Appendix — 800 Adept, Inc. v. Murex Securities, Ltd., Murex Licensing Corporation, Targus Information Corporation, and West Corporation, 505 F. Supp.2d 1327 (2008) (No. 08-859)

Supreme Court U.S.

\ es 2 08-859 wn 5- 2009

OFFICE OF THE CLERK

In The

Supreme Court of the Anited States

800 ADEPT, INC.,

Petitioner.

V.

MUREX SECURITIES, LTD., MUREX LICENSING

CORPORATION, TARGUS INFORMATION

CORPORATION, and WEST CORPORATION,

Respondents.

*

On Petition For A Writ Of Certiorari

To The United States Court Of Appeals

For The Federal Circuit

APPENDIX 'TO

PETITION FOR WRIT OF CERTIORARI

VOLUME I

— «

STEPHEN D. MILBRATH

Counsel of Record

DAVID W. MAGANA

ALLEN, DYER, DOPPELT, MILBRATH

& GILCHRIST, PA.

255 S. Orange Avenue, Suite 1401

P.O. Pex 3791

Orlando, FL 32801-3791

Telephone: 407-841-2330

Counsel for Petittoner

App. l

United States Court of Appeals

for the Federal Circuit

2007-1272, -1356

800 ADEPT, INC..,

Plaintiff-Appellee,

Ve

MUREX SECURITIES, LTD., MUREX LICENSING

CORPORATION, TARGUS INFORMATION

CORPORATION, and WEST CORPORATION,

Defendants-Appellants.

Stephen D. Miulbrath, Allen, Dyer, Doppelt,

Milbrath & Gilchrist, PA., of Orlando, Florida, ar-

gued for plaintiff-appellee. With him on the brief were

Brian R. Gilchrist and Stephen H. Luther.

William F. Lee, Wilmer Cutler Pickering Hale

and Dorr, LLP, of Boston, Massachusetts, argued for

defendants-appellants. With him on the brief were

Lisa J. Pirozzolo and Benjamin M. Stern, and Paul

R.Q. Wolfson, of Washington, DC.

Appealed from: United States District Court for the

Middle District of Florida

Chief Judge Patricia C. Fawsett

App. 2

DECIDED: August 29, 2008

Before GAJARSA, Circuit Judge, PLAGER, Senior

Circuit Judge, and DYK, Circuit Judge.

Opinion for the court filed by Senior Circuit Judge

Plager. Circuit Judge Dyk concurs in the result.

PLAGER, Senior Circuit Judge.

This patent case involves technology for routing

“1-800” telephone calls to an appropriate service

location, e.g., the service provider closest to the

customer who placed the call. Plaintiff 800 Adept, Inc.

(“Adept”) and Defendant Targus Information Corpo-

ration (“Targus”) sell competing services that are

used to route calls made to 800 numbers, and both

companies own patents covering systems and meth-

ods for call routing. Their customers include owners

of 800 numbers, such as Enterprise Rent-A-Car and

Pizza Hut, as well as providers of telecommunications

‘platforms” that route 800 calls for such businesses.

In 2002, Adept sued Targus, its affiliated compa-

nies Murex Securities, Ltd. and Murex Licensing

' A platform is one or more computers linked to a long

distance or local telecommunications network and is used to

handle telephone calls requiring special services.

App. 3

Corporation, and its customer West Corporation’ in

the United States District Court for the Middle

District of Florida, alleging that services sold by

Targus infringed two patents owned by Adept.° Adept

further alleged that Targus had tortiously interfered

with Adept’s business relationships by asserting

Targus’s patents against Adept’s customers. Targus

filed counterclaims alleging that Adept’s call routing

services infringed various claims in several Targus

patents.”

After a 24-day jury trial, the jury’s verdict essen-

tially found for plaintiff Adept on all issues. The jury

found that Targus willfully infringed the asserted

claims of Adept’s patents and that Adept did not

infringe the asserted claims of Targus’s patents. The

jury found that all the asserted claims of Targus’s

patents were inves .4d4 and further found that the

* The Defendants will be collectively referred to as “Targus”

throughout the remainder of this opinion unless otherwise

indicated.

* The Adept patents at issue in this case are U.S. Patent

No. Re. 36,111 (“the ’111 patent”), which is a reissue of U.S.

Patent No. 5,588,048, and U.S. Patent No. 5,805,689 (“the ‘689

patent”), collectively referred to as the “Neville patents.”

* The Targus patents at issue are U.S. Patent No. 4,757,267

(“the ‘267 patent” or “Riskin patent”) and U.S. Patent Nos.

5,506,897 (“the ’897 patent”), 5,848,131 (“the °131 patent”),

5,901,214 (“the °214 patent”), 5,907,608 (“the ‘608 patent”),

35,910,982 (“the °982 patent”), 5,956,397 (“the “397 patent”),

5,982,868 (“the °868 patent”), 6,058,179 (“the ’179 patent”), and

6,091,810 (“the ‘810 patent”), collectively referred to as the

“Moore-Shaffer patents.”

App. 4

unasserted claims of Targus’s ’897 patent and °131

patent were invalid as well. The jury also found

Targus liable under state law for tortious interference

with Adept’s business’ relationships. The jury

awarded Adept $18 million for patent infringement

and $7 million on the tortious interference claim.

The trial court entered judgment on the jury

verdict, issued a permanent injunction, and awarded

enhanced damages of $24 million on the patent

infringement claim, bringing the total damages

award to $49 million. The trial court also determined

that the case was exceptional and therefore Adept

was entitled to attorney fees under 35 U.S.C. § 285.

After thorough consideration of all the issues in

the case, we conclude that the trial! court erred

regarding a critical claim construction issue in the

Adept patents, one that permitted the jury to make

incorrect findings. Under the correct claim construc-

tion, no reasonable jury could find that Targus in-

fringes the asserted claims of Adept’s patents;

accordingly, we reverse the trial court’s judgment of

infringement. For the reasons we shall explain, we

also reverse the trial court’s judgment for Adept on its

tortious interference claim. In light of these determi-

nations, we vacate the trial court’s damages award,

the permanent injunction, and the judgment with

respect to willfulness, enhanced damages, and attor-

ney fees.

Regarding the Targus patents, with two excep-

tions we affirm the trial court’s judgment upholding

App. 5

the jury’s verdict that the asserted claims of Targus’s

patents are invalid; for the reasons we explain, we

vacate the invalidity judgment on two of the asserted

claims of Targus’s patents and remand for a new trial

on these claims. Because the validity of the unas-

serted claims of Targus’s patents was not at issue

during the trial, we vacate the trial court’s invalidity

judgment with respect to all of those claims.

BACKGROUND

The patents at issue in this case relate to tech-

nology for routing telephone calls made to 800 num-

bers. Typically when a caller dials an 800 number, the

long distance carrier (“LDC”) handling the call must

identify the 10-digit telephone number, known as a

“Plain Old Telephone System” (“POTS”) number, to

which to route the call. (A POTS number has the form

NPA-NXX-XXXX, where NPA is the area code and

NXX is the exchange.) If all calls to a particular 800

number are to be routed to a single location, the

process is relatively simple. Some businesses, how-

ever, advertise a single 800 number but have multiple

service locations. When a caller dials the 800 number

of one of these businesses, the LDC must have some

way to determine the POTS number of an appropriate

service location. For example, if the 800 number is for

a chain of pizza restaurants, the correct service

location could be the closest restaurant or one that

delivers within the geographic area in which the

caller is located.

App. 6

Plaintiff Adept owns the ‘111 patent and its

divisional, the 689 patent, both of which claim prior-

ity to an application filed on July 31, 1992. The two

patents, referred to as the Neville patents, are enti-

tled “Geographically Mapped Telephone Routing

Method and System,” and have virtually identical

written descriptions.” The Neville patents disclose a

method for directly routing an 800 call to the appro-

priate service location based on the caller’s 10-digit

telephone number (NPA-NXX-XXXX), sometimes

referred to as the Automatic Number Identification

(“ANI”). The invention involves the construction of a

database that assigns a service location POTS num-

ber to every potential caller according to geographic

criteria provided by the owner of the 800 number.

This database can be provided to the LDC, which

then routes calls made to the 800 number according

to the routing instructions in the database. The

process is summarized in the patent’s abstract:

A method and system for direct routing of

telephone calls made by a caller originating

from within specific calling areas to one of a

plurality of locations of a second party ac-

cording to certain criteria established by the

second party. This routing is accomplished

based on the assignment of latitude and lon-

gitude coordinates to a potential caller’s loca-

tion. Once these coordinates are assigned to

’ For convenience, this opinion cites only to the written

description of the ‘111 patent

App. 7

each of the potential callers, the second

party’s criteria is applied to assign the poten-

tial caller to a second party. Such criteria

could be existence within a _previously-

defined geographic area, a custom defined

geographic area, or through calculations

such as the shortest distance between coor-

dinate points. Once all such assignments

have been made, a database is assembled to

be used by a long distance carrier for direct

routing of telephone calls from callers to an

assigned second party.

"111 patent, abstract (emphasis added).

The 111 patent has five independent claims, and

the 689 patent has one independent claim, all of

which were asserted by Adept against Targus. Claim

1 and claim 17 of the ’111 patent are system claims;

claim 9 and claim 29 of the °111 patent are method

claims; and claim 41 of the °111 patent and claim 1 of

the 689 patent are directed to a method of construct-

ing a datahase. Claim 29, a method claim, is illustra-

tive of the Adept patent claims:

29. A method for direct rouling a telephone

call from a first party who has an originating

telephone number at a physical location and

who dials a telephone number including dig-

its uniquely characteristic to a second party

having a plurality of service locations, said

method comprising the steps of:

la} allocating latitude and longitude coor-

dinates to the physical location of all poten-

tial first parties;

App. 8

[b] defining the boundaries of one or more

geographical areas which can be of any size

and shape according to predetermined crite-

ria, each point along said boundaries being

defined by latitude and longitude coordi-

nates;

[c] assigning to the physical location of said

potential first parties a telephone number of a

service location of a second party that will re-

ceive calls originating from within the

boundary of a geographic area in which the

latitude and longitude coordinates of the

physical location of each of said potential

first parties lie;

ld| determining the originating telephone

number of the first party from which said

telephone call is to be routed; and

le] directly routing said telephone call to a

service location of the second party assigned

to said originating telephone number of the

first party by said step of assigning.

‘111 patent, col. 15 11.19-45 (emphases and paragraph

lettering added).

Defendant Targus owns two families of patents

referred to as the Moore-Shaffer patents, which, like

the Neville patents, disclose various systems and

methods for routing 800 calls to an appropriate

service location based on the caller’s 10-digit tele-

phone number. The first family includes seven pat-

ents: the ’897 patent; its continuation-in-part, the

‘131 patent; its continuation-in-part, the 868 patent;

App. 9

and its four continuations, the 608 patent, the ’982

patent, the °397 patent, and the °810 patent. The

second family includes the '214 patent and its con-

tinuation, the 7179 patent.

The earliest Moore-Shaffer patent is the °897

patent, which claims priority to an application filed

on February 22, 1993. The ’897 patent, which issued

in 1996, was also the subject of a reexamination

request filed by Adept in 1999. The United States

Patent and Trademark Office (“PTO”) granted the

request and in 2001 issued a reexamination certifi-

cate, confirming the patentability of all claims.

The ’897 patent discloses a database containing

two tables — a master table and a client table —

linked by a spatial key. Each record in the master

table contains a caller telephone number and a

corresponding spatial key, such as a nine-digit postal

code (referred to as “zip+4”). 897 patent, col.8 1.55 to

col.9 1.6. Each record in the client table contains a

spatial key and the telephone number of a corre-

sponding client service location. /d. at col. 9 I1.7-26.

The master table is indexed by caller telephone

numbers, and the client table is indexed by the spa-

tial key, so that when a call is placed the system

retrieves from the master table the spatial key corre-

sponding to the caller’s telephone number and then

retrieves from the client table the telephene number

of the client service location corresponding to that

spatial key. Jd. at col.10 |l.1-7. The ’897 patent de-

scribes two methods for constructing the client table,

one involving radius-defined service areas and one

App. 10

involving polygon-defined service areas for each

service location. /d. at col.15 1.52 to col. 28 1.5. The

"131 patent, a continuation of the ’897 patent, is

similar to the ’897 patent but additionally includes a

third table containing specific service location infor-

mation, such as store hours, that may be recited to

the caller by a Voice Response Unit. ’131 patent col.31

11.27-53.

With the ’868 patent, a continuation-in-part of

the °131 patent, Moore and Shaffer introduced several

new embodiments. One of these was a “real-time”

system, in which spatial calculations are performed

during the call to determine the appropriate service

location for a caller. ’868 patent col.45 1.35 to col.55

1.50. As in the ’897 patent, the service area for cach

client service location can be defined as an area with

a radius of any size or a polygon of any size and

shape. Jd. at col.47 J!.14-17. Unlike the two-table

system first described in the '897 patent, however, the

real-time system does not simply retrieve records

from tables to obtain a service location for a caller.

Instead, after a call is placed, the system creates a

window key (e.g., a rectangular area defined by

longitude and latitude coordinates) that is associated

with the caller’s location. Jd. at col.51 11.26-42. Based

on this window key, the system builds a list of poten-

tial service locations and then performs more detailed

spatial calculations to generate a final list of service

locations whose service areas encompass the caller's

location, in ascending order of distance between the

caller’s location and the service location. /d. at col.51

App. 11

1.42 to col.54 1.45. The claims of the ’868 patent are

directed to various aspects of the real-time system

and process.

The four continuations of the ’868 patent — the

608 patent, 982 patent, 397 patent, and ’810 patent

— have the same written description as the ’868

patent. While some claims of these patents are di-

rected to the rcal-time system, many are directed to

other embodiments, including, for example, a single-

table database, referred to as a “telephone number to

telephone number” (“TNTTN”) table, which is essen-

tially a merger of the master and client tables first

disclosed in the 897 patent.

The second family of Moore-Shaffer patents

includes the ’214 patent and °179 patent. They dis-

close spatial key-linked, multi-table databases for

providing informatien to callers or service locations.

The processes described in the '214 and °179 patents

for applications that require connecting a caller to a

service location are similar to the process described in

the 131 patent.

Targus sells services that operate in conjunction

with telecommunications platforms to route 800 calls.

One service, IntelliRouting Express, uses the real-

time process described in Targus’s ‘868 patent to

identify the location of a caller and determine an

appropriate service location after the call is placed

and while the caller remains on the line. The service

provides the telephone number of the correct service

location to the platform, which then processes the

App. 12

call. Another ‘Targus service, Location Express,

merely identifies the latitude/longitude location of the

caller and provides it to the platform, which then

uses that information while the caller is on the line to

perform whatever calculations are necessary to

determine an appropriate service location.

Plaintiff Adept alleged that Targus’s IntelliRout-

ing Express and Location Express services literally

infringe all six independent claims of the Neville

patents and several dependent claims. Two key claim

construction issues before the trial court concerned

the “directly routing” (paragraph [ec] in illustrative

claim 29, above) and “assigning” (paragraph [c])

limitations in the Neville patents. The case was

initially assigned to District Judge Antoon, who

construed the term “directly routing” in the Neville

patents to mean “routing a telephone cal) to another

party without a human or computer re-dialing or

otherwise placing a second call.” 800 Adept, Inc. v.

Murex Secs., Lid., No. 6:02-CV-1354, slip op. at 38

(M.D. Fla. May 27, 2005).

Subsequently, the case was transferred to Chief

Judge Fawsett three months before trial. On Targus’s

motion, she construed the claim language in the

“assigning” limitation, language that is present in all

of the asserted claims of the Neville patents. First,

she construed the term “potential first parties” as

“individuals who can place a telephone call but have

not yet done so.” 800 Adept, Inc. v. Murex Secs., Ltd.,

No. 6:02-CV-1354, slip op. at 16 (M.D. Fla. Aug. 3,

2006). She then construed “assigning” as referring to

App. 13

“a designation made prior to the telephone call of the

first parties” (emphasis added). However, she de-

clined to find that there was a disclaimer of calcula-

tions made after the call is placed. Jd. at 19-22. She

further held that the claims are not limited to a

database containing a single look-up table. Jd. at 18-

19.

During trial, a critical issue in Adept’s infringe-

ment case against Targus was whether Targus’s “real-

time” process, which performs spatial calculations

during the call to determine an appropriate service

location, satisfies the “assigning” limitation in the

claims of the Neville patents. Adept’s counsel argued

that the court’s construction of the term “assigning”

should be modified so the jury would understand it to

cover “a stored procedure and algorithm in the data-

base that constitutes a, quote, assignment, closed

quote, but nevertheless makes that calculation while

the caller is on-line.” (Trial Tr. 254:7-10, Oct. 20,

2006). On the nineteenth day of trial, in response to

Adept’s argument, and over the objection of Targus’s

counsel, Chief Judge Fawsett added a sentence to the

claim construction. The final jury instruction regard-

ing this limitation read:

The term “assigning” as used in the

third element of the claims of the ’111 and

‘689 Patents refers to “a designation made

prior to the telephone call of the first parties.”

However, the °111 and 689 patents do not ex-

clude calculations made during the telephone

call.

App. 14

As we explain more fully below, the addition of the

“However ... ” sentence to the assigning limitation

changed the dynamic of the trial.

The jury ruled in Adept’s favor on all of its patent

infringement allegations against Targus, finding that

Targus infringed all six independent cleims and the

asserted dependent claims of the Neville patents and

that those claims were not invalid or unenforceable.

The jury also found that Targus’s infringement was

willful.” In addition, the jury found that Targus

tortiously interfered with the business relationships

between Adept and its customers and further found

that Targus acted in bad faith. The jury awarded

Adept $18 million in patent infringement damages

and $2 million in compensatory damages and $5

million in punitive damages on the tortious interfer-

ence claim.

Adept also prevailed at trial on all issues related

to Targus’s patents. The jury found that Adept did not

infringe any of the asserted claims of Targus’s pat-

ents. Regarding the validity of Targus’s patents, the

jury determined that all claims of the ’897 patent and

the °131 patent were invalid, even though Targus

asserted only claim 69 of the ’897 patent and claims 1

and 50 of the °131 patent. The jury also found that the

" The jury found that Targus’s customer West infringed the

asserted system and method claims but not the database claims

and further found that West's infringement was not willful.

App. 15

asserted claims of the other Moore-Shaffer patents

were invalid.’

Targus filed a renewed motion for judgment as a

matter of law and an alternative motion for a new

trial, both of which the trial court denied without

discussion. The trial court awarded Adept an addi-

tional $24 million in enhanced patent infringement

damages in accordance with 35 U.S.C. § 284, bringing

the total damages award to $49 million. The court

then entered final judgment and a permanent injunc-

tion. The trial court also determined that the case

was exceptional under 35 U.S.C. § 285 and that Adept

was entitled to attorney fees, but the court denied the

motion for attorney fees without prejudice to reasser-

tion after completion of the appellate process.

Targus appeals the judgment with respect to

infringement of Adept’s patents, the invalidity of

Targus’s patents, tortious interference, and willful-

ness. Targus also appeals the jury’s damages award,

the trial court’s award of enhanced damages, and the

trial court’s determination that Targus was entitled

to attorney fees. Finally, Targus challenges the per-

manent injunction as vague or overbroad. We have

jurisdiction pursuant to 28 U.S.C. § 1295(a)(1).

‘ The asserted claims of the other Moore-Shaffer patents

were claim 19 of the '214 patent, claim 25 of the ’179 patent,

claim 46 of the 868 patent, claims 1 and 20 of the ’608 patent,

claims 4 and 13 of the 982 patent, claim 1 of the °397 patent,

and claim 10 of the ’810 patent.

App. 16

DISCUSSION

I. Adept Patents

Targus contends that the trial court erred in

failing to enter judgment as a matter of law that the

accused Targus services do not infringe the asserted

claims of the Neville patents. Targus focuses on the

two claim limitations previously noted — “assigning”

and “directly routing.” Regarding the assigning

limitation, Targus argues that the trial court erred in

modifying its claim construction in a way that al-

lowed Adept to argue at trial that the assignment

could be done during the call. Under the proper

construction of “assigning,” Targus maintains, its

services do not infringe the claims of the Neville

patents. Because we agree with Targus that under the

correct. claim construction no reasonable jury could

find that Targus’s services perform the “assigning”

step, we need not address Targus’s arguments with

respect to the “directly routing” limitation.

A. Claim Construction — the “Assigning” Limi-

tation

Targus argues that the claims in the Neville

patents require assignment of a _ service location

telephone number to the telephone number of each

potential caller before any call is placed. Adept does

not dispute that the assignment must occur before a

call is placed, but argues that the assigning limitation

can be satisfied by placing “in or with” a datahase

an algorithm or criteria for determining the correct

App. 17

service location, even though the calculations neces-

sary to implement the algorithm or apply the criteria

are performed during the telephone call. Targus

responds that any calculations needed to complete

the assignment of service location numbers to poten-

tial callers must occur before the call. The ultimate

question, then, is not when the assigning step must

occur, which the parties agree must be prior to any

telephone call, but rather what constitutes an as-

signment. To that end, Targus argues that the trial

court erred when it added to its original claim con-

struction the “However ... ” statement that the

patents “do not exclude calculations made during the

telephone call” because that allowed the jury to apply

Adept’s flawed interpretation.

Though in claim construction matters we give

due weight to a trial court’s claim construction,

ultimately claim construction is a matter of law the

final responsibility for which lies with us. Cybor Corp.

v. FAS Techs., Inc., 188 F.3d 1448, 1456 (Fed. Cir.

1998) (en banc). As usual, we start with the language

of the claims themselves. Phillips v. AWH Corp., 415

F.3d 1303, 13812 (Fed. Cir. 2005) (en banc). The rele-

vant language (see, e.g., claim 29 of the ’111 patent,

above) is: “assigning to the physical location of said

potential first parties a telephone number of a service

location of a second party that will receive calls. ...”

* The other independent claims either include identical

language or refer to the “originating telephone number” of said

(Continued on following page)

App. 18

"111 patent col. 15 11.33-35. Use of the word “poten-

tial” to describe the callers and use of the future tense

(“will receive calls”) for the recipient points directly to

the conclusion that the assigning step must occur

before a call is placed. The plain language of the

claims makes clear that the “assigning” step requires

that “a telephone number of a service location” be

assigned to each potential caller. Nothing in the

claims suggests that storing an algorithm that will be

used to determine the telephone number of the cor-

rect service location during a telephone call consti-

tutes an assignment of a service iocation telephone

number to a potential caller before a telephone call ts

placed.

The patents’ written description confirms this.

See Phillips, 415 F.3d at 1315-17. The Neville patents

disclose a method for routing 800 calls using routing

instructions contained in a database. According to the

written description, the database is constructed by

assigning the telephone number of an appropriate

service location to each potential caller. *111 patent

fig. 1, col. 11 11.42-54. The assignments are made by

applying customer-provided criteria, such as “exis-

tence within a previously-defined geographic area, a

custom defined geographic area, or through calcula-

tions such as the shortest distance between coordi-

nate points.” Jd. abstract. As summarized in the

potential first partics G.c., callers) rather than their “physical

location.”

App. 19

abstract, the patents make clear that assignment of

service location telephone numbers to _ potential

callers must be completed before a telephone call is

ever placed: “Once all such assignments have been

made, a datahase is assembled to be used by a long

distance carrier for direct routing of telephone calls.”

Id. (emphasis added).

The assigning step in the Neville patents results

in “direct routing instructions” that are submitted to

an LDC to be used for routing calls. Adept argues

that these routing instructions could include stored

procedures such as the distance calculations men-

tioned in the abstract. The written description, how-

ever, does not support Adept’s position. The “routing

instructions” are always described as a database

containing potential caller telephone numbers and

corresponding service location telephone numbers. Id.

col.4 11.10-12, col.12 11.48-51. To the extent that proce-

dures like distance calculations are implemented or

geographic criteria are applied, it is only to construct

a database containing assignments of service loca-

tions telephone numbers to potential callers, a step

that is completed prior to any call. Nowhere do the

patents characterize the routing instructions given to

an LDC as a stored procedure, algorithm, or criteria

to be used later during a call to determine an appro-

priate service location telephone number.

Statements made by the applicant during prose-

cution reinforce the conclusion that any calculations

necessary for assigning service location telephone

numbers to callers must be performed before any

App. 20

calls are placed. See Phillips, 415 F.3d at 1317 (“{Tlhe

prosecution history can often inform the meaning of

the claim language by demonstrating how the inven-

tor understood the invention.... ”). During prosecu-

tion of the original application that led to the Neville

patents, the examiner rejected most of the claims as

anticipated by a prior art patent to Finucane, et al.

(“Finucane”). In response, the applicant distinguished

Finucane on several grounds, one of which was that

Finucane “requires ... a computer [to] perform ‘point

of origin’ to ‘point of termination’ calculations while a

caller is on the line.” J.A. 8572. The applicant con-

trasted this feature with his system, which “performs

all such calculations prior to the call even being made

and, in fact, prior to delivery of the data base to the

Long Distance Carrier (LDC).” /d.

The examiner maintained his rejection during

prosecution of a continuation application. In remarks

accompanying an amendment in which he canceled

all independent claims and added new claims, the

applicant once again distinguished his invention from

Finucane:

The major difference {between the present

invention and Finucane] is that with the

present invention all point of origin to point

of termination calculations have already been

performed by determining in which response

zone (client-defined polygon) the call origi-

nated, and to which corresponding terminat-

ing number the call should be routed. The

results of these calculations are stored in a

database at the service provider’s location.

App. 21

Thus, the present invention eliminates the

need to perform online-calculations to deter-

mine the appropriate terminating number.

J A. 8626 (emphasis added). Thus Adept and Neville

repeatedly characterized the invention as one in

which all calculations necessary for assigning service

location telephone numbers to callers are performed

before any telephone calls are made.

Adept argues that it is improper to rely on these

statements from the prosecution history vecause they

are too ambiguous to serve as a “clear and unmistak-

able” disavowal of claim scope. See Omega Eng’g, Inc.

v. Raytek Corp., 334 F.3d 1314, 1325-26 (Fed. Cir.

2003). Adept points out that the issued claims are

quite different from those pending at the time the

statements were made. Because there is no link

between the applicant’s arguments and the specific

claim language at issue, Adept asserts, there can be

no disclaimer.

The doctrine of prosecution disclaimer to which

Adept refers is typically invoked to limit the meaning

of a claim term that would otherwise be read broadly.

See id. at 1324 (“|Wlhere the patentee has unequivo-

cally disavowed a certain meaning to obtain his

patent, the doctrine of prosecution disclaimer at-

taches and narrows the ordinary meaning of the claim

congruent with the scope of the surrender.” (emphasis

added)); see also Rheox, Inc. v. Entact, Inc., 276 F.3d

1319, 1325 (Fed. Cir. 2002) (construing the broad term

“calcium orthophosphate” to exclude monocalcium

App. 22

orthophosphate based on_ prosecution disclaimer

although excluded compound was within the ordinary

and accustomed meaning of the claim term); South-

wall Techs., Inc. v. Cardinal IG Co., 54 F.3d 1570,

1576-77 (Fed. Cir. 1995) (holding that “sputter-

deposited dielectric” could not be formed by a two-

step process because patentee argued during prosecu-

tion that it was formed by a one-step process). In this

case, however, we do not consult the prosecution

history for that purpose. We simply use it as support

for the construction already discerned from the claim

language and confirmed by the written description,

i.e., that all calculations necessary to assign a service

location telephone number to a potential caller are

completed before any call is placed. Although the

claims pending at the time of the quoted statements

did not include the “assigning” limitation, the appli-

cant was quite clear throughout prosecution that his

invention performed calculations for assigning service

location telephone numbers to callers prior to any call

being placed. As is true of the written description,

nothing in the prosecution history supports Adept’s

position that a stored algorithm constitutes an as-

signment of a service location to a caller.

Adept asserts that a claim construction requiring

all calculations to be performed prior to any tele-

phone calls cannot be correct because even its pre-

ferred embodiment performs some _ calculations

during the telephone call. Specifically, Adept claims

that when a call arrives, the Neville system must

perform “lookup” calculations to retrieve from the

App. 23

database the service location assigned to the caller.

Adept fails to recognize, however, that these lookup

calculations are not part of the assigning step in the

Neville patents — service location telephone numbers

are assigned to callers when the database is created,

i.e., before any calls take place. Under the correct

claim construction, only calculations that are neces-

sary to complete the assignment must be performed

before any calls are made. As long as that require-

ment is met, the claims do not preclude any addi-

tional calculations during the telephone call.

According to Adept, three dependent claims not

asserted in the case should compel a different claim

construction. In these claims — 28, 40, and 52 of the

"111 patent — the originating telephone number is

that of a “non-stationary telephone, such as a mobile,

cellular or transportable telephone.” Adept contends

that these mobile telephone claims require some sort

of spatial calculation at the time of the call to deter-

mine the correct service location based on the caller’s

physical location and therefore would be impossible to

practice under a claim construction such as the one

we adopt.

We are not persuaded. As discussed, the plain

language of the independent claims requires each

potential caller to be assigned a service location

telephone number hefore any call is placed. Since the

mobile telephone claims depend from the independent

claims, all potential mobile telephone callers must

also be assigned a service location before a call

is placed. Nothing in the language of the claims

App. 24

indicates otherwise. While the claims and the written

description appear to contemplate that the assign-

ment will be based on the caller’s physical location at

the time of the call, the written description does not

teach a method for doing so. Significantly, the patents

do not disclose the use of stored algorithms that could

be used to assign service location telephone numbers

duriny a call from either a mobile telephone or a ‘fixed

landline, and thus the written description does not

support Adept’s proposed construction.

Furthermore, it is not clear that the mobile

telephone claims would be impossible to practice

under the correct claim construction. Prior to any

calls, a service location could be assigned to a mobile

telephone based on, for example, a physical location

associated with its NPA-NXX. Be that as it may, we

need not resolve this question. Even if the mobile

telephone claims are rendered inoperative by a

proper claim construction, preserving the validity of

unasserted claims is an insufficient reason to ignore

the meaning of the claims actually asserted in the

case. See Intamin Ltd. v. Magnetar Techs. Corp., 488

F.3d 1328, 1307 (Fed. Cir. 2007).

In sum, based on consideration of the claims, the

written description, and the remainder of the intrin-

sic evidence, we conclude that the trial court was

correct in the first instance when it construed the

“assigning” language to refer to “a designation made

prior to the telephone call of the first parties.” We

must also recognize, however, what the assignment

entails — the telephone number of a service location is

App. 25

assigned to the physical location or telephone number

of each potential caller. As noted, this assignment

must be made before any calls are placed. Thus, to

the extent any calculations are needed to complete

the assignment of service location telephone numbers

to potential callers, they must be performed prior to

any calls.

The trial judge modified the original claim con-

struction by adding that the Neville patents “do not

exclude calculations made during the telephone call.”

That statement is imprecise in the context in which it

was presented, i.e., as part of the construction of the

term “assigning,” and allowed Adept to argue before

the jury that calculations for completing the assign-

ing step could be performed while a caller is on-line,

an argument that is not consistent with the patented

invention. Under the correct claim construction,

assignment of service location telephone numbers to

potential callers must occur prior to any calis, and

thus any calculations necessary for completing that

assignment must be performed before any telephone

calls are placed.

B. Infringement

With the trial court’s modified claim construction

before them, the ‘.ry found that defendant Targus

infringed the Neville patents, and the trial court

subsequently denied a motion by ‘Targus to grant,

contrary to the jury's verdict, judgment as a matter

of law in ‘largus’s favor. The question before us is

App. 26

whether the trial judge erred in denying the motion.

We review the trial court’s denial of Targus’s motion

for judgment as a matter of law under the law of the

regional circuit. 24 Techs., Inc. v. Microsoft Corp., 507

F.3d 1340, 1346 (Fed. Cir. 2007). Under Eleventh

Circuit law, we review the denial of a motion for

judgment as a matter of law without deference,

reapplying the same standard applied by the trial

court. Christopher v. Florida, 449 F.3d 1360, 1364

(llth Cir. 2006). Judgment as a matter of law is

appropriate when there is no legally sufficient evi-

dentiary basis for a reasonable jury to find in favor of

the nunmoving party. /d. When a patent infringement

verdict is based on an incorrect claim construction,

we reverse the trial court’s denial of a motion for

judgment as a matter of law if no reasonable jury

could have found infringement under the proper

claim construction. Finisar Corp. v. DirecTV Group,

Inc., 523 F.3d 1323, 1333 (Fed. Cir. 2008).

In the Targus system, the telephone numbers

and locations of potential callers are maintained in a

database. The system also includes a database for

each system customer containing the telephone

numbers of the customer's service locations along

with their corresponding service arcas. Those service

areas are configured by the customer before any calls

are placed and may be radius-based (a circle around

the service location) or defined by polygonal regions

around each service location. While the Targus sys

lem contains information relating to both potential

callers and customer service locations, it does not

App. 27

match a customer service location to a particular

caller prior to any calls taking place. Instead, as

described in the IntelliRouting Express User Guide,

callers are assigned to a service location “on the fly”

with each telephone call.

When a call comes into the platform, the Targus

system determines the caller’s approximate latitude

and longitude based on the caller’s ANI. The system

then computes a rectangular area, referred to as a

window key, around that latitude/longitude. Next the

system identifies a list of candidate service locations

whose service areas overlap the window key. For each

candidate, the system performs a detailed spatial

calculation, either a distance computation or “point-

in-polygon” calculation, to determine whether the

caller’s location is within the service area. This

results in a list of one or more service locations to

which the call may be routed.

Thus the accused Targus services do not assign

service location telephone numbers to _ potential

callers before calls are placed. Because all calcula-

tions necessary to complete the assignment are

performed in real-time while the caller is on the line,

the Targus services do not satisfy the “assigning”

limitations in the Neville claims. Under the correct

claim construction, no reasonable jury could find that

Targus infringes the asserted claims of Adept’s pat-

ents. Accordingly, we reverse the trial court’s denial of

Targus’s motion for judgment of non-infringement as

a matter of law. In light of that result, we vacate the

infringement damages award and the permanent

App. 28

injunction; we also vacate the trial court’s judgment

with respect to willfulness and attorney fees.

Il. Targus Patents

A. Unasserted Claims

The jury found that all claims of the ’897 patent

and °131 patent were invalid, and the trial court

entered judgment accordingly. Targus argues that the

trial court erred because only claim 69 of the ’897

patent and claims 1 and 50 of the °131 patent were

asserted and at issue. Adept responds that all claims

of the two patents were placed in issue by the de-

claratory judgment count in its complaint. If the

evidence at trial proved that all the claims were

invalid, Adept maintains, the tria! judge properly

entered judgment on the jury verdict.

We agree with Targus that the unasserted claims

were not at issue, and thus the trial court erred.

First, the scope of Adept’s complaint is less than clear.

Adept requested a declaratory judgment with respect

to the invalidity of Targus’s “asserted claims,” an

apparent reference to Targus’s assertions of infringc-

ment against Adept and its customers prior to the

filing of the lawsuit. (First Am. Compl. {{ 57-58.) The

complaint does not specify which claims fall into that

category. In any event, a reference in the complaint is

not sufficient to support a judgment that particular

claims are invalid; the specific validity of those claims

must have been at issue during the trial and actually

App. 29

litigated by the parties. Datascope Corp. v. SMEC,

Inc., 776 F.2d 320, 327 (Fed. Cir. 1985).

Second, the parties’ Joint Final Pretrial State-

ment demonstrates that ovly claim 69 of the °897

patent and claims 1 and 50 of the ’131 patent were at

issue during the trial. In that document, the parties

stipulated that the asserted claims of the ’897 patent

and 7131 patent were claim 69 and claims 1 and 50,

respectively. (Joint Final Pretrial Statement 31.)

Then, under the heading “Concise Statement of

Issues of Fact and Issues of Law Which Remain for

Determination by the Trial Court,” the parties in-

cluded the following two questions: “Are the asserted

claims of the Shaffer-Moore patents valid?” and “Are

the asserted Shaffer-Moore patents infringed, liter-

ally or under the doctrine of equivalents?” (/d. at 32-

22.) There were no references whatsoever to the

unasserted claims of the ’897 patent and 7131 patent.

Third, at trial, neither party presented evidence

with respect to the unasserted claims. Adept’s expert,

Dr. Brody, expressly limited his validity analysis and

opinions to claim 69 of the ’897 patent and claims 1

and 50 of the 131 patent. (Trial Tr. 148-49, 184-85,

198-200, 208-10, 213, Oct. 16, 2006.) This is true with

respect to both Adept’s anticipation and obviousness

contentions and its argument that the claims of the

"131 patent were invalid duce to an on-sale bar. Adepi’s

argument that 1t was unnecessary for its validity

expert to put forth a claim-by-claim analysis of the

unasserted claims is simply incorrect. Under the

patent statute, the validity of each claim must be

App. 30

considered separately. See 35 U.S.C. § 282 (“Each

claim of a patent (whether in independent, dependent,

or multiple dependent form) shall be presumed valid

independently of the validity of other claims.... ”);

Schumer v. Lab. Computer Sys., Inc., 308 F.3d 1304,

1316 (Fed. Cir. 2002); Sandt Tech., Ltd. v. Resco Metal

& Plastics Corp., 264 F.3d 1344, 1356 (Fed. Cir. 2001).

In this case, it is clear from the parties’ pretrial

statement and from the trial proceedings that the

unasserted claims were neither litigated nor placed in

issue during the trial. We therefore reverse the trial

court’s judgment of invalidity with respect to the

unasserted claims, i.e., all the claims of the °897

patent except claim 69 and all the claims of the °131

patent except claims 1 and 50.”

B. Asserted Claims

The jury also found all twelve of the asserted

claims in the Moore-Shaffer patents invalid. Targus

chose not to appeal the trial court’s denial of its

motion for judgment as a matter of law that the

asserted claims are not invalid, and thus dves not

challenge on appeal the sufficiency of the evidence in

support of the jury’s verdict. Instead, Targus appeals

only the trial court’s denial of its motion for a new

" In light of this conclusion, we need not address Targus’s

additional argument that the tnal court lacked jurisdiction to

adjudicate the validity of the unasserted claims because there

was no case or controversy with respect to those claims

App. 31

trial on the validity of these claims. Applying Elev-

enth Circuit law, we review the trial court’s denial of

a motion for a new trial for abuse of discretion. Hicks

v. Talboit Recovery Sys., Inc., 196 F.3d 1226, 1242

(llth Cir. 1999). When a jury verdict is judged to be

against the great weight of the evidence, the trial

judge has authority to grant a motion for a new trial.

Id.; Charles Alan Wright, Arthur R. Miller & Mary

Kay Kane, Federal Practice and Procedure § 2806 (2d

ed. 1995).

Targus argues on appeal that the jury’s invalidity

findings were “tainted” by the erroneous characteri-

zation of the Neville patents by Adept’s expert,

Dr. Brody. In particular, Targus complains that Dr.

Brody repeatedly asserted that the Neville patents

teach real-time spatial calculations of the sort used

by Targus and claimed in some of the Moore-Shaffer

patents. Because Dr. Brody testified that the asserted

claims were either anticipated by the Neville patents

or rendered obvious by the combination of the Neville

patents and other prior art, Targus believes it is

entitled to a new trial on the validity of the asserted

claims.

We agree with Targus, but only in part. Targus

requests on appeal a new trial on “whether the as-

serted claims of the Moore-Shaffer patents that

concern ‘on line calculations’ are invalid.” (Appellant’s

Reply Br. 22-23.) in its brief, Targus identifies only

two asserted claims that involve on-line or real-time

calculations — claim 46 of the 868 patent and claim

10 of the °810 patent. (Appellant’s Br. 49-50.) Our

App. 32

review of the record confirms that those are the only

asserted claims directed to Targus’s real-time system.

Our review further confirms that Dr. Brody’s testi-

mony with regard to the alleged real-time aspect of

the Neville patents was directed to the validity of

only those two claims and not to the other asserted

claims.

As explained above in the discussion on the

Adept patents, Dr. Brody’s characterization of the

scope of the Neville patent disclosure was mistaken.

Furthermore, the primary if not the entire evidence

on which the jury could have relied in finding claim

46 of the ’868 patent and claim 10 of the 810 patent

invalid was Dr. Brody’s erroneous testimony. Under

these circumstances, the trial judge should have

granted the motion for a new trial with regard to

these two claims because the great weight of the

evidence in the record was against the jury’s verdict.

This does not preclude the possibility that othr

evidence produced at a retrial would be sufficient to

establish invalidity.

The failure to have granted Targus’s motion was

an abuse of discretion; accordingly, we vacate the trial

court’s judgment that claim 46 of the ’868 patent and

claim 10 of the ’810 patent are invalid, and remand

for a new trial on their validity. We affirm the trial

courts judgment that the remaining asserted claims

of the Moore-Shaffer patents are invalid.

App. 33

WI. Tortious Interference

in its suit against Targus, Adept claimed that,

because Targus had asserted certain of its patent

claims against some of Adept’s customers, Targus had

tortiously interfered with Adept’s business relation-

ships with those customers. This, according to Adept,

entitled Adept to the state-law remedy available for

such an unfair trade practic. Targus responded that

the state-law remedy is preempted by the federal

patent laws. The “preemption” issue can be stated

thus: if a patentee attempts to enforce its patents

against a competitor’s customers, under what circum-

stances, if any, is the patentee protected from the

usual standards regarding unfair trade practices,

imposed by various state unfair competition laws, on

the theory that the rights accorded a patentee to

enforce the patent supersede the usual anti-

competition rules? See Zenith Elecs. Corp. v. Exzec,

Inc., 182 F.3d 1340, 1345-46 (Fed. Cir. 1999).

The answer to the question is now well-

established. State tort claims against a patent holder,

including tortious interference claims, based on

enforcing a patent in the marketplace, are “pre-

empted” by federal patent laws, unless the claimant

can show that the patent holder acted in “bad faith”

ir the publication or enforcement of its patent. Jd. at

1355; Hunter Douglas, Inc. v. Harmonic Design, Inc.,

153 F.3d 1318, 1336-37 (Fed. Cir. 1998). As the Su-

preme Court said long ago, “Patents would be of little

value if infringers of them could not be notified of the

consequences of infringement, or proceeded against in

App. 34

the courts. Such action, considered by itself, cannot

be said to be illegal.” Virtue v. Creamery Package Mfg.

Co., 227 U.S. 8, 37-38 (1913).

The issue in this case is whether Adent presented

to the jury sufficient facts, if believed, that a reason-

able jury could find for Adept on the issue of Targus’s

bad faith. This “bad faith” standard has objective and

subjective components. Dominant Semiconductors

Sdn. Bhd. v. Osram GmbH, 52% F.3d 1254, 1260 (Fed.

Cir. 2008). The objective component requires a show-

ing that the infringement allegations are “objectively

baseless.” Globetrotter Software, Inc. v. Elan Com-

puter Group, Inc., 362 F.3d 13867, 1875 (Fed. Cir.

2004). The subjective component relates to a showing

that the patentee in enforcing the patent demon-

strated subjective bad faith. See id. Absent a showing

that the infringement allegations are objectively

baseless, it is unnecessary to reach the question of

the patentee’s intent. See id.

Infringement allegations are objectively baseless

if “no reasonable litigant could realistically expect

success on the merits.” Prof’] Real Estate Investors,

Inc. v. Columbia Pictures Indus., Inc., 508 U.S. 49, 60

(1993); see also GP Indus., Inc. v. Eran Indus., Inc.,

500 F.3d 1369, 1374 (Fed. Cir. 2007); Globetrotter, 362

F.3d at 1375-76. To prove at trial that Targus’s ac-

tions were objectively baseless, Adept was required to

offer clear and convincing evidence that Targus had

no reasonable basis to believe that its patent claims

were valid or that they were infringed by Adept’s

customers. See Golan v. Pingel Enter., Inc., 310 F.3d

App. 35

1360, 1371 (Fed. Cir. 2002). Because of the value

placed on property rights, which issued patents

share, see 35 U.S.C. § 261 (“[Platents shall have the

attributes of personal property.”); Consol. Fruit-Jar

Co. v. Wright, 94 U.S. 92, 96 (1876) (“A patent for an

invention is as much property as a patent for iand.”);

Kearns v. Gen. Motors Corp., 94 F.3d 1553, 1555 (Fed.

Cir. 1996) (“By statutory and common law, each

patent establishes an independent and _ distinct

property right.”), and in Jight of the underlying

jurisprudential basis for the bad faith standard,

rooted as it is in Supreme Court cases and Constitu-

tional principles, see Globetrotter, 362 F.3d at 1375-

77, a party attempting to prove had faith on the part

of a patentee enforcing its patent rights has a heavy

burden to carry.

The jury verdict was that Adept had proved its

case. Targus appeals the trial court’s denial of its

motion for judgment as a matter of law, arguing that

there was no clear and convincing evidence on which

a reasonable jury could conclude its actions were

objectively baseless. On the record before us, for the

reasons we shall exp!/ain, we believe Targus ts correct

that Adept has not successfully carried its burden.

We first address the question of whether Targus

could have had a reasonable belief that its patents

were valid, beginning with the ’897 patent. The main

dispute regarding the validity of the ’897 patent was

whether Neville discloses a two-table embodiment,

which would anticipate the claims of the ’897 patent.

While the preferred embodiment in Neville uses a

App. 36

single-table TNTTN database, one sentence in the

written description states that “the correlational

database may be relational or hierarchical,” which

implies that the database could have more than one

table. ’111 patent col.9 I1.50-51. The issue before us is

not the validity vel non of the ’897 patent, but

whether the evidence was such that Targus could not

have had a reasonable basis for believing that the

patent was valid when it asserted the patent against

Adept’s customers.

Adept alleges that Targus knew the disclosure in

the Neville patents anticipated the claims of the ’897

patent, and that Targus misrepresented the scope of

Neville to the PTO so that the ’897 patent claims

would survive the reexamination requested by Adept

in 1999. Adept’s argument sounds more like an alle-

gation of subjective bad faith on ‘Targus’s part, a

question that is not at issue absent the predicate

showing that the claims asserted by Targus were

objectively baseless. Furthermore, none of the evi-

dence cited in Adept’s brief supports its theory that

Targus acted deceptively. The evidence introduced at

trial shows that many people, including the examiner

who conducted the recxamination and even Adept’s

own patent attorney, understood Neville to disclose

only a one-table system. Notably, Targus did not file

suit against any of Adept’s customers until after

reexamination of the 897 patent had been completed.

On this record, a reasonable jury could not have

found by clear and convincing evidence that Targus

App. 37

lacked a reasonable basis to believe that the claims of

the 897 patent were not anticipated by Neville.

Adept also asserts that Targus knew that Neville

anticipated Targus’s one-table claims — claim 1 of the

608 patent and claim 4 of the '982 patent. Targus

argues that it reasonably believed Neville did not

disclose the automated table-build process required

by the Targus claims. This was a reasonable view, as

evidenced by the opinion of ‘largus’s expert at trial

that Neville does not teach a fully automated system.

The contrasting opinion of Adept’s expert does not

render Targus’s position unreasonable. As with the

’°897 patent, we conclude that no reasonable jury

could have found that Adept met its burden to show

that there was no reasonable basis on which Targus

could believe in the validity of its one-table claims.

Regarding the °131 patent, Adept argues that

Targus knew it was subject to an on-sale bar based on

work that Targus did for Federal Express, and that

Targus actively concealed that information from the

PTO. The record indicates, however, that Targus

reasonably believed that that work was experimental,

even if ultimately the jury in this case may have

found otherwise. Furthermore, during prosecution of

the application that led to the °131 patent, Targus

submitted a declaration to the PTO detailing the

development and testing of the FedEx system. Under

these circumstances, no reasonable jury could find

that Adept proved by clear and convincing evidence

that Targus lacked a reasonable basis for believing

App. 38

that the claims of the ’131 patent were not subject to

the on-sale bar.

With respect to Targus’s other patents, Adept

alleges that the examiner was led astray so that he

failed to consider Neville in combination with Riskin

or other references, even though Neville and Riskin

and multiple other references were before him. Yet

Adept cites no evidence demonstrating that Targus

knew its claims were invalid for obviousness or

showing that Targus somehow caused the examiner

not to combine prior art references. On this record, no

reasonable jury could have found that a belief by

Targus that its patents were valid had no reasonable

basis.

We must also consider whether there was a basis

for Targus to reasonably believe that Adept’s custom-

ers infringed the Targus patents. Adept essentially

argues that Targus could not have had a reasonable

basis for asserting its patents against Adept’s cus-

tomers because ‘Targus did not succeed at trial on its

infringement claims against Adept. Courts, however,

“must ‘resist the temptation to engage in pest hoc

reasoning by concluding’ that an ultimately unsuc-

cessful ‘action must have been unreasonable or with-

out foundation.’” Prof’] Real Estate, 508 U.S. at 60

n.5 (quoting Christiansburg Garment Co. v. EROC,

434 U.S. 412, 421-22 (1978)): see also Dominant, 524

F.3d at 1261 & n.6 (citing Prof’/ Real Estate, 508 U.S.

at 60 n.5). Thus the result of Targus’s infringement

claims in this case is not dispositive of whether

App. 39

Targus’s claims against Adept’s customers were

reasonable.

Targus presented evidence that it reasonably

believed Adept’s customers were infringing the Tar-

gus patents. For instance, Adept admitted that the

database it provided to two of its customers was in

the same format as the database used in the Targus

system. Also, Targus did not assert its claims against

another Adept customer until after Targus’s in-house

counsel had prepared claim charts explaining Tar-

gus’s infringement theories. Adept has not cited any

contradictory evidence that was introduced at trial.

On this record, no reasonable jury could find by

clear and convincing evidence that Targus had no

reasonable basis for believing that Adept’s customers

were infringing its patents.

Adept’s tortious interference claim with respect

to its customer Allstate Motor Club (“AMC”) was

based on Targus’s infringement claim against its own

customer, Vail Systems. In providing routing services

to AMC, Vail used data received from AMC, which

included a database that Allstate had received from

Adept. After learning about this arrangement

through discovery in this case, Targus believed that

Vail infringed its patents and filed claims against

Vail, which subsequently sought indemnification from

AMC. While Adept alleges that Targus and Vail

colluded to pressure AMC, Adept fails to cite evidence

showing that Targus’s belief that Vail infrinyed its

patents was unreasonable. As with Targus’s in

fringement allegations against Adept’s customers, no

App. 40

reasonable jury could find that Adept met its burden

to show that Targus lacked a reasonable basis for

believing that Vail infringed its patents.

In sum, we conclude that there is not clear and

convincing evidence on which a reasonable jury could

find that Targus acted in bad faith by asserting

objectively baseless patent infringement allegations.

Thus Adept’s state-law tortious interference claim is

preempted by federal patent law. The trial judge

erred in denying Targus’s motion for judgment as a

matter of law on this claim, and we therefore reverse

the trial court’s judgment.

CONCLUSION

We reverse the trial court’s judgment of in-

fringement of the Neville patents. Accordingly, we

vacate the infringement damages award and the

permanent injunction; we also vacate the trial court’s

judgment with respect to willfulness and attorney

fees.

We reverse the trial court’s judgment of invalid-

ity with respect to the unasserted claims of the '897

patent and ‘131 patent. We vacate the trial court’s

judgment that claim 46 of the '868 patent and claim

10 of the °810 patent are invalid and remand for a

new trial on the validity of those claims. We affirm

the invalidity judgment with respect to the remaining

patent claims asserted by Targus against Adept.

App. 41

We reverse the trial court’s judgment on Adept’s

tortious interference claim and vacate the accompa-

nying award of compensatory and punitive damages.

AFFIRMED-IN-PART, REVERSED-IN-PART, VA-

CATED-IN-PART; and REMANDED

DYK, Circuit Judge, concurs in the result.

App. 42

UNITED STATES DISTRICT COURT

MIDDLE DISTRICT OF FLORIDA

ORLANDO DIVISION

800 ADEPT, INC.,

Plaintiff,

-VS-

MUREX SECURITIES, LTD.,

MUREX LICENSING CORPO-

RATION, TARGUS INFORMA-

TION CORPORATION,

and WEST CORPORATION,

Defendants.

MUREX SECURITIES, LTD..,

MUREX LICENSING CORPO-

RATION, TARGUS INFORMA-

TION CORPORATION, Pee

and WEST CORPORATION, ee ees

6:02-cv-1354-

Counter-Plaintiffs Orl-28DAB

-VS-

800 Adept, Inc.,

Counter-Defendant.

MUREX SECURITIES, LTD..,

and MUREX LICENSING

CORPORATION,

Third-Party Plaintiffs,

-VS-

Adeptel, Inc.,

Third-Party Defendant.

App. 43

ORDER

(Filed Aug. 3, 2006)

This case comes before the Court on the following:

1. Markman Motion of Targus Information

Corporation, Murex Securities, Ltd., Murex Licensing

Corporation, and West Corporation (collectively

“Defendants”) (Doc. No. 240, filed May 19, 2006);

2. Opposition To Defendant’s Markman Motion

of Plaintiff 800 Adept, Inc. (Doc. No. 268, filed June

19, 2006);

3. Combined Motion And Memorandum To

Strike 800 Adept’s Markman Opposition As Untimely

Or, Alternatively, For Leave To Reply of Defendants

(Doc. No. 291, filed July 3, 2006); and

4. Opposition To Combined Motion To Strike

Markman Opposition And Motion For Leave To Reply

of Plaintiff 800 Adept, Inc. (Doc. No. 303, filed July

17, 2006).

In this patent infringement lawsuit, Targus

Information Corporation, Murex Securities, Ltd.,

Murex Licensing Corporation, and West Corporation

(collectively “Defendants”) ask the Court to interpret

several terms from the claims of U.S. Patent Num-

bers RE36,111 (“the ’111 Reissue”) and 5,805,689 (“the

689 Patent”) and one term from the claims of the

App. 44

Shaffer-Moore Patents that are identified in the

margin. (Doc. No. 240).

First, Defendants move the Court to Strike the

Opposition of Plaintiff 800 Adept, Inc. (hereinafter,

“800 Adept”) because 800 Adept did not file a Mark-

man Motion seeking to construe the claims of the ’111

Reissue and ’689 Patent and because 800 Adept

raised new arguments in its Opposition regarding the

proper construction of Defendant’s disputed claim

terms. (Doc. No. 291). Defendant’s Motion to Strike

and the issued raised therein are without merit, as an

opposition to a motion is expressly allowed by the

Court’s Amended Case Management and Scheduling

Order. (Doc. No. 182, Part II.E, p. 5). Moreover, a

reply is not necessary for the arguments raised by

800 Adept in its Opposition.

Secondly, Plaintiff’s argument that this motion is

barred by the law of the case doctrine is not well-

founded. (See Doc. No. 268, p. 15). The law of the case

doctrine applies to only those issues discussed and

decided by previous decisions and those issues de-

cided in such decisions by necessary implication. Toro

The Shaffer-Moore Patents, as identified in the Declara-

tion of Michael M. Barry, are U.S. Patent Numbers 5,506,897

(“the ’897 Patent”), 5,848,131 (“the '131 Patent”), 5,901,214 (“the

‘214 Patent”), 5,907,608 (“the 608 Patent”), 5,910,982 (“the 982

Patent”), 5,956,397 (“the °397 Patent”), 5,982,868 (“the °868

Patent”), 6,058,179 (“the "'79 Patent”), and 6,091,810 (“the °810

Patent”). (See Doc. No. 24), Ex. FF; Doc. No. 31, pp. 12-13). The

claims of the ‘868 Patent do not recite the disputed claim term.

App. 45

Co. v. White Consol. Indus., Inc., 383 F.3d 1326, 1335

(Fed. Cir. 2004). Defendants now seek a _ judicial

determination of the meaning of a claim term, “as-

signing,” which is a separate and distinct claim term

from the one that was previously construed, “directly

routing.” The Court must “must give each claim term

the respect that it is due,” Pause Tech., LLC v. TiVo,

Inc., 419 F.3d 1326, 1334 (Fed. Cir. 2005), or, in other

words, the Court should endeavor to give meaning to

al] the terms of a claim. Merck & Co. v. Teva Pharms.

USA, Inc., 395 F.3d 1364, 1872 (Fed. Cir. 2005).

Moreover, the issues raised in Defendants’ mo-

tion were not necessarily decided by implication in

the District Court’s previous Markman Order. In that

Order, the Court addressed whether the claim term

“direct routing” prohibited caller input. (Doc. No. 178,

p. 38). Further, the Court’s determination that the

preambles of claim 41 of the ’111 Reissue and claim 1

of the 689 Patent did not contain a “direct routing”

limitation did not decide, either expressly or impli-

edly, whether those claims assigned callers prior to

the placement of a telephone call.

In addition, the Magistrate Judge and previous

District Court Judge declined to address the litigants’

arguments concerning the “assigning” limitation and

instead considered the merits of the “direct routing”

limitation. (See Doc. No. 252, p. 19; Doc. No. 178, p.

34). Where previous decisions decline to consider an

issue, the law of the case doctrine does not operate to

bar the future consideration of such issue. Laitram

Corp. v. NEC Corp., 115 F.3d 947, 952-53 (Fed. Cir.

App. 46

1997) (applying the precedent of the Court of Appeals

for the Eleventh Circuit).

‘The Court now turns to the task of construing

the claims.

Claim Construction

Patent claims are construed by the Court as a

matter of law. Cybor Corp. v. FAS Techs., Inc., 138

F.3d 1448, 1454-56 (Fed. Cir. 1998) (en banc). “(T]he

words of a claim ‘are generally given their ordinary

and customary meaning.” Phillips v. AWH Corp., 415

F.3d 1303, 1312 (Fed. Cir. 2005) (en banc) (quoting

Vitronics Corp. v. Conceptronic, Inc., 90 F.3d 1576,

1582 (Fed. Cir. 1996)). Such ordinary meaning “is the

meaning that the term would have to a person of

ordinary skill in the art in question at the time of the

invention.” Jd. at 1313.

To determine the ordinary meaning of a term, the

court should review “the same resources as would”

the person of ordinary skill in the art. Multiform

Dessicants, Inc. v. Medzam, Ltd., 133 F.3d 1473, 1477

(Fed. Cir. 1998). Those resources include “the words

of the claims themselves, the remainder of the speci-

fication, the prosecution history, and extrinsic evi-

dence concerning relevant scientific principles, the

meaning of technical terms, and the state of the art.”

Innova/Pure Water, Inc. v. Safart Water Filtration

Sys., Inc., 381 F.3d 1111, 1116 (Fed. Cir. 2004).

App. 47

“(TJhe claims themselves provide substantial

guidance as to the meaning of particular claim

terms.” Phillips, 415 F.3d at 1314. Both “the context

in which a term is used in the asserted claim” and the

“folther claims of the patent in question” are useful

for understanding the ordinary meaning. /d.

“(T]he specification ‘is always highly relevant to

the claim construction analysis. Usually, it is disposi-

tive; it is the single best guide to the meaning of a

disputed term.” Jd. at 1315 (quoting Vitronics, 90

F.3d at 1582). In short, the claims “must be read in

view of the specification, of which they are a part.”

Markman v. Westview Instruments, Inc., 52 F.3d 967,

979 (Fed. Cir. 1995) (en banc). Thus, “[t]he construc-

tion that stays true to the claim language and most

naturally aligns with the patent’s description of the

invention will be, in the end, the correct construc-

tion.” Renishaw PLC v. Marposs Socteta’ per Aziont,

158 F.3d 1243, 1250 (Fed. Cir. 1998): see also On

Demand Mach. Corp. v. Ingram Indus., Inc., 442 F.3d

1331, 1344 (Fed. Cir. 2006) (“[E]ach term must be

construed to implement the invention described in

the specification”).

Occasionally, “the specification may reveal a

special definition given to a claim term ... that

differs from the meaning it would otherwise possess.

In such cases, the inventor’s lexicography governs.”

Phillips, 415 F.3d at 1316 (citing CCS Fitness, Inc. v.

Brunswick Corp., 288 F.3d 1359, 1366 (Fed. Cir.

2002)). The specification may also “reveal an inten-

tional disclaimer, or disavowal, of claim scope by the

App. 48

inventor ...[{, which] is regarded as dispositive.” /d.

(citing SciMed Life Sys., Inc. v. Advanced Cardiovas-

cular Sys., Inc., 242 F.3d 1337, 1343-44 (Fed. Cir.

2001)).

In addition to consulting the specification, courts

“should also consider the patent’s prosecution history,

if it is in evidence.” /d. at 1317 (internal quotation

marks and citation omitted). Because the prosecution

history represents negotiation between the United

States Patent and Trademark Office (the “Patent

Office”) and the applicant, “it often lacks the clarity of

the specification and thus is less useful for claim

construction purposes.” /d. Nevertheless, the prosecu-

tion history can be helpful “by demonstrating how the

inventor understood the invention and whether the

inventor limited the invention in the course of prose-

cution.” Id.

The court may also rely on extrinsic evidence,

which is “all evidence external to the patent and

prosecution history, including expert and inventor

testimony, dictionaries, and learned treatises.”

Markman, 52 F.3d at 980. Although extrinsic evi-

dence can be useful, it is “less significant than the

intrinsic record in determining ‘the legally operative

meanin s of claim language.”’ Phillips, 415 F.3d at

1317 (quoting C.R. Bard, Inc. v. U.S. Surgical Corp.,

388 F.3d 858, 862 (Fed. Cir. 2004)). Technical diction-

aries and treatises can inform the Court’s under-

standing of the underlying technology and _ the

manner in which one skilled in the art might use

claim terms, but technical dictionaries and treatises

App. 49

may provide definitions that are too broad or may not

be indicative of how the term is used in the patent.

Id. at 1318. Similarly, expert testimony can aid a

court in understanding the underlying technology

and determining the particular meaning of a term in

the pertinent field, but an expert’s conclusory, unsup-

ported assertions as to a term’s definition is not

unhelpful. /d. Generally, extrinsic evidence is “less

reliable than the patent and its prosecution history in

determining how to read claim terms.” /d.

During claim construction, “[t]lhe sequence of

steps used by the judge in consulting various sources

is not important; what matters is for the court to

attach the appropriate weight to be assigned to those

sources in light of the statutes and policies that

inform patent law.” PAillips, 415 F.3d at 1324.

In addition, the ’111 Reissue and the ’689 Patent

contain means-plus-function limitations that require

construction. Such limitations are subject to Title 35

U.S.C. § 112, 7 6. Braun Med., Inc. v. Abbott Labs.,

124 F.3d 1419, 1424 (Fed. Cir. 1997). In relevant part,

Section 112, 4 6 mandates that “such a claim limita-

tion ‘be construed to cover the corresponding struc-

ture ... described in the specification and equivalents

thereof.” Jd. Accordingly, when faced with means-

plus-function limitations, courts “must turn to the

written description of the patent to find the structure

that corresponds to the means recited in the [limita-

tions].” Id.

App. 50

Construing a means-plus-function limitation

involves multiple steps. “The first step in construing

[a means-plus-function] limitation is a determination

of the function of the means-plus-function limitation.”

Medtronic, Inc. v. Advanced Cardiovascular Sys., Inc.,

248 F.3d 1303, 1311 (Fed. Cir. 2001). Once the Court

has determined the limitation’s function, “the next

step is to determine the corresponding structure

disclosed in the specification and _ equivalents

thereof.” Jd. A “structure disclosed in the specification

is ‘corresponding’ structure only if the specification or

prosecution history clearly links or associates that

structure to the function recited in the claim.” /d.

Moreover, the focus of the “corresponding structure”

inquiry is not merely whether a structure is capable

of performing the recited function, but rather

whether the corresponding structure is “clearly linked

or associated with the |recited]| function.” /d.

The ’111 Reissue and ’689 Patent Claims

Defendants contend that each of theses patents

contains claims having the following limitation:

assigning to... said potential first parties a

telephone number of a service location of a

second party.

ioc. No. 240, p. 1). Defendants aver that this limita-

tion of the ’111 Reissue and the ’689 Patent “re-

quire[s}] that all potential first parties be assigned to

a telephone number of a service location of a second

party by defining the boundaries of various service

App. 51

location trade areas.” (Jd. at 4, quotations and modifi-

cations omitted). Consequently, Defendants conclude

that the claims require that each and every potential

caller be assigned to a service location before any call

is made, and therefore any system that uses calcula-

tions to select a service location after a call is made is

excluded from the claimed invention. (Jd. at 5). 800

Adept argues in response that Defendants improperly

construe the claims without reference to the specific

claim language. (Doc. No. 268, p. 2).

The Court first identifies the language of each

claim the parties wish to construe. The ‘111 Reissue

contains five independent claims that contain similar

assigning claim limitations or method steps. Claims

1, 9, 17, 29 and 41, as amended by the reissue patent,

are set forth below.

1. A system for direct routing a telephone

call from a first party who has an originating

telephone number at a specific location de-

fined by latitude and longitude coordinates

who dials a telephone number including dig-

its uniquely characteristic to a second party

having a plurality of service locations, said

system comprising:

means for allocating individual latitude

and longitude coordinates to each

originating telephone number of all

potential first parties;

means for defining the boundaries of one

or more geographical areas which can

be of any size and shape according to

App. 52

predetermined criteria, each point

along said boundaries being defined

by latitude and longitude coordi-

nates;

means for assigning to each originating

telephone number of said potential

first parties a telephone number of a

service location of a second party

that will receive calls originating

from within the boundary of a geo-

graphic area defined by said means

for defining in which the individual

latitude and longttude coordinates of

the specific location of each of said

potential first parties lie;

means for determining the originating

telephone number of the first party

from which said telephone call is to

be routed; and

direct routing means for direct routing

said telephone call to a service loca-

tion of the second party assigned to

said originating telephone number

of the first party by said means for

assigning.

9. A method for direct routing a telephone

call from a first party who has an originating

telephone number at a specific location de-

fined by latitude and longitude coordinates

who dials a telephone number including dig-

its uniquely characteristic to a second party

having a plurality of service locations, said

method comprising the steps of:

App. 53

allocating individual latitude and longi-

tude coordinates to each originating

telephone number of all potential

first parties;

defining the boundaries of one or more

geographical areas which can be of

any size and shape according to pre-

determined criteria, each point

along said boundaries being defined

by latitude and longitude coordi-

nates;

assigning to each originating telephone

number of said potential first parties

[a telephone number] of a service | /

location of a second party that [will’]

receive calls originating from within

the boundary of a geographic area

defined in said step of defining in

which the individual latitude and

longitude coordinates of the specific

Claim 9 of the 7111 Reissue contains three printing errors.

The claim recites the word “parties” in between “service loca-

tion” and omits the terms “a telephone number” and “will.” The

published claim differs from the claim language recited in the

claims allowed by the Patent Office and submitted by the

applicant. (See Doc. No. 240, Ex. C, p. 235). The record does not

contain any evidence that a certificate of correction has issued

for this patent. The Court finds that these are clear clerical

errors due to oversight that are not subject to reasonable debate

and construes the claim as if it were properly published. Noro

Indus., L.P. v. Micro Molds Corp., 350 F.3d 1348, 1354 (Fed. Cir.

2003) (quoting 1.7:S. Rubber Co. v. Essex Rubber Co., 272 U.S.

429 (1926)). The claim language in this Order incorporates the

changes of the Reissue.

ys

App. 54

location of each of said potential first

parties lie;

determining the originating telephone

number of the first party from which

said telephone call is to be routed;

and

directly routing said telephone call to a

service location of the second party

assigned to said originating tele-

phone number of the first party by

said step of assigning.

A system for direct routing a telephone

call from a first party who has an originating

telephone number at a physical location and

who dials a telephone number including dig

its uniquely characteristic to a second party

having a plurality of service locations, said

system comprising:

means for allocating latitude and longi-

tude coordinates to the physical lo-

cation of all potential first parties;

means for defining the boundaries of one

or more geographical areas which

can be of any size and shape accord-

ing to predetermined criteria, each

point along said boundaries heing

defined by latitude and longitude

coordinates;

means for assigning to the physical loca-

tion of said potential first parties a

telephone number of a service loca-

tion of a_ second party that will

App. 55

receive calls originating from within

the boundary of a geographic area in

which the latitude and longitude co-

ordinates of the physical location of

each of said potential first parties

lie;

means for determining the originating

telephone number of the first party

from which said telephone call is to

be routed; and

direct routing means for directly routing

said telephone call to a service loca-

tion of the second party assigned to

said originating telephone number

of the first party by said means for

assigning.

29. Amethod for direct routing a telephone

call from a first party who has an originating

telephone number at a physical location and

who dials a telephone number including dig-

its uniquely characteristic to a second party

having a plurality of service locations, said

method comprising the steps of:

allocating latitude and longitude coordi-

nates to the physical location of all

potential first parties;

defining the boundaries of one or more

geographical areas which can be of

any size and shape according to

predetermined criteria, each point

along said boundaries being defined

App. 56

by latitude and longitude coordi-

nates;

assigning to the physical location of said

potential first parties a_ telephone

number of a service location of a sec-

ond party that will receive calls

originating from within the bound-

ary of a geographic area in which

the latitude and longitude coordti-

nates of the physical location of each

of said potential first parties lie;

determining the originating telephone

number of the first party from which

said telephone call is to be routed;

and

directly routing said telephone call to a

service location of the second party

assigned to said originating tele-

phone number of the first party by

said step of assigning.

41. A method of constructing a database

wherein said database is used by a telephone

service provider for direct routing a tele-

phone call from a first party who has an

originating telephone number at a physical

location and who dials one of an 800-type,

900-type or other special access code tele-

ohone number assigned to a second party,

who has determined specific locations to re-

ceive calls originating from within pre-

determined geographic areas, thereby allow-

ing the first party to reach one of a plurality

of locations of the second party hased on

App. 57

geographic location from which the telephone

call originate from within one of a plurality

of geographic areas, said method comprising

the steps of:

(a) assigning individual latitude and

longitude coordinates to the physical

location of all potential first parties;

defining the boundaries of one or

more geographic areas which can be

of any size and shape according to

predetermined criteria each point

along said boundaries being defined

by latitude and longitude coordi-

nates; and

assigning to the physical location of

said potential first parties a tele-

phone number of a service location of

a second party that will receive calls

originating from within the bound-

ary of a_ geographic territory in

which the latitude and longitude co-

ordinates of the physical location of

each of said potential first parties

lies.

(111 Reissue, col. 13, ll. 2-30; col 13. 1. 51 to col. 14, 1.

11; col. 14., Il. 32-57; col. 15, ll. 19-44; col. 16, Il. 7-34,

emphasis added). The 689 Patent issued with a

single independent claim. Claim 1 recites:

1. In a telephone system, a method of con-

structing a database wherein said database

is used by a telephone service provider ‘or di-

rect routing a telephone call from a first

App. 58

party who dials one of an 800-type, 900-type

or other special access code telephone num-

ber assigned to a second party, who has de-

termined specific locations to receive calls

originating from within pre-determined geo-

graphic areas, thereby allowing the first

party to reach one of a plurality of locations

of the second party based on geographic loca-

tion of the first party from within one of a

plurality of geographic areas, said method

comprising the steps of:

a. assigning individual latitude and

longitude coordinates to each tele-

phone number of all potential! first

parties;

b. defining the boundaries of one or

more geographic areas which can be

of any size and shape according to

pre-determined criteria;

c. assigning to the telephone number of

each potential first party a telephone

number of a specific location of the

second party that will receive calls

originating from within a_e geo-

graphic area of each first party;

d. determining in which geographic

area a potential call might originate

for each potentiai first party in the

area encompassed by all geographic

areas; and

e. assigning the specific location of the

second party to all potential first

App. 59

parties within the boundaries of

each geographic area.

(689 Patent, col. 12, 1. 64 to col. 13, l. 238, emphasis

added). The Court addresses the construction of

claims 1 and 17 of the ’111 Reissue separately below

because each of these claims recites the assigning

limitation in mean-plus-function format.

Both parties treat the underlined assigning steps

in claims 9, 17, 29, and 41 of the ’111 Reissue and

claim 1 of the ’689 Patent as substantially the same;

the Court does not. Further, Defendants’ truncation of

the assigning step improperly omits claim terms. In

each claim, the object of the gerund “assigning” is not

“to ... said first parties” but “to each originating

telephone number of said potential first parties” or

“to the physical location of said potential first parties”

or “to the telephone number of each potential first

party.” Because the Court must “must give each claim

term the respect that it is due,” it would be inappro-

priate to ignore the underlined terms. Pause Tech.,

LLC, 419 F.3d at 1334.

Nevertheless, the claims are substantially simi-

lar in that they each call for an assignment, and each

claim recites “potential first parties” or “potential

first party.” This Order addresses the latter claim

limitations first. Then, the Court will construe the

meaning of the “assigning” limitation.

App. 60

“Potential First Parties”

Defendants argue that the term “first parties”

should be understood as referring to a caller or a

person who is making a telephone call. (Doc. No. 240,

p. 4). Defendants also assert that the term “poten-

tial,” which allegedly modifies the term “first parties”

in every claim, means the “first parties” are not

actual callers, i.e., a person who has made or is

making a call, but rather a person who may make a

telephone call. (/d.). 800 Adept contends that “poten-

tial first parties” should be construed as “those par-

ties who can be assigned latitude and longitude

coordinates and can also be assigned to a destination

according to the second parties’ criteria.” (Doc. No.

268, p. 9).

Each of the independent claims of these two

patents provides the context in which to construe

“first parties.” The preambles of claims 1, 9, 17, 29

and 41 of the ’111 Reissue all recite “a telephone call

from a first party who has an originating telephone

number,” and the preamble of claim 1 of the ’689

Patent recites “a telephone call from a first party who

dials one of an 800-type, 900-type or other special

access code telephone number.” This is not to say that

the preambles act as a limitation of the claims, but

such language places the claim term in a context that

is absent from the rest of the claim. Thus, the claimed

“first parties” are colloquially “callers” or “individuals

who place telephone calls.”

App. 61

It is also clear from the specification that the

term “first parties” must refer to callers. The written

description describes “a system for automatic direct

routing of telephone calls from customers” (111

Reissue, col. 1, ll. 19-20) designed to reduce the

amount of computer interaction by “causing the call

to be direct-routed” (id. at col. 2, |. 7). It also states

that a prior art patent “requires that the caller dial

from a ‘touch-tone’ phone.” Ud. at col 2, ll. 19-20).

Under the heading “Summary of the Invention,” the

patent discloses that the “primary object of the pre-

sent invention is to provide a reliable and cost-

effective manner of directly connecting callers inter-

ested in an advertiser’s product... .” Ud. at col. 3, Il.

10-12). The abstracts and specifications repeatedly

and consistently refer to “calls” and “callers” but fail

even once to use the term “first parties” except in the

claims. (See id. passim). Put simply, the terms call

and caller are used throughout both patent specifica-

tions, and “first parties” is not. (See id. at face page).

Defendants offer two definitions for “potential”

from internet dictionaries which do not differ sub-

stantively from the definition found in the bound

dictionaries available to the Court. (See Doc. No. 240,

p. 4 n.6). Defendants’ definitions are “existing in

possibility” and “capable of development into actual-

ity.” (See id.). Plaintiffs do not offer any dictionary

definition for the term. Webster's II] New Riverside

University Dictionary defines potential as “1. Capable

of being but not yet in existence. 2. Denoting possibil-

ity, capability, or power.” WEBSTER’S Il NEW RIVERSIDE

App. 62

UNIVERSITY DICTIONARY 920 (1994). The Court of

Appeals for the Federal Circuit permits the use of

general purpose dictionarics in cases that involve

commonly understood words having widely accepted

meanings. Phillins, 415 F.3d at 1314. Such is the case

here.

The ordinary meaning of “potential” is also

consistent with the use of the term in the specifica-

tion. The term “potential” is found only within the

abstract and claims of each patent. The abstracts are

identical:

A method and system for direct routing of

telephone calls made by a caller originating

from within specific calling areas to one of a

plurality of locations of a second party ac-

cording to certain criteria established by the

second party. This routing is accomplished

based on the assignment of latitude and lon-

gituide coordinates to a potential caller’s loca-

tion. Once these coordinates are assigned to

each of the potential callers, the second

party's criteria is applied to assign the poten-

tial caller to a second party. Such criteria

could be existence within a _ previously-

defined geographic area, a custom defined

geographic area, or through calculations

such as the shortest distance between coor-

dinate points. Once all such assignments

have been made, a database is assembled to

be used by a long distance carrier for direct

routing of telephone calls from callers to an

assigned second party.

App. 63

(Id. at face page, emphasis added). Such disclosure

does not add much of substance other than indicating

the term is used as one would expect, and that the

written description of the patents does not “reveal a

special definition ... that differs from the meaning

[that the term] would otherwise possess.” Phillips,

415 F.3d at 1316.

Here, the adjective, “potential,” modifies the

meaning of the noun “parties” which has already been

modified by the adjective “first.” That is, the meaning

of “potential first parties” is a specialized meaning of

the broader term “first parties.” As discussed above,

the term “first parties” refers to a universe of callers

or individuals who place telephone calls, and the

adjective “potential” narrows that universe of indi-

viduals to those having the capability of placing a

telephone call but who have not done so. Conse-

quently, the Court construes the term “potential first

parties” to mean “individuals who can place a tele-

phone call but have not yet done so.”

“Assigning”

Defendants contend that the term “assigning”

means to specify, select, or designate or to “fix in

correspondence or relationship.” (Doc. No. 240, p. 4

n.8). Defendants argue that the patent abstracts and

figures demonstrate further that such assignment

must be accomplished before a caller places a tele-

phone call and that such assignment must be stored

in a single look-up table. (/d. at 5-8). Defendants also

App. 64

identify portions of the prosecution history that

allegedly show a disclaimer of spacial calculations

made after a caller has placed a call and a disclaimer

of database structures other than a single look-up

table. Ud. at 8-15). In addition, Defendants contend

that the Examiner’s statements concerning the scope

of the disclosure of the ’111 Reissue in an unrelated

reexamination proceeding supports the conclusion

that the claims of the ’111 Reissue are limited to

single look-up tables. (/d. at 16). The state of the art

at the time of the filing of the patent applications,

argue Defendants, also supports the limitation of

“assigning” to that of a single look-up table. (/d. at 16-

18). Lastly, Defendants assert that because Plaintiff

omitted any reference to spacial calculations made

during a call in an interrogatory response, such

omission is evidence of a disclaimer of such calcula-

tions. (Ud. at 18-19).

800 Adept contends that the abstract, figures and

other parts of the patents’ specifications do not limit

the claimed inventions to a single look-up table. (Doc.

No. 268, pp. 3-5, 6-8). On the contrary, argues Plain-

tiff, the specifications specifically recite multiple

embodiments, including relational or hierarchical

database structures. (/d. at 4). 800 Adept also criti-

cizes Defendants’ reliance on statements made in an

unreiated reexamination proceeding by the Examiner

concerning the scope of the disclosure of the ‘111

Reissue. Ud. at 5-6).

App. 65

Returning to the languages of the claims, Plain-

tiff asserts that the plain meaning of the term “as-

sign” is not limited to any one methodology. (/d. at 8).

800 Adept avers that every database query is the

equivalent of a mathematic calculation, and therefore

the database embodiments disclosed in the specifica-

tions do require “calculations” to be made after a

telephone call is placed by a caller. dd. at 10-11).

Moreover, Plaintiff argues that there is no way in

which to perform the “assign” limitation to a caller

using a mobile telephone prior to the actual telephone

call. Ud. at 11-13). Lastly, Plaintiff argues that the

passages from the prosecution history identified by

Defendants do not address the “assigning” limitation

of the claims and, in any event, do not disclaim

calculations made during a telephone call. (/d. at 14).”

Based on the above, it is apparent that there are

two general disagreements over the construction of

this claim term. First, the parties debate whether the

claims of the ’111 Reissue and ’689 Patent are limited

to a single look-up table, or in other words whether

the applicants disclaimed all embodiments except for

a database containing a single table. Secondly, the

Plaintiff also presents an argument which relies on a

portion of the Magistrate’s Markman Order which was not

adopted by the Court. (See Doc. No. 178, p. 39). Such reliance is

misplaced. In addition, Plaintiff improperly attempts to incorpo-

rate by reference arguments presented in other documents. (See

Doc. No. 268, p. 16). This practice is prohibited by Local Rule

3.01(b) which limits a response to a document to not more than

twenty (20) pages.

App. 66

parties dispute whether the assigning limitation

disclaims calculations made during the telephone

call.

As to the first issue, the Plaintiff plainly has the

better argument. The claims, specification and prose-

cution history of the ‘111 Reissue and ‘689 Patent do

not limit the term “assigning” to a single, static look-

up table. The claims do not recite the term table; they

recite the term database. The specification teaches

that the database contains fields which can be used

as natural keys and that the database structure may

be relational or hierarchal. (111 Reissue, col. 9, ll. 48-

51). Thus, the specification plainly teaches database

structures as alternatives to a single table database.

Moreover, it is well settled that “the scope of the

claims is not limited to particular embodiments

depicted in the figures.” Lighting World, Inc. v. Birch-

wood Lighting, Inc., 382 F.3d 1354, 1365 (Fed. Cir.

2004). Therefore, without more, Defendants’ argu-

ments concerning Figure 1 from the patents is with-

out merit.

Moreover, the passages selected from the patents’

prosecution history do not clearly and unambiguously

disclaim alternative database structures. See Soren-

sen v. Int'l Trade Comm’n, 427 F.3d 1375, 1378-79

(Fed. Cir. 2005) (“Disclaimers based on disavowing

actions or statements during prosecution ... must be

both clear and unmistakable.”). In each passage

quoted from the prosecution history, applicants speak

of a “database,” not a table or a single look-up table.

(See Doc. No. 240, pp. LO-11, 13).

App. 67

Lastly, the Court finds no reason to limit the

claims to a single look-up table from the statements

of the Patent Office Examiner. First, “it is the appli-

cant, not the examiner, who must give up or disclaim

subject matter that would otherwise fall within the

scope of the claims.” Sorensen, 427 F.3d at 1379

(quoting Jnnova/Pure Water, Inc., 381 F.3d at 1124).

Secondly, the Examiner’s statements in the ‘111

Reissue do not refer to a look-up table but rather to

the database of the claimed invention. It is of no

moment that the Examiner refers to the embodiment

depicted in Figure 1. That argument has no more

force in this context than when the Court construes

the claims. See Lighting World, Inc., 382 F.3d at 1365

(“[TJhe scope of the claims is not limited to particular

embodiments depicted in the figures.”). Further,

although the Examiner characterizes the ’111 Reissue

in an unrelated reexamination proceeding as imple-

menting “a telephone number to telephone number

lookup in a single table, or database,” it is clear from

the context of the statement that the Examiner was

discussing the patent’s disclosure, i.e., what the ‘111

Reissue teaches and not the scope of the claimed

invention. (See Doc. No. 240, p. 16 n.33 & 7.34).

“Specifications teach. Claims claim.” SRI/ Intl v.

Matsushita Elec. Corp. of Am., 775 F.2d 1107, 1121

n.14 (Fed. Cir. 1985).

The parties also dispute whether the assigning

limitation disclaims calculations made during the

telephone call, and both parties delve into the prose

cution history and state of the art to support their

App. 68

positions. The Court addresses this dispute in two

parts. First, the Court must determine when the

“assigning” step occurs. Then, the Court determines

whether there is a disclaimer of the scope of the

claims.

The answer to the first question starts with the

language of the claims. The claims of the ’111 Reissue

recite “assigning to leach originating telephone

number‘ or the physical location’) of said potential

first parties a telephone number of a service location

of a second party that will receive calls originating

from within the boundary of a geographic area.”

Similarly, claim 1 of the 689 Patent recites “assigning

to the telephone number of each potential first party

a telephone number of a specific location of the sec-

ond party that will receive calls originating from

within a geographic area of each first party.”

“Assigning” is a commonly used and widely

understood word. See Phillips, 415 F.3d at 1314. It

means “to set aside for a particular purpose” or

“designate.” WEBSTER’S Il NEW RIVERSIDE UNIVERSITY

DICTIONARY 131 (1994). It is clear upon review of the

specification that the patent uses the term in a man:

ner consistent with its ordinary meaning without

' This is the languave used in claim | and claim 9 of the

111 Reissue

This language is used in claim 17, claim 29, and claim 4]

of the ‘111 Reissue

App. 69

providing a more specialized meaning. See Philips,

415 F.3d at 1366.

As discussed above, the term “potential first

parties” refers to individuals who can place a tele-

phone call but have not done so. The use of the term

“potential first parties” strongly suggests that the

assignment occurs prior to the caller placing a tele-

phone call. In addition, each and every one of the

claims uses the future tense, i.e., “the second party

that will receive calls.” The use of the future tense in

the claims also suggests that the event described by

the verb, 1.e., the call, has not happencd yet.

A review of the specification also supports the

conclusion that the assignment occurs prior to the

placement of the telephone call. The °111 Reissue

teaches that once a telephone call has been placed by

an individual, a local exchange carrier contacts a long

distance carrier (“LDC”) for routing instructions. (7111

Reissue, col. 4, 1. 60 to col. 5, 1. 20). The LDC retrieves

the routing instructions from its own network control

point (“NCP”) and passes those instructions back to

the local exchange carrier. (/Jd.). The specification

teaches that the NCP contains “all of the direct

routing instructions for the WATS number.” (/d.; see

also id., col. 5, ll. 24-51: id., col. 5, ll. 45-53; rd., col. 8,

ll. 14-22; id., col. 8, ll. 39-48; id., col. 8, 1. 64 to col. 9, 1.

6; id., col. 9, ll. 23-32).

The specification also teaches the steps required

to prepare the NPC for its role in this system. The

written description discloses that “/a/fter defining the

App. 70

trade areas, assigning the corresponding NPA-NXX

(or NPA-NXX-XXXX) combinations and submitting

the appropriate direct routing information to the

chosen LDC, the system (network) is activated.” (/d.,

col. 12, ll. 38-41, emphasis added). In other words, the

LDC does not receive the routing instructions that

are stored in the NCP until after the assignment step

is complete.

The abstract also supports this claim construc-

tion. It discloses:

Once these coordinates are assigned to each

of the potential callers, the second party’s cri-

teria is applied to assign the potential caller

to a second party.... Once all such assign-

ments have been made, a database is assem-

bled to be used by a long distance carrier for

direct routing of telephone calls from callers

to an assigned second party.

Ud. at face page, emphasis added).

Consequently, the language of the claims when

read in light of the specification refers to “a designa-

tion made prior to the telephone call of the first

parties.”

The Court also considers whether the applicant

disclaimed calculations made after the telephone call.

Nothing in the above analysis indicates that the appli-

cant must have disclaimed further calculations. Indeed,

the specification contemplates further processing

App. 71

where the call is placed from a mobile telephone.” (/d.,

col. 6, 1. 59 to col. 7, 1. 2).

Additionally, the prosecution history does not

expressly and unambiguously disclaim all calcula-

tions made after a telephone call is placed. In distin-

guishing a prior art reference, the applicant stated:

A second major distinction between Finu-

cane, et al. patent and Applicant’s system is

that Finucane, et al. requires that a com-

puter verform “point of origin” to “point of

termination” calculations while the caller is

on the line. ...

On the other hand, Applicant’s Direct Rout-

ing Telephone System performs all such cal-

culations prior to the call even being made

and, in fact, prior to the delivery of the data

base [sic] to the Long Distance Carrier

(LDC).

(Doc. No. 240, Ex. C, pp. 123). Similar statements are

quoted by Defendants on pages 9 to 13 of docket

number 240. These statements are, at best, ambigu-

ous. They might refer to the timing of the “assigning”

step or they might refer to the disclaimer of post

telephone call calculations. The Court finds the

former is the better view in light of the disclosure

of the specification as a whole. In any event, such

' Plaintiff’s argument concerning the “cell phone embodi-

ments” supports only the proposition that further calculations

were contemplated once the technology was available.

ambiguity prevents the applicant’s statements in the

prosecution history from serving as a disclaimer of

claim scope.

Means-Plus-Function Limitations

Neither party offers the Court an argument

concerning the means-plus-function limitations

recited in claim 1 and claim 17 of the ’111 Reissue. In

order to construe these claims, the Court must iden-

tify the function of the limitation and then determine

the corresponding structure disclosed in the specifica-

tion. Medtronic, Inc., 248 F.3d at 1311. In addition,

the Court must identify whether the corresponding

structure is clearly linked or associated with the

recited function. /d.

The Court grants leave to each party to submit

one five (5) page memorandum on this issue. The

memorandum shall (1) identify the function, (2)

identify the corresponding structure disclosed in the

specification, and (3) identify whether the correspond-

ing structure is clearly linked or associated with the

recited function.

The Shaffer-Moore Patents

The parties also dispute the meaning of the term

“spatial key” which appears in the claims of nearly all

of the Shaffer-Moore Patents. Defendants’ proposed

definition is “a single number that identifies a small,

specific geographically defined area, line, or point

App. 73

that is defined by a set or sets of coordinates.” (Doc.

No. 240, pp. 19-20). In support of this definition,

Defendants point to the use of the term in the specifi-

cation of the patents and to the construction given to

this term by the United States District Court for the

Eastern District of Virginia. (/d. ).

800 Adept argues that “spacial key” should be

construed as that term was defined in the Shaffer-

Moore Patents. (Doc. No. 268, pp. 17-20). Plaintiff

contends that it would be inappropriate to insert

“small” in the definition of this term because (1) the

specification does not limit spacial keys to “small”

geographic areas but merely calls these “preferred” or

“unique,” (2) “small” adds nothing to the definition

because it is a relative term, and (3) the ruling of the

District Court of the Eastern District of Virginia is

not binding on this Court. (/d.).

Although the Court recognizes that a uniform

treatment of claim construction is desirable, the claim

construction of another district court in no way binds

this Court under the instant circumstances. The

parties provide only a single Order of the Court,

without its reasoning, discussion of the arguments of

the parties, or reference to the underlying facts. The

claim construction of the Virginia District Court was

not appealed to the Federal Circuit. Defendants do

not provide any authority that would afford that

Order preclusive effect. Defendants do not argue that

issue preclusion, collateral estoppel, or judicial estop-

pel are applicable. Simply put, this Court “will render

its own independent claim construction.” See Maurice

App. 74

Mitchell Innovations, L.P. v. Intel Corp., 2006 WL

1751779, *4 (E.D. Tex. 2006).

The Court construes “spacial key” as that term is

taught in the specification of the ‘897 Patent. It is

defined there as:

The spacial key is a single number that iden-

tifies a specific geographically defined area,

line, or point that is defined by a set of coor-

dinates.

(‘897 Patent, col. 9, ll. 39-42). The specification dis-

closes that the spacial key can be “a coded version of

the coordinate description of” “simple geographies

like points and rectangles.” (/d., col. 9, Il. 43-45).

Further, the specification teaches:

The postal zip+4 code is the preferred spacial

key used to link the master table to the cli-

ent table, but there are other small geo-

eraphic areas capable of having unique

spacial keys, such as zip+6 code areas, cen-

sus blocks, or very small latitude/longitude

grids, tiles, windows, or quad-trees.

(Id., col. 9, \l. 46-50). Except ior this single reference,

the figures, tables, and disclosure of the specification

only disclose the use of a zip+4 code as a spacial key.

(See id., col. 11, 1. 45 to col. 12, 1. 12; id., col. 12, ll. 40-

50; id., col. 13, ll. 8-30; id., col. 17, ll. 29-33; id., col.

21, ll. 38-40; id., col. 24, ll. 13-16; td., col. 24, ll. 30-

34).

The specification also characterizes the operation

of prior routing systems and their problems. Prior art

systems, the applicants note, “are very coarse in their

level of precision and cannot handle small service

areas with legally defined franchise territories like

pizza delivery.” Ud., col. 3, ll. 35-37). Another problem

with prior art routing systems “is that they divide the

United States into many large arbitrarily defined

areas and there is no ability to route a call to the

closest service location if the closest location is not

located in the same artificially created area as the

caller.” Ud., col. 3, ll. 48-52). Moreover, the specifica-

tion teaches that the desired system should “not use

artificially created areas such as telephone wire

centers, teiephone prefixes, or 5-digit zip codes where

calls can only be routed within their area.” (/d., col. 3,

ll. 56-59). The specification also characterizes U.S.

Postal Service zip+4 codes as “small geographic

areas” and the first six digits of the Automatic Num-

ber Identification system as designating a “fairly

large” area. (Ud., col. 4, ll. 53-56; id., col. 4, Il. 64-67).

Accordingly, two strands wind through the disclo-

sure of the Shaffer-Moore Patents. On the one hand,

the Shaffer-Moore Patents teach that a spacial key is

a single number that identifies a specific geographic

area. The size of the geographic area is omitted; it is

the specificity or “uniqueness” of the area that is

important. On the other hand, the specification also

systematically discloses the advantages of choosing

“small” geographic areas to use a spacial keys. In

particular, the use of telephone exchange numbers

and five-digit zip codes is disparaged while the use of

zip+4 and similarly-sized or smaller geographic areas

App. 76

1s touted. Nevertheless, there is no explicit or mani-

fest disclaimer in the specification requiring that

spacial keys must be small, specific geographically-

defined areas.

The Federal Circuit instructs courts that “the

claims of the patent will not be read restrictively

unless the patentee has demonstrated a clear inten-

tion to limit the claim scope using words or expres-

sions of manifest exclusion or restriction.” Liebel-

Flarsheim Co. v. Medrad, Inc., 358 F.3d 898, 907-08

(Fed. Cir. 2004) (quotation omitted). Last year, the

Federal Circuit followed this maxim in Gillette Co. v.

Energizer Holdings, Inc., 405 F.3d 1367, 1374 (Fed.

Cir. 2005).

In that case, the patent-in-suit claimed a wet-

shave safety razor with multiple blades. /d. at 1369.

‘safety razor com-

Specifically, the patent claimed a

prising ...a group of first, second, and third blades,”

but the defendant manufactured a four-blade safety

razor. Jd. After reviewing the patent specification, the

District Court limited the scope of the claim to a razor

having solely three-blades. Jd. On appeal, the Federal

Circuit reversed this claim construction. /d. at 1374.

After discussing the use of open language in,the

claim, the Court focused on the patent’s wzcitten

description. Jd. at 1373. The specification, noted the

Court, first characterized the scope of the invention

broadly when it taught that the invention relates to

safety razors having blade units with a plurality of

blades. Jd. The Court then emphasized that although

App. 77

the specification makes numerous references to a

preferred embodiment with three blades, such “nar-

rower embodiment does not impose a limit on the

broader claim language as elucidated by the reference

to ‘the invention’ as embracing a ‘plurality of blades.’”

Id. at 1374. Additionally, despite the numerous cites

to three-bladed razors plucked from the written

description, the Court noted that “no statement in the

?

patent surrenders or excludes a four-bladed razor.’

Id.

The written description of the Shaffer-Moore

Patents is similar to the written description at issue

in Gillette. In each case, the written description

broadly defines a claim term but nonetheless provides

a disclosure of examples of limited scope. As in Gil-

lette, this Court will construe the term broadly be-

cause there is no explicit or manifest disclaimer of

claim scope in the Shaffer-Moore Patents.

Accordingly, the Court construes “spacial key” to

mean “a single number that identifies a specific

geographically defined area, line, or point that is

defined by a set of coordinates.”

Conclusion

Based on the foregoing, the Court GRANTS

Defendants’ Markman Motion (Doc. No. 240) and

rules as follows:

App. 78

As recited in the ’111 Reissue and the ’689

Patent, the term “potential first parties” re-

fers to “individuals who can place a tele-

phone call but have not yet done so”;

As recited in the ’111 Reissue and the 689

Patent, the term “assigning” refers to “a des-

ignation made prior to the telephone call of

the first parties”;

>

As recited in the Shaffer-Moore Patents, the

term “spacial key” refers to “a single number

that identifies a specific geographically de-

fined area, linc, or point that is defined by a

set of coordinates”; and

The parties shall within five (5) days of the

date of this Order file with the Court a

memorandum addressing the means-plus-

function claims of the “lll Reissue. The

memorandum of each party shall be no more

than five (5) pages in length and _ shall

(1) identify the function, (2) identify the

corresponding structure disclosed in the

specification, and (3) identify whether the

corresponding structure is clearly linked or

associated with the recited function. The op-

posing party may then file a memorandum in

opposition within ten (10) days of the date of

this Order. A memorandum in opposition

shall also be no more than five (5) pages in

length.

App. 719

DONE and ORDERED in Chambers in Orlando,

Florida on August 3, 2006.

/s/ Patricia C, Fawsett

PATRICIA C. FAWSETT,

CHIEF JUDGE

UNITED STATES

DISTRICT COURT

Copies furnished to:

Counsel of Record

App. 80

UNITED STATES DISTRICT COURT

MIDDLE DISTRICT OF FLORIDA

ORLANDO DIVISION

800 ADEPT, INC., and

ADEPTEL, INC.,

Plaintiffs/Counter-

Defendants,

“a Case No.

MUREX SECURITIES, LTD., 6:02-cv-1354-

MUREX LICENSING CORPO. Orl-28DAB

RATION, TARGUS INFORMA-

TION CORPORATION, and

WEST CORPORATION,

Defendants/Counter-

Plaintiffs.

ORDER

(Filed Apr. 12, 2007)

This case comes before the Court for ruling on

the following:

1. Motion (And Memorandum) For Entry of Final

Judgment, An Award Of Prejudgment Interest

And A Permanent Injunction (Doc. No. 430, filed

November 8, 2006);

Motion And Memorandum To Award Plaintiff’s

Attorneys’ Fees (Doc. No. 431, filed November 9,

2006);

Defendants’ Combined Response To Plaintiff's

Motions For Entry Of Final Judgment, An Award

App. 81

Of Prejudgment Interest, A Permanent Injunc-

tion, And Attorneys’ Fees (Doc. No. 442, filed No-

vember 29, 2006);

Plaintiff’s Motion And Memorandum ‘To Strike

Improper Submissions Contained in Docket No.

442 (Doc. No. 448, filed December 12, 2006); and

Defendants’ Opposition To Plaintiff's Motion And

Memorandum To Strike Improper Submissions

Contained In Docket No. 442 (Filed At Docket

448) (Doc. No. 452, filed December 26, 2006).

I. Background of the Case

After a twenty-four day trial, a jury found that

Defendants, Murex Securities, Ltd., Murex Licensing

Corporation, and ‘TARGUS Information Corporation

(“the Murex-Targus Parties”), willfully infringed

claims from twe United States patents owned by

Plaintiff 800 Adept, Inc. (“800 Adept”). More specifi-

cally, the jury found that the Murex-Targus Parties

willfully infringed claims 1-19, 22-27, 29, 31, 34-39,

41, 43, and 46-51 of U.S. Patent No. RE36,111 (“the

111 Reissue”) and claims 1 and 3-5 of U.S. Patent No.

5,805,689 (“the ’689 Patent”). (Doc. No. 425, pp. 1-4).

The jury found that such claims of the °111 Reissue

and the ’689 Patent were not invalid, and the Court

determined later that the subject patents were not

unenforceable. (Jd. at 2-3; Doc. No. 470, filed April 2,

2007). For such infringement, the jury determined

that the Murex-Targus Parties’ should pay

$18,000,000.00 in damages to 800 Adept. (/d. at 3).

The jury also found that Defendant West Corporation

App. 82

(“West”) infringed claims 1-19, 22-27, 29, 31, 34-39,

41. 43, and 46-51 of the ’111 Reissue.’ (/d. at 2). The

jury found that West did not willfully infringe such

claims and that it should pay 800 Adept $48,000.00 in

damages. (See Doc. No. 425, pp. 3-4).

800 Adept now asks this Court to (1) award

prejudgment interest on its claims, (2) enjoin the

Murex-Targus Parties’ from engaging in further acts

of infringement, (3) award enhanced damages against

the Murex-Targus Parties, and (4) an award of attor-

neys’ fees under Title 35 U.S.C. § 285. (Doc. Nos. 430,

431). In addition to the above remedies, 800 Adept

also requests that the Court enter final judgment in

this case.

II. Prejudgment Interest

800 Adept’s request for prejudgment interest

actually concerns two separate issues and two sepa-

rate bodies of law, although neither 800 Adept nor the

Targus-Murex Parties and West bring this to the

Court’s attention. The Court considers first 800

Adept’s request for prejudgment interest on its suc-

cessful state law tort claims and then whether to

award prejudgment interest for 800 Adept’s patent

infringement claims.

The jury was charged with instructions detailing both

direct and indirect infringement

800 Adept docs not seck to cnjoin the actions of West

App. 83

A. Prejudgment Interest For Florida Tort

Claims

Florida courts consider prejudgment interest an

element of pecuniary damages under the “loss the-

ory.” Argonaut Ins. Co. v. May Plumbing Co., 474 So.

2d 212, 215 (Fla. 1985); see also Gilchrist Timber Co.

v. ITT Rayonier, Inc., 472 F.3d 1329, 1331 (11th Cir.

2006). There are two prerequisites to the award of

prejudgment interest as damages: (1) an out-of-pocket

pecuniary loss and (2) a fixed date of loss. Underhill

Fancy Veal, Inc. v. Padot, 677 So. 2d 1378, 1380 (Fla.

Dist. Ct. App. 1996). Prejudgment interest is gener-

ally not awarded, however, for tort damages because

such damages are generally too speculative to liqui-

date before final judgment. Lumbermens Mut. Casu-

alty Co. v. Percefull, 653 So. 2d 389 (Fla. 1995); see

also Nat'l R.R. Passenger Corp. v. Roundtree Trasp. &

Rigging, Inc., 286 F.3d 1233, 1259 (11th Cir. 2002).

This rule is not absolute, however, and prejudgment

interest may be awarded for tort damages where

there has been an ascertainable, out-of-pocket loss

occurring at a specific time prior to the entry of the

judgment. See Underhill Fancy Veal, Inc., 677 So. 2d

at 1380: see also Alvarado v. Rice, 614 So. 2d 498 (Fla.

1993). Prejudgment interest also can be awarded in

tort cases where there is a loss of vested property

right, such as claims involving the negligent destruc

tion of a building, the wrongful withholding of sales

commissions, or a subcontractor’s mechanic’s lien. See

Alvarado, 614 So, 2d at 499.

App. 84

In the instant case, 800 Adept has not shown

that it has suffered an ascertainable, out-of-pocket

loss related to its state tort claims at a time prior to

the entry of judgment or that it suffered the loss of a

vested property right. 800 Adept’s theory of liability

on its state law claims revolved around Defendants’

actions toward five different third parties whom, at

one time, had business relationships with 800 Adept.

Ms. Denise Dauphin, the financial expert for 800

Adept on the subject of damages, opined at trial that

800 Adept had lost over $3.4 million in revenues from

the Murex-Targus Parties’ tortious interference with

these five customers. (October 20, 2006 Testimony of

Denise Dauphin, hereinafter “Dauphin Test.”). Of this

amount, Ms. Dauphin testified that lost profits repre-

sented approximately $2,239,973.00 or, when dis-

counted, $1,863,999.00. (7d. ).

The jury, however, determined that 800 Adept

should be awarded $2,000,000.00 for the Murex-

Targus Parties’ tortious interference, an amount that

is greater than Ms. Dauphin’s discounted lost value

calculations but Jess than her lost revenue and her

non-discounted lost profits calculation. It is unclear

from the verdict whether the jury did not adopt the

rate at which Ms. Dauphin discounted 800 Adept’s

lost profits; whether the jury did not adopt the rate at

which Ms. Dauphin calculated lost profits from 800

Adept’s lost revenue; or whether the jury based its

finding of tortious interference on less than all of the

business relationships asserted by 800 Adept. Criti-

cally, because the Court cannot determine from the

App. 85

general verdict which relationship(s) was the basis

for the jury’s finding of damages, it also cannot ascer-

tain a date upon which 800 Adept’s liability may

spring. See, e.g., Perdue Farms Inc. v. Hook, 777 So.

2d 1047, 1054-55 (Fla. Dist. Ct. App. 2001) (finding

that it was impossible to determine any date upon

which the plaintiff was injured in a claim for unjust

enrichment where the jury could have chosen one of a

number of dates but did not). The Court, therefore,

determines that 800 Adept is not entitled to prejudg-

ment interest on its state law claim of tortious inter-

ference.

B. Prejudgment Interest For Patent In-

fringement Claims

Title 35 U.S.C. § 284 provides that, upon finding

a claim of patent infringement, courts “shall award

the claimant damages adequate to compensate for the

infringement, ... together with interest and costs as

fixed by the court.” This provision, according to the

U.S. Supreme Court, compels courts to ordinarily

award prejudgment interest so that the patent holder

would be in as good a position as it would have been

had the infringer entered into a reasonable royalty

agreement. See Gen. Motors Corp. v. Devex Corp., 461

U.S. 648 (1983). Thus, the Court found that prejudg-

ment interest should be awarded under Section 284

absent some justification for withholding such award.

Id. at 657.

App. 86

However, Section 284 does not require the award

of prejudgment interest whenever infringement is

found. Jd. The statute provides that “interests and

costs” should be “fixed by the court”, which the Su-

preme Court has construed to leave some discretion

to the district court in awarding prejudgment inter-

est. Id. “For example, it may be appropriate to limit

prejudgment interest, or perhaps even deny it alto-

gether, where the patent owner has been responsible

for undue delay in prosecuting the lawsuit.” Jd. The

Court of Appeals for the Federal Circuit interprets

this reasoning to mean that the justification for

withholding prejudgment interest must have some

relation to the reasons for awarding it. See Radio

Steel & Mfg. Co. v. MTD Prods., Inc., 788 F.2d 1554,

1558 (Fed. Cir. 1986).

In this case, it is clear that 800 Adept and the

Murex-Targus Parties knew that each was a potential

competitor of the other party from a very early date.

By November of 1996, the principals of both sides,

Juan Sierra for 800 Adept and George Moore for the

Murex-Targus Parties, had exchanged correspon-

dence. (September 21, 2006 Testimony of Juan Sierra,

hereinafter “Sep. 21 Test.”).

A few months later, in December of 1996, the

U.S. Patent and Trademark Office (“Patent Office”)

issued to 800 Adept the original patent of the ‘111

Reissue, U.S. Patent No. 5,588,048 (“the ’048 Pat-

ent”). (See Def. Ex. 13). Although 800 Adept would

later assert claims against the Murex-Targus Parties

that originally appeared in the ’048 Patent, it did not

App. 87

do so in 1996 or 1997. 800 Adept filed a broadening

reissue application for the 048 Patent on May 21,

1997, and the Patent Office reissued the 048 Patent,

with a number of new claims, as the ’111 Reissue on

February 23, 1999. In addition, the Patent Office

issued the 698 Patent on September 8, 1998.

In 1997, Juan Sierra received information from

Ross Shanken, who was then acting as a salesperson

for the Murex-Targus Parties, about the Murex-

Targus Parties’ services. (Sep. 21 Sierra Test.). Mr.

Shanken had called Mr. Sierra to sell the Murex-

Targus Parties’ services to 800 Adept. (Ud.). “In-

trigued”, Mr. Sierra requested that the Murex-Targus

Parties’ technical people meet with 800 Adept’s tech-

nical people. (/d.). James Shaffer, who was one of the

representatives from the Murex-Targus Parties,

divulged to 800 Adept at the subsequent meeting that

Targus possessed a database of about 125 million geo-

coded telephone numbers and that a large number of

additional numbers were assigned proxy locations,

which struck Mr. Sierra as “as being a near identical

copy of predominance.” (Sep. 21 Test.”).

In September of 1997, 800 Adept, through its

attorney, contacted Western Interactive Media, which

was later known as Patriot Communications (“Pa-

triot”), about allegedly infringing telephone call

routing services that Patriot provided its customers.

Patriot served as the marking company for another

closely-related entity, Access Long-Distance, which acted as the

(Continued on following page)

App. 88

(Def. Ex. 174). In response, Patriot chose to terminate

its relationship with the Murex-Targus Parties, with

whom it had contracted for its telephone cail routing

services, and use the technology of 800 Adept. (Def.

Ex. 176; September 22, 2006 Testimony of Juan

Sierra, hereinafter “Sep. 22 Sierra Test.”). In so doing,

Patriot asked that 800 Adept provide each “routing

solution” in the format that had been supplied by the

Murex-Targus Parties.’ Thus, by the end of 1997, 800

Adept understood that the Murex-Targus Parties

were providing information for telephone routing

services, including the latitude and longitude of

individual telephone numbers. (See Sep. 22 Sierra

Test. ).

After this time, 800 Adept began to assert its

patent rights in the marketplace. In May of 2000, 800

Adept, acting again through its attorney, advised

Budget Group, Inc. (“Budget”) that its plan to obtain

call routing services from the Murex-Targus Parties

telecommunications platform for routing services. (Sep. 21

Sierra Test.). For simplicity, the Court will refer to both compa-

nics as Patriot in this Order.

' The “routing solution” references the instructions that are

used by the telecommunication platform to route the telephone

call or the information that the telecommunications platform

needed to calculate such solution. At this time, 800 Adept was

supplying a plurality of such routing solutions in a single-table

database to its customers. The Murex-Targus Parties, on the

other hand, developed a query-based business model in which its

customers would not be provided a database but would instead

contact a server maintained by the Murex-Targus Parties for

routing solutions, as needed.

App. 89

potentially infringed 800 Adept’s patents. (Def. Ex.

228). By July of 2000, both Targus and AT& T re-

sponded to 800 Adept’s letter and denied that the

telephone routing system which they offered Budget

infringed 800 Adept’s patent claims. (Def. Exs. 230,

231). In this correspondence and correspondence

regarding the patents owned by the Murex-Targus

Parties, 800 Adept and its attorney argued positions

of infringement and validity that were different than

those ultimately relied upon by 800 Adept’s counsel in

this case.

Moreover, during this time, the Murex-Targus

Parties developed and began to market the telephone

call routing systems that were found to be infringing

by the jury in this case. Unlike the routing system

initially developed by 800 Adept, the Murex-Targus

Parties developed a query-based business model that

delivered each routing solution to its customers upon

their request. The Murex-Targus Parties revenue

from its routing customers grew from 1997 until

2005.

800 Adept did not initiate this lawsuit until

November 13, 2002.”

* Juan Sierra maintained at trial that 800 Adept is a small

company with limited financial resources that would be at a

disadvantage if brought into a Jawsuit against the large, well-

funded operation of the Murex-Targus Parties. (September 22.

2006 Testimony of Juan Sierra). Contemporaneous correspon-

dence supports Mr. Sierra's testimony. (Def. Ex. 176).

App. 90

This lawsuit was the result of a long-running and

contentious dispute between two competitors in the

field of telephone call routing services. 800 Adept

knew or should have known, based on the evidence

adduced at trial and more particularly upon the

testimony of Juan Sierra, its principal and owner,

that the Murex-Targus Parties were providing poten-

tially infringing services to third parties as early as

1997.

Even assuming that 800 Adept would not be in a

position to assert its patent rights until after the

Patent Office issued the *111 Reissue on February 23,

1999," 800 Adept still waited almost three years and

nine months to file this lawsuit. There is precedent

which views delay as a self-serving litigation tactic

that causes damages to escalate and prejudices

infringers. Crystal Semiconductor Corp. v. TriTech

Microelectronic Int'l, Corp., 246 F.3d 1336, 1362 (Fed.

Cir. 2001) (holding that a two year delay in bringing a

patent infringement suit prejudiced the infringer and

constituted an undue delay). The delay in the instant

case might not nave been an intentional litigation

tactic, but it nonetheless prolonged resolution of th

By 1998, the Patent Office had issued the ‘689 Patent,

claims from which 800 Adept also asserted in the instant case.

The evidence a tral shows that 800 Adept did not file

this lawsuit until after ¢ Murex-Targus Parties began assert-

ing their patent rights against 800 Adept’s customers. Although

there is sufficient evidence of record for the jury to find that the

Murex-Targus Parties’ actions were part of a broader scheme to

(Continued on following page

App. 91

underlying business dispute. During the delay, 800

Adept’s attorney took positions on its patents that

were different from those that were successfully

asserted by 800 Adept at trial. Further, during the

delay, the Murex-Targus Parties were investing In a

telephone routing system based on a different busi-

ness model than 800 Adept and were developing their

presence in the marketplace. In view of these circum-

stances, the Court declines to award 800 Adept

prejudment interest for its claims of patent infringe-

ment.

Ilf. Permanent Injunction

Title 35 U.S.C. § 283 provides that “[tlhe several

courts having jurisdiction of cases under this title

may grant injunctions in accordance with the princi-

ples uf equity to prevent the violation of any right

secured by patent, on such terms as the court deems

reasonable.” The standard for a permanent injunction

is essentially the same as for a preliminary injunction

except that the plaintiff must show actual success on

the merits instead of a likelihood of success. See

Amoco Prod. Co. v. Village of Gambell, 480 U.S. 531,

546 n. 12 (1987). The Supreme Court recently made

clear that courts should apply the traditional four-

factor t used by court of equity when considering

whether to award permanent injunctive relief to a

isolate 800 Adept from its customers, 800 Adept still Celayed

filing suit a significant period of time.

App. 92

prevailing patent holder. See eBay, Inc. v. Merckx-

change, L.L.C., _. U.S. — ., —., 126 &. Ct. 1637,

1839 (2006). The patent holder must demonstrate:

“(1) that it has suffered an irreparable injury; (2) that

remedies available at law, such as monetary dam-

ages, are inadequate to compensate for that injury;

(3) that, considering the balance of hardships be-

tween the plaintiff and defendant, a remedy in equity

is warranted; and (4) that the public interest would

not be disserved by a permanent injunction.” /d. The

Court held that “the discretion whether to grant or

deny injunctive relief rests within the equitable

discretion of the district courts, and that such discre-

tion must be exercised consistent with traditional

principles of equity, in patent disputes no less than in

other cases governed by such standards.” Jd. at 1841.

A. Application of the Traditional Four-

Part Test

1. Irreparable Harm

Irreparable harm is intended to serve as a meas-

ure of the quality or severity of harm that is neces-

sary to trigger equitable intervention. /d. The Murex-

Targus Parties assert that 800 Adept’s delay in filing

the instant lawsuit demonstrates a lack of irreparable

harm. (Doc. No. 442, pp. 16-17). In support, the

' As far as the Court can discern from the extensive record

in the instant case, the Murex-Targus Parties have never to date

argued that 800 Adept’s claims are barred by the equitable

(Continued on following page)

App. 93

Murex-Targus Parties point to a number of court

opinions whicl. consider, on motion for a preliminary

injunction, the relationship between the nature of

alleged harm and movant’s delay in seeking injunc-

tive relief. (/d.). The Court, too, has found a large

number of cases that discuss the consideration that

may be given to a movant’s delay when determining

irreparable injury in the context of a preliminary

injunction, but the Court’ research has uncovered

only one opinion that considered such delay on mo-

tion for a permanent injunction.”

doctrine of laches. See, e.g., A.C. Aukerman Co. v. R.L. Chaides

Constr. Co., 960 F.2d 1020, 1032 (Fed. Cir. 1992). Accordingly,

the Court deems such an argument waived if the Murex-Targus

Parties are attempting to raise it here in the first instance.

” See TiVo, Inc. v. Echostar Commce’ns Corp., 446 F. Supp.

2d 664, 670 (E.D. Tex. 2006) (finding that such argument is

irrelevant in the context of a permanent injunction). All other

opinions addressed delay in the context of preliminary injunc-

tions. See, e.g., Polymer Techs., Inc. v. Bridwell, 108 F.3d 970

(Fed. Cir. 1996) (finding four month delay does not rebut a

presumption of irreparable harm in the context of a preliminary

injunction); High Tech Med. Inst., Inc. v. New Image Indus., Inc.,

49 F.3d 1551 (Fed. Cir. 1995) (a seventeen month delay militates

against a finding of irreparable harm in a request for prelimi

nary injunction); Nutrition 21 vu. United States, 930 F.2d 867

(Fed. Cir. 1991) (finding patent holder’s “substantial period” of

delay negates a finding of irreparable harm for preliminary

injunction); T.J. Smith & Nephew Ltd. v. Consol. Med. Equip.,

Ine., 821 F.2d 646 (finding fifteen month delay militates against

a finding of irreparable harm in the context of a preliminary

injunction); Atari Corp. v. Sega of Am., Inc., 869 F. Supp. 783

(N.D. Cal. 1994) (failure to show irreparable harm where the

(Continued on following page)

App. 94

Of course, both types of injunctive relief look

toward the future. See Dombrowski v. Pfister, 380

U.S. 479, 485 (1965); United Stateasv. Or. State Med.

Soc’y, 343 U.S. 326, 333 (1952) (“The sole function of

an action for injunction is to forestall future viola-

tions.”). The purpose of preliminary injunctive relief

is to restrain or compel conduct in those extraordi-

nary situations where irreparable injury might result

from inaction or delay. See Alabama v. U.S. Army

Corps of Eng’rs, 424 F.3d 1117, 1133 (llth Cir. 2005).

It also serves to preserve the relative positions of the

parties until a trial on the merits. /d. In this regard,

the Court of Appeals for the Eleventh Circuit has

called irreparable harm the sine qua non of injunctive

relief. Jd. at 1133 (quoting N.E. Fla. Chapter of Ass’n

of Gen. Contractors of Am. v. City of Jacksonville, 896

F.2d 1283, 1285 (11th Cir. 1990)). The harm consid-

ered by the Court, however, is “confined to that which

might occur in the interval between ruling on the

preliminary injunction and trial on the merits.” Jd. at

1134.

A permanent injunction, in contrast, can issue

only after the right to injunctive relief has been

firmly established at a trial on the merits of the

movant’s claims. Amoco Prod. Co., 480 U.S. at 546 n.

12. Although irreparable harm is an essential finding

where the movant seeks a preliminary injunction, a

patent holder delaved over seven years before requesting

preliminary injunctive relich

App. 95

request for a permanent injunction usually turns on

the unavailability of an adequate remedy at law. See

Lewis v. S.S. Baune, 534 F.2d 115, 1123-24 (5th Cir.

10 : ° . ©

1976). Irreparable injury is one basis, however, for

showing the inadequacy of any legal remedy, and as

noted by the Court of Appeals for the Fifth Circuit,

“lolften times the concepts of ‘irreparable injury’ and

‘no adequate remedy at law’ are indistinguishable” in

the context of a permanent injunction.’ /d. at 1124.

With this background in mind, the argument of

the Murex-Targus Parties concerning 800 Adept’s

delay is much more persuasive in the context of a

preliminary injunction. There, a court must carefully

weigh harm that is imminent or that which arises in

inaction with the goal of maintaining the status quo

between the parties. A court confronted with a

movant who unreasonably delayed seeking such relief

should rightly question whether the request for a

preliminary injunction was to address an irreparable

injury rather than a shrewd litigation tactic. Here, in

contrast, 800 Adept has established the merits of its

claims, and its past conduct does little, if anything, to

inform the question of whether 800 Adept will be

The Eleventh Circuit adopted as binding precedent all

cases decided by the Former Fifth Circuit Court of Appeals prior

to the close of business on September 30, 1981. Bonner v, City of

Prichard, 661 F.2d 1206, 1207 (11th Cir. 1981)

For a more thorough discussion of the countervailing

considerations for granting preliminary injunctive relief and

permanent injunctive relief, see Douglas Laycock, The Death of

the [rreparable Injurv Rule, 103 HAry. L. REV. 687 (1990)

App. 96

harmed by any future acts of infringement by the

Murex-Targus Parties. See TiVo, Inc. v. Echostar

Comme’ns Corp., 446 F. Supp. 2d 664, 670 (F.D. Tex.

2006).

Furthermore, even assuming the body of law

concerning delay in preliminary injunction cases

applies here, a showing of delay alone does not pre-

clude a determination of irreparable harm. Hybrid-

tech Inc. v. Abbott Labs., 849 F.2d 1446, 1457 (Fed.

Cir. 1988). A patent holder’s delay is only one factor

that the Court must consider within the totality of

the circumstances. /d.

In the instant case, 800 Adept and the Murex-

Targus Parties are competitors in the market for

telephone call routing services. A competitor has a

“right, granted by Congress, not to assist its rivals

with the use of proprietary technology.” Novozymes

A/S v. Genencor Intern., Inc., 2007 W.L. 506828 (D.

Del. 2007). Moreover, where a company pioneers an

invention in the marketplace, irreparable harm flows

from « competitor's attempts to usurp the pioneering

company’s market position and goodwill. MPT, Inc. v

Marathon Labels, Inc., 2007 W.L. 184747 (N.D. Ohio

2007); TiVo, Inc. v. Echostar Comme’ns Corp., 446

F. Supp. 2d 664, 669 (E.D.Tex. 2006); see also Reebok

Int'l, Ltd. v. J. Baker, Inc., 32 F.3d 1552, 1557 (Fed.

Cir. 1994); Atlas Powder Co. v. Treco Chems., 773 F.2d

1230, 1233 (Fed. Cir. 1985); Smith Int'l, Inc. 1

Hughes Tool Co., 718 F.2d 1573, 1580-81 (Fed. Cir.

1983). The evidence presented at trial] demonstrated

that the Murex-Targus Parties attempted to reduce

App. 97

the market share of 800 Adept through various

means, some of which were the bases of the jury’s

verdict of toritious interference. Such evidence sup-

ports a finding of irreparable harm. See TiVo, Inc.,

446 F.Supp. 2d at 670 (finding irreparable harm

where “the impact of Defendants’ continued infringe-

ment is shaping the market to Plaintiff’s disadvan-

tage and results in long term customer loss).

In view of the above, the Court concludes that the

harm caused by the conduct of the Murex-Targus

Parties outweighs whatever consideration 800 Adept’s

delay in bringing suit should be given. Thus, 800

Adept has shown irreparable harm.

2. Inadequate Remedy at Law

The inadequate remedy prong of the traditional

four-part test for an injunction is focused on the

possibility of alternative modes of relief, regardless of

the seriousness of the injury. Lewis, 534 F.2d at 1124.

In this case, the Murex-Targus Parties argue that 800

Adept may be compensated for any continuing in-

fringement with money damages, which would be an

adequate remedy at law. (Doc. No. 442, p. 20). The

Murex-Targus Parties contend that 800 Adept cannot

simply rest on its patent right to exclude for injunc-

tive relief to issue. (/d.). These arguments are not

persuasive.

“The patent statute provides injunctive relief to

preserve the legal interests of the parties against

future infringement which may have market effects

App. 98

never fully compensable in money. Because the prin-

cipal value of a patent is its statutory right to ex-

clude, the nature of the patent grant weighs against

holding that monetary damages will always suffice to

make the patentee whole.” Reebok Intl, Ltd. v. J.

Baker, Inc., 32 F.3d 1552, 1557 (Fed. Cir. 1994) (in-

ternal citation omitted). In other words, injunctive

relief operates to protect the interests of a patentee

against future infringement, the market effects of

which may not be fully compensable in the form of

monetary damages.

In this case, 800 Adept is seeking to prevent the

Murex-Targus Parties from practicing future acts of

infringement. It has already proven such infringe-

ment on the merits to the satisfaction of a jury. 800

Adept has proven that the Murex-Targus Parties

compete with it in the market for telephone call

routing services, and the Murex-Targus Parties

concede that they have many more customers than

800 Adept. Furthermore, at least some of those cus-

tomers where obtained, in the view of the jury in the

instant case, through the Murex-Targus Parties’

tortious conduct. To allow the Mures-Targus Parties

to continue to offer their infringing services in the

marketplace under such circumstances in_ direct

competition with 800 Adept would be inequitable.

In addition, the fact that an infringing defendant

has apparently, at least temporarily, ceased its in-

fringement is not a basis to deny a permanent injunc-

tion against future infringement unless the evidence

is very persuasive that the infringing defendant will

App. 99

not resume its infringement. See W.L. Gore & Assocs.

vu. Garlock, Inc., 842 F.2d 1275, 1281-82

(Fed.Cir.1988). The Murex-Targis Parties offer no

such evidence here.

3. Balancing the Hardships

On the one hand, the record shows that 800

Adept is primarily involved in offering its services in

the telephone call routing market and that it peo

sesses a small share of that market. On the other

hand, the provision of telephone routing services is a

very small part of the business of the Murex-Targus

Parties, although they service a much large portion of

the telephone call routing market than 800 Adept.

Thus, a properly circumscribed injunction would

permit the Murex-Targus Parties to continue as an

ongoing business concern while protecting the inter-

ests of 800 Adept. See 7iVo Inc., 446 F. Supp. 2d at

670.

4. Public Interest

Lastly, the public interest would not be disserved

by a permanent injunction. “The public has an inter-

est In maintaining a strong patent system.” /d. There

is no evidence of record that suggests that the Murex-

Targus Parties’ infringing services are related to any

issue of public health or some other critical public

interest.

App. 100

In conclusion, the Court finds that, upon balanc-

ing the factors of the traditional test for equitable

relief, the requested injunctive relief should be

granted.

B. Form and Scope of the Permanent

Injunction

The form and scope of a permanent injunction is

governed by Federal Rule of Civil Procedure 65(d),

which provides as follows:

Every order granting an injunction and every

restraining order shall set forth the reasons

for its issuance; shall be specific in terms;

shall describe in reasonable detail, and not

by reference to the complaint or other docu-

ment, the act or acts sought to be restrained;

and is binding only upon the parties to the

action, their officers, agents, servants, em-

ployees, and attorneys, and upon those per-

sons in active concert or participation with

them who receive actual notice of the order

by personal service or otherwise.

Fep. R. Civ. P. 65(d). “In accord with the policy of

Rule 65(d), the Supreme Court has denounced broad

injunctions that merely instruct the enjoined party

not to violate a statute,” because such “injunctions

increase the likelihood of unwarranted contempt

proceedings for acts unlike or unrelated to those

originally judged unlawful.” Intl Rectifier Corp. v.

IXYS Corp., 383 F.3d 1312, 1316 (Fed. Cir. 2004).

The Federal Circuit has vacated as overly broad

App. 101

injunctions that “failed to state which acts consti-

tuted infringement or to expressly limit [their] prohi-

bition to the manufacture, use, or sale of the specific

device found to infringe, or devices no more than

colorably different from the infringing device.” Jd.

Thus “the only acts the injunction may prohibit are

infringement of the patent by the adjudicated devices

and infringement by devices not more than colorably

different from the adjudicated devices.” Id.; see also

Riles v. Shell Exploration & Prod. Co., 298 F.3d 1302,

1311 (Fed. Cir. 2002) (“[A]n injunction cannot impose

unnecessary restraints on lawful activity”).

In the instant case, there is sufficient evidence to

enjoin the Murex-Targus Parties from offering their

IntelliRouting Express, LocationExpress and DART

products, or colorable versions of those products, for

sale, and from making, using, or selling the same.

The record in the .»stant case demonstrates that

there are known methuds for constructing computer

databases for telephone routing, none of which use

latitude and longitude coordinates in the manner

disclosed in the °111 Reissue and the ‘689 Patent.

Therefore, the Court will enjoin the Murex-Targus

Parties from using latitude and longitude coordinates

in the construction of computer database(s) used to

produce and/or support telephone routing products or

services. To the extent that the Murex-Targus Parties

offer services that are not related to telephone rout-

ing or services that have substantial non-infringing

uses, the Court finds that such services cannot be

enjoined or, if enjoined, would present evidentiary

App. 102

difficulties better resolved in another forum. Based on

these findings, the Court declines to adopt the pro-

posed injunction offered by 800 Adept and will in-

clude an injunction in a scparate Final Judgment

that will issue after thfs Order.

V. Enhanced Damages

In exceptional cases of patent infringement, a

court may increase the damages up to three times.

See 35 U.S.C. § 284. Because the jury found that the

Murex-Targus Parties willfully infringed the asserted

claims of 800 Adept’s patents, the Court concludes

that this is an exceptional case. See Epcon Gas Sys.,

Inc. v. Bauer Compressors, Inc., 279 F.3d 1022, 1034

(Fed. Cir. 2002).

Enhanced damages are appropriate if the “in-

fringer is guilty of conduct upon which increased

damages may be based,” and if the “totality of the

circumstances” supports an enhanced award. Jurgens

vu. CBK, Ltd., 80 F.3d 1566, 1570 (Fed. Cir. 1996)

(citing Read Corp. v. Portec, Inc., 970 F.2d 816, 826-27

(Fed. Cir. 1992)). “In exercising [its] discretion [to

award enhanced damages], the trial court considers

the weight of the evidence of the infringer’s culpabil-

ity, in light of the factors included in Read.” Johns

Hopkins Univ. v. CellPro, Inc., 152 F.3d 1342, 1365

(Fed. Cir. 1998) (internal citations omitted). The Read

factors are:

App. 103

(1) whether the infringer deliberately cop-

ied the ideas or design of another;

(2) whether the infringer, when he knew of

the other’s patent protection, investigated

the scope of the patent and formed a good-

faith belief that it was invalid or that it was

not infringed;...

(3) the infringer’s behavior as a party to the

litigation[;] . .

(4) [dlefendant’s size and financial condi-

tion|:}..

(5) [clloseness of the casel;]...

(6) {djuration of defendant’s misconduct{;}

(7) [rlemedial action by the defendantl;]...

(8) |dlefendant’s motivation for harm[;] ...

[and|

(9) [wlhether defendant attempted to con-

ceal its misconduct.

See 970 F.2d at 827.

Several of the Read factors speak to the circum-

stances of the instant case. The Murex-Targus Parties

clearly knew of 800 Adept’s patents, and the record

shows that they vigorously attacked the validity of

those patents both before the Patent Office and

during this litigation. They also provided the infring-

ing services for years prior to the entry of the jury

verdict and after notice of the infringement. The

App. 104

evidence adduced at trial also demonstrates that the

Murex-Targus Parties aggressively expanded their

share of the market during this time using studiously

duplicitous business methods to the disadvantage of

800 Adept. In this regard, the willfulness question

was not a close one. See Modine Mfg. Co. v. The Allen

Group, 917 F.2a 538, 543 (Fed.Cir. 1990) (discussing

whether the finding of willfulness was “sufficiently

close on the evidence.”). Also, the evidence shows that

800 Adepi, aitnough it was first to market, was a

significantly smaller company with a smaller market

share than the Murex-Targus Parties. See St. Regis

Paper Co. v. Winchester Carton Corp., 410 F. Supp.

1304, 1309 (D. Mass. 1976). The Murex-Targus Par-

ties also appear from the instant record to have the

financial wherewithal to absorb the cost of increased

damages, if not an award of three times the jury

award. The Court, therefore, concludes that the

balance of the Read factors favors awarding enhanced

damages of one and a half times the jury award, 1.e.,

$24,000,000.00, which is an amount sufficient punish

the conduct of the Murex-Targus Parties.

VI. Attorneys’ Fees

In exceptional cases, a court may also “award

reasonable attorney fees to the prevailing party.” 35

U.S.C. § 285. “(T]he Court may consider the factors

relevant to an enhanced damages award in determin-

ing whether attorneys’ fees should be granted.”

NCUBE Corp. v. SeaChange Int'l, Inc., 313 F. Supp.

2d 361. 391°(D. Del. 2004)

>

App. 105

For the reasons discussed above, the Court also

finds that this is an exceptional case and determines

that 800 Adept should be awarded attorneys’ fees. 800

Adept is not entitled to fees, however, that arise from

the prosecution of any claim(s) that were not brought

before the jury. 800 Adept shall, within fourteen (14)

days from the date of this Order, file with the Court a

separate motion or petition together with the sup-

porting evidence necessary to determine a reasonable

and appropriate fee. The Murex-Targus Parties shall

respond within ten (10) days thereafter.”

VII. Conclusion

Based on the forgoing, the Court GRANTS IN

PART and DENIES IN PART the Motion for Entry

Of Final Judgment, An Award Of Prejudgment Inter-

est And A Permanent Injunction (Doc. No. 430) of

Plaintiff 800 Adept, Inc. and GRANTS 800 Adept’s

Motion for Attorneys’ Fees (Doc. No. 431). More

specifically, the Court Rules as follows:

(1) 800 Adept’s Motion for Prejudgment In-

terest is DENIED;

(2) 800 Adept’s Motion for A Permanent In-

junction is GRANTED IN PART;

* This finding is limited to the Murex-Targus Parties, and

800 Adept is not entitled to attorney’s fees from West Corpora-

tion.

App. 106

(3) 800 Adept’s Motion for Enhanced Dam-

ages is GRANTED, and the Court

awards $24,000,000.00 in’ enhanced

damages to 800 Adept against the Mu-

rex-Targus Parties; and

(4) 800 Adept’s Motion for Attorneys’ Fees is

GRANTED, and 800 Adept shall, within

fourteen (14) days of the day of this Or-

der, file with the Court a separate mo-

tion or petition together with such

evidence as necessary to determine a

reasonable and appropriate fee.

The Court will enter a separate Final Judgment, in

accordance with this Order, forthwith. All other

pending motions are denied as moot.

DONE and ORDERED in Chambers in Orlando,

Florida on April 12, 2007.

/s/ Patricia C. Fawsett

PATRICIA C. FAWSETT,

CHIEF JUDGE

UNITED STATES

DISTRICT COURT

Copies furnished to:

Counsel of Record

App. 107

UNITED STATES DISTRICT COURT

MIDDLE DISTRICT OF FLORIDA

ORLANDO DIVISION

800 ADEPT, INC., and

ADEPTEL, INC.,

Plaintiffs/Counter-

Defendants,

“var Case No.

MUREX SECURITIES, LTD., 6:02-cv-1354-

MUREX LICENSING CORPO- Orl-19DAB

RATION, TARGUS INFORMA-

TION CORPORATION, and

WEST CORPORATION,

Defendants/Counter-

Plaintiffs.

FINAL JUDGMENT AND ORDER

OF INJUNCTIVE RELIEF

(Filed Apr. 12, 2007)

Pursuant to Federai Rule of Civil Procedure 58

and in accordance with the jury verdict delivered on

October 30, 2006, and the Court’s own findings and

conclusions entered on the record in this case, Final

Judgment is entered in favor of Plaintiff 800 Adept,

Inc. and against Defendants Murex Securities, Ltd.,

Murex Licensing Corporation, Targus Information

Corporation and West Corporation for infringement of

claims 1-19, 22-27, 29, 31, and 34-39 of U.S. Patent

No. RE36,111.

App. 108

Final Judgment is entered in favor of Plaintiff

800 Adept, Inc. and against Defendants Murex Secu-

rities, Ltd., Murex Licensing Corporation, and Targus

Information Corporation for infringement of claims

41, 43, and 46-51 of U.S. Patent No. RE36,111, and

for infringement of claims 1, 3, 4, and 5 of U.S. Patent

No. 5,805,689.

Final Judgment is entered in favor of Counter-

Defendants 800 Adept, Inc. and Adeptel, Inc. and

against Counter-Plaintiffs Murex Securities, Ltd.,

Murex Licensing Corporation, and Targus Informa-

tion Corporation for non-infringement by Counter-

Defendants 800 Adept, Inc. and Adeptel, Inc. of

claims 11, 12, and 13 of U.S. Patent No. 4,757,267,

claim 69 of Patent No. 5,506,897, claims 1 and 50 of

J.S. Patent No. 5,848,131, claim 19 of U.S. Patent

No. 5,901,214, claims 1 and 20 of U.S. Patent No.

5,907,608, claims 4 and 13 of U.S. Patent No.

5,910,982, claim 1 of U.S. Patent No. 5,956,397, claim

46 of U.S. Patent No. 5,982,868, claim 25 of U.S.

Patent No. 6,058,179, and claim 10 of U.S. Patent No.

6,091,810.

Final Judgment is entered in favor of Counter-

Defendants 800 Adept, Inc. and Adeptel, Inc. and

against Counter-Plaintiffs Murex Securities, Ltd.,

Murex Licensing Corporation, and Targus Informa-

tion Corporation on the issue of invalidity of all

claims of Patent No. 5,506,897, all claims of U.S.

Patent No. 5,848,131, claim 19 of U.S. Patent No.

5,901,214, claims 1 and 20 of U.S. Patent No.

5,907,608, claims 4 and 13 of U.S. Patent No.

5,910,982, claim 1 of U.S. Patent No. 5.956.397, claim

App. 109

46 of U.S. Patent No. 5.982.868, claim 25 of U.S.

Patent No. 6,058,179, and claim 10 of U.S. Patent No.

6,091,810.

IT IS THEREFORE ORDERED AND AD-

JUDGED

i. That the Plaintiff/Counter-Defendant,

800 ADEPT, INC., shall recover from

the Defendants/Counter-Plaintiffis, MU-

REX SECURITIES, LTD., MUREX

LICENSING CORPORATION, and

TARGUS INFORMATIGN CORPO-

RATION, jointly and severally, the

amount of $18,000,000.00 on its claims of

patent infringement, plus $24,000,000.00

in enhanced damages, plus $2,000,000.00

in compensatory damages on its claim of

tortious interference, plus $5,000,000.00

in punitive damages, for a total amount

of $49,000,000.00, for which sum let exe-

cution issue.

to

That the Plaintiff/Counter-Defendant,

800 ADEPT, INC., shall recover from

the Defendant/Counter-Plaintiff, WEST

CORPORATION, the sum of $48,000.00,

for which sum let execution issue.

3. That the Plaintiff/Cotnter-Defendant,

800 ADEPT, INC., shall take nothing

on its remaining claims not set forth in

this Final Judgment and that such

claims be dismissed with prejudice

4. That the Defendants/Counter-Plaintiffs,

MUREX SECURITIES, LTD., MUREX

App. 110

LICENSING CORPORATION, and

TARGUS INFORMATION CORPORA-

TION, shall take nothing by this action.

IT IS FURTHER ORDER AND ADJUDGED

5. That injunctive relief is granted in favor

of Plaintiff, 800 ADEPT, INC., and

against Defendants, MUREX SECU-

RITIES, LTD., MUREX LICENSING

CORPORATION, and TARGUS IN-

FORMATION CORPORATION.

That the Defendants/Counter-Plaintiffs,

MUREX SECURITIES, LTD., MUREX

LICENSING CORPORATION, and

TARGUS INFORMATION CORPO-

RATION, are cnjoined and shall ccase

and desist in the making, using, sale, or

offering for sale, the IntelliRouting Ex

press, LocationExpress and DART prod-

ucts, and any colorable versions thereof,

and shall be further enjoined from using

latitude and longitude coordinates in the

construction of computer databases used

to produce and/or support such products.

Date: April 12, 2007 at 1:19 p.m.

/s/ PatriciaC. Fawsett |

PATRICIA C. FAWSETT,

CHIEF JUDGE

UNITED STATES

DISTRICT COURT

App. 111

UNITED STATES COURT OF APPEALS

FOR THE FEDERAL CIRCUIT

2007-1272,-1356

800 ADEPT, INC.,

Plaintiff-Appellee,

v.

MUREX SECURITIES, LTD., MUREX LICENSING

CORPORATION, TARGUS INFORMATION

CORPORATION, and WEST CORPORATION,

Defendants-Appellants.

Appeals from the United States District Court for the

Middle District of Florida in case no. 6:02-CV-1354,

Chief Judge Patricia C. Fawsett.

ORDER

(Filed Oct. 6, 2008)

A combined petition for panel rehearing and for

rehearing en banc naving been filed by the Appellee.

and the petition for rehearing, having been referred

to the panel that heard the appeal, and thereafter the

petition for rehearing en banc having been referred to

the circuit judges who are in regular active service,

UPON CONSIDERATION THEREOF, it is

ORDERED that the petition for panel rehearing

be, and the same hereby 1s, DENIED and it is further

ORDERED that the petition for rehearing en

banc be, and the same hereby is, DENIED.

App. 112

The mandate of the court will issue on October

14, 2008.

FOR THE COURT,

/s/ Jan Horbaly/JB

Jan Horbaly

Clerk

Dated: 10/06/2008

cc: Paul R.Q. Wolfson

Stephen D. Milbrath

800 ADEPT V MUREX SECURITIES, 2007-1272,-1356

(DCT — 6:02-CV-1354)

App. 113

Fed. R. Civ. P., Rule 50. Judgment as a Matter

of Law in a Jury Trial; Related Motion for

a New Trial; Conditional Ruling

(a) JUDGMENT AS A MATTER OF LAW.

(1) In General. If a party has been fully

heard on an issue during a jury trial and the

court finds that a reasonable jury would not have

a legally sufficient evidentiary basis to find for

the party on that issue, the court may:

(A) resolve the issue against the party;

and

(B) grant a motion for judgment as a

matter of law against the party on a claim or

defense that, under the controlling law, can

be maintained or defeated only with a favor-

able finding on that issue.

ok *

App. 114

Fed. R. Civ. P., Rule 52. Findings and Conclu-

(a)

sions by tne Court; Judgment on Partial

Findings

FINDINGS AND CONCLUSIONS.

(1) In General. In an action tried on the

facts without a jury or with an advisory jury, the

court must find the facts specially and state its

conclusions of law separately, ...

(6) Setting Aside the Findings. Fin

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