Opinion ID: 807368
Heading Depth: 3
Heading Rank: 1

Heading: ActiveVideo Patents

Text: 1. Obviousness – ’578, ’678, ’883, and ’582 patents Verizon argues that the district court erred in granting ActiveVideo’s JMOL of no invalidity, which prevented Verizon’s obviousness defense from reaching the jury. The district court determined that the obviousness opinions offered by Verizon’s expert were conclusory and lacked factual support. Verizon contends that testimony by its expert about six prior art references, the “modular nature of the components in the asserted claims,” and how combining any of the prior art references would yield a predictable result, was sufficient for the question of obviousness to reach the jury. Verizon also argues that efficiency and market demand were sufficient motivations to combine any of the prior art references discussed by its expert. We agree with the district court that the obviousness testimony by Verizon’s expert was conclusory and factually unsupported. Although Verizon’s expert testified that “[t]hese are all components that are modular, and when I add one, it doesn’t change the way the other one works,” J.A. 4709, he never provided any factual basis for his assertions. The expert failed to explain how specific ACTIVEVIDEO v. VERIZON COMMUNICATION 24 references could be combined, which combination(s) of elements in specific references would yield a predictable result, or how any specific combination would operate or read on the asserted claims. Rather, the expert’s testimony on obviousness was essentially a conclusory statement that a person of ordinary skill in the art would have known, based on the “modular” nature of the claimed components, how to combine any of a number of references to achieve the claimed inventions. This is not sufficient and is fraught with hindsight bias. See KSR, 550 U.S. at 418 (“A patent composed of several elements is not proved obvious by merely demonstrating that each of its elements was, independently, known in the prior art.”); Innogenetics, N.V. v. Abbott Labs., 512 F.3d 1363, 1373-74 (Fed. Cir. 2008) (“Such vague testimony would not have been helpful to a lay jury in avoiding the pitfalls of hindsight that belie a determination of obviousness.”). The opinion by Verizon’s expert regarding the motivation to combine references was likewise insufficient. Verizon’s expert testified that: The motivation to combine would be because you wanted to build something better. You wanted a system that was more efficient, cheaper, or you wanted a system that had more features, makes it more attractive to your customers, because by combining these two things you could do some- thing new that hadn’t been able to do before. J.A. 4709-10. This testimony is generic and bears no relation to any specific combination of prior art elements. It also fails to explain why a person of ordinary skill in the art would have combined elements from specific references in the way the claimed invention does. See KSR, 550 U.S. at 418 (“[I]t can be important to identify a reason that would have prompted a person of ordinary 25 ACTIVEVIDEO v. VERIZON COMMUNICATION skill in the relevant field to combine the elements in the way the claimed new invention does . . . because inventions in most, if not all, instances rely upon building blocks long since uncovered, and claimed discoveries almost of necessity will be combinations of what, in some sense, is already known.”); Innogenetics, 512 F.3d at 1373 (Fed. Cir. 2008) (“[K]nowledge of a problem and motivation to solve it are entirely different from motivation to combine particular references . . . .”). Because the record evidence was insufficient for a reasonable jury to support a determination of obviousness, the district court’s grant of ActiveVideo’s JMOL on obviousness was not erroneous. 2. Anticipation – ’578 and ’582 patents Verizon argued at trial that the asserted claims of the ’578 and ’582 patents were anticipated by multiple prior art references, including a 1986 article by C.W. Lundgren and P.S. Natarajan entitled Single Mode Fiber Transport and Coaxial Distribution of Video on Demand (Bellcore VoD) and U.S. Patent No. 4,616,263 (GTE VoD). Bellcore VoD discloses a system having a single computer (master control console) that controls a robotic arm to retrieve video cassettes from a storage cabinet and insert them into video tape recorders to be played for viewers. J.A. 91731. GTE VoD discloses a video system having video control clusters (microprocessors) that supervise the retrieval of video segments from mass storage video disks. Coupled to the video disks are modulators for frequency translating the video segments for transmission to viewers. J.A. 91738-40. Before the case was submitted to the jury, the district court granted ActiveVideo’s JMOL of no invalidity, holding that there was insufficient evidence for Verizon’s anticipation defenses to reach the jury. For the ’578 patent, the district court found that Verizon’s expert ACTIVEVIDEO v. VERIZON COMMUNICATION 26 failed to explain how the Bellcore VoD tape recorders are in “assignable television communication” with a home interface controller. The district court also found that Verizon’s expert failed to offer any opinion or analysis as to how GTE VoD’s video control clusters are in assignable television communication with a home interface controller. For the ’582 patent, the district court found that Verizon’s expert failed to explain how the Bellcore VoD tape recorders are individually assignable processors in assignable communication with a home interface controller. The district court also found that Verizon’s expert failed to identify Bellcore VoD structure corresponding to the claimed “frame server.” And the district court found that Verizon’s expert failed to explain how the GTE VoD video cluster controllers are individually assignable processors in assignable communication with a home interface controller. Verizon argues that expert testimony regarding the Bellcore VoD and GTE VoD references was sufficient to allow the jury to decide whether either of them anticipates the ’578 and ’582 patent claims. We disagree. Verizon’s expert failed to explain how the Bellcore VoD “tape recorders,” which play video cassettes (e.g., VCRs), are “processors” as required by the claimed “plurality of interactive controllers” (’578 patent) and “individually assignable processors” (’582 patent). Verizon’s expert similarly failed to explain how these “tape recorders” are in “data communication” with a home interface controller (’578 patent) and how they are in “assignable . . . data communication” with a home interface controller (’582 patent). 2 And Verizon’s expert failed to identify any 2 To the extent that Verizon’s expert opined that the “master control console” in Bellcore VoD satisfied the “interactive controller” element of the ’578 patent claims or the “individually assignable processors” element of the 27 ACTIVEVIDEO v. VERIZON COMMUNICATION Bellcore VoD structure having a data transceiver and subscriber selection device as required by the ’578 patent’s home interface controller. Verizon’s expert also failed to explain how any Bellcore VoD structure provides interactive pages to viewers and uses a plurality of processes, as required by the ’582 patent’s frame server component. Similarly, Verizon’s expert failed to explain how the video cluster controllers in the GTE VoD reference (alleged “interactive controllers” and “individually assignable processors”) are connected to a home interface controller, much less in “assignable . . . communication” with one. Even though the ’578 patent claims require the interactive controller to be in television communication with an information source, see ’578 patent claim 8, Verizon’s expert testified that the video cluster controllers in GTE VoD are not in television communication with the video disk unit (alleged information source). J.A. 4787. The expert also testified that the video signal is sent to a subscriber not from the video cluster controller but instead from the video disk unit. J.A. 4665, 4786-87. That is not what the ’578 or ’582 patent claims require. And Verizon’s expert testified that the GTE VoD reference does not disclose “a plurality of processes running in said frame server” as required by the ’582 patent claims. Compare J.A. 4792 (“The [GTE VoD] patent does not say there are separate processes.”), with ’582 patent claim 5 (“each [home interface controller] assigned to one of a plurality of processes running in said frame server”). ’582 patent claims, see J.A. 4623-24, this opinion is also insufficient because there is only one master control console disclosed in Bellcore VoD and the claims require a plurality of interactive controllers and individually assignable processors. ACTIVEVIDEO v. VERIZON COMMUNICATION 28 We agree with the district court. The testimony of Verizon’s expert on anticipation of the ’578 and ’582 patent claims was insufficient for a reasonable jury to conclude that Bellcore VoD or GTE VoD anticipate the asserted claims.