# PayRange, Inc. v. Kiosoft Technologies, LLC

> District Court, S.D. Florida · August 30, 2023

URL: https://www.frixlaw.com/law-library/cases/10122398

## Case

- **Court:** District Court, S.D. Florida
- **Decided:** August 30, 2023
- **Opinion:** 100trialcourt
- **Cited by:** 0 later opinions in the Frix Law Library

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## Opinion text

United States District Court
for the
Southern District of Florida

PayRange, Inc., Plaintiff, )
)
v. )
Civil Action No. 20-24342-Civ-Scola
)
KioSoft Technologies, LLC, and )
TechTrex, Inc., Defendants. )
Order on Objections to
Magistrate Judge Goodman’s June 16, 2023, Order
This matter is before the Court on the Defendants KioSoft Technologies,
LLC and TechTrex, Inc.’ (collectively, “KioSoft”) objections to Magistrate Judge
Goodman’s June 16, 2023, order denying Kiosoft’s motion for leave to file a
revised claim construction brief. (Objs., ECF No. 183.) The Plaintiff PayRange
Inc. filed a response to KioSoft’s objections (ECF No. 184), to which KioSoft
filed a reply (ECF No. 185). This Court believes its inartfully drafted scheduling
order is mostly responsible for leading the magistrate judge astray. After
careful consideration of the parties’ written submissions, the record, and the
relevant legal authorities, and with apologies to the magistrate judge, the Court
sustains KioSoft’s objections (Objs., ECF No. 183), and grants its motion for
leave to file a revised claim construction brief (Mot., ECF No. 171).
1. Background
This action originates from KioSoft’s alleged infringement of PayRange’s
patents, namely, United States Patent Nos. 10,719,833; 10,891,608; and
10,891,614 (the “‘833 Patent,” “‘608 Patent,” and “‘614 Patent” respectively).
(Second Am. Compl. ¶ 3, ECF No. 142.) PayRange alleges that KioSoft has
infringed on its patent rights in mobile payment systems for non-networked
unattended retail machines by making and selling kiosks with built-in mobile
payment functionalities. (Id. ¶¶ 15–17, 24.)
In April, May, and June of 2021, KioSoft filed Post Grant Review (“PGR”)
Petitions before the Patent Trial and Appeal Board (“PTAB”) relating to the ‘833
Patent, ‘608 Patent, and ‘614 Patent, respectively. (ECF No. 89.) The PGR
Petitions seek to invalidate each of the three patents at issue in this action. On
March 18, 2022, the Court stayed the case pending the outcome of the PGR
petitions. (ECF No. 128.) In late December 2022 and January 2023, the parties
notified the Court that the PTAB had issued various substantive rulings and
submitted a joint proposed revised scheduling order lifting the stay in this
matter. (ECF Nos. 137, 138, 140.) The Court lifted the stay and entered an
amended scheduling order. (ECF No. 140.)
Although the parties had each filed their claim constructions briefs
before the case was stayed (see ECF Nos. 73, 75, 82, 108), the amended
scheduling order provided for April 14, 2023, as the “[d]eadline for any party
claiming patent infringement to move [to] file a revised opening claim
construction brief,” while specifying that “simultaneous opening briefs are not
permitted” and “[r]esponse and reply deadlines w[ould] proceed as provided for
in the Local Rules.” (ECF No. 140.) April 14, 2023, came around and PayRange,
the only party claiming patent infringement, did not request leave to file a
revised opening brief. However, on April 28, 2023, KioSoft filed its own motion
for leave to file a revised claim construction brief. (ECF No. 171.) Because the
Court had previously referred the parties’ claim construction briefing to Judge
Goodman for a report and recommendations (ECF No. 107), it also referred
KioSoft’s motion for leave to file a revised claim construction brief to Judge
Goodman (ECF No. 172). On June 16, 2023, Judge Goodman denied KioSoft’s
motion for leave to file a revised claim construction brief. (ECF No. 178.) The
instant order addresses KioSoft’s objections to that denial.
2. Legal Standard
A party may appeal a magistrate judge’s ruling to the district court
pursuant to Federal Rule of Civil Procedure 72(a) and 28 U.S.C. § 636(c)(1).
“When a party objects to a magistrate’s non-dispositive order, the district court
must consider those ‘objections and modify or set aside any part of the order
that is clearly erroneous or is contrary to law.’” Traylor v. Howard, 433 F. App’x
835, 836 (11th Cir. 2011) (quoting Fed. R. Civ. P. 72(a)). “An order is contrary
to law when it fails to apply or misapplies relevant statutes, case law or rules of
procedure.” Summit Towers Condo. Ass’n, Inc. v. QBE Ins. Corp., 2012 U.S.
Dist. LEXIS 59633, 2012 WL 1440894, at *1 (S.D. Fla. Apr. 4, 2012) (Seitz, J.)
(citation omitted). A magistrate judge’s ruling is deemed “clearly erroneous”
only when the district court “is left with the definite and firm conviction that a
mistake has been committed.” See Salazar v. Wells Fargo Bank, N.A., 2010 U.S.
Dist. LEXIS 140872, 2011 WL 379145, at *3 (S.D. Fla. Feb. 2, 2011) (Lenard,
J.) (citation omitted). “Clear error is a highly deferential standard of review.”
Holton v. City of Thomasville Sch. Dist., 425 F.3d 1325, 1350 (11th Cir. 2005).
The district court may not undo the magistrate judge’s determination “simply
because it is convinced that it would have decided the case differently.” See id.
at 1351. “This standard has been described as ‘a very difficult one to meet.’”
Thornton v. Mercantile Stores Co., 180 F.R.D. 437, 439 (M.D. Ala. 1998) (De
Ment, J.).
3. Analysis
Judge Goodman denied KioSoft’s motion for leave to file a revised claim
construction brief by relying on the language of the Court’s amended
scheduling order. Because the scheduling order set April 14, 2023, as the
deadline for “any party claiming patent infringement to [ ] file a revised
opening claim construction brief (simultaneous opening briefs are not
permitted),” and PayRange, the only party claiming patent infringement, chose
not to file a revised opening brief, Judge Goodman concluded that KioSoft was
precluded from filing a brief itself. (See Order 4, ECF No. 178.) “[I]t is illogical
and unnecessary,” Judge Goodman reasoned, “to allow a party to respond to
something that was never filed.” (Id.) Moreover, Judge Goodman explained that,
even if the scheduling order could be interpreted to allow KioSoft to file an
opening brief itself, because it waited until April 28, 2023, to file its motion,
KioSoft’s request was untimely. Though the Court now realizes that the
language of the amended scheduling order is not entirely clear, it ultimately
cannot agree with Judge Goodman’s conclusion.
The Court’s amended scheduling order was not intended to preclude
KioSoft from raising claim construction disputes independent of PayRange. The
amended scheduling order was modeled on the Court’s initial scheduling order,
which provided a “[d]eadline for any party claiming patent infringement to file
opening claim construction brief” with the expectation that the defending party
would present its position on claim construction in a “[r]esponse.” (See, e.g.,
ECF No. 30.) Many courts allow parties in patent cases to file simultaneous
opening briefs. See, e.g., Automatic Equip. Mfg. Co. v. Danko Mfg., No. 8:19-CV-
162, 2020 U.S. Dist. LEXIS 47350, at *2 (D. Neb. Mar. 12, 2020) (“[T]he parties
filed simultaneous opening claim construction briefs on January 24, 2020.”);
Source Search Techs., LLC v. Kayak Software Corp., Civil Action No. 11-3388
(FSH), 2014 U.S. Dist. LEXIS 1008, at *3-4 (D.N.J. Jan. 6, 2014) (same). As
indicated in its initial order, this Court has chosen to require staggered
submissions instead to promote clarity and efficiency. (See ECF No. 4.)
However, this procedural decision was never intended to allow a plaintiff to
unilaterally control the claim construction process. Thus, the language in the
Court’s amended scheduling order setting the “[d]eadline for any party claiming
patent infringement to move [to] file a revised opening claim construction brief
(simultaneous opening briefs are not permitted)” was meant to mirror that in
the Court’s initial scheduling orders, and not to circumscribe KioSoft to
PayRange’s decision on whether to file a revised opening brief.
In light of the admittedly unclear nature of the language in the amended
scheduling order, and its specification that “simultaneous opening briefs are
not permitted,” KioSoft’s decision to wait until April 28, 2023—the deadline for
it to “respond” had PayRange filed its own opening brief—is understandable.
Indeed, KioSoft informed PayRange and the Court of its intention to submit
revised proposed claim constructions at least as of April 14, 2023, when the
parties filed their amended joint claim construction and prehearing statement.
(See ECF No. 170.) In the statement, PayRange acknowledged that KioSoft
“ha[d] proposed additional terms for claim construction.” (Id. at 2). In addition,
KioSoft has explained that it “provided those proposed revised claim
constructions to [PayRange] two weeks prior to [PayRange’s] deadline to move
to file a revised claim construction brief[.]” (Mot. 3, ECF No. 171.) Moreover, the
Court notes that the stay in this case was lifted pursuant to the parties’
submission of a joint proposed revised scheduling order, which specifically
contemplated the parties “exchanging[ing] revised opening claim construction
briefs.” (See ECF No. 140.) And, while not dispositive of the parties’ obligations
pursuant to the scheduling order subsequently entered, their joint submission
clearly indicates that neither party expected KioSoft’s ability to seek revised
claim construction to depend on whether PayRange sought it first. Thus, for all
these reasons, the Court will not penalize KioSoft for requesting leave to file a
revised claim construction brief on April 28, 2023.
Having settled that KioSoft should not be precluded from moving for
leave to file a revised claim construction brief merely because it waited until the
response deadline contemplated in the amended scheduling order to do so, the
Court turns to the merits of KioSoft’s request for additional briefing. KioSoft
essentially argues that additional claim construction briefing is required
because the intervening PTAB proceedings have shed light on its positions with
regard to the meanings of disputed claim terms, and, as such, the parties’ April
14, 2023, joint claim construction and prehearing statement identified multiple
new disputes regarding the proper scope of claim terms. (See ECF No. 171;
ECF No. 175.) PayRange counters the KioSoft presents no valid basis for
seeking leave to amend the previously submitted claim construction briefing,
as the parties already addressed most of the disputed terms in earlier briefing,
and the Court need not construe all disputed claim terms. (ECF No. 174.) The
Court does not agree with PayRange.
Preliminarily, the Court acknowledges that a thorough comparison of the
parties’ initial and revised joint claim construction and prehearing statements
reveals that PayRange is correct in pointing out that the parties have previously
addressed the majority of the claim terms raised in KioSoft’s revised claim
construction brief. Moreover, although KioSoft mentions that the PTAB
proceedings played a significant role in shedding light on newly disputed claim
terms, it fails to explain why in concrete terms. Indeed, the Court’s review of
KioSoft’s amended statement of preliminary claim constructions and extrinsic
evidence (ECF No. 170-2), as well as of its proposed revised claim construction
brief (ECF No. 171-2) discloses that neither the PTAB proceedings, nor any
evidence arising therefrom play important roles in KioSoft’s proposed amended
submissions. Thus, this suggests that KioSoft may indeed be exaggerating the
significance of the PTAB proceedings in its efforts to seek a redo of its claim
construction briefing.
That being said, regardless of how much overlap there is between the
claim terms previously addressed by the parties and those raised in KioSoft’s
revised brief, the fact remains that KioSoft has now proposed additional and
modified terms for claim construction. As just one example, KioSoft now argues
that the term “status,” as it appears in the ‘614 patent, requires a particular
construction that PayRange disagrees with, and the parties did not address
this term previously. (Compare Joint State. 2–3, ECF No. 59, with Am. Joint
State. 4, ECF No. 170.) And PayRange is incorrect that the Court need not
construe all disputed claim terms. As explained by the Court of Appeals for the
Federal Circuit, “parties in patent cases frequently stipulate to a construction
or the court construes a term, only to have their dispute evolve to a point
where they realize that a further construction is necessary[,]” and “when a
determinative claim construction dispute arises, a district court must resolve
it.” TNS Media Research, LLC v. Tivo Research & Analytics, Inc., 629 F. App’x
916, 938 (Fed. Cir. 2015) (cleaned up); see also O2 Micro Int’l Ltd. v. Beyond
Innovation Tech. Co., 521 F.3d 1351, 1360 (Fed. Cir. 2008) (“When the parties
raise an actual dispute regarding the proper scope of these claims, the court,
not the jury, must resolve that dispute.”). In TNS Media Research, LLC, for
example, the parties agreed on the construction of a term during claim
construction, only to find at summary judgment that they were not actually on
the same page as to whether they agreed on the construction of the term. Id. at
938. The Federal Circuit found it was error for the district court to decide the
issue without affording the parties an opportunity to present their claim
construction arguments. Id. at 939.
Here, it appears to the Court that KioSoft has raised various issues not
previously addressed in the parties’ initial claim construction briefing.
Accordingly, in an abundance of causation, and to be in the best position to
address those issues, including their ultimate significance to the claims in
dispute, the Court deems is appropriate to grant KioSoft’s motion for leave to
file a revised claim construction brief. See, e.g., Finjan, Inc. v. Symantec Corp.,
No. 14-cv-02998-HSG, 2016 U.S. Dist. LEXIS 153584, at *3 (N.D. Cal. Nov. 4,
2016) (granting defendant’s motion for an order allowing the parties to submit
additional claim construction briefing and scheduling another Markman
hearing following the court’s decision to lift litigation stay that had been
instituted pending a decision by the PTAB). In so doing, the Court also notes
that the parties’ initial briefing is close to two years old at this point and that,
as touched on above, PayRange will not be prejudiced by KioSoft filing a revised
brief. In particular, not only has PayRange been aware, for some time now, of
KioSoft’s intention to move to file a revised brief, but the Court will also allow it
an opportunity to file its own revised claim construction brief in response.
4. Conclusion
For the reasons explained above, KioSoft’s objections to Judge
Goodman’s June 16, 2023, order are sustained (Objs., ECF No. 183), and its
motion for leave to file a revised claim construction brief is granted (Mot., ECF
No. 171). KioSoft must separately refile its revised claim construction brief by
September 1, 2023. PayRange has up to and including September 15, 2023,
to file a response brief.
Done and ordered at Miami, Florida, PR Ly 7
Robert N. Scola, Jr.
United States District Judge

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Source: Frix Law Library, https://www.frixlaw.com/law-library/cases/10122398. Public record. Not legal advice.