Case: 22-1598 Document: 99 Page: 1 Filed: 04/01/2024
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`NOTE: This disposition is nonprecedential.
`
`United States Court of Appeals
`for the Federal Circuit
`______________________
`
`ALEXSAM, INC.,
`Plaintiff-Appellant
`
`v.
`
`SIMON PROPERTY GROUP, L.P., BLACKHAWK
`NETWORK, INC.,
`Defendants-Appellees
`
`US BANK NA,
`Defendant
`______________________
`
`2022-1598
`______________________
`
`Appeal from the United States District Court for the
`Eastern District of Texas in No. 2:19-cv-00331-RWS-RDP,
`Judge Robert Schroeder, III.
`______________________
`
`Decided: April 1, 2024
`______________________
`
`STEVEN RITCHESON, Insight, PLC, Marina del Rey, CA,
`argued for plaintiff-appellant.
` Also represented by
`JACQUELINE KNAPP BURT, Heninger Garrison Davis, LLC,
`Atlanta, GA; TIMOTHY C. DAVIS, W. LEE GRESHAM, III, Bir-
`mingham, AL.
`
`
`

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`Case: 22-1598 Document: 99 Page: 2 Filed: 04/01/2024
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`ALEXSAM, INC. v. SIMON PROPERTY GROUP, L.P.
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` ELIZABETH M. MANNO, Venable LLP, Washington, DC,
`argued for defendant-appellee Simon Property Group, L.P.
`Also represented by TIMOTHY J. CARROLL, Orrick, Herring-
`ton & Sutcliffe LLP, Chicago, IL; LAURA A. WYTSMA, Los
`Angeles, CA.
`
` JASON F. HOFFMAN, Baker & Hostetler LLP, Washing-
`ton, DC, argued for defendant-appellee Blackhawk Net-
`work, Inc. Also represented by JAMES B. HATTEN, Atlanta,
`GA.
`
`______________________
`
`Before PROST, TARANTO, and HUGHES, Circuit Judges.
`HUGHES, Circuit Judge.
`AlexSam, Inc. appeals the U.S. District Court for the
`Eastern District of Texas’s grant of Simon Property Group,
`L.P.’s and Blackhawk Network, Inc.’s non-infringement
`summary judgment motions. AlexSam contends that the
`district court erred in its application of the stipulated claim
`construction of “unmodified” and that genuine issues of
`material fact exist. For the reasons that follow, we affirm.
`I
`Appellant AlexSam owns U.S. Patent No. 6,000,608,
`which discloses a “multifunction card system.” ’608 patent
`Abstract. The system includes a multifunction card that
`“can serve a number of functions, thus allowing the con-
`sumer to have one card which may act as their card for fi-
`nancial transactions, long-distance telephone calls, loyalty
`information, and medical information.” Id. at 3:3–6. These
`cards do not require special programming to be used: they
`can be activated, reloaded, or used at existing, rather than
`specialized, point-of-sale retail devices. Id. at 4:14–20.
`Independent claim 34 provides:
`A system comprising:
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`Case: 22-1598 Document: 99 Page: 3 Filed: 04/01/2024
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`ALEXSAM, INC. v. SIMON PROPERTY GROUP, L.P.
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`a. at least one electronic gift certificate card having
`an electronic gift certificate card unique identifica-
`tion number encoded on it, said electronic gift cer-
`tificate
`card unique
`identification number
`comprising a bank identification number approved
`by the American Banking Association for use in a
`banking network;
`b. a transaction processor receiving electronic gift
`card activation data from an unmodified existing
`standard retail point-of-sale device, said electronic
`gift certificate card activation data including said
`unique identification number and an electronic gift
`certificate card activation amount;
`c. a processing hub receiving directly or indirectly
`said activation data from said transaction proces-
`sor; and
`d. said processing hub activating an account corre-
`sponding to the electronic gift certificate card
`unique identification number with a balance corre-
`sponding to the electronic gift certificate activation
`amount.
`Id. at 16:15–33 (emphasis added). Independent claim 60 re-
`cites “[a] method of activating a prepaid card” by “swiping
`the card through an unmodified existing standard point-of-
`sale device.” Id. at 18:58–19:2 (emphasis added).
`A
`During prosecution of the ’608 patent, the inventor dis-
`tinguished their invention from the prior art because the
`patented invention “is specifically intended to be deployed
`over an existing banking network,” therefore “custom soft-
`ware is not necessary at the activating location . . . . Thus,
`existing point-of-sale devices known in the art for processing
`credit card and/or debit card transactions can be utilized
`without modification.” J.A. 3469 (emphasis added). The pa-
`tent examiner allowed the claims once the inventor
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`ALEXSAM, INC. v. SIMON PROPERTY GROUP, L.P.
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`inserted the word “unmodified” before “existing standard
`point-of-sale device.” See J.A. 3486–87. The ’608 patent
`subsequently issued.
`
`B
`There has been much litigation regarding the meaning
`of “unmodified existing standard [retail] point-of-sale de-
`vice”1 as used in the ’608 patent’s claims. AlexSam sued
`Datastream Card Services Ltd. for infringement of the ’608
`patent in 2003. Alexsam, Inc. v. Datastream Card Servs.
`Ltd., No. 2:03-cv-337 (E.D. Tex. Sept. 26, 2003), ECF No. 1.
`There, the district court issued a claim construction order,
`construing “unmodified existing standard [retail] point-of-
`sale device” to mean “a terminal for making purchases at a
`retail location of the type in use as of July 10, 1997 that has
`not been reprogrammed, customized, or otherwise altered
`with respect to its software or hardware for use in the card
`system”
`(hereinafter,
`the Datastream construction).
`Alexsam, Inc., No. 2:03-cv-337 (E.D. Tex. June 10, 2005),
`ECF No. 199 at 9. The district court reasoned that, based
`on the prosecution history, the “examiner required the in-
`clusion” of “unmodified” “to clarify that the systems
`claimed in the ’608 patent did not require any hardware
`and/or software modifications to the existing standard re-
`tail POS devices.” Id.
`In subsequent litigation involving the ’608 patent,
`AlexSam has stipulated to the Datastream construction of
`“unmodified existing standard [retail] point-of-sale device.”
`See, e.g., Alexsam, Inc. v. IDT Corp., 715 F.3d 1336, 1339
`
`
`Independent claim 34 includes the bracketed term
`1
`“retail,” whereas independent claim 60 does not. The par-
`ties do not argue that the exclusion of “retail” meaningfully
`changes the scope of claim 60 relative to claim 34. For sim-
`plicity, we refer to both claim limitations as “unmodified
`existing standard [retail] point-of-sale device.”
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`ALEXSAM, INC. v. SIMON PROPERTY GROUP, L.P.
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`(Fed. Cir. 2013) (IDT); Alexsam, Inc. v. Gap, Inc., 621 F.
`App’x 983, 986 (Fed. Cir. 2015) (Gap). In both cases, the
`construction of “unmodified existing standard [retail]
`point-of-sale device” was an important aspect of the dis-
`putes. In IDT, we reversed a district court’s judgment of
`infringement because AlexSam did not provide sufficient
`evidence that “no modifications were actually made to the
`[accused systems’] software in order to allow them to acti-
`vate [the accused’s] cards.” 715 F.3d at 1342, 1348. And in
`Gap, we reversed a district court’s denial of judgment as a
`matter of law because AlexSam did not show prior concep-
`tion of an “unmodified” point-of-sale device. 621 F. App’x at
`994–95.
`
`C
`Appellee Simon sells self-branded gift cards, including
`a Visa Gift Card, a 5% Back Visa Gift Card, and an Amer-
`ican Express Gift Card. AlexSam initially sued only Simon,
`alleging that its gift cards infringed independent claims 34
`and 60 and various dependent claims of the ’608 patent.
`AlexSam later amended its complaint to include infringe-
`ment claims against Appellee Blackhawk, the entity that
`supplies and activates some of the accused Simon-branded
`gift cards.
`During claim construction, AlexSam, Simon, and
`Blackhawk agreed that the Datastream construction of
`“unmodified existing standard [retail] point-of-sale device”
`should be applied. J.A. 29, 67–68. Under the Datastream
`construction, “unmodified existing standard retail point-of-
`sale device” means “[a] terminal, for making purchases at
`a retail location, that is of the type in use as of July 10,
`1997, and that has not been reprogrammed, customized, or
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`ALEXSAM, INC. v. SIMON PROPERTY GROUP, L.P.
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`otherwise altered with respect to its software or hardware
`for use in the card system.” J.A. 68.2,3
`Simon and Blackhawk separately moved for summary
`judgment of non-infringement, arguing that AlexSam did
`not proffer sufficient evidence that the accused systems’
`point-of-sale devices were actually “unmodified” and, in
`any event, that the accused point-of-sale devices are modi-
`fied (and not “unmodified” as required by the claims). J.A.
`74. The magistrate judge issued a report and recommenda-
`tion (R&R) recommending that the district court grant the
`non-infringement motions and dismiss AlexSam’s infringe-
`ment claims with prejudice. J.A. 69–83. The district court
`adopted the magistrate judge’s R&R over AlexSam’s objec-
`tions and granted Simon’s and Blackhawk’s motions for
`summary judgment. J.A. 1–6.
`AlexSam timely appealed, and we have jurisdiction un-
`der 28 U.S.C. § 1295(a)(1).
`
`II
`We review a district court’s summary judgment deci-
`sion under applicable regional circuit precedent. Unwired
`Planet, LLC v. Apple Inc., 829 F.3d 1353, 1356 (Fed. Cir.
`2016). The Fifth Circuit reviews the grant of summary
`judgment de novo. Patel v. Tex. Tech Univ., 941 F.3d 743,
`747 (5th Cir. 2019). “Summary judgment is appropriate
`when, drawing all justifiable inferences in the nonmovant’s
`favor, ‘the movant shows that there is no genuine dispute
`as to any material fact and the movant is entitled to
`
`2 The stipulated construction of “unmodified existing
`standard point-of-sale device,” as used in claim 60, omits
`the “at a retail location” language. J.A. 67.
`3 No party argues that the added commas in the stip-
`ulated version of the Datastream construction applied here
`impacts the disputed “unmodified existing standard [re-
`tail] point-of-sale device” claim limitations. See J.A. 77 n.7.
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`Case: 22-1598 Document: 99 Page: 7 Filed: 04/01/2024
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`ALEXSAM, INC. v. SIMON PROPERTY GROUP, L.P.
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`judgment as a matter of law.’” Unwired Planet, 829 F.3d at
`1356 (quoting Fed. R. Civ. P. 56(a) and citing Anderson v.
`Liberty Lobby, Inc., 477 U.S. 242, 255 (1986)).
`III
`On appeal, AlexSam challenges the stipulated and
`long-applied construction of “unmodified existing standard
`[retail] point-of-sale device,” and argues that under the cor-
`rect construction of “unmodified” or the correct application
`of the stipulated construction, genuine issues of material
`fact exist. We disagree.
`To the extent that AlexSam attempts to challenge the
`stipulated construction of “unmodified existing standard
`[retail] point-of-sale device,” we conclude that this argu-
`ment is waived. See Digital-Vending Servs. Int’l, LLC v.
`Univ. of Phoenix, Inc., 672 F.3d 1270, 1278 (Fed. Cir. 2012)
`(“By stipulating to the construction that the district court
`adopted, Digital-Vending waived its right to challenge this
`construction on appeal.”).
`AlexSam next contends that the district court erred in
`applying the stipulated construction such that any modifi-
`cation made to a point-of-sale device would take that device
`outside the scope of the claims. As AlexSam understands
`the Datastream construction, the key language is “for use
`in the card system.” Appellant’s Br. 42. In AlexSam’s view,
`“unmodified” excludes modifications “directed to the spe-
`cific functions required of the device in the Asserted
`Claims,” such as reading a card’s identification number or
`having the device communicate data over a banking net-
`work, and that are “not otherwise required” because they
`are “required for any use, not just ‘for use in the card sys-
`tem.’” Id.
`We agree with AlexSam that a point-of-sale device can
`be altered in certain respects while still being “unmodified”
`for purposes of infringement. However, the Datastream
`construction, as it has long been applied, specifies what an
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`ALEXSAM, INC. v. SIMON PROPERTY GROUP, L.P.
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`“unmodified . . . [retail] point-of-sale device” is: a point-of-
`sale device that has not been “reprogrammed, customized,
`or otherwise altered with respect to its software or hard-
`ware for use in the card system.” The magistrate judge
`faithfully applied this construction in the R&R, explaining
`that “modifications to the software or hardware that im-
`pact how the POS device would generally be used in the
`card system fall outside of the claim scope.” J.A. 80 (empha-
`sis added); J.A. 5. To the extent AlexSam even advances a
`new or different understanding of the “unmodified” claim
`term, we are unpersuaded by AlexSam’s attempt to
`broaden the scope of “unmodified existing standard [retail]
`point-of-sale device” after stipulating to the Datastream
`construction after cases like Gap and IDT.
`In sum, we conclude that the district court did not err
`in its application of the Datastream construction.
`IV
`We next consider whether the district court erred in its
`grant of Simon’s and Blackhawk’s motions for summary
`judgment of non-infringement. AlexSam argues that it of-
`fered sufficient evidence of Simon’s and Blackhawk’s in-
`fringement to proceed to trial. We are not persuaded.
`The district court concluded there was no genuine dis-
`pute of material fact about whether the accused point-of-
`sale devices were “unmodified” because AlexSam’s evi-
`dence was “substantially the same as that presented in
`IDT.” J.A. 4. In IDT, we explained that to establish in-
`fringement, AlexSam had to show that the accused sys-
`tems’ point-of-sale devices “ha[d] not been reprogrammed,
`customized, or otherwise altered with respect to [their]
`software . . . for use in the card system.” 715 F.3d at 1341
`(emphasis omitted). Before the IDT district court, AlexSam
`relied on expert testimony that IDT’s systems did not need
`to be modified to function with the accused cards, but did
`not opine that the point-of-sale devices were not actually
`“reprogrammed, customized, or otherwise altered” as
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`required by the Datastream construction. 715 F.3d at
`1341–42. AlexSam’s other expert similarly “testified that
`no modifications were ‘necessary’ to allow a standard
`[point-of-sale] terminal to read an IDT card.” Id. at 1342.
`Ultimately, we reversed the district court’s denial of IDT’s
`motion for judgment as a matter of law of non-infringement
`because AlexSam failed to present sufficient evidence that
`IDT’s accused systems had not been “reprogrammed, cus-
`tomized, or otherwise altered with respect to [their] soft-
`ware . . . for use in the card system.” Id.
`Here, AlexSam’s expert testified that it was “not neces-
`sary to inspect the actual [point-of-sale] devices used in the
`Simon and Blackhawk systems” to determine that the ac-
`cused systems infringed the asserted claims. J.A. 3223
`(Zatkovich Supplemental Report ¶ 29). Once more,
`AlexSam’s expert “concluded that no modification is re-
`quired to the [point-of-sale] Devices for use in the Simon
`and Blackhawk systems.” J.A. 3222 (Zatkovich Supple-
`mental Report ¶ 26) (emphasis added). This testimony re-
`mains insufficient under IDT. We agree with the district
`court that AlexSam’s evidence falls short of creating a gen-
`uine issue of material fact.
`We conclude that the district court did not err in grant-
`ing Simon’s and Blackhawk’s motions for summary judg-
`ment of non-infringement.
`
`V
`The district court correctly applied the stipulated
`Datastream claim construction and AlexSam did not pro-
`vide sufficient evidence to establish a genuine dispute of
`material fact over whether the accused devices were “un-
`modified.” We have considered AlexSam’s additional argu-
`ments and find them unpersuasive. We affirm.
`AFFIRMED
`
`