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Server Technology, Inc. v. American Power Conversion Corporation

United States District Court, D. Nevada

May 12, 2017

SERVER TECHNOLOGY, INC., Plaintiff and Counterdefendant,
v.
AMERICAN POWER CONVERSION CORPORATION, Defendant and Counterclaimant

          AMENDED ORDER

          LARRY R. HICKS UNITED STATES DISTRICT JUDGE

         Before the court is defendant American Power Conversion Corp.'s ("APC") motion for summary judgment on the issues of anticipation, obviousness, and non-infringement. Doc. #287.[1] Plaintiff Server Technology, Inc. ("STI") filed an opposition (Doc. #301) to which APC replied (Doc. #324).[2]

         I. Facts and Procedural History

         A. Procedural Overview

         Plaintiff STI manufactures intelligent power distribution devices. STI brought the underlying patent infringement action against defendant APC alleging that APC's product designs infringe three of its patents: United States Patents numbers 7, 043, 543 ("the '543 patent"), [3]7, 141, 461 ("the '461 patent"), [4] and 7, 702, 771 ("the '771 patent).[5] Specifically, STI alleges that APC's various products infringe claims 1-3, 6, and 15-17 of the '543 patent; claims 1, 3, and 8 of the '461 patent; and claims 15-17 of the '771 patent.

         Like STI, APC manufacturers intelligent power distribution devices. APC denies that its products infringe STI's patents and has raised three defenses: (1) anticipation under 35 U.S.C. § 102; (2) obviousness under 35 U.S.C. § 103; and (3) non-infringement.

         On April 13, 2010, the court issued a Markman order construing various disputed terms of the patents in suit. Doc. #163. Thereafter, APC filed the present motion for summary judgment. Doc. #287. On February 23, 2012, the court heard argument on the motion.

         B. The Patents Generally[6]

         STI's patents in suit ('543, '771, and '461 patents) describe and relate to intelligent power distribution devices, also referred to as "intelligent plugstrips" or "PDUs." Like an ordinary electrical plugstrip used in a home or office, intelligent plugstrips are primarily intended to distribute power from a wall outlet through an input power cord to a number of power outlets. But unlike ordinary plugstrips, intelligent plugstrips are intended for large scale applications such as commercial data centers and include several enhanced features. These enhanced features enable a user to locally or remotely control and monitor the power supply to connected appliances such as computers, servers, routers, and other electronic equipment through various internal relay controls.

         II. Legal Standard

         Summary judgment is appropriate only when the pleadings, depositions, answers to interrogatories, affidavits or declarations, stipulations, admissions, and other materials in the record show that "there is no genuine issue as to any material fact and the movant is entitled to judgment as a matter of law." Fed.R.Civ.P. 56(a). In assessing a motion for summary judgment, the evidence, together with all inferences that can reasonably be drawn therefrom, must be read in the light most favorable to the party opposing the motion. Matsushita Elec. Indus. Co. v. Zenith Radio Corp., 475 U.S. 574, 587 (1986); County of Tuolumne v. Sonora Cmty. Hosp., 236 F.3d 1148, 1154 (9th Cir. 2001).

         The moving party bears the initial burden of informing the court of the basis for its motion, along with evidence showing the absence of any genuine issue of material fact. Celotex Corp. v. Catrett, 477 U.S. 317, 323 (1986). On those issues for which it bears the burden of proof, the moving party must make a showing that is "sufficient for the court to hold that no reasonable trier of fact could find other than for the moving party." Calderone v. United States, 799 F.2d 254, 259 (6th Cir. 1986); see also Idema v. Dreamworks, Inc., 162 F.Supp.2d 1129, 1141 (CD. Cal. 2001).

         To successfully rebut a motion for summary judgment, the non-moving party must point to facts supported by the record which demonstrate a genuine issue of material fact. Reese v. Jefferson Sch. Dist. No. 14J, 208 F.3d 736 (9th Cir. 2000). A "material fact" is a fact "that might affect the outcome of the suit under the governing law." Anderson v. Liberty Lobby, Inc., 477 U.S. 242, 248 (1986). Where reasonable minds could differ on the material facts at issue, summary judgment is not appropriate. See v. Durang, 711 F.2d 141, 143 (9th Cir. 1983). A dispute regarding a material fact is considered genuine "if the evidence is such that a reasonable jury could return a verdict for the nonmoving party." Liberty Lobby, 477 U.S. at 248. The mere existence of a scintilla of evidence in support of the party's position is insufficient to establish a genuine dispute; there must be evidence on which a jury could reasonably find for the party. See Id. at 252.

         III. Discussion

         In its motion, APC seeks an order from the court (1) that asserted claims 1, 2, 3, and 6 of the '543 patent are invalid as anticipated under 35 U.S.C. § 102; (2) that asserted claims 15, 16, and 17 of both the '543 patent and the '771 patent are invalid as obvious under 35 U.S.C. § 103; and (3) that accused APC product designs, the AP7900 and AP8900, do not infringe asserted claims 1, 3, and 8 of the '461 patent. Doc. #287. The court shall address each argument below.

         A. Anticipation

         APC argues that claims 1, 2, 3, and 6 of the '543 patent are invalid as anticipated based on two pieces of prior art, the MasterSwitch VM ("MSVM") manufactured by APC and the RPC-21 manufactured by non-party BayTech. Doc. #287.

         In opposition, STI argues that the '543 patent is not anticipated because neither identified prior art design (1) contains a "current-related information display" in "current-related information-determining communication, " or (2) is a "plugstrip" as that term is used and understood in the patent. Doc. #301.

         1. Anticipation Standard

         An issued patent is presumed valid by statute. 35 U.S.C. § 282. However, a patent may be held invalid as a matter of law if it is anticipated. 35 U.S.C. § 102. A patent is anticipated if a single reference, either printed publication or prior use, published more than one year before the date of the patent application, discloses, expressly or inherently, every limitation of the claim such that a person of ordinary skill in the art could practice the invention without experimentation. 35 U.S.C. § 102(b); see also Advanced Display Systems, Inc. v. Kent State Univ., 212 F.3d 1272, 1282 (Fed. Cir. 2000).

         The anticipating reference must describe the patented features "with sufficient clarity and detail" such that a person of ordinary skill in the field would recognize the existence of the patent features in the reference. Crown Operations Int'l v. Solutia, Inc., 289 F.3d 1367, 1375 (Fed. Cir. 2002). Moreover, "all of the elements and limitations of the claim must be shown in a single prior reference, arranged as in the claim." Karsten Mfg. Corp. v. Cleveland Golf Co., 242 F.3d 1376, 1383 (Fed. Cir. 2001).

         2. Person of Ordinary Skill in the Art

         A person of ordinary skill in the art is a person presumed to think "along the line of conventional wisdom in the art and is not one who undertakes to innovate, whether by patient, and often expensive, systematic research or by extraordinary insights." Standard Oil Co. v. Am. Cyanamid Co., 774 F.2d 448, 454 (Fed. Cir. 1985). For purposes of this motion, the parties agree that a person of ordinary skill in the art is one who would have an electrical or computer engineering degree (or the equivalent industry experience) and at least one to three years of experience designing power distribution devices.

         3. Identified Prior Art

         APC identifies two pieces of prior art anticipating the '543 patent: the RPC-21[7] and the MSVM.[8] See Doc. #287. Both of these products were advertised and sold in 1999, [9] and as such, these designs pre-date the '543 patent application of December 8, 2000, by more than one year.

         STI concedes that the RPC-21 and MSVM are prior art references for the purpose of the court's anticipation analysis. Further, the parties do not distinguish between the MSVM and the RPC-21 in addressing APC's motion. Therefore, for the sake of simplicity, the court will analyze APC's anticipation arguments using the MSVM design.

         4. Claim Language

         Independent claim 1 of the '543 patent discloses:

         An electrical power distribution plugstrip connectable to one or more electrical loads in a vertical electrical equipment rack, the electrical power distribution plugstrip comprising in combination:

A. a vertical strip enclosure having a thickness and a length longer than a width of the enclosure;
B. a power input penetrating said vertical strip enclosure;
C. a plurality of power outputs disposed along a face of said length of the strip enclosure, each among the plurality of power outputs being connectable to a corresponding one of said one or more electrical loads;
D. a plurality of power control relays disposed in said vertical strip enclosure, each among said plurality of power control relays being connected to said power input and in independent power controlling communication with one or more corresponding power outputs among said plurality of power outputs;
E. a current-related information display disposed on said vertical strip enclosure in current-related information-determining communication with at least one among said power input and said plurality outputs; and
F. a current-related information reporting system associated with said vertical strip enclosure and being (i) in current-related information-determining communication with at least one among said power input and said plurality of power outputs, and (ii) connectable in current-related information transfer communication with a separate communications network distal from the electrical power distribution plugstrip.

Doc. #288, Exhibit 1, '543 patent, Col. 10:57-11:19. Claim 2 is a dependent claim of claim 1 and discloses:

The electrical power plugstrip of claim 1 further comprising at least one intelligent power section disposed in the vertical strip enclosure and in which is disposed at least one of the plurality of power control relays.

Doc. #288, Exhibit 1, '543 patent, Col. 11:20-24. Claim 3 is a dependent claim of both claims 1 and 2 and discloses:

The electrical power plugstrip of claim 2 further comprising an external power manager application external to the vertical strip enclosure in network communication with the intelligent power section disposed in the vertical strip enclosure, whereby a user of the of the external power manager may control power provided to selectable ones of said plurality of power outputs.

Doc. #288, Exhibit 1, '543 patent, Col. 11:25-31. Finally, claim 6 is a dependent claim of claim 1 and discloses:

The electrical power plugstrip of claim 1 wherein the current-related information display is in current determining communication with all among the plurality of power outputs through at least one current sensing device.

Doc. #288, Exhibit 1, '543 patent, Col. 11:45-48.

         5. Independent Claim 1

         The plain language of claim 1 requires a power distribution plugstrip with the following limitations: (a) a vertical strip enclosure; (b) a power input; (c) a number of outlets; (d) remotely controllable relays associated with the outlets; (e) a current-related information display; and (0 a current reporting system. See Doc. #288, Exhibit 1, '543 patent, Col. 10:57-11:19.

         In its motion for summary judgment, APC argues that the MSVM includes all these limitations. See Doc. #287. STI concedes that the MSVM meets limitations (a) through (d) of claim 1 but argues that the MSVM does not contain (1) a "current-related information display... in current-related information-determining communication" as required by limitation (e); and (2) a network device contained within the vertical strip enclosure as required by limitation (f). See Doc. #301. The court shall address each argument below.

         a. Current-related Information Display

         In substance, limitation (e) requires that the device contain a display that conveys current-related information. See Doc. #288, Exhibit 1, '543 patent, claim 1(e). During the claim construction process, the court did not construe the phrase "current-related information-determining communication" because the parties agreed that "current-related information-determining communication" meant "communication in which current is measured." See Doc. #94, STI's Opening Claim Construction Brief, p.45-46; Doc. #122, APC's Response, p.39.

         STI now argues that because "current-related information-determining communication" means "communication in which current is measured, " limitation (0 requires that the same measured current information be communicated to the display. STI's interpretation requires a numerical value that is then transmitted and displayed, which, it argues, can only be accomplished through a digital display. Thus, at its core, STI's interpretation of limitation (e) requires a digital display. As the MSVM used an LED display which did not, and could not, display a numerical value, STI argues that it cannot anticipate the '543 patent.

         The court has reviewed the documents and pleadings on file in this matter and finds that, contrary to STI's arguments, (1) limitation (e) does not require a digital display, and (2) the MSVM contains a "current-related information display... in current-related information-determining communication." First, STI's interpretation of limitation (e) is in direct contradiction to the court's claim construction order. In that order, the court found that STI's interpretation of "current-related information display" to mean a digital display that conveyed a numerical current value was contrary to the plain claim language and specification of the '543 patent. See Doc. #163, p. 21-22 ("STI's interpretation is contrary to the terms plain meaning and usage" and "would improperly limit the claim language based on the specification.").

         Second, STI's attempt to salvage its argument by relying on the word "determining" in the claim phrase is equally unavailing. Both claims 1 and 15 of the '543 patent require a display in "current-related information-determining communication, " but while claim 1 discloses a display, claim 15 specifically discloses a digital display confirming that the "determining" language is not determinative for claim construction. STI's attempt to limit claim 1 to require a digital display would render the specific "digital display" language in claim 15 meaningless. See e.g., AllVoice Computing PLC v. Nuance Commc'ns, Inc., 504 F.3d 1236, 1247 (Fed. Cir. 2007) ("[C]laim differentiation takes on relevance in the context of a claim construction that would render additional, or different, language in another independent claim superfluous.").

         Finally, the court finds that the MSVM's LED display does, in fact, display determined current information. The crux of STI's argument is that the only kind of current information that can be determined is a numerical value. However, information other than a numerical value can be "determined." For example, one can determine whether something is hot or cold, without measuring a precise value of temperature. Similarly, a PDU device can determine that current is high or low, or above or below a certain threshold, and this determined information can then be communicated to an LED display.

         Here, it is undisputed that the MSVM's LED determines and communicates a condition: when the PDU is operating in a normal current condition under a pre-programmed threshold value the LED displays a solid green indicator; when the PDU's current draw is approaching an overload condition the LED displays a flashing green indicator; and when the current level has passed the overload condition the LED displays a solid red indicator. See Doc. #310, Exhibit 6, Bors Depo., p.47:13-18. Hence, the MSVM measures the level of input current, determines whether the measured input current is above or below a threshold level, and communicates this information to the LED. Based on this function, the court finds that the MSVM displays determined current-related information, and therefore, meets limitation (e) of the '543 patent.

         b. "Plugstrip"

         STI also argues that the MSVM does not anticipate claim 1 of the '543 patent because it is not a "plugstrip'' as that term is used and understood in the '543 patent. STI contends that claim 1 of the '543 patent discloses a single piece vertical plugstrip that houses all identified parts including the "current-related information reporting system'' disclosed in limitation (f). Because it is undisputed that the MSVM is a two*piece device that ...


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