Case 1:20-cv-01238 Document 1 Filed 12/22/20 Page 1 of 13
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`UNITED STATES DISTRICT COURT
`WESTERN DISTRICT OF TEXAS
`AUSTIN DIVISION
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`CANON INC.,
`
`
`Plaintiff,
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`
`
`v.
`
`
`OPTIMUM IMAGING TECHNOLOGIES
`LLC,
`
`
`Defendant.
`
`
`
`
`
`
`Civil Action No. 1:20-cv-1238
`
`
`
`
`
`CANON INC.’S COMPLAINT FOR DECLARATORY JUDGMENT OF
`UNENFORCEABILITY
`
`Plaintiff Canon Inc. (“Canon”) hereby files this complaint for declaratory judgment of
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`
`
`
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`unenforceability as to U.S. Patent No. 10,873,685 (“the ’685 Patent”) against Defendant
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`Optimum Imaging Technologies LLC (“OIT”), and in support of its complaint alleges as
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`follows:
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`NATURE OF THE ACTION
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`1.
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`This is an action arising under the patent laws of the United States, 35 U.S.C. § 1
`
`et. seq. and the Declaratory Judgment Act, 28 U.S.C. §§ 2201-2202, seeking a declaratory
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`judgment of unenforceability of the ’685 Patent, together with such other relief as the Court
`
`deems just and proper.
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`2.
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`3.
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`A true and correct copy of the ’685 Patent is attached hereto as Exhibit A.
`
`THE PARTIES
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`Canon is a corporation organized and existing under the laws of Japan. Its
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`principal place of business is located at 30-2, Shimomaruko 3-chome, Ohta-ku, Tokyo 146-8501,
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`Japan.
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`1
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`4.
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`On information and belief, OIT is a limited liability company organized and
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`existing under the laws of Texas, with a principal place of business located at 8701 Shoal Creek
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`Blvd # 401, Austin, Texas 78757.
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`JURISDICTION AND VENUE
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`5.
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`This Court has exclusive subject matter jurisdiction over this action pursuant to
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`federal question jurisdiction, 28 U.S.C. §§ 1331 and 1338(a), the Declaratory Judgment Act, 28
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`U.S.C. §§ 2201-2202, and the Patent Laws of the United States, 35 U.S.C. § 1 et seq.
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`6.
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`An actual and justiciable controversy exists between Canon and OIT of sufficient
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`immediacy and reality to warrant a declaration of rights by this Court. As set forth herein, an
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`actual case and controversy exists as to the alleged enforceability of the claims of the ’685
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`Patent.
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`7.
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`This Court has subject matter jurisdiction over this action based on a real and
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`immediate controversy between Canon and OIT regarding whether the ’685 Patent is
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`unenforceable. As described in more detail below, this controversy arises out of OIT’s
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`infringement assertions against Canon with respect to patents related to the ’685 Patent, where
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`OIT has alleged that its patents cover technologies implemented by Canon’s entire line of digital
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`cameras and digital video cameras.
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`8.
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`This Court has personal jurisdiction over OIT because, on information and belief,
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`OIT is a Texas limited liability company with its principal place of business in Austin, Texas,
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`and a registered agent with an address in Austin, Texas.
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`9.
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`Venue is proper in this Court under 28 U.S.C. § 1391 because OIT has its
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`principal place of business in this district and is subject to personal jurisdiction in this district.
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`2
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`FACTUAL BACKGROUND
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`10.
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`The ’685 Patent, titled “Digital Imaging System for Correcting Video Image
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`Aberrations,” issued on December 22, 2020. The ’685 Patent has a filing date of December 2,
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`2012, and lists Neal Solomon as the sole inventor.
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`11.
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`The ’685 Patent issued from U.S. Patent Application No. 13/691,805 (“the ’805
`
`Application”).
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`12.
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`The ’805 Application is a continuation of U.S. Patent Application No.
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`12/586,221, filed on September 18, 2009, which issued as U.S. Patent No. 8,451,339 (“the ’339
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`Patent”), which itself is a continuation of U.S. Patent Application No. 11/825,521, filed on July
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`6, 2007, which issued as U.S. Patent No. 7,612,805 (“the ’805 Patent”).
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`13.
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`Each of the ’685 Patent, ’805 Patent, and ’339 Patent purport to claim priority to
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`U.S. Provisional Patent Application No. 60/807,065, filed on July 11, 2006.
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`14.
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`15.
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`On information and belief, OIT is the sole assignee of the ’685 Patent.
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`OIT claims to own both the ’339 and ’805 Patents as well. See Optimum Imaging
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`Technologies LLC v. Canon Inc., E.D. Tex. Case No. 2:19-cv-00246-JRG, D.I. 1 at ¶ 13.
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`16.
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`The ’805 Patent, titled “Digital Imaging System and Methods For Selective Image
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`Filtration,” issued on November 3, 2009. The ’805 Patent lists Neal Solomon as the sole
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`inventor.
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`17.
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`The ’339 Patent, titled “Digital Imaging System for Correcting Image
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`Aberrations,” issued on May 28, 2013. The ’339 Patent also lists Neal Solomon as the sole
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`inventor.
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`18.
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`Each of the ’685 Patent, ’805 Patent, and ’339 Patent share a common
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`specification.
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`3
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`19.
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`The ’685 Patent and ’339 Patent also share a common abstract:
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`A system is disclosed for the automated correction of optical and
`digital aberrations in a digital imaging system. The system includes
`(a) digital filters, (b) hardware modifications and (c) digital system
`corrections. The system solves numerous problems in still and
`video photography that are presented in the digital imaging
`environment.
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`The claims of the ’685, ’805, and ’339 Patents relate generally to aberration
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`20.
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`correction in digital imaging and/or video systems.
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`21.
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`On July 8, 2019, OIT filed a complaint against Canon alleging infringement of the
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`’805 and ’339 Patents. See Optimum Imaging Technologies LLC v. Canon Inc., E.D. Tex. Case
`
`No. 2:19-cv-00246-JRG, D.I. 1. In this litigation (“the E.D. Tex. litigation”), OIT has asserted
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`that Canon’s entire line of digital still cameras and digital video cameras infringe the ’805 and
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`’339 Patents due to their incorporation of in-camera aberration correction technology. See
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`Optimum Imaging Technologies LLC v. Canon Inc., E.D. Tex. Case No. 2:19-cv-00246-JRG,
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`D.I. 1 at ¶¶ 19-20.
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`22.
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`The first Canon digital still cameras and digital video cameras with in-camera
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`aberration correction functionality—namely, the PowerShot SD300 Digital ELPH, PowerShot
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`SD200 Digital ELPH, and ZR80, ZR85, and ZR90—were first sold in the United States in 2004.
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`Canon digital still cameras and digital video cameras with in-camera aberration correction
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`functionality remain available for sale in the United States to this day.
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`23.
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`There are 150+ Canon products at issue in the E.D. Tex. litigation, including
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`Canon digital still cameras that include DIGIC 4, DIGIC 4+, DIGIC 5, DIGIC 5+, DIGIC 6,
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`DIGIC 6+, DIGIC 7, and DIGIC 8 imaging engines, and Canon digital video cameras that
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`include DIGIC DV III, DIGIC DV 4, DIGIC DV 5, DIGIC DV 6, and DIGIC DV 7 imaging
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`4
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`engines. See Optimum Imaging Technologies LLC v. Canon Inc., E.D. Tex. Case No. 2:19-cv-
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`00246-JRG, D.I. 163 at 6.
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`24.
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`Each independent claim of the ’685 Patent requires “a digital video camera,” and
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`OIT’s litigation assertions against Canon with respect to the ’805 and ’339 Patents demonstrate
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`OIT’s intent to enforce the ’685 Patent against, at least, Canon’s digital video camera products
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`that include any of the DIGIC DV III, DIGIC DV 4, DIGIC DV 5, DIGIC DV 6, and DIGIC DV
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`7 imaging engines (“Canon Digital Video Camera Products”).
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`25.
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`The Canon Digital Video Camera Products include, at minimum, the VIXIA HF
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`G60, XA55, XA50, XA45, XA40, VIXIA HF G50, XF705, XA15, XA11, VIXIA HF G21,
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`XF405, XF400, VIXIA GX10, VIXIA HF R82, VIXIA HF R800, VIXIA HF R80, XC15,
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`ME200S-SH, VIXIA HF R72, VIXIA HF R700, VIXIA HF R70, VIXIA HF G40, ME20F-SH,
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`XC10, VIXIA mini X, VIXIA HF G20, EOS C700 FF, EOS C700 FF PL, EOS C500 Mark II,
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`EOS C700, EOS C700 PL, EOS C700 GS PL, EOS C300 Mark II, EOS C300 Mark II PL, EOS
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`C200, EOS C200B, and EOS C100 Mark II.
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`26.
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`The foregoing facts and circumstances give rise to a reasonable apprehension of
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`litigation on the part of Canon. There is now existing an actual, substantial justiciable
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`controversy between the parties with respect to the ’685 Patent.
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`COUNT I
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`(Declaratory Judgment of Unenforceability of the ’685 Patent
`Due to Inequitable Conduct )
`
`27.
`
`Canon incorporates by reference the allegations in paragraphs 1 through 26 as
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`though fully set forth herein.
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`28.
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`An actual and justiciable controversy exists between Canon and OIT concerning
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`the ’685 Patent.
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`5
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`29.
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`The ’685 Patent is unenforceable due to inequitable conduct that occurred during
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`the prosecution of the ’805 Application resulting in the issuance of the ’685 Patent.
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`30.
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`Neal Solomon filed the ’805 Application with the U.S. Patent and Trademark
`
`Office (“PTO”) on December 2, 2012. The ’805 Application listed Neal Solomon as the sole
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`inventor.
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`31.
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`On January 3, 2013, the PTO mailed Mr. Solomon a “Notice To File Missing
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`Parts Of Nonprovisional Application” (hereinafter, the “January 2013 Notice”), attached hereto
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`as Exhibit B, informing Mr. Solomon that he had failed to pay his application fees and failed to
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`include a proper inventor’s declaration when filing the ’805 Application. The PTO’s January
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`2013 Notice set a two-month deadline for Mr. Solomon to reply with payment of the missing
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`application fees ($1,260) plus a late-payment surcharge ($130).
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`32.
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`On information and belief, Mr. Solomon received the January 2013 Notice shortly
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`after it was mailed, well before the two-month deadline for responding, and made a conscious
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`and deliberate decision not to respond. Accordingly, the ’805 Application became abandoned.
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`33.
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`On September 6, 2013, the PTO mailed to Mr. Solomon a “Notice of
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`Abandonment Under 37 CFR 1.53(f) or (g)” (hereinafter, the “September 2013 Notice”),
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`attached hereto as Exhibit C, advising him that the ’805 Application had been abandoned and
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`that any petition to revive the ’805 Application “must be filed promptly after applicant becomes
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`aware of the abandonment” and must include either a showing that the delay was “unavoidable”
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`or “a statement that the entire delay was unintentional.” On information and belief, Mr. Solomon
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`received the September 2013 Notice shortly after it was mailed.
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`34.
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`Five years and five months later, on February 11, 2019, Mr. Solomon filed a
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`“Petition for Revival of an Application for Patent Abandoned Unintentionally Under 37 CFR
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`6
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`1.137(b)” for the ’805 Application (hereinafter, the “February 2019 Revival Petition”), attached
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`hereto as Exhibit D. In the February 2019 Revival Petition, Mr. Solomon represented that “[t]he
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`entire delay in filing the required reply from the due date for the required reply until the filing of
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`a grantable petition under 37 CFR 1.137(b) was unintentional.”
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`35.
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`In a letter filed on the same date as the February 2019 Revival Petition, attached
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`hereto as Exhibit E, Mr. Solomon explained that the ’805 Application was abandoned for lack of
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`payment of application fees and represented that the “reason for the non-payment was economic
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`constraints.”
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`36.
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`On March 22, 2019, the PTO granted Mr. Solomon’s petition and revived the
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`’805 Application. In its decision, attached hereto as Exhibit F, the PTO stated:
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`37 CFR 1.137(b)(4) requires a statement that the entire delay in
`filing the required reply from the due date for the reply until the
`filing of a grantable petition pursuant to 37 CFR 1.137(a) was
`unintentional. Since the statement appearing in the petition varies
`from the language required by 37 CFR 1.137(b)(4), the statement is
`being construed as the required statement. Petitioner must notify the
`Office if this is not a correct reading of the statement appearing in
`the petition.
`
`This application has been abandoned for an extended period of time.
`The U.S. Patent and Trademark Office is relying on petitioner’s duty
`of candor and good faith and accepting the statement that “the entire
`delay in filing the required reply from the due date for the reply until
`the filing of a grantable petition pursuant to 37 CFR 1.137 was
`unintentional.” See Changes to Representation of Others Before the
`United States Patent and Trademark Office, 73 Fed. Reg. 47650
`(August 14, 2008), 1334 Off. Gaz. Pat. Office 338 September 9,
`2008) (applicant obligated under 37 CFR 11.18 to inquire into the
`underlying facts and circumstances when providing the statement
`required by 37 CFR 1.137 to the U.S. Patent and Trademark Office).
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`37. Mr. Solomon did not advise the PTO that its understanding of his petition was
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`inaccurate. He, through his attorneys, thereafter prosecuted the ’805 Application through to
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`issuance as the ’685 Patent.
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`7
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`38.
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`On information and belief, and contrary to Mr. Solomon’s representations to the
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`PTO, neither Mr. Solomon’s initial decision to let the ’805 Application become abandoned, nor
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`Mr. Solomon’s nearly six-year delay in between the ’805 Application becoming abandoned and
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`his filing of the February 2019 Revival Petition, was unintentional. Rather, on information and
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`belief, Mr. Solomon made a conscious and deliberate decision to allow the ’805 Application to
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`go abandoned in early 2013 and his delay in paying the application fees until February 2019 was
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`intentional, as Mr. Solomon had adequate funds to make such payment well before filing his
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`February 2019 Revival Petition.
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`39.
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` On information and belief, Mr. Solomon knowingly and deliberately made
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`affirmative misrepresentations to the PTO in his February 2019 Revival Petition and
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`accompanying letter about the entire delay being “unintentional” and the non-payment being due
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`to “economic constraints.” Moreover, on information and belief, after receiving the PTO’s
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`March 22, 2019 Decision, Mr. Solomon knowingly and deliberately failed to disclose to the PTO
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`that its understanding regarding the circumstances surrounding the duration of Mr. Solomon’s
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`delay in paying the missing application fee was inaccurate.
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`40.
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`On information and belief, Mr. Solomon’s statement of unintentional delay in his
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`February 2019 Revival Petition and accompanying letter and his failure to disclose that his six-
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`year delay in replying to the PTO’s January 2013 Notice was not unintentional were material to
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`the decision of the PTO to reinstate the ’805 Application. Thus, Mr. Solomon’s
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`misrepresentations were also material to the decision of the PTO to issue the ’685 Patent. But
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`for Mr. Solomon’s knowing and deliberate mispresentations, the PTO would not have accepted
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`Mr. Solomon’s revival petition, and the ’805 Application would not have issued as the ’685
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`Patent.
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`8
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`41.
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`On information and belief, Mr. Solomon’s statement of unintentional delay was
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`knowingly false and intended to deceive the PTO, as Mr. Solomon’s decision to abandon the
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`’805 Application and his nearly six-year delay in reviving the ’805 Application were not
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`unintentional.
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`42.
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`The application fees for the ’805 Application could have been timely paid at
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`anytime between December 2, 2012, when the ’805 Application was filed, and March 3, 2013,
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`when a response to the January 2013 Notice was due. On information and belief, Mr. Solomon
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`had ample funds with which to pay the application fees during and after that window, but he
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`decided not to, as shown by Mr. Solomon’s payment of other prosecution-related fees for other
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`patents in the same time frame (as discussed below). On information and belief, Mr. Solomon
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`instead decided to allow the ’805 Application to become and remain abandoned rather than to
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`pay the application fees.
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`43. Mr. Solomon did not petition to revive the abandoned ’805 Application until
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`February 11, 2019. On information and belief, and as discussed below, in between December 2,
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`2012 (the date the ’805 Application was filed) and February 11, 2019, Mr. Solomon chose to pay
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`prosecution-related fees for other of his patents and pending applications, including fees
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`associated with the ’805 Patent at issue in the E.D. Tex. litigation, which Mr. Solomon petitioned
`
`to revive in February 2017 at a cost of $1,850 (after failing to pay a 3.5 year maintenance fee by
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`November 4, 2013). Accordingly, on information and belief, Mr. Solomon could have afforded
`
`to pay the application fees for the ’805 Application long before February 2019, but he
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`intentionally delayed paying them.
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`44.
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`In addition to the revival fees for the ’805 Patent, in between December 2, 2012
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`and February 11, 2019, Mr. Solomon paid at least the following prosecution-related fees to the
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`9
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`Case 1:20-cv-01238 Document 1 Filed 12/22/20 Page 10 of 13
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`PTO: (1) the ’339 Patent - $1,170 Issue Fee on December 10, 2012; (2) US 8,478,677 - $1,185
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`Issue Fee on January 14, 2013; (3) US 8,384,785 - $1,185 Issue Fee on January 22, 2013; (4) US
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`8,395,668 - $1,185 Issue Fee on February 11, 2013; (5) US 8,395,682 - $1,185 Issue Fee on
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`February 11, 2013; (6) US 8,400,531 - $1,185 Issue Fee on February 12, 2013; (7) US 8,407,660
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`- $1,185 Issue Fee on February 14, 2013; (8) US 8,472,230 - $1,190 Issue Fee on May 21, 2013;
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`(9) US 8,565,540 - $1,190 Issue Fee on September 16, 2013; (10) US 8,570,381 - $1,190 Issue
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`Fee on September 23, 2013; (11) US 8,617,873 - $1,190 Issue Fee on November 21, 2013; (12)
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`US 8,623,638 - $1,190 Issue Fee on November 29, 2013; (13) US 8,639,524 - $1,190 Issue Fee
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`on December 19, 2013; (14) the ’339 Patent - $880 Maintenance Fee on February 19, 2017; (15)
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`US 8,384,785 - $880 Maintenance Fee on February 19, 2017; (16) US 8,395,668 - $880
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`Maintenance Fee on March 7, 2017; (17) US 8,395,682 - $880 Maintenance Fee on March 7,
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`2017; (18) US 8,400,531 - $880 Maintenance Fee on March 7, 2017; (19) the ’805 Patent -
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`$1,880 Maintenance Fee on October 31, 2017.
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`45.
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`Accordingly, on information and belief, Mr. Solomon knew that he could have
`
`afforded to pay the application fees for the ’805 Application prior to it becoming abandoned on
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`March 4, 2013, and knew that he could have afforded to revive the ’805 Application long before
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`he filed his February 2019 Revival Petition. Accordingly, Mr. Solomon’s statement in his
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`February 2019 Revival Petition that his delay in replying to the PTO’s January 2013 Notice was
`
`unintentional was knowingly false and intended to deceive the PTO. Moreover, his statement
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`that his “reason for the non-payment [of the ’805 Application fee] was economic constraints”
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`was a knowing and deliberate misrepresentation to the PTO made with intent to deceive, as it
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`misled the PTO into believing that Mr. Solomon would have liked to have timely paid the
`
`application fees, but could not afford to until February 2019, which was not the case. Further,
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`10
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`Case 1:20-cv-01238 Document 1 Filed 12/22/20 Page 11 of 13
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`Mr. Solomon’s failure to clarify the PTO’s understanding of the statements in his February 2019
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`Revival Petition and accompanying letter after Mr. Solomon received the PTO’s March 22, 2019
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`Decision constitutes a knowing and deliberate withholding of material information from the PTO
`
`made with an intent to deceive.
`
`46.
`
`Further supporting that Mr. Solomon’s material misrepresentations with respect to
`
`his statements of unintentionality and economic constraints in connection with his revival of the
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`’805 Application were intentional, Mr. Solomon was well aware of the requirements of PTO
`
`revival petitions by February 2019. See Optimum Imaging Technologies LLC v. Canon Inc.,
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`E.D. Tex. Case No. 2:19-cv-00246-JRG, D.I. 170 at 7-13 (setting forth Mr. Solomon’s extensive
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`history in engaging in the practice of reviving expired patents).
`
`47.
`
`On information and belief, Mr. Solomon’s decision to abandon the ’805
`
`Application and his nearly six-year delay in reviving the ’805 Application were not
`
`unintentional, and his statements to the contrary constitute knowing and deliberate material
`
`misrepresentations to the PTO.
`
`48.
`
`All asserted claims of the ’685 Patent are unenforceable due to this inequitable
`
`conduct during prosecution of the ’805 Application.
`
`49.
`
`Pursuant to the Federal Declaratory Judgment Act, 28 U.S.C. §§ 2201 et seq.,
`
`Canon seeks a declaration that the ’685 Patent is unenforceable due to inequitable conduct that
`
`occurred during the prosecution of the ’685 Patent.
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`PRAYER FOR RELIEF
`
`WHEREFORE, Canon prays for the following judgment and relief:
`
`A.
`
`A declaration that the ’685 Patent is unenforceable;
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`11
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`Case 1:20-cv-01238 Document 1 Filed 12/22/20 Page 12 of 13
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`B.
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`An order declaring that Canon is the prevailing party and that this case is an
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`exceptional case under 35 U.S.C. § 285, and awarding Canon its costs, expenses, and reasonable
`
`attorneys’ fees under 35 U.S.C. § 285 and all other applicable statutes, rules, and common law,
`
`including this Court’s inherent authority; and
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`C.
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`Any other equitable and/or legal relief that this Court may deem just and proper.
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`12
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`Case 1:20-cv-01238 Document 1 Filed 12/22/20 Page 13 of 13
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`Date: December 22, 2020
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`Respectfully submitted,
`
`
`/s/ Michael P. Sandonato w/permission Andrea L. Fair
`Michael P. Sandonato
`NY Bar No. 2532646
`Peter D. Shapiro
`NY Bar No. 3047826
`Daniel A. Apgar
`NY Bar No. 5178181
`VENABLE LLP
`1290 Avenue of the Americas
`New York, NY 10104
`(212) 218-2100 (telephone)
`(212) 218-2200 (facsimile)
`MSandonato@Venable.com
`PShapiro@Venable.com
`DApgar@Venable.com
`
`Of Counsel:
`
`Wesley Hill
`Texas Bar No. 24032294
`Andrea L. Fair
`Texas Bar No. 24078488
`WARD, SMITH & HILL, PLLC
`1507 Bill Owens Parkway
`Longview, Texas 75604
`(903) 757-6400 (main line)
`(903) 757-2323 (facsimile)
`wh@wsfirm.com
`andrea@wsfirm.com
`
`Attorneys for Plaintiff Canon Inc.
`
`
`
`
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`13
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