IN THE UNITED STATES DISTRICT COURT 

FOR THE DISTRICT OF COLORADO 

Civil Action No.: 11-cv-02519-WYD-MJW 

TELECOMMUNICATION SYSTEMS, INC., 

a Maryland company, 

Plaintiff, REQUEST FOR ORAL ARGUMENT

v. 

TRACBEAM, L.L.C., 

a Colorado limited liability company, 

Defendant. 

PLAINTIFF TELECOMMUNICATION SYSTEMS, INC.’S OPPOSITION 

TO DEFENDANT TRACBEAM, L.L.C.’S MOTION TO DISMISS UNDER 

FED. R. CIV. P. 12(b)(1) 

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I. INTRODUCTION .............................................................................................................. 1

II. RELEVANT LEGAL STANDARDS FOR DECLARATORY JUDGMENT 

JURISDICTION ................................................................................................................. 2

III. ARGUMENT ...................................................................................................................... 3

A. TCS’ Indemnification of MetroPCS in the Texas Litigation Unequivocally 

Confers Declaratory Judgment Jurisdiction ............................................................ 3

B. TracBeam Misconstrues the Case Law Relevant to Indemnification ..................... 5

C. TracBeam’s Notice Letter to TCS, Considered With the Totality of the 

Circumstances, Is Sufficient to Confer Declaratory Judgment Jurisdiction ........... 6

IV. CONCLUSION ................................................................................................................. 10

V. REQUEST FOR ORAL ARGUMENT ............................................................................ 10

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Plaintiff TeleCommunication Systems, Inc. (“TCS”), by and through its undersigned 

counsel, submits this Memorandum in Opposition to Defendant TracBeam, L.L.C.’s 

(“TracBeam”) Motion to Dismiss Under Fed. R. Civ. P. 12(b)(1). 

I. INTRODUCTION 

TracBeam’s Motion to Dismiss (“TracBeam’s Motion”) is predicated on a selective and 

strained interpretation of the case law. TracBeam claims that TCS’ Complaint should be 

dismissed because the standard for declaratory judgment is not met for two reasons: (i) 

TracBeam’s lawsuit against multiple TCS customers in the Eastern District of Texas, and TCS’ 

indemnification of one of those customers, does not create a justiciable controversy; and (ii) 

TracBeam’s notice letter to TCS does not create a substantial controversy between the two 

entities. Neither argument is availing. 

As set forth below, TCS’ indemnification of a defendant in TracBeam’s litigation in the 

Eastern District of Texas (“the Texas litigation”) unequivocally creates “adverse legal interests” 

between TCS and TracBeam. TCS has indemnified MetroPCS (a TCS customer) in the Texas 

litigation. Both Supreme Court and Federal Circuit precedent hold that acceptance of a 

contractual obligation to indemnify a customer is sufficient to confer declaratory judgment 

jurisdiction. 

TracBeam’s alternative claim – that there is no actual controversy worthy of declaratory 

judgment jurisdiction – fares no better. TracBeam argues that no substantial controversy exists 

because the notification letter to TCS is mere advertising, devoid of an express accusation of 

infringement or threat of litigation. This argument belies TracBeam’s true intentions, and 

nevertheless, has been expressly rejected by the Federal Circuit. 

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The overarching theme in TracBeam’s Motion is that the issues of indemnification and 

notice should be considered in isolation, as separate and distinct concepts. This approach is 

contrary to legal precedent, which requires consideration of the totality of the circumstances. See 

MedImmune, Inc. v. Genentech, Inc., 549 U.S. 118, 127 (2007). When considered in the proper 

manner, TCS’ indemnification of MetroPCS (a TCS customer) in the Texas litigation as a result 

of litigation commenced by TracBeam, coupled with TracBeam’s notification to TCS and 

TracBeam’s prior conduct, requires the denial of TracBeam’s Motion. 

II. RELEVANT LEGAL STANDARDS FOR DECLARATORY JUDGMENT 

JURISDICTION 

Declaratory relief is available when the facts as alleged “under all the circumstances, 

show that there is a substantial controversy, between the parties having adverse legal interests, of 

sufficient immediacy and reality to warrant the issuance of a declaratory judgment.” 

MedImmune, Inc. v. Genentech, Inc., 549 U.S. 118, 127 (2007) (citation and quotation omitted) 

(emphasis added). In particular, “where a patentee asserts rights under a patent based on certain 

identified ongoing or planned activity of another party, and where the party contends that it has 

the right to engage in the accused activity without a license, an Article III case or controversy 

will arise and the party need not risk a suit for infringement by engaging in the identified activity 

before seeking a declaration of its legal rights.” SanDisk Corp. v. STMicroelectronics, Inc., 480 

F.3d 1372, 1381 (Fed. Cir. 2007). 

Under “’the now more lenient legal standard’ set forth in MedImmune, which seemingly 

‘facilitates or enhances the availability of declaratory judgment jurisdiction in patent cases’ . . . a 

plaintiff need only show, in short, that ‘all of the circumstances’ establish a ‘substantial 

controversy.’” Micron Tech., Inc. v. Mosaid Techs., Inc., 518 F.3d 897, 901-902 (Fed. Cir. 

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2008). “[T]here is no bright-line rule for determining whether an action satisfies [this] 

requirement”; rather, the Court’s analysis “must be calibrated to the particular facts of each 

case.” Prasco, LLC v. Medicis Pharm. Corp., 537 F.3d 1329, 1336 (Fed. Cir. 2008) (citing 

MedImmune, 549 U.S. at 127). 

Furthermore, “[a]lthough the best evidence of a reasonable apprehension of suit comes in 

the form of an express threat of litigation, an express threat is not required.” Vanguard 

Research, Inc. v. PEAT, Inc., 304 F.3d 1249, 1254 (Fed. Cir. 2002) (emphasis added). In fact, 

declaratory judgment jurisdiction can exist even where the potential declaratory judgment 

defendant cannot sue or has not indicated a willingness to sue. See SanDisk, 480 F.3d at 1372. 

“Prior litigious conduct is one circumstance to be considered in assessing whether the 

totality of circumstances creates an actual controversy.” Prasco, 537 F.3d at 1341. Moreover, 

prior litigation involving a party over the technology covered by the patent at issue is “sufficient 

to give [the plaintiff] an objective inference of an impending infringement suit.” Goodyear Tire 

& Rubber Co. v. Releasomers, Inc., 824 F.2d 953, 955 (Fed. Cir. 1987). This is so even when 

the prior suit did not involve the patent in the declaratory judgment action and there had been no 

threat to enforce that patent by the defendant. Id. at 955-956. 

III. ARGUMENT 

A. TCS’ Indemnification of MetroPCS in the Texas Litigation Unequivocally 

Confers Declaratory Judgment Jurisdiction 

In situations where a patent holder accuses customers of direct infringement based on the 

sale or use of a supplier’s equipment, the Federal Circuit recently held that the supplier has 

standing to commence a declaratory judgment action if: (a) the supplier is obligated to indemnify 

its customers from infringement liability; or (b) there is a controversy between the patentee and 

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the supplier as to the supplier’s liability for induced or contributory infringement based on the 

alleged acts of direct infringement by its customers. See Arris Group Inc. v. British 

Telecommunications PLC, 639 F.3d 1368, 1374 (Fed. Cir. 2011). In this case, TCS’ contractual 

obligation to indemnify its customer, MetroPCS, confers the standing necessary to commence 

the present declaratory judgment action.1

 Ex. 3 at ¶5, 7.2

The original TracBeam case that gives rise to jurisdiction here, TracBeam, L.L.C. v. 

AT&T Inc., et al., Case No. 6:11cv00096 (E.D. Tex.) (“the Texas action” referred to above), was 

filed against MetroPCS on February 25, 2011. See Exhibit 1.3

 TracBeam does not dispute TCS’ 

contention that the products/services at issue in the Texas litigation against MetroPCS are 

supplied by TCS. TracBeam subsequently filed an Amended Complaint on May 19, 2011, in 

which two additional defendants were added. See Exhibit 2. In May 2011, MetroPCS requested 

indemnification based on a contract between TCS and MetroPCS, and TCS accepted its 

contractual indemnification obligations shortly thereafter. See Ex. 3 at ¶5, 7. 

It is clear that an “adverse legal interest” – TCS’ freedom to provide MetroPCS with 

products and/or services free of the threat of infringement claims by TracBeam – exists under 

these circumstances. See MedImmune, 549 U.S. at 126-127. Indeed, the Federal Circuit recently 

 

1 TCS determines indemnification of each of its customers on a case by case basis, depending on the particular 

patents asserted and systems/products accused by a particular Plaintiff. TCS has determined, under the particular 

circumstances of the Texas litigation, that it is contractually obligated to indemnify MetroPCS in the action filed by 

TracBeam, L.L.C in the Eastern District of Texas for the products/services provided by TCS. (Exhibit 3 at ¶7). 

2 In deciding a Rule 12(b)(1) motion, the Court is permitted to consider this evidence. See, e.g., Robert Warth v. Ira 

Seldin, 95 S. Ct. 2197, 2219 (1975) (“the portion of Rule 12(b) concerning conversion to a Rule 56 motion applies 

only to a motion to dismiss for failure to state a cause of action, and not to a motion to dismiss for other reasons”); 

see also David Holt v. The United States of America, 46 F.3d 1000, 1003 (10th Cir. 1995) (“A court has wide 

discretion to allow affidavits, other documents, and a limited evidentiary hearing to resolve disputed jurisdictional 

facts under Rule 12(b)(1)”).

3 Unless otherwise noted, all cites to exhibits are to the exhibits attached to the Declaration of Sid V. Pandit in 

Support of Plaintiff’s Opposition to TracBeam’s Motion to Dismiss Under Fed. R. Civ. P. 12(b)(1), filed herewith.

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held that an actual controversy sufficient for declaratory judgment jurisdiction exists in similar 

circumstances. See, e.g., Arris Group at 1374-1376 (holding that declaratory judgment 

jurisdiction exists when the plaintiff accused a customer of direct infringement, based on the 

customer’s making, using or selling of the supplier’s allegedly infringing product). 

B. TracBeam Misconstrues the Case Law Relevant to Indemnification 

The crux of TracBeam’s indemnification argument is that TCS’ Declaratory Judgment 

Complaint does not explicitly state that it has accepted the indemnification requests from either 

AT&T or MetroPCS in the Texas litigation. (ECF No. 6 at Page 13). However, as set forth in 

the Declaration of Bruce A. White, TCS has indeed accepted the indemnification request of 

MetroPCS in the Texas litigation (and had done so as of the date of the filing of the Complaint), 

rendering this argument moot. Ex. 3 at ¶¶7-8. If the Court believes it is necessary for 

clarification purposes, TCS will amend its Declaratory Judgment Complaint to clarify that it has 

accepted MetroPCS’ indemnification request in the Texas litigation. 

In the alternative, TracBeam appears to argue that even if TCS has agreed to indemnify 

MetroPCS, such an obligation would be economic, as opposed to legal. This argument also fails 

in light of TCS’ acceptance of its contractual obligation to indemnify MetroPCS in the Texas 

litigation. Ex. 3 at ¶¶7-8. TracBeam attempts to confuse the relevant case law by implying that 

more than a legal obligation to indemnify is necessary to confer declaratory judgment 

jurisdiction. (ECF No. 6 at Page 13). This mischaracterization of legal precedent, and the 

Motion it purports to support, should be rejected by the Court. 

For instance, TracBeam refers to three cases cited by Arris Group in which the 

indemnification language was narrowly tailored to a specific patent holder. (Id.). Based on the 

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particular circumstances of each of those cases, TracBeam proffers the misleading conclusion 

that “[t]hese cases indicate that the legal obligation required to confer standing upon an 

indemnifier requires more than the existence of a broadly worded indemnification agreement that 

may not be applicable to the litigation at issue.” (Id.). This statement is wholly incorrect, is not 

supported by any of the cases cited, and contradicts the broad circumstances under which 

jurisdiction maybe conferred. See Arris Group, 639 F.3d 1368, 1373-1374 (“the dispute must be 

‘definite and concrete, touching the legal relations of parties having adverse legal interests’”) 

(quoting MedImmune, 549 U.S. at 127). 

TracBeam also argues that prior litigation between TCS and MetroPCS proves that 

“barebone allegations regarding indemnification demands are too speculative to confer 

standing.” (ECF No. 6 at Page 13). Notwithstanding the fact that TracBeam provides no legal 

support for this conclusion, TCS has clarified that it has accepted its contractual indemnification 

obligation to MetroPCS, rendering the entirety of TracBeam’s argument moot. Ex. 3 at ¶¶7-8. 

C. TracBeam’s Notice Letter to TCS, Considered With the Totality of the 

Circumstances, Is Sufficient to Confer Declaratory Judgment Jurisdiction 

The Supreme Court has unequivocally stated that the totality of the circumstances should 

be considered when determining whether declaratory judgment jurisdiction applies. 

MedImmune, 549 U.S. at 127 (citing Maryland Casualty Co. v. Pacific Coal & Oil Co., 312 

U.S. 270, 273 (1941)). In addition to the timeline provided above with respect to MetroPCS’ 

indemnification, on August 30, 2011, only three (3) months after filing its Amended Complaint 

in the Texas litigation, TracBeam sent a letter directly to TCS notifying it of TracBeam’s patent 

portfolio. See Exhibit 4. While TCS’ acceptance of its indemnification obligation to MetroPCS 

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is itself enough to confer declaratory judgment jurisdiction, TracBeam’s subsequent notification 

letter to TCS removes any doubt. MedImmune, 549 U.S. at 127. 

Additional public information available to TCS confirmed the immediacy of the 

controversy. In particular, TCS was aware that the two patents-in-suit, U.S. Patent No. 

7,764,231 (“the ‘231 patent”) and U.S. Patent No. 7,525,484 (“the ‘484 patent”) were filed on 

September 8, 1997 and January 26, 2001, respectively, and issued on July 27, 2010 and April 28, 

2009, respectively. Both the ‘231 and ‘484 patents purport to claim priority to provisional Patent 

Application No. 60/025,855 (“the Provisional application”), filed on September 9, 1996. 

Considering all of these facts, TCS was also aware that TracBeam contacted AT&T, 

Sprint Nextel, and Verizon as early as 1996 to inform them of their wireless location technology 

and the Provisional application. Ex. 2 at ¶25, 32, and 36. In fact, TracBeam “provided 

detailed information both orally and in writing” to Sprint Nextel and other defendants. Id. at 

¶32. Thus, to the best of TCS’ knowledge, TracBeam attempted to license its supposed 

technological innovations well before it secured issued patents (and even prior to the filing of its 

Utility Patent Applications), and at least thirteen (13) years prior to the issuance of the patents. 

Id. at ¶25, 32, and 36. With the patents now recently issued, TracBeam asks the Court to ignore 

common sense, TracBeam’s actions with respect to other defendants (and potential defendants) 

prior to the issuance of the patents, and its notice letter to TCS, and find that a substantial 

controversy does not exist.4

 

 

4 TracBeam insinuates that it is somehow in the advertising business, stating that its notice “letter simply advertises 

TracBeam’s international patent portfolio.” (ECF No. 6 at Page 1). In light of TracBeam’s existing litigation, this 

assertion strains credulity to the breaking point.

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TracBeam also contends that “[t]he letter did not claim that TCS infringed any of 

TracBeam’s patents, did not focus on the patents at issue in the Texas Action, made no demands 

of TCS, did not identify any products or customers of TCS, and did not mention any litigation.” 

(ECF No. 6 at Page 2). Of course, this very line of reasoning was recently rejected by the 

Federal Circuit. Arris Group, 639 F.3d at 1379 (“a specific threat of infringement litigation by 

the patentee is not required to establish jurisdiction, and a ‘declaratory judgment action cannot be 

defeated simply by the stratagem of a correspondence that avoids magic words such as 

“litigation” or “infringement”’”) (quoting ABB Inc. v. Cooper Indus., LLC, 635 F.3d 1345 (Fed. 

Cir. 2011)). 

Continuing to flout established precedent, TracBeam then provides the following eight 

reasons to argue that there is no case or controversy, all of which are either refuted by existing 

precedent, logic, or their own glaring lack of legal support: 

1. There is no suggestion that TCS infringes any of TracBeam’s patents. 

2. TracBeam makes no requests or demands of TCS. 

3. TracBeam does not identify any specific products or services of TCS. 

4. TracBeam does not suggest that TCS needs to license the patents. 

5. There is no mention of a lawsuit against TCS or anyone else. 

6. TracBeam does not mention any of the defendants in the Texas Action or any 

customers or TCS. 

7. TracBeam does not single out the patents asserted in the Texas Action. 

8. The letter was not sent by an attorney. 

As mentioned above, arguments [1] to [5] are refuted by the holding in Arris Group. See 

Arris, 639 F.3d at 1379; see also Vanguard Research, Inc. v. PEAT, Inc., 304 F.3d 1249, 1254 

(Fed. Cir. 2002) (“[a]lthough the best evidence of a reasonable apprehension of suit comes in the 

form of an express threat of litigation, an express threat is not required.”). 

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With respect to arguments [6] and [7], there is no legal basis for TracBeam’s contention 

that mentioning defendants or patents in the Texas Action, or customers of TCS, is required for 

declaratory judgment jurisdiction. TCS is unaware of any precedent that requires a notified 

entity to ignore logic, common sense, or information obtained through publicly available 

sources. Quite to the contrary, “a plaintiff need only show, in short, that ‘all of the 

circumstances’ establish a ‘substantial controversy.’” Micron Tech., 518 F.3d 897, 901-902 

(Fed. Cir. 2008). 

Without citing any legal authority for its proposition, TracBeam also asserts that its 

notice letter was not sent by an attorney, and thus no adverse legal interest sufficient to confer 

standing exists. (ECF No. 6 at Page 5). As an initial matter, TracBeam’s letter was sent by the 

owner and registered agent of TracBeam, Mr. Dennis Dupray. See Exhibits 5 and 6.5

 

Coincidentally, Mr. Dupray is listed as an inventor on the face of the patents-in-suit, which are 

the same patents being asserted in the Texas litigation. See Exhibits 8 and 9. Finally, Mr. 

Dupray is a registered Patent Agent, and prosecuted the patents-in-suit. See Exhibit 10. Mr. 

Dupray’s connections to TracBeam and the patents-in-suit could not be more deeply rooted, and 

his admission to practice law bears no relevance to whether or not an adverse legal interest 

exists. 

Finally, TracBeam argues that there is no “immediacy” to TCS’ dispute. As support, 

TracBeam argues that it notified some of the defendants in the Texas litigation over ten years 

before it filed its lawsuit. (ECF No. 6 at Page 7). This timeline conveniently ignores the fact 

that the patents did not issue until 2009 (the ‘484 patent) and 2010 (the ‘231 patent), and that the 

 

5 Exhibit 5 reflects that Mr. Dupray is the owner of Intellabs, LLC. On October 9, 1999, Intellabs, LLC changed its 

name to TracBeam, L.L.C., as shown in Exhibit 7.

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Texas litigation was filed only seven (7) months after the issuance of the ‘231 patent. Prasco, 

537 F.3d at 1341 (“Prior litigious conduct is one circumstance to be considered in assessing 

whether the totality of circumstances creates an actual controversy.”). Moreover, TracBeam’s 

apparent attempt to secure licenses from various entities as early as the filing of its provisional 

application, before it had secured any legal patent rights, highlights its determination to extract 

payments for its purported innovations despite the absence of any legal right to do so. 

IV. CONCLUSION 

For all of the foregoing reasons, Plaintiff TeleCommunication Systems, Inc. respectfully 

requests that Defendant TracBeam, L.L.C.’s Motion to Dismiss Under Fed. R. Civ. P. 12(b)(1) 

be denied. Alternatively, if required by the Court, TCS will seek leave of court to amend the 

Complaint to add an allegation reflecting TCS’ obligation to indemnify MetroPCS that is 

consistent with the attached affidavit of TCS’ Bruce A. White. 

V. REQUEST FOR ORAL ARGUMENT 

TCS respectfully requests oral argument on TracBeam’s Motion. 

Dated: November 15, 2011 Respectfully submitted, 

 /s/ Victor M. Morales_________________ 

Victor M. Morales, #16974 

MCELROY, DEUTSCH, MULVANEY 

& CARPENTER, LLP 

5613 DTC Parkway, Suite 1100 

P.O. Box 4467 

Greenwood Village, CO 80155-4467 

Direct: (303) 226-8963 

Telephone: (303) 293-8800 

Fax: (303) 839-0036 

E-mail: vmorales@mdmc-lawco.com 

 and 

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/s/ Sid V. Pandit 

Edward A. Pennington 

Stephanie D. Scruggs 

Sid V. Pandit 

MURPHY & KING 

Professional Corporation 

1055 Thomas Jefferson Street, N.W., Suite 400 

Washington, D.C. 20007 

Telephone: (202) 403-2100 

Facsimile: (202) 429-4380 

Email: eap@murphyking.com 

 sds@murphyking.com 

 svp@murphyking.com 

Attorneys for Plaintiff, 

TeleCommunication Systems, Inc. 

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CERTIFICATE OF SERVICE

I hereby certify that on November 15, 2011, I electronically filed PLAINTIFF 

TELECOMMUNICATION SYSTEMS, INC.’S OPPOSITION TO DEFENDANT 

TRACBEAM, L.L.C.’S MOTION TO DISMISS UNDER FED. R. CIV. P. 12(b)(1) with the 

Clerk of the Court through the CM/ECF system, which will send electronic notice of the filing to 

the registered participants as identified on the Notice of Electronic Filing: 

 

Gregory S. Dovel 

Jonathan Gottfried 

Dovel & Luner, LLP 

201 Santa Monica Blvd., Suite 600 

Santa Monica, CA 90401 

 

 s/ Victor M. Morales 

____________________________________ 

Victor M. Morales, #16974 

McELROY, DEUTSCH, MULVANEY 

 & CARPENTER, LLP 

5613 DTC Parkway, Suite 1100 

P.O. Box 4467 

Greenwood Village, CO 80155-4467 

Direct: (303) 226-8963 

Telephone: (303) 293-8800 

Fax: (303) 839-0036 

E-mail: vmorales@mdmc-lawco.com 

Attorneys for Plaintiff 

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