`
`IN THE UNITED STATES DISTRICT COURT
`FOR THE EASTERN DISTRICT OF TEXAS
`MARSHALL DIVISION
`
`
`
`
`CASE NO. 2:14-cv-33-JRG
`
`§
`§
`§
`§
`§
`§
`§
`§
`§
`§
`§
`§
`
`
`GENBAND US LLC,
`
`Plaintiff,
`
`
`
`v.
`
`METASWITCH NETWORKS LTD;
`METASWITCH NETWORKS CORP.,
`
`Defendants.
`
`
`
`
`
`ORDER AND OPINION WITH
`FINDINGS OF FACT AND CONCLUSIONS OF LAW
`
`On March 29, 2016, the Court held a bench trial and heard evidence in this patent
`
`infringement case. Before the Court are several equitable remedies and defenses raised by the
`
`Parties, in addition to open questions of law under 35 U.S.C. § 101.
`
`The first set of issues before the Court relate to Genband’s request for a permanent
`
`injunction. As part of this request, Genband filed a Motion to Alter or Amend the Judgment to
`
`Include a Permanent Injunction (Dkt. No. 491.) In response, Metaswitch asserts the equitable
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`defense of laches.
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`The second set of issues before the Court relate to equitable defenses raised by
`
`Metaswitch: the defense of laches (which Metaswitch contends bars Genband from receiving a
`
`permanent injunction and recovering pre-suit damages) and unenforceability of several patents
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`due to the equitable doctrines of implied waiver, equitable estoppel, and implied license.
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`
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`Case 2:14-cv-00033-JRG Document 582 Filed 09/29/16 Page 2 of 80 PageID #: 72701
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`The parties have submitted briefs, supporting documents, expert reports, and proposed
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`findings of fact and conclusions of law. The Court, having considered the same, now makes and
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`enters the following findings of fact and conclusions of law.
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`Case 2:14-cv-00033-JRG Document 582 Filed 09/29/16 Page 3 of 80 PageID #: 72702
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`I.
`
`C.
`D.
`
`E.
`
`FINDINGS OF FACT (“FF”) .......................................................................................... 6
`A.
`The Parties ...............................................................................................................6
`B.
`The Lawsuit .............................................................................................................7
`1.
`The Patents ...................................................................................................7
`2.
`The Jury Trial .............................................................................................10
`3.
`The Bench Trial .........................................................................................11
`Accused Metaswitch Products ...............................................................................12
`Genband’s Knowledge of Metaswitch and Its Products ........................................13
`1.
`The Court finds that there was delay .........................................................13
`2.
`The Court finds that the minimal amount of Metaswitch’s infringing
`activity and the circumstances surrounding Genband’s CVAS
`acquisition are sufficient to rebut any presumption or showing of
`unreasonable delay. ....................................................................................16
`Nortel’s History and Knowledge of Metaswitch’s Products .................................17
`1.
`The Court finds that the minimal amount of Metaswitch’s infringing
`activity and the circumstances surrounding Nortel’s bankruptcy are
`sufficient to rebut any presumption or showing of unreasonable
`delay. ..........................................................................................................17
`Prejudice to Metaswitch .........................................................................................20
`1.
`Economic Prejudice ...................................................................................20
`2.
`Evidentiary Prejudice .................................................................................23
`Nortel and Genband’s Involvement in CableLabs .................................................26
`1.
`Agreements between CableLabs and NNCSI ............................................26
`2.
`CableLabs IPR Agreement ........................................................................28
`3.
`Metaswitch’s “alter ego” theory ................................................................30
`4.
`Metaswitch’s knowledge ...........................................................................36
`IETF .......................................................................................................................38
`1.
`Metaswitch does not have a license to any asserted claim under the
`IETF Statement because it failed to show that the asserted claims are
`essential to an IETF standard. ....................................................................39
`Metaswitch does not have a license to any asserted claim under the
`IETF Statement because Metaswitch failed to show that Nortel
`contributed a document to the IETF describing the patented
`technology. .................................................................................................41
`
`F.
`
`G.
`
`H.
`
`2.
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`Case 2:14-cv-00033-JRG Document 582 Filed 09/29/16 Page 4 of 80 PageID #: 72703
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`3.
`
`4.
`
`5.
`
`6.
`
`2.
`
`3.
`
`Metaswitch does not have a license to any asserted claim under the
`IETF Statement because Metaswitch failed to show that its accused
`products comply with an IETF standard. ...................................................42
`Metaswitch does not have a license to any asserted claim under the
`IETF Statement because it failed to show that the asserted claims are
`essential to an IETF standard. ....................................................................43
`Metaswitch does not have a license to any asserted claim under the
`IETF Statement because Metaswitch failed to show that Nortel
`contributed a document to the IETF describing the patented
`technology. .................................................................................................47
`Metaswitch does not have a license to any asserted claim under the
`IETF Statement because Metaswitch failed to show that its accused
`products comply with an IETF standard. ...................................................48
`ITU .........................................................................................................................51
`1.
`Metaswitch does not have a license to Claim 70 of the ’971 Patent
`under the ITU Declarations because it failed to show that Nortel
`contributed its patented technology to the relevant ITU
`Recommendations. .....................................................................................52
`Metaswitch does not have a license to Claim 70 of the ’971 Patent
`under the ITU Declarations because it failed to prove that its
`accused products comply with the relevant ITU Recommendations. ........52
`Metaswitch does not have a license to Claim 70 of the ’971 Patent
`under the ITU Declarations because it failed to prove that the claim
`is essential to the relevant ITU Recommendations. ...................................53
`CONCLUSIONS OF LAW (“CL”) ............................................................................... 54
`A.
`Permanent Injunction: Availability ........................................................................55
`4.
`Legal Standard ...........................................................................................55
`5.
`Irreparable Harm ........................................................................................55
`Defense of Laches ..................................................................................................58
`1.
`Legal Standard ...........................................................................................58
`2.
`Analysis......................................................................................................61
`Equitable Defense: Implied Waiver .......................................................................62
`1.
`Applicable Law ..........................................................................................62
`2.
`The Court concludes that Metaswitch has not proven by clear and
`convincing evidence that implied waiver bars Genband’s damages. ........63
`Equitable Defense: Equitable Estoppel ..................................................................64
`1.
`Applicable Law ..........................................................................................64
`
`I.
`
`B.
`
`C.
`
`D.
`
`II.
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`Case 2:14-cv-00033-JRG Document 582 Filed 09/29/16 Page 5 of 80 PageID #: 72704
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`E.
`
`F.
`
`2.
`
`The Court concludes that Metaswitch has not proven by clear and
`convincing evidence that equitable estoppel bars Genband’s
`damages......................................................................................................66
`Equitable Defense: Implied License ......................................................................68
`1.
`Applicable Law ..........................................................................................68
`2.
`The Court concludes that Metaswitch has not proven by clear and
`convincing evidence that implied license bars Genband’s damages. ........68
`Patent Eligible Subject Matter under 35 U.S.C. § 101 ..........................................69
`1.
`Legal Standard ...........................................................................................69
`2.
`’561 Patent Asserted Claims are Patent Eligible .......................................72
`3.
`’658 Patent Asserted Claims are Patent Eligible .......................................73
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`Case 2:14-cv-00033-JRG Document 582 Filed 09/29/16 Page 6 of 80 PageID #: 72705
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`I. FINDINGS OF FACT (“FF”)
`
`A.
`
`The Parties
`
`[FF1]
`
`Plaintiff Genband US LLC (“Genband”) is a Delaware corporation and a real
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`time communications software company formed in 1999, having a principal place of business in
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`Frisco, Texas. (Dkt. No. 12 at 1; PX4037 (“Bakewell Op. Rpt.”) at ¶ 29.)
`
`[FF2]
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`Genband was founded in 1999 under the name General Bandwidth. Id. at ¶ 20.
`
`In 2001, General Bandwidth introduced its first product, the VG-100. In 2006, General
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`Bandwidth was renamed Genband. Id. In December 2009, Genband submitted a bid for Nortel
`
`Networks Inc.’s (“Nortel”) Carrier VoIP and Application Solutions (“CVAS”) business, and
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`Genband acquired the CVAS business on May 28, 2010. Id. at ¶ 23. Nortel’s CVAS business
`
`offered a variety of voice over packet products (i.e., softswitches and media gateways),
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`multimedia communication servers, application servers, IMS products, optical products, WAN
`
`switches and digital-based telephone switches. Id. at ¶ 24. As part of the CVAS business unit
`
`acquisition, Genband gained intellectual property assets, including five of the seven patents
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`asserted in this litigation. Id. at ¶¶ 24–25.
`
`[FF3]
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`Defendant Metaswitch Networks Ltd (“Metaswitch Ltd”) is a privately held
`
`communications software company formed in 1981 with its principal place of business in the
`
`United Kingdom. (DX-230 at -563.)
`
`[FF4] Metaswitch Networks Corp. (“Metaswitch Corp.”) is a wholly owned U.S.
`
`subsidiary of Metaswitch Ltd with its principal place of business located in San Francisco,
`
`California. (Metaswitch Networks Ltd and Metaswitch Corp., collectively “Metaswitch”). (Dkt.
`
`No. 12 at ¶ 3–4; see also DX-230 at -1608.) Metaswitch provides software solutions for voice
`
`and data communications for telecom equipment manufacturers. Metaswitch offers a line of
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`Case 2:14-cv-00033-JRG Document 582 Filed 09/29/16 Page 7 of 80 PageID #: 72706
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`softswitches, media gateways, application servers, and session border control products to
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`telecommunication operators. Bakewell Op. Rep. at ¶¶ 43–44.
`
`B.
`
`The Lawsuit
`
`[FF5]
`
`On January 21, 2014, Genband filed the original complaint in this case. Dkt.
`
`No. 1. In this complaint, Genband alleged that certain Metaswitch products infringed U.S.
`
`Patent Nos. 6,772,210, 6,791,971, 6,885,658, 6,934,279, 7,995,589, 7,047,561, 7,184,427 and
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`7,990,984. Id.
`
`1.
`
`The Patents
`
`[FF6]
`
`Genband asserts seven patents: U.S. Patent Nos. 6,791,971 (“’971 Patent”);
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`6,885,658 (“’658 Patent”); 6,934,279 (“’279 Patent”); 7,047,561 (“’561 Patent”); 7,184,427
`
`(“’427 Patent”); 7,990,984 (“’984 Patent”); and 7,995,589 (“’589 Patent”) (collectively, the
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`“patents-in-suit”).
`
`[FF7]
`
`The ’971 Patent is entitled “Method and Apparatus for Providing a
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`Communications Service, for Communication and for Extending Packet Network Functionality.”
`
`PX2. The application for the ’971 Patent was filed on December 1, 1999, and the ’971 Patent
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`issued on September 14, 2004. Id. The inventors listed on the face of the ’971 Patent are
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`Marwan Osman and Antoine Zoghbi. Id. Genband asserts Claims 70, 80, and 92 of the ’971
`
`Patent.
`
`[FF8]
`
`The ’561 Patent is entitled “Firewall for Real-Time Internet Applications.”
`
`PX5. The application for the ’561 Patent was filed on September 28, 2000, and the ’561 Patent
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`issued on May 16, 2006. Id. The sole inventor listed on the face of the ’561 Patent is Michael C.
`
`G. Lee. Id. Genband asserts Claims 6, 17, and 20 of the ’561 Patent.
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`Case 2:14-cv-00033-JRG Document 582 Filed 09/29/16 Page 8 of 80 PageID #: 72707
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`[FF9]
`
`The
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`’279 and
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`’589 Patents are both entitled “Controlling Voice
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`Communications over a Data Network.” PX0004, PX0008. The ’589 Patent is a continuation of
`
`the ’279 Patent. PX0008. The application for the ’279 Patent was filed on March 13, 2000, and
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`the ’279 Patent issued on August 23, 2005. PX0004. The application for the ’589 Patent was
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`filed on August 23, 2005, and the ’589 Patent issued on August 9, 2011. PX0008. The inventors
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`listed on the face of the ’279 and ’589 Patents are Patrick N. Sollee, David R. Creech, Gregory
`
`T. Osterhout, and Christopher L. Jessen. PX0004, PX0008. Genband asserts Claim 25 of the
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`’279 Patent and Claim 15 of the ’589 Patent.
`
`[FF10] The ’427 and ’984 Patents are both entitled “System and Method for
`
`Communicating Telecommunication
`
`Information
`
`from a Broadband Network
`
`to a
`
`Telecommunication Network.” PX0006, PX0007. The application for the ’427 Patent was filed
`
`on November 28, 2000, and the ’427 Patent issued on February 27, 2007. PX0006. The
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`application for the ’984 Patent was filed on February 27, 2007 and issued on August 2, 2011.
`
`PX0007. The inventors listed on the face of the ’427 and ’984 Patents are A. J. Paul Carew and
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`Brendon W. Mills. PX0006, PX0007. Genband asserts Claim 1 of the ’427 Patent and Claim 1
`
`of the ’984 Patent.
`
`[FF11] The ’658 Patent is entitled “Method and Apparatus for Interworking Between
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`Internet Protocol (IP) Telephony Protocols.” PX0003. The application for the ’658 Patent was
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`filed on February 18, 2000, and the ’658 Patent issued on April 26, 2005. PX0003. The
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`inventors listed on the face of the ’658 Patent are David P. Ress, Xuewen Li, Denise J. Ingram,
`
`and Gregory Robert Utas. PX0003. Genband asserts Claims 1 and 11 of the ’658 Patent.
`
`[FF12] The ’658 Patent claims are directed towards the practice of protocol
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`interworking through the use of an abstraction or “interworking protocol.” (May 8, 2015 Expert
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`Case 2:14-cv-00033-JRG Document 582 Filed 09/29/16 Page 9 of 80 PageID #: 72708
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`Report of E. Burger, ¶ 130.) The ’658 Patent involves mapping the information contained in an
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`incoming signal of an inbound signaling protocol into a messages of an intermediary protocol,
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`which the ’658 Patent calls an “agent interworking protocol.” (Id.) From there, the information,
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`which is now represented in the format of the interworking protocol, can be mapped to any other
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`protocol so that the information may be transmitted in an outgoing message of a desired
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`outbound signaling protocol. (Id.)
`
`[FF13] Claims 1 and 11 of the ’658 Patent, which Genband asserts, recite a call server
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`and method:
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`1. A call server comprising:
`(a) a fist protocol agent for communicating with a first internet protocol (IP)
`telephony device according to a first IP telephony protocol;
`(b) a second protocol agent for communicating with a second IP telephony
`device according to a second IP telephony protocol; and
`(c) an interworking agent for providing functions usable by the first and
`second protocol agents to communicate with each other according to a
`third protocol, the functions provided by the third protocol being a
`superset of functions provided by the first and second IP telephony
`protocols, said interworking agent further adapted to determine that a
`first parameter associated with the first IP telephony protocol does not
`map to the second IP telephony protocol and communicating first
`parameter to the second protocol agent without alteration.
`
`11. A method for interworking devices that communicate using different internet
`protocol (IP) telephony protocols, the method comprising:
`(a) receiving, from a first telephony device, a first message formatted
`according to a first IP telephony protocol;
`in response to receiving the first message, generating a second message,
`formatted according to a second protocol, said second protocol being
`distinct from said first protocol, the second message including at least
`one of a media capabilities description and media stream management
`information derived from the first message;
`transmitting the second message to a second protocol agent; and
`
`(b)
`
`(c)
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`Case 2:14-cv-00033-JRG Document 582 Filed 09/29/16 Page 10 of 80 PageID #: 72709
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`(d)
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`in response to receiving the second message, generating a third message
`formatted according to a third IP telephony protocol, the third message
`including at least one of the media capabilities description and media
`stream management information derived from the second message.
`(DX-005, ’658 Patent at Claim 1, Claim 11.)
`[FF14] Genband acquired the rights to enforce the patents at different times.
`
`[FF15] Genband owned the ’984 and ’589 Patents at the time they issued in August
`
`2011. PX7 and PX8. Thus, Genband first obtained rights to enforce these patents
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`approximately three years before the filing of this lawsuit.
`
`[FF16] Genband acquired rights to enforce the ’561, ’658, ’971, and the ’279 Patents
`
`in May 2010. See PX34. Thus, Genband first obtained rights to enforce the ’561, ’658, ’971,
`
`and ’279 Patents approximately four years before the filing of this lawsuit.
`
`[FF17] Genband owned the ’427 Patent at the time it issued on February 27, 2007.
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`PX6. Thus, Genband first obtained rights to enforce the ’427 Patent approximately seven years
`
`before the filing this lawsuit.
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`2.
`
`The Jury Trial
`
`[FF18] During January 11–15, 2016, the Court held a jury trial on Genband’s
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`infringement claims. The Jury also heard Metaswitch’s patent defenses, which included non-
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`infringement, invalidity, and arguments that it was entitled to a license to certain patents on
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`royalty-free terms. The patent claims at issue at the jury trial were:
`
`•
`•
`•
`•
`•
`•
`•
`
`’971 Patent: Claims 70, 80, and 92
`’658 Patent: Claims 1 and 11
`’279 Patent: Claim 25
`’589 Patent: Claim 15
`’561 Patent: Claims 6, 17, and 20
`’427 Patent: Claim 1
`’984 Patent: Claim 1
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`Case 2:14-cv-00033-JRG Document 582 Filed 09/29/16 Page 11 of 80 PageID #: 72710
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`(Dkt. No. 465.)
`[FF19] On January 15, 2016, the Jury found that Metaswitch infringes all asserted
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`claims of Genband’s seven patents and that those claims are valid. (Dkt. No. 465, “Jury
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`Verdict”). The Jury awarded $8,168,400 in damages. (Id.)
`
`[FF20] On January 26, 2016, the Court entered a Final Judgment in accordance with
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`the jury verdict. (Dkt. No. 480, “January 26, 2016 Final Judgment.”)
`
`[FF21] On February 5, 2016, the Court set aside the January 26, 2016 Final Judgment
`
`pending a final determination of Metaswitch’s equitable defense to Genband’s patent
`
`infringement claims, noting that those equitable issues would be heard in a subsequent bench
`
`trial, and that after the bench trial, the Court would re-enter judgment in light of both the jury’s
`
`verdict and the bench trial. (Dkt. No. 492.)
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`3.
`
`The Bench Trial
`
`[FF22] On March 28, 2016, the day before the bench trial, the Parties filed a joint
`
`notice of stipulations for the bench trial. (Dkt. No. 538.) As part of the stipulation, the parties
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`agreed to waive objections to the admission of any exhibit identified on a bench trial exhibit list
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`that was “pre-admitted” in the jury trial in this case. (Id.) The parties further agreed to waive any
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`hearsay objection to expert reports that were timely served in this case. (Id.) The parties therefore
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`agreed that such expert reports are admissible as evidence in the bench trial and agreed not to
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`call any expert witnesses live during the bench trial. (Id.)
`
`[FF23] On March 29, 2016, the Court held a bench trial on Genband’s claim for a
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`permanent injunction, Metaswitch’s equitable defenses (including laches, implied waiver,
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`equitable estoppel, and implied license), and Metaswitch’s defense of invalidity of the ’561 and
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`’658 Patents under 35 U.S.C. § 101. (Dkt. No. 543.)
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`Case 2:14-cv-00033-JRG Document 582 Filed 09/29/16 Page 12 of 80 PageID #: 72711
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`[FF24] During the bench trial, the Court also took under advisement Genband’s
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`motion to alter or amend the judgment to include a permanent injunction (Dkt. No. 491). The
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`Court also took under advisement Genband’s objections to testimony Metaswitch submitted
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`relating to the permanent injunction and equitable defenses, i.e.: the declaration of Lance E.
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`Gunderson (Dkt. No. 510), the declaration of Alastair Mitchell (Dkt. No. 511), and the
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`declarations of Jennifer Kash (Dkt. No. 545).
`
`[FF25] Pursuant to the Court’s order, the parties filed post-bench-trial briefs on April
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`12, 2016. (Dkt. Nos. 552, 553.)
`
`C.
`
`Accused Metaswitch Products
`
`[FF26] Genband accuses Metaswitch of infringing the following patent claims via
`
`these Metaswitch products:
`
`•
`
`•
`
`•
`
`•
`
`•
`
`’561 Patent Claims 6, 17, and 20:
`o Perimeta Session Border Controller (Dkt. No. 470, 1/12/2016 P.M. Trial
`Tr. at 29:20–30:16; 38:14–16; 44:15–24);
`’971 Patent Claims 70, 80, and 92:
`o Call Feature Server (id. at 98:24–99:8; 104:23–105:24; 108:25–109:15),
`o Integrated Softswitches VP2510, VP3500, VP3510, VP6010, and VP6050
`(id. at 98:24–99:8; 104:23–105:24; 108:25–109:15),
`o Service Broker (id. at 98:24–99:8; 108:25–109:15);
`’279 Patent Claim 25 and ’589 Patent Claim 15:
`o MTAS platform with Accession Software supporting Call Jump (id. at
`122:16–19; 124:3–8),
`o MTAS platform with CommPortal Software supporting Click to Dial (id.
`at 128:1–19; 130:15–18);
`’658 Patent Claims 1 and 11:
`o Call Feature Server (id. at 138:25–139:15; 149:20–24; 157:12–158:20),
`o Integrated Softswitches VP2510, VP3500, VP3510, VP6010, and VP6050
`(id.);
`’984 Patent Claim 1 and ’427 Patent Claim 1:
`o Universal Media Gateways MG2510, MG3500, MG3510, MG6010, and
`MG6050 (id. at 166:10–167:2; 181:1–4; 187:17–188:7),
`o Integrated Softswitches VP2510, VP3500, VP3510, VP6010, and VP6050
`(id.).
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`Case 2:14-cv-00033-JRG Document 582 Filed 09/29/16 Page 13 of 80 PageID #: 72712
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`[FF27] Mr. John Lazar testified on behalf of Metaswitch that Perimeta was not
`
`available before July 2011. (Dkt. No. 472, 1/13/2016 P.M. Trial Tr. at 205:3–6; PX167.)
`
`D.
`
`Genband’s Knowledge of Metaswitch and Its Products
`
`1.
`
`The Court finds that there was delay
`
`[FF28] As early as 2001, Genband was aware of Metaswitch. The parties participated
`
`in an interoperability consortium called Open VoB. (Dkt. No. 502-4 ¶ 9.) Former Genband
`
`CEO Charlie Vogt, who ran the company for eight and half years up to 2013, knew Metaswitch’s
`
`product offerings and had a general sense of the functionalities included in Metaswitch products.
`
`(Dkt. 503-4 at 37–38, 118–19.) Vogt joined Genband in July 2004. (Id. at 37.) He was aware of
`
`Metaswitch prior to joining Genband. (Id.)
`
`[FF29] Genband contends that, while Genband was aware of Metaswitch prior to filing
`
`its complaint, Genband was not aware that Metaswitch’s products infringed its patents until just
`
`prior to filing its original complaint. (Dkt. No. 503-2, “Jarzemsky Tr.,” at 129:4-7.)
`
`[FF30] However, the Genband marketing department monitored Metaswitch press
`
`releases regarding new Metaswitch products. (Dkt. No. 503-2.) Upon learning of a new product,
`
`the marketing department would conduct a competitive analysis that involved “comparing
`
`Genband products to Metaswitch products.” (Id.)
`
`[FF31] Accordingly, Metaswitch contends that Genband has known about the accused
`
`products, as well as the “features and services claimed by the Metaswitch products,” in this case
`
`since at least as early as the first date that those products were announced by Metaswitch. (Dkt.
`
`No. 503-2.)
`
`[FF32] The Court finds that such knowledge by the marketing department is sufficient
`
`to show that Genband knew of these accused products.
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`Case 2:14-cv-00033-JRG Document 582 Filed 09/29/16 Page 14 of 80 PageID #: 72713
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`[FF33] The accused products were publicly disclosed at least as early as the below
`
`dates. (Dkt. No. 502-4, “Mitchell Feb. 24, 2016 Decl.”)
`
`Product
`
`United States Launch Date
`
`VP3500 Integrated Softswitch
`
`VP3510 Integrated Softswitch
`MG3510 Universal Media Gateway
`
`Call Feature Server
`Enhanced Application Server
`MG3500 Universal Media Gateway
`DC-SBC
`VP2510 Integrated Softswitch
`MG2510 Universal Media Gateway
`CommPortal
`Service Broker
`
`Perimeta Session Border Controllers
`VP6010 Integrated Softswitch
`VP6050 Integrated Softswitch
`Accession Communicator
`MG6010 Universal Media Gateway
`MG6050 Universal Media Gateway
`MetaSphere Multiservice Telephony
`Application Servers
`
`Publicly announced in May 2002. Generally
`available October 2002.
`May 2004
`Publicly announced in June 2004. Generally
`available in December 2004.
`December 2004
`March 2005
`December 2004
`November 2005
`January 2006
`January 2006
`April 2007
`AppTrigger’s launch of Service Broker: at
`least as early as 2007
`Metaswitch launch of Service Broker: March
`2010
`July 2011
`April 2012
`July 2012
`February 2012
`April 2012
`July 2012
`MetaSphere MTAS is a branding name that
`includes Metaswitch’s Call Feature Server and
`Enhanced Application Server. This branding
`change occurred in 2007.
`
`
`
`[FF34] The following features were publicly disclosed at least as early as the dates
`
`described below. (Dkt. No. 502-4.)
`
`
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`- 14 -
`
`
`
`Case 2:14-cv-00033-JRG Document 582 Filed 09/29/16 Page 15 of 80 PageID #: 72714
`
`Feature
`
`Publicly Described
`
`Session Border Controller’s separate handling
`of signaling and media traffic
`Session Border Controller’s application of
`packets associated with the signaling and
`control channels to an application proxy and
`application of packets associated with the
`bearer (media) channel to a packet filter
`Session Border Controller’s intelligent firewall
`functionality for real-time applications, such as
`VoIP
`The ability for softswitches and Call Feature
`Servers to provide intelligent networking
`services, such as toll-free calling, using legacy
`intelligent network equipment in an IP
`Environment
`Click to dial
`
`First publicly described at least as early as
`2005.
`First publicly described at least as early as
`2005.
`
`First publicly described at least as early as
`2005.
`
`First publicly described at least as early as
`2007.
`
`First publicly described at least as early as
`2007.
`First publicly described at least as early as
`2004.
`
`The ability to add support for additional
`protocols to its Call Feature Servers (as stand-
`alone products and as part of an Integrated
`Softswitch) by creating a mapping of the new
`protocol to a common, interworking protocol
`Communicating telecommunication
`information between an IP or ATM broadband
`network and a telecommunication network
`(e.g., the PSTN)
`
`[FF35] Genband produced internal documents dating back to 2007 analyzing
`
`First publicly described at least as early as
`2002.
`
`Metaswitch’s products. (Dkt. No. 503 Exs. 5–9.)
`
`[FF36] Genband’s engineers believed “most of the people in the space,” including
`
`Metaswitch, were infringing Genband patents. (Dkt. No. 503-4 at 113–14.) However, Genband
`
`did not sue Metaswitch or others companies that its engineers believed to be infringing. (Id. at
`
`120–21.) Genband’s former CEO believed it was best to use patents “as a way of defending
`
`ourselves” unless “we were being eliminated in our ability to fairly compete in the market.” (Id.
`
`
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`- 15 -
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`
`
`Case 2:14-cv-00033-JRG Document 582 Filed 09/29/16 Page 16 of 80 PageID #: 72715
`
`at 122:4–24.) Genband’s current CEO, David Walsh, testified that he personally believed
`
`Metaswitch was potentially infringing in February 2011. (Dkt. No. 503-10 at 141–44.)
`
`2.
`
`The Court finds that the minimal amount of Metaswitch’s infringing activity
`and the circumstances surrounding Genband’s CVAS acquisition are
`sufficient to rebut any presumption or showing of unreasonable delay.
`
`[FF37] Before Genband acquired CVAS in 2010, the only asserted patent owned by
`
`Genband was the ’427 Patent. See [FF14]–[FF17].
`
`[FF38]
`
`It is reasonable that Genband was not aware of and did not investigate any
`
`possible infringement by Metaswitch of the ’427 Patent because the two companies were not
`
`major competitors and any infringement by Metaswitch was minimal. Before Genband acquired
`
`CVAS in 2010, Mr. Lazar testified that Genband and Metaswitch had a friendly relationship:
`
`Q. And could you tell us what the relationship was between Metaswitch and
`Genband during the early to mid 2000s?
`A. We’d run into them sometimes. The relationship was reasonably friendly.
`Q. Did that change at some point in time?
`A. Yeah. I mean, I think during the -- the mid 2000s, I knew the chief executive,
`Charlie Vogt, reasonably well. We -- we would talk to each other a couple of
`times a year. I would say it began to change after the CVAS acquisition.
`Q. And when you say “after the CVAS acquisition,” what do you mean?
`A. I think it began to get a -- it began to get much, much more competitive.
`Q. Because -- and that's because Genband acquired the CVAS unit?
`A. I don't know if it's directly linked to that, but I think so.
`
`1.13.16 p.m. Trial Tr. at 168:2–18. He testified that Genband and CVAS became “fierce
`competitors” in 2013 or 2014:
`Q. . . . and I think that the quotation from your deposition was that -- the fact that
`Genband and Metaswitch were fierce competitors.
`A. Yeah. I think as of 2013, 2014, that would be true.
`Q. Prior to 2013 or 2014, did you view them as a fierce competitor?
`A. Less so.
`
`1.13.16 p.m. Trial Tr. at 168:25–169:6.
`[FF39] After Genband acquired CVAS, it is reasonable that Genband was not aware of
`
`and did not investigate any possible infringement by Metaswitch because (1) Genband was pre-
`
`
`
`- 16 -
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`
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`Case 2:14-cv-00033-JRG Document 582 Filed 09/29/16 Page 17 of 80 PageID #: 72716
`
`occupied with absorbing the newly acquired company; (2) as a much larger company with a
`
`broader product portfolio, Genband did not view Metaswitch as a major competitor; and (3)
`
`Metaswitch’s infringing activity was minimal.
`
`[FF40] Mr. McCready, Genband’s Executive Vice President, testified that the
`
`magnitude of the Nortel acquisition was significant:
`
`Q And how -- how did Genband's business change, if at all, when it acquired
`CVAS?
`A Well, it changed dramatically. You know, the company had effectively one
`main product line.
` Now, it had a broad portfolio of products. The number of employees increased
`by a factor of, I think, four or five times, so did the revenue. Primarily, sales had
`been to these large integrators in the United States.
` Now, Genband had hundreds of companies -- pardon me -- hundreds of
`customers that it was servicing directly, and around the world, it became a global
`company in that step. It was truly transformational.
`
`
`(3/29/2016 Bench Trial Tr., Dkt. No. 542, at 73:12–23.)
`
`[FF41] Genband’s former CEO Mr. Vogt testified that, as of 2008, Genband did not
`
`consider Metaswitch one of the two competitors for the SBC market. (3/29/2016 Bench Trial Tr.,
`
`Dkt. No. 542, at 206:24–207:2.)
`
`E.
`
`Nortel’s Histo