaintiff first argues that the summary judgment record does not support a finding, based on clear and convincing undisputed evidence, that there is sufficient identity between the subject of the MCI offer for sale and claim 1 of the '670 patent. The Memorandum Opinion determined that the record evidence, considered as a whole, satisfied the clear and convincing standard because “the ultimate factfinder [would have] an abiding conviction that the truth of [the claimants’] factual contentions are highly probable.”
Pfizer, Inc. v. Apotex, Inc.,
A.
In
Netscape I,
the claim term “said http server” was construed to mean “the same http server that received the request from the http client.”
Netscape I,
The doctrine of inherent anticipation is most commonly invoked with respect to prior art references, as in the context of a patent examiner’s rejection of a patent application on the ground that the claimed invention was in the prior art,
5
or in the context of a claim of invalidity on grounds that a patented invention was used or described in a printed publication under 35 U.S.C. § 102(a)-(b).
6
Yet, the
there is no requirement that the offer [for sale] specifically identify these limitations. Nor is there a requirement that [the inventor/assignee] must have recognized the significance of these limitations at the time of offer. If the process that was offered for sale inherently possessed each of the claim limitations, then the process was on sale, whether or not the seller recognized that his process possessed the claimed characteristics.
Scaltech Inc. v. Retec/Tetra, L.L.C.,
As noted, the claim term “said http server,” as defined in the
Markman
process, means “the same http server that received the request from the http client.”
Netscape I,
Significantly, plaintiff, in arguing for reconsideration, points to no expert testimony or documentary evidence suggesting that an http server could, without being prompted by an http request, send a state object directly to an http client. And in fact, the record evidence points clearly and convincingly to a contrary conclusion, namely one that is consistent with the inherency of the “said http server” limitation. For instance, Netscape co-founder and vice president Marc Andreessen testified that the Netscape-MCI discussions focused sharply on “figuring] out a way to have the server be able to basically leave a piece of information on the client” in the context of “the server and browser ... connecting] for the purpose of loading a page or session or whatever.” Defs.’ Opp’n Ex. 15, at 101-02 (emphasis added). This testimony establishes Andreessen’s understanding: (i) that the to-be-written MCI software would operate in the context of a single http server accepting a request to connect with, and transmit a file to, an http client; and (ii) that MCI required computer source code directing a single http server “to basically leave a piece of information on the client”—ie., the state object containing state information—while the client and server remained connected. Significantly, Andreessen describes this as being the essence of MCI’s design requirements; his testimony does not disclose the presence or participation of a second http server that does not receive a request from the http client. Accordingly, the inherency of the “said http server” limitation in the Web browser sold to MCI is necessarily dictated by the nature of the http environment and confirmed by Andreessen’s undisputed testimony.
The same conclusion obtains with respect to the sequence of steps disclosed in claim 1. Again, no evidence in the record disputes the fact that an http server is a passive entity that responds to an http client’s request. Accordingly, the process must begin with a request by an http client to an http server. This result is the natural and necessary consequence of the operation of the Web browser sold to MCI.
See
PL’s Ex. 4 ¶28 (describing “response/request exchange”); Defs.’ Attach. 5 ¶ 25 (describing “response-request paradigm”). It follows that the requested file and a state object be sent next, prior to the storage of the state object on the client computer. As Dr. John Klensin of MCI testified in his deposition, “the state information where the user was last in the marketplace needed to be
transmitted from the server to the client
in some way.
The client needed to keep it.”
Defs.’ Ex. 4, at 98-99 (emphasis added). As noted in the Memorandum Opinion, this testimony tracks precisely steps 3 and 4 of claim 1— that is, the transmission of state information in the form of a state object and the storage of the state object—and plaintiff points to no evidence suggesting that a state object might be stored before it is received by the http client. Indeed, such an argument would be nonsensical. Although Dr. Klensin states that during the August 10, 1994 meeting the participants did not discuss “in which sequence of the HTTP operations these things would be
In sum, the undisputed summary judgment record establishes that, in September 1994, Netscape sold a cookies-functional Web browser to MCI before the critical date. Also clear from the undisputed record is the fact that this Web browser operated within the limitations imposed by the http protocol, including the fact that http servers are passive entities that interact with an http client only on an http client’s request. Therefore, it necessarily follows—and is not simply a matter of possibility or probability—that the Web browser sold to MCI prior to the critical date inherently satisfies the “said http server” and the sequence of steps limitations disclosed in claim 1 of the '670 patent.
B.
Next, plaintiff argues that no evidence proves, as the Memorandum Opinion concluded, that the state object was part of the offer for sale to MCI in August and September 1994. This argument is wholly unpersuasive. In addition to the fact that state information is inherently transferred in a structured manner such that it forms a state object—that is, “data having a predetermined structure that specifies state information”
10
—ample record evidence demonstrates that the state object was in fact made part of the Web browser sold to MCI prior to the critical date.
11
This follows inexorably from the fact that the term “cookie” in the http context is synonymous with the term “state object.”
12
Andreessen testified at least three times during his deposition that the cookies invention was used to satisfy MCI requirements.
13
This testimony is corroborated
Added support for this conclusion is found in the Netscape-MCI software licensing agreement, which provides the terms by which Netscape would license “client and server software ... in connection with such electronic shopping mall and to provide access to and browsing capabilities with respect to the World Wide Web and the Internet generally.” Defs.’ Ex. 13, at 1. Contrary to plaintiffs assertion, the document expressly discloses that the Web browser sold to MCI was capable of performing the claimed method, as it explicitly discusses the storage of “cookies” on a client computer.
14
Although the agreement was executed in February 1995, it nonetheless provides documentary evidence corroborating other testimonial evidence on the state object’s sale prior to the critical date. There is no dispute that the agreement relates to software technology that Netscape and MCI began discussing on August 10, 1994. Indeed, plaintiff concedes as much when it cites the agreement, albeit inaccurately, in both its summary judgment and motion for reconsideration briefs as evidence that “MCI’s high-level system requirements with respect to state information was limited to ... state information stor[age] on the client side,”
15
the central design requirement discussed on August 10, 1994.
16
Moreover, Article 6(b)(i) of the agreement indicates; (i) that MCI made a $500,000 prepayment for “Netscape Software” on September 23, 1994; and (ii) that MCI would pay $2,400,000 either by January 1, 1995, or on receipt of “Version 1.A” of the client and server software. Defs.’ Ex. 13, at 9. This evidence plainly shows that the agreement records, and relates to, events that occurred prior to its February 1995 execution. Put another way, the agreement memorializes the Netscape-MCI relationship—which began in August 1994 and led to a $500,000 prepayment in September 1994—all concerning the development, implementation, and delivery of software technology that would, as the agreement states, fulfill MCI’s “desire[ ] to
In support of its motion for reconsideration, plaintiff argues that the Web browser sold to MCI did not necessarily, and thus did not inherently, use the claimed cookies invention. To that end, plaintiff cites Montulli’s testimony that “there were other ways of dealing with that problem, but none of them were terribly elegant.” Defs.’ Opp’n Ex. 16, at 119. Yet, this statement, when placed in context, does not undermine the conclusion that the state object was inherent to the transfer and storage of state information on a client computer. Although Montulli at one point asserted that there were other ways of addressing statelessness, the sole alternate solution identified by Montulli in his deposition—namely the http server’s sending a unique, recognizable Web address to the http client—does not require the http client to store state information, and thus would not have satisfied MCI’s specific design requirements. See id. In other words, Montulli’s statement casts no doubt on the inherency of a state object because his testimony does not disclose that there were other ways of storing state information on a client computer. Instead, he stated that there were other ways of addressing statelessness generally, and identified one such example that did not require storage of state information on a client computer. Thus, the evidence cited by plaintiff does not demonstrate that the use of a state object was only one of a number of means by which Montulli could have satisfied MCI’s specific requirement of storing state information on a client computer, a requirement distinct from addressing http statelessness more generally. 18 Accordingly, this evidence does not call into question the conclusion that the state object was part of the offered technology.
The parties spill much ink on whether, and to what degree, evidence supporting a finding of invalidity must be corroborated by either testimonial or documentary evidence. Thus, it is appropriate to clarify the corroboration requirement.
Confusion concerning the corroboration requirement stems from two arguably contradictory decisions. First, in
Thomson, S.A. v. Quixote Corp.,
Thomson
was distinguished—but not expressly overruled—by a subsequent panel decision in
Finnigan Corp. v. Int’l Trade Comm’n,
One district court has noted in discussing
Thomson
and
Finnigan,
that “[i]t is not at all that easy to understand why patent invalidity, of all things, should rank with treason in terms of the need for special corroboration.”
Engate, Inc. v. Esquire Deposition Servs., L.L.C.,
We agree with Judge Sachs of the Western District of Missouri who, in deciding a summary judgment motion, said that even though Thomson has not been overruled, in light of all the “subsequent decisions [that] have either returned to the rule as it was enunciated before Thomson, see Oney v. Ratliff,182 F.3d 893 , 896-97 (Fed.Cir.1999), or have distinguished Thomson under circumstances suggesting that its holding may not be viable, see Finnigan,180 F.3d at 1367-68 ,” the Court’s “safest” option is “to operate under the assumption that the corroboration requirement still exists.” K & K Jump Start/Chargers, Inc. v. Schumacher Elec. Corp.,82 F.Supp.2d 1012 , 1018 n. 7 (W.D.Mo.2000). One can only hope that the Federal Circuit will resolve the conflict created by its decisions on this issue.
See Engate,
Despite the confusion concerning when the corroboration requirement applies, the manner of its application is well-settled. Put another way, the principles that guide a court’s evaluation of the sufficiency of corroborating evidence are clear. The seminal decision in this regard is
Woodland Trust v. Flowertree Nursery, Inc.,
(1) the relationship between the corroborating witness and the alleged prior user;
(2) the time period between the event and trial;
(3) the interest of the corroborating witness in the subject matter of the suit;
(4) contradiction or impeachment of the witness’ testimony;
(5) the extent and details of the corroborating testimony;
(6) the witness’ familiarity with the subject matter of the patented invention and the prior use;
(7) probability that a prior use could occur considering the state of the art at the time; and
(8) impact of the invention on the industry, and the commercial value of its practice.
Woodland Trust,
These factors are notable in two respects. First, although the witness’s interest in the litigation is irrelevant to whether the corroboration requirement applies in the first instance under
Finnigan,
the witness’s interest is relevant to the sufficiency of corroboration. Second, the
Woodland Trust
factors expressly contemplate that an inventor’s testimony may be corroborated by other testimony, and thus invalidity may be determined even in the absence of documentary evidence.
See TypeRight
These principles, applied here, compel the conclusion that the summary judgment record satisfies the
Finnigan
corroboration requirement under the factors enumerated in
Woodland Trust.
The evidence in the summary judgment record pertaining to the identity issue is found in: (i) deposition testimony of Andreessen, Giannandrea, and Montulli of Netscape; (ii) deposition testimony of Drs. Vincent Cerf and Klensin of MCI; (iii) reports by plaintiffs and defendants’ experts; (iv) the Netscape-MCI software licensing agreement; and (v) the draft client-side cookies source code entered into the Netscape source code repository on October 3 or 4, 1994.
22
To begin with, the record evidence
Moreover, although plaintiff asserted in the course of oral argument that Dr. Klensin is an “interested party” because he is a retained expert, this fact does not make him an “interested party” as understood by the Federal Circuit. More precisely, Dr. Klensin is neither a named party, nor an employee of, or assignor to, a named party, nor a person who is otherwise in a position to gain directly and substantially from the invalidation of the contested patent claims.
See Thomson,
This testimonial evidence is further corroborated by undisputed documentary evidence. Specifically, the Netscape-MCI software licensing agreement makes clear that MCI purchased Web browser technology capable of receiving and storing a
In response, plaintiff cites the Federal Circuit’s decision in
Adenta GmbH v. OrthoArm, Inc.
In
Adenta,
the Federal Circuit held that OrthoArm’s motion for judgment as a matter of law as to invalidity was correctly denied on the ground that the trial record contained ample corroborating evidence to support the jury’s invalidity verdict.
See
D.
Finally with respect to identity, Netscape contends that the summary judgment record contains only disputed evidence concerning whether the offer of sale to MCI prior to the critical date met the limitations found in claim 1 of the '670 patent. Distilled to its essence, Netscape’s argument is that while the storage of state information on an http client was discussed at the August 10, 1994 meeting, the remaining claim 1 limitations were not identified, and thus claim 1 was not offered for sale prior to October 6, 1994. This argument fails on legal and factual grounds.
To begin with, it is well-established, as discussed
swpra,
“that there is no requirement that the offer specifically identify these limitations,” provided that “the process that was offered for sale inherently possessed each of the claim limitations.”
Scaltech,
Plaintiffs cited evidence neither compels a contrary conclusion nor creates a dispute of material fact. Specifically, Dr. Cerfs statement that “sometime after August, several months after August, [Netscape] produced a product that [MCI was] able to validate performed the way that [MCI] needed it to”
27
is irrelevant to the on-sale bar analysis. As the Federal Circuit has explained, even assuming
arguendo
that Netscape delivered the product to MCI after October 6, 1994, “[i]t is immaterial that the record shows no delivery ... until after the critical date.”
Weatherchem Corp. v. J.L. Clark, Inc.,
Moreover, Dr. Cerfs additional statement that “there is some distance between [the August 10, 1994 discussion of storing state information on the client] and the specifics and the details that are found in the patent”
28
does not create a
material
dispute of fact concerning the specificity of the Netseape-MCI discussions that precludes entry of summary judgment in favor of defendants
as to claim 1.
As explained in the Memorandum Opinion, the parties’ disagreement as to whether specific attributes of the general method disclosed in claim 1, such as name-value pairs or secure encryption, were discussed at the August 10, 1994 meeting is relevant only to claims 2-8 and 15-26; the parties’ disagreement is irrelevant to the general four-step method disclosed in claim 1.
See Netscape II,
IV.
Plaintiff next argues that the second
Pfajf
prong was not satisfied, and thus it was error to conclude that the method disclosed in claim 1 of the '670 patent was “ready for patenting” prior to October 6, 1994, the critical date. Under
Pfajf,
there are two means of establishing that an invention is “ready for patenting”: (i) by adducing “proof that the invention was reduced to practice”; and (ii) by adducing “proof that prior to the critical date the inventor had prepared drawings or other descriptions of the invention that were sufficiently specific to enable a person skilled in the art to practice the invention.”
Pfaff, 525
U.S. at 67-68,
The Memorandum Opinion found by clear and convincing evidence that the cookies invention was ready for patenting prior to October 6, 1994, under both theories. Specifically, the fact that Montulli entered draft cookies source code into the Netscape source code repository on October 3 or 4, 1994, was found to establish, by clear and convincing evidence, that the cookies invention was reduced to practice prior to the critical date.
See Netscape II,
A.
With respect to the “ready for patenting” Pfaff prong, plaintiff first challenges the conclusion that the cookies invention was reduced to practice solely because Montulli logged draft cookies computer source code into the Netscape source code repository on October 3 or 4, 1994. This challenge succeeds.
Under the Federal Circuit’s decision in
In re Omeprazole Patent Litigation,
In this case, an embodiment capable of performing the entire process disclosed in claim 1 would require the existence of both client/browser-side computer source code and server-side computer source code. The client/browser-side source code is necessary to the client computer’s storage of the state object, and the server-side source code is necessary to the http server’s creation and transmission of the state object in the first instance. Here, Montulli did not construct an embodiment of the claimed invention by writing draft cookies source code by October 6, 1994, the critical date. Although client/browser-side source code was logged into the Netscape source code repository on October 3 or 4, 1994, it is undisputed that server-side source code was not entered into the Netscape source code repository until October 13, 1994, one week after the critical date. See Pl.’s Ex. 42 ¶¶ 22-31 (expert report of Edwin Aoki); Pl.’s Ex. 43 ¶¶ 35-47 (expert report of Judson Valeski). The fact that a client computer may have been able to receive and store the state object is, by itself, insufficient to support a conclusion that the draft browser-side source code constituted an embodiment capable of performing all of the limitations disclosed in claim 1. 30
In response, defendants make two related arguments concerning whether completed server-side source code is required to prove that the cookies invention was ready for patenting under the reduction to practice theory. First, defendants argue that incomplete source code is sufficient to prove reduction to practice provided that the source code enables a person skilled in the art to practice the invention. This argument fails because it conflates the two separate theories identified in
Pfaff
under which a party may prove that an invention was ready for patenting. As the Supreme Court explained in
Pfaff,
the “[ready for patenting] condition may be satisfied in two ways: [1] by proof of reduction to practice
... or
[2] by proof that ... the inventor had prepared drawings or other descriptions of the invention that were sufficiently specific to enable a person skilled in the art to practice the invention.”
Pfaff,
Accordingly, plaintiff correctly argues that the summary judgment record does not, on this theory, establish that the cookies invention offered for sale was reduced to practice, and thus ready for patenting, prior to the critical date. Yet, the Memorandum Opinion also found that the cookies invention was ready for patenting under a second theory, which is addressed next.
B.
Plaintiff also argues that the alternative ground for concluding that the cookies invention was ready for patenting prior to the critical date—namely that Montulli conceived of the invention and made an enabling disclosure sufficiently specific to allow Giannandrea to practice the claimed invention prior to the critical date-—was not proven by clear and convincing evidence. In this regard, plaintiffs arguments, which were plainly raised and rejected in the Memorandum Opinion, remain unpersuasive.
Plaintiff incorrectly reads the Federal Circuit’s decision in
Robotic
in three respects. In that case, an inventor disclosed the invention to a colleague who then wrote computer source code implementing the invention. To begin with,
Robotic
does not require either Montulli or Giannandrea to state expressly that Montulli provided an “enabling disclosure.” Indeed, the Federal Circuit in
Robotic
found an enabling disclosure in the absence of, and without requiring, any testimonial evidence that the inventor or the person to whom he disclosed the invention subjectively believed that an enabling disclosure had been made. In addition, although plaintiff argues that there is a factual dispute as to whether Giannandrea is a person of
ordinary
skill in the art, the Federal Circuit in
Robotic
refers only to “a person skilled in the art.”
Robotic,
Nor is plaintiff correct in arguing that an enabling disclosure can only be proven under Robotic where the person to whom the disclosure is made actually reduces the invention to practice. Ample authority supports the conclusion that an enabling disclosure can be made even though, as here, the inventor, rather than the person to whom the disclosure is made, ultimately writes the computer source code implementing the invention. Under Pfaff and Robotic, it is the fact of the enabling disclosure itself, not a subsequent reduction to practice based on this disclosure, that satisfies the “ready for patenting” prong of the Pfaff test. As the Federal Circuit explained in clarifying its pre-Pfaff Robotic decision,
[i]n Robotic II, we indicated that, unless the software was completed before the critical date, the method itself could not have been on sale. Robotic II at 1167. However, under Pfaff, actual completion of such software is not required, provided that there is a disclosure that is sufficiently specific to enable a person skilled in the art to write the necessarysource code to implement the claimed method.
Robotic,
In this case, there is little doubt that an enabling disclosure was made to a person skilled in the art even though Montulli, not Giannandrea, ultimately reduced the invention to practice. As Giannandrea explained, “I had more years of experience as a software engineer than [Montulli] had, so I was, in age and seniority, senior to him, and I think he was verifying his design idea with me.” Defs.’ Ex. 21, at 61. More specifically, Montulli disclosed the cookies invention to Giannandrea in July or August 1994, during which time the two programmers met to discuss and diagram on a whiteboard the design and software architecture—that is, the actual computer source code—that might be used to implement the cookies invention. Indeed, in his deposition Montulli describes the extent of the meetings as covering “the entire specification.” Defs.’ Opp’n Ex. 16, at 131.
Contrary to plaintiffs contention in support of the motion at bar, it is clear from the undisputed record evidence that the enabling disclosure occurred prior to the critical date, and that the limitations disclosed in claim 1 were discussed during the meetings. Specifically, Montulli stated in his deposition that he met with Giannandrea in July or August 1994 to discuss the cookies invention’s implementation. See Defs.’ Opp’n Ex. 16, at 117. Significantly, this evidence is corroborated by Giannandrea’s sworn, written declaration to the PTO, in which he states, that the “series of design meetings [were] held during July-August 1994.” Defs.’ Ex. 23 ¶ 3. 36 Additionally, it is equally clear that Montulli and Giannandrea explicitly discussed the state object limitation. When asked in his deposition to describe the exact idea Montulli brought to the summer 1994 design meetings, Giannandrea stated the following:
Q: All right. Well, what idea did he bring to you specifically, as you recall?
A: As I recall, the idea of having a Web server request with [sic] a browser keep a cookie for returning back to the Web server later.
Q: So he brought to you the idea, you said, of having the Web server “keep” the cookie?
A: The Web server set a cookie.
Q: Mr. Giannandrea, your answer—I’ll have the reporter read it back, but it’s on the screen here. It says:
I recall, the idea of having a Web server request with—with a browser keep a cookie for returning back to the Web server later.
A: Yes.
Defs.’ Ex. 21, at 59-60. This evidence, which is corroborated by Giannandrea’s PTO declaration statement that, “[i]n one
C.
Finally with respect to the “ready for patenting” prong of the
Pfaff
test, plaintiff argues that summary judgment was improperly entered in favor of defendants because plaintiff was not afforded an adequate opportunity to litigate the existence of an enabling disclosure, and therefore was deprived of due process.
38
Specifically, plaintiff complains that defendants first identified the Montulli-Giannandrea discussions as proof of an enabling disclosure in their reply brief, thereby depriving plaintiff of an opportunity respond with argument and supporting evidence. In support of this contention, plaintiff cites
Eon-Net LP v. Flagstar Bancorp,
Even assuming this principle is apposite here,
39
this argument is unavailing; it is flatly contradicted by the record. In the first instance, the parties filed cross-motions for summary judgment on the § 102(b) statutory on-sale bar invalidity defense and fully litigated the issue. Indeed, the parties dedicated a large portion of their summary judgment briefs to addressing this issue and submitted a voluminous record in support of their respective positions. Moreover, in its motion for reconsideration, plaintiff simply repeats arguments that were raised and briefed on summary judgment. For instance, defendants argued in their opening brief in support of summary judgment that
Robotic
applied, and plaintiff responded by attempting to distinguish
Robotic. See
Pl.’s Summ. J. Opp’n Br. at 16-17 (“This is an
V.
In opposing plaintiffs motion for reconsideration, defendants briefly argue that if claim 1 of the '670 patent is invalid under the § 102(b) statutory on-sale bar, then claims 9, 10, and 14 must likewise be invalid because they “add nothing to claim 1 that was not inherent in the product Netscape offered for sale to MCI.” This argument fails for two reasons. First, defendants have not filed a formal motion for reconsideration on this issue, and it would be inappropriate to deem defendants’ cursory argument in its opposition brief as such a motion. Furthermore, on the merit s, the district court decision cited by defendants relies on a withdrawn and superseded Federal Circuit decision. More precisely, the district court decision in
Perfect Web Technologies, Inc. v. Infousa, Inc.
addressed an alleged infringer’s contention that a claimed method and a claimed computer system capable of performing the method were invalid on obviousness and anticipation grounds. The district court first agreed that the claimed method was invalid under either legal theory. From this, the district court then reasoned that the five challenged systems claims were also invalid under the Federal Circuit’s decision in
In re Comiskey,
which held that “[t]he routine addition of modern electronics to an otherwise unpatentable invention typically creates a prima facie case of obviousness.”
40
Perfect Web,
VI.
Claim 1 of the '670 patent discloses a general, broad method in which a state object containing state information is transferred from an http server to a client computer in conjunction with the transfer of a requested file. As found by the Memorandum Opinion, undisputed record evidence establishes, by clear and convincing evidence, that Netscape offered to sell the method disclosed in claim 1 of the '670 patent to MCI before October 6, 1994. Although it was error to conclude on the summary judgment record that the method disclosed in claim 1 was reduced to practice prior to October 6, 1994, the method was nonetheless ready for patenting by that date under Pfaff because the inventor made an enabling disclosure sufficiently specific to allow one skilled in the art to practice the invention. Accordingly, clear and convincing evidence supports the conclusion that claim 1 is invalid under the § 102(b) statutory on-sale bar.
An appropriate Order will issue following the hearing currently scheduled in this matter for 2:00 p.m., Friday, April 16, 2010.
Notes
. The six named defendants are ValueClick, Inc., Mediaplex, Inc., FastClick, Inc., Commission Junction, Inc., MeziMedia, Inc., and Web Clients, L.L.C., (collectively "defendants”).
. Specifically, the parties filed various motions and cross-motions for summary judgment as to the following issues: (i) infringement and willful infringement; (ii) invalidity defenses pursuant to 35 U.S.C. §§ 102 and 112; (iii) equitable defenses of waiver, laches, and equitable estoppel; and (iv) preemption of defendants' state law counterclaims. These issues were resolved with the exception of plaintiff's motion concerning defendants' prior art invalidity defense, which was deferred pending further briefing.
, It is worth noting that defendants attach to their opposition brief a table identifying arguments that plaintiff argued in its original summary judgment briefs and now reargues in support of its motion for reconsideration. Defs.' Recons. Opp’n Br. Ex. A. Although defendants contend that all of plaintiff's current arguments were previously raised, this contention is inaccurate; it is clear that plaintiff raises new arguments and Federal Circuit authority not raised in its previous summary judgment briefs.
. The Rule states, in pertinent part, that
any order or other decision ... that adjudicates fewer than all the claims or the rights and liabilities of fewer than all the parties does not end the action as to any of the claims or parties and may be revised at any time before the entry of a judgment adjudicating all the claims and all the parties’ rights and liabilities.
Rule 54(d), Fed.R.Civ.P.
.
See, e.g., In re Schreiber,
.
See, e.g., Perricone v. Medicis Pharm. Corp.,
. Importantly, the Federal Circuit no longer requires proof that a person of ordinary skill in the art at the time would have recognized the inherent disclosure.
See Schering Corp. v. Geneva Pharms., Inc.,
. See Defs.’ Ex. 4, at 19, 96-99, 101 (deposition of Dr. John Klensin of MCI); Defs.’ Ex. 5, at 61-62 (deposition of Dr. Vincent Cerf of MCI); Defs.’ Ex. 19, at 101-02 (deposition of Marc Andreessen of Netscape).
. Defs.' Ex. 4, at 96.
. As explained in the Memorandum Opinion, “claim 1 neither requires nor specifies that a particular source code must be used,'' and “requires only that state information be conveyed in a structured manner.” Because "the storage of state information on a client necessarily and inherently requires that this data be conveyed in a structured manner,” it follows that the August 10, 1994 discussion of state information storage on an http client inherently anticipates claim 1 under
Scaltech. Netscape II,
. As noted
supra,
the fact that the state object was not identified during the August 10, 1994 meeting as the solution to statelessness is irrelevant because "there is no requirement that the offer specifically identify these limitations.”
Scaltech,
. See Defs.’ Opp’n Ex. 16, at 120 (Montulli agreeing that the "state object is called a cookie”); Defs.' Attach. 4 ¶ 16 (defendant's expert concluding that "[t]he cookie is a short hand term for state object ....”); see also '670 Patent Specification col. 7 11. 13-18 (teaching that, in one embodiment, a piece of state information "is referred to as a 'cookie' ”).
. See, e.g., Pl.'s Ex. 45, at 102 (explaining that Netscape's developing software for marketplaceMCI "eventually led to the creation of cookies”); Defs.' Opp’n Ex. 15, at 102 (recalling that "cookie” referred to "information that the server could leave on the client” and that this process would satisfy MCI's design requirement); id. at 140 (agreeing that "the cookie functionality would be included in browsers sold not just to MCI, but to other customers as well”).
. See Defs.' Ex. 13 Attach. A at 2 (“Support for multiple (10) Client Cookies to handle shopping carts/discrete one-time one-line info deliver, etc.”); id. Attach. A-l at 1.18 (“The number of cookies that can be stored in a client needs to be increased ...."); see also id. Attach. A at 3 (“Automatic transparent identification of client.”).
. Pl.’s Summ. J. Statement of Disputed Facts ¶ 3; see also Pl.'s Recons. Br. at 14 & n. 45. Specifically, the statement is inaccurate because the agreement explicitly refers to the storage of “cookies”—i.e., a state object—on a client computer, and is not, contrary to plaintiff's contention, limited to the "high-level” requirement of state information storage on a client computer. Indeed, plaintiff's brief in support of summary judgment recognizes that the February 1995 agreement “discuss[es] 'cookies.' ” Pl.'s Summ. J. Br. at 18.
.
See Netscape II,
. As explained in the Memorandum Opinion, clear and convincing evidence establishes that MCI negotiated with Netscape in the summer of 1994 to develop software for implementation in marketplaceMCI, an online shopping mall.
See Netscape II,
. Even assuming that the state object was not inherent to the storage of state information on a client computer, plaintiff's argument still fails because it ignores evidence that Netscape and Montulli actually used the cookies technology to satisfy MCI requirements. As the Federal Circuit has explained in the context of an anticipating prior art reference, the doctrine of inherent anticipation may be asserted in circumstances where "the reference is silent about the asserted inherent characteristic,” making it necessary to fill "such a gap ... with recourse to
extrinsic
evidence.”
See Continental Can Co. USA, Inc. v. Monsanto Co.,
. Citing
Finnigan,
the Federal Circuit in 2003 expressly held that "[c]orroboration is also required where, as here, the testimony is from an accused infringer concerning the sale (or offer to sell) or public use of an invention more than one year before the filing of a patent.”
Lacks Indus. v. McKechnie Vehicle Components USA, Inc.,
. Pl.'s Recons. Br. at 9.
. The decisions of the Court of Customs and Patent Appeals govern here pursuant to South Corp. v. United States:
As a foundation for decision in this and subsequent cases in this court, we deem it fitting, necessary, and proper to adopt an established body of law as precedent. That body of law represented by the holdings of the Court of Claims and the Court of Customs and Patent Appeals announced before the close of business on September 30, 1982 is most applicable to the areas of law within the substantive jurisdiction of this new court. It is also most familiar to members of the bar. Accordingly, that body of law is herewith adopted by this court sitting in banc.
S.
Corp. v. United States,
. Plaintiff argues that the draft cookies source code cannot serve as corroborating evidence because defendants have not submitted any expert testimony deciphering the source code. Yet, the absence of a defendants’ expert on this point is immaterial because two of plaintiff’s experts have analyzed the source code. Notably, the conclusion reached by plaintiff's experts is clear and undisputed: computer code pertaining to Web browser cookie functionality existed as of October 3 or 4, 1994.
See
Pl.'s Ex. 42 ¶¶ 22-31
In this regard, it is also worth noting defendants'. argument that the summary judgment record contains other corroborating evidence, namely the alpha version of the software sent to MCI in September 1994. Yet, this evidence does not affect or alter the corroboration analysis because, as noted in the Memorandum Opinion with respect to defendants' public use invalidity defense, "the record evidence does not indicate whether the 'alpha' or 'beta' versions of plaintiff’s Web browser sent to [MCI] were cookies-functional."
See Netscape II,
. See Pl.'s Ex. 45, at 102 (Andreessen testifying that the development of software for MCI "eventually led to the creation of cookies"); Defs.' Opp'n Ex. 15, at 140 (Andreessen testifying that the "cookie functionality would be included in browsers sold ... to MCI”); Defs.’ Ex. 16, at 114-19 (Montulli recounting that he invented the Web cookie in response to a client demand for a "shopping cart methodology” that would address the "sessionless nature of HTTP” within the context of an "e-commerce server”).
. See Defs.’ Ex. 4, at 19, 96-99, 101 (deposition of Dr. John Klensin of MCI); Defs.' Ex. 5, at 61-62 (deposition of Dr. Vincent Cerf of MCI); Defs.' Ex. 19, at 101-02 (deposition of Marc Andreessen of Netscape).
. It is worth emphasizing, as discussed supra, that although the agreement was executed in February 1995, it is clear that the agreement records and memorializes events that occurred prior to the critical date concerning the sale of cookies technology to MCI for implementation in marketplace-MCI.
. Notably,
Adenta
addressed the application of the corroboration requirement on a motion for judgment as a matter of law following trial on the invalidity defense and the jury’s resolution of a factual dispute. Accordingly, the question in
Adenta
was whether there was sufficient evidence on which a jury could find invalidity clearly and convincingly.
See Aden-ta,
. PL's Opp'n Br. Ex. 2, at 61-63.
. Pl.'s Ex. 2, at 136-37.
. It is worth briefly addressing plaintiff's two additional arguments. First, the fact that Dr. Klensin’s calendar shows that "[Netscape] decides they can support name-value pairs” on October 10, 1994, is irrelevant to whether claim 1 was offered for sale. Name-value pairs is a limitation found in claim 2, not in claim 1. Second, plaintiff's citation to
Plumtree Software, Inc. v. Datamize, LLC,
. Given this, it is unnecessary to reach or address plaintiff’s argument that defendants are required to submit expert testimony explaining the content and import of the computer source code. Nonetheless, it is worth noting that the summary judgment record contains a description of the source code by
. Defs.' Ex. 21, at 70.
. It is worth noting that in the course of oral argument, defendants' counsel correctly recognized that "[source code] has something to do with reduction to practice.” See Transcript at 19 (Mar. 26, 2010).
. See Defs.’ Ex. 21, at 16, 61 (Giannandrea testifying that he "had more years of experience as a software engineer than [Montulli],” the inventor).
. Plaintiff argues that
Space Systems/Loral, Inc. v. Lockheed Martin Corp.,
. In this regard, it is worth noting the Federal Circuit has held that ordinarily “creation of the specific source code is within the skill of the art.”
Robotic,
. It is worth noting that this declaration is not submitted in support of the '670 patent; rather, it corresponds to the closely-related 6,134,592 patent (“the '592 patent”). As noted in
Netscape I,
the original application for the '670 patent contained additional claims that the patent examiner concluded could not be claimed in a single patent. Montulli responded on July 23, 1997, electing to prosecute the invention that included claims 1-8, 12-17, and 27-30 in the '670 patent application. These claims were renumbered and issued as the '670 patent.
See Netscape I,
. Defs.' Ex. 23 113. Notably, Giannandrea made clear in his deposition that the "invention” to which he refers in the PTO declaration is “the HTTP state object, commonly known as [a] ‘cookie.’ ” Pl.’s Ex. 7, at 109 (internal quotation marks omitted).
. As it is determined supra that it was error to conclude the invention was reduced to practice and thus ready for patenting prior to the critical date, it is unnecessary to reach or address plaintiff's due process claim with respect to that issue.
. Plaintiff argues that ”[t]he due process problem is a serious concern” and cites a number of decisions purporting to support its position. Yet, the cited decisions are not persuasive in this regard; they are factually distinguishable and address a due process concern not at issue here, namely when a court orders summary judgment on a claim not raised by the litigants.
See Fountain v. Filson,
. Notably, finding as a legal matter that claims 9, 10, and 14 of the '670 patent are obvious is inappropriate on this record “because the predicate facts underlying an obviousness analysis are plainly contested.”
Netscape II,
. Indeed, the revised panel decision found that the challenged patent claimed unpatentable subject matter, and thus the decision neither reached nor decided the obviousness issue.
See In re Comiskey,