TIVO vs E*

[Greg Bimson]

From Thomas22:

Devices which could not be enjoined as infringements on a separate complaint cannot possibly be deemed enjoined as infringements under an existing injunction in contempt proceedings.

Except that the devices in question are the devices in the current injunction.

Infringement is the sine qua non of violation of an injunction against infringements.

And infringement has been found against the devices ordered disabled.

The authorities are uniform that the modified device must be an infringement to find contempt of such an injunction. See, e.g., Panther Pumps Equipment Company, Inc. v. Hydrocraft, Inc.

The modified device in this case was a new construct; the Spraymate was the adjudicated device, the issue of contempt was sales (there's that word again) of the Spraymate B product.

Again, what the entire contempt will boil down to is whether or not Joe Blow's four-year old 501 DVR with new software is an adjudicated device, or if it is legally a modified device.

In other words, does simply changing the software on a device ruled as an infringement change the fact it has been legally found infringing, subject to a disable order? If the answer is yes, DISH/SATS is not in contempt unless the difference is colorable. If the answer is no, DISH/SATS is in contempt.

 

[Thomas22]

From Thomas22:Except that the devices in question are the devices in the current injunction.

If there is more than a colorable difference, the devices in the current injunction no longer exist. If the devices in the current injunction no longer exist then they can't be the devices in question.

 

[Ronnie-]

actually there isn't that much going on between the 2 right now

Aint that the truth! Besides this Tivo/Dish thing, the sat landscape is baren

 

[Greg Bimson]

If there is more than a colorable difference, the devices in the current injunction no longer exist. If the devices in the current injunction no longer exist then they can't be the devices in question.

Ahh, but does colorable difference come into play? That is, does KSM apply, as KSM only applies to devices not adjudged, and the devices that adjudged in TiVo still exist?

 

[Thomas22]

Ahh, but does colorable difference come into play? That is, does KSM apply, as KSM only applies to devices not adjudged, and the devices that adjudged in TiVo still exist?

If Judge Folsom doesn't look at whether the modified devices infringe then he will have made the same mistake that the District Court in KSM made and his contempt finding will be reversed.

Under the standard we adopt, a judgment of contempt against an enjoined party for violation of an injunction against patent infringement by the making, using or selling of a modified device may not be upheld without a finding that the modified device falls within the admitted or adjudicated scope of the claims and is, therefore, an infringement.

http://bulk.resource.org/courts.gov/c/F2/776/776.F2d.1522.84-1568.html KSM

 

[Greg Bimson]

Oh boy.

If Judge Folsom doesn't look at whether the modified devices infringe then he will have made the same mistake that the District Court in KSM made and his contempt finding will be reversed.

From KSM:

Under the standard we adopt, a judgment of contempt against an enjoined party for violation of an injunction against patent infringement by the making, using or selling of a modified device may not be upheld without a finding that the modified device falls within the admitted or adjudicated scope of the claims and is, therefore, an infringement.

The injunction in TiVo v. Echostar:

IT IS FURTHER ORDERED THAT
Each Defendant, its officers, agents, servants, employees and attorneys, and those persons in active concert or participation with them who receive actual notice hereof, are hereby restrained and enjoined, pursuant to 35 U.S.C. § 283 and Fed. R. Civ. P. 65(d), from making, using, offering to sell, selling, or importing in the Untied States, the Infringing Products, either alone or in combination with any other product and all other products that are only colorably different therefrom in the context of the Infringed Claims, whether individually or in combination with other products or as a part of another product, and from otherwise infringing or inducing others to infringe the Infringed Claims of the ‘389 patent.

So far so good. Except this isn't the only order...

Defendants are hereby FURTHER ORDERED to, within thirty (30) days of the issuance of this order, disable the DVR functionality (i.e., disable all storage to and playback from a hard disk drive of television data) in all but 192,708 units of the Infringing Products that have been placed with an end user or subscriber. The DVR functionality, i.e., disable all storage to and playback from a hard disk drive of television data) shall not be enabled in any new placements of the Infringing Products.

Funny how the KSM standard is worded almost exactly to the first order. The KSM standard does not apply to the second order: the disable order. And TiVo is not accusing DISH/SATS of "violation of an injunction against patent infringement by the making, using or selling of a modified device". TiVo is accusing that DISH/SATS has disregarded the disable order.

The only way to argue it is if a modification to the "Infringing Products" makes them no longer "Infringing Products". Except for the fact that a finding of infringement has been attached to the device.

Yet that is not what DISH/SATS is arguing. They've argued that "Infringing Products" means infringing products. After all, their receivers do not infringe any longer, because they have opinion from outside counsel and affadavits from their engineering staff that the software was changed. Except in April 2006 DISH/SATS was found guilty of infringement, and at that time they had opinion from outside counsel and affadavits from their engineering staff that they don't infringe.

Their "proof" that the recievers found infringing isn't proof that those receivers no longer infringe. And discovery was not awarded to dig deeper to find out exactly how everything works.

This is a matter of law, and the only question that needs answering is if KSM applies.

I believe it should not.

 

[vampz26]

Aint that the truth! Besides this Tivo/Dish thing, the sat landscape is baren

The only thing baren there is the current discussion...

No opposing viewpoint
No discussion
No warzone

What we've got there is... failure to communicate. Some men you just can't reach. So you get what we had there last, which is the way 'He' wants it... well, 'He' gets it. I don't like it any more than you men.

But hey...at least certain folks have an E* forum to troll when in need of conflict...

I'm just glad the just and fair E* mods know how to keep things in line. Thanks guys... :up

 

[Greg Bimson]

What we've got there is... failure to communicate. Some men you just can't reach. So you get what we had there last, which is the way 'He' wants it... well, 'He' gets it. I don't like it any more than you men.

Why are you quoting stuff from a Guns and Roses song?

 

[vampz26]

Why are you quoting stuff from a Guns and Roses song?

I'm not quoting Guns and Roses...I'm quoting the movie Cool Hand Luke starring the late Paul Newman.

Guns and Roses just happened to use that quote in their song "Civil War".

Which, BTW thanks for pointing that out...had I thought about that Song title at the time I posted...it would have been equally appropriate...

 

[Thomas22]

Oh boy.From KSM:The injunction in TiVo v. Echostar:So far so good. Except this isn't the only order...Funny how the KSM standard is worded almost exactly to the first order. The KSM standard does not apply to the second order: the disable order. And TiVo is not accusing DISH/SATS of "violation of an injunction against patent infringement by the making, using or selling of a modified device". TiVo is accusing that DISH/SATS has disregarded the disable order.

I guess you didn't notice that the district court injunction in the KSM case that the defendant was found in violation of didn't mention infringement either. They were just told to stop using the fasteners or any similar fasteners. It was much stricter than the DVR injunction because it specifically proscribed similar items. Even though infringement wasn't mentioned in the KSM injunction the appeals court reversed the contempt ruling and required the district court to look at infringement of the modified devices. The case is almost identical to this case.

 

[Greg Bimson]

I guess you didn't notice that the district court injunction in the KSM case that the defendant was found in violation of didn't mention infringement either. They were just told to stop using the fasteners or any similar fasteners. It was much stricter than the DVR injunction because it specifically proscribed similar items.

Because there was an admission of infringement. That admission of infringement turned into a consent decree, where the parties basically settled. A non-standard injunction was also signed by the judge.

The valid injunction also did not adhere to Rule 65(d), as the injunction "restrained from making, using or selling insulation hangers or refractory anchors of the type and nature identified by the Plaintiff in its Complaint against the Defendant for the remainder of the life of U.S. Patent No. 3,738,217 issued June 12, 1973." The injunction is not supposed to refer to another document.

So KSM filed a contempt motion which was granted by the District Court, without a finding of infringement on the new Ultra-Lok I and II. Upon appeal, the infringer Jones argues that the anchor which may be "of the type and nature identified by the Plaintiff in its complaint against the Defendant" must also be found infringing. So the finding of contempt was reversed, and we get the standard created because of KSM:

Under the standard we adopt, a judgment of contempt against an enjoined party for violation of an injunction against patent infringement by the making, using or selling of a modified device may not be upheld without a finding that the modified device falls within the admitted or adjudicated scope of the claims and is, therefore, an infringement.

Simple enough.

If the infringer creates a workaround, and the patentee accuses the infringer of contempt for violations of making, using or selling these workaround devices, then infringement must be found as the device has never been evaluated before the court. That is the complete principle of KSM.

Except that is not the accusation of contempt from TiVo: TiVo is not accusing modified DVR's of infringement*1*; TiVo is accusing DISH/SATS of not following the disable order on devices already adjudged as infringements.

There were four million DVR's in customers' hands that were found infringing upon TiVo's Time Warp patent. Joe Blow's four year old 501 DVR does not become a new manufacture simply because some software was downloaded.

*1* Actually, TiVo has accused that the modifications to the 501, 508, 510, 522 and 625 are still infringing, and has asked for Judge Folsom to find DISH/SATS in contempt on sales of those units as well. The question of ongoing infringement regarding the modifications will be addressed as well, but it may be moot with respect to the disable order.

This is going to be one of those "standards" cases. This will be one that will be cited over and over again when all is said and done.

 

[Thomas22]

This is going to be one of those "standards" cases. This will be one that will be cited over and over again when all is said and done.

There is nothing unique about this case. It is almost identical to the KSM case. Even though infringement wasn't mentioned in the KSM order to stop using the devices, the court immediately recognized that infringement was the fundamental issue and required the district court to look at whether the modified devices infringed.

 

[Greg Bimson]

There is nothing unique about this case. It is almost identical to the KSM case. Even though infringement wasn't mentioned in the KSM order to stop using the devices,

Sure there is. There were 4 million DVR's in end users hands which were found infringing.

In KSM, those devices were the Therma-Lock devices. They weren't modified at customer homes to become the Ultra-Lok devices.

In TiVo, one has to take a wild leap of faith to say that the devices found infringing no longer exist, because of some action taken by the infringer. They are still working, and they haven't been disabled. Joe Blow's DVR has been in the same spot over the past four years.

 

[Thomas22]

In TiVo, one has to take a wild leap of faith to say that the devices found infringing no longer exist, because of some action taken by the infringer.

Not at all. That's what is required to be determined in a contempt hearing. If there is more than a colorable difference then the adjudicated devices no longer exist and there cannot be a contempt finding.

If there is “more than a colorable difference” between the accused product and the adjudged infringing product such that “substantial open issues with respect to infringement to be tried” exist, contempt proceedings are not appropriate. KSM Fastening, 776 F.2d at 1532.

 

[Greg Bimson]

From Thomas22:

If there is “more than a colorable difference” between the accused product and the adjudged infringing product such that “substantial open issues with respect to infringement to be tried” exist, contempt proceedings are not appropriate. KSM Fastening, 776 F.2d at 1532.

Except that the accused product is the adjudged infringing product.

Joe Blow's four year old DVR has been found as an infringement. DISH/SATS pushed some software to it.

So when one gets down to it:

Under the standard we adopt, a judgment of contempt against an enjoined party for violation of an injunction against patent infringement by the making, using or selling of a modified device may not be upheld without a finding that the modified device falls within the admitted or adjudicated scope of the claims and is, therefore, an infringement.

The KSM standard. It applies when a patentee accuses an infringer of "making, using or selling" a modified device which the patentee believes still infringes. That is not the charge, here. Therefore, that is not the standard that should be used.

The charge is that DISH/SATS has not disabled the receivers adjudged as infringements. The boiling question is if a download changes the judgment against that receiver.

So the big question is if a software download changes the judgment on the devices. If Judge Folsom finds that the devices still exist, then he will find contempt without looking at KSM. If Judge Folsom finds that the devices in question no longer exist, then KSM must apply.

 

[Thomas22]

From Thomas22:Except that the accused product is the adjudged infringing product.

The accused product is the modified product. TiVo has already admitted that there has been a modification.

 

[Greg Bimson]

But the KSM standard only applies when a patentee accuses an infringer of "making, using or selling" a modified device which the patentee believes still infringes.

So KSM doesn't apply to existing devices ruled as infringing.

Like I said, the only question is if a software download changes the legal status of the devices adjudged as infringements, to non-adjudicated.

 

[Thomas22]

But the KSM standard only applies when a patentee accuses an infringer of "making, using or selling" a modified device which the patentee believes still infringes.

I'm pretty sure that TiVo thinks the modified DVRs still infringe.

 

[Greg Bimson]

I'm pretty sure that TiVo thinks the modified DVRs still infringe.

They are asking for that finding through the damages section; they did ask for that ruling when countering how the new software is "infringement-free".

 

[jacmyoung]

And there you have it. The judge needs to decide if KSM applies or not...

KSM applies to all contempt rulings in patent infringement cases when design around is an issue, the Circuit Court established their standard when they made the decision in KSM and asked all district courts to apply such standard, and it will have to be applied, that is not my words but the words of the Circuit Court, until such time a new standard is establised to supersede it.

If one reads the 9/4 transcript it is clear Judge Folsom was very perplexed by TiVo's attempt to dismiss KSM. Of course he did not say TiVo was wrong, just to understand in what logic was TiVo operating.

In a summary proceeding, the burden of proof is always on the mover (TiVo in this case), and the burden of proof is higher than in a regular trial too.

It is not enough for TiVo to simply dismiss all the cases such as KSM, for TiVo to prevail they need to cite cases to prove their own argument. TiVo failed to do so. The closest one, as the judge called it, is one which the injunction was ruled in violation of Rule 65(d), but prior to that the infringer simply continued infringement without any attempt to design around the patent, and contested the authority of the order during the contempt proceeding.

This "closest case" clearly does not prove anything here, it is not even close. Here the order is correct, and E* designed around the patent, and E* is not arguing now that the order is wrong. TiVo needed to know what was the argument before they cited a case.

TiVo cannot prove their case if they cannot cite a single relevant case in which an infringer was found in contempt after they designed around the patent with respect to the adjudicated products, and the design around was more than colorable.

It is not that TiVo's lawyers did not do a good research job, it was because they could not find one such case. In all the cases I have read, the infringers had always avoid a contempt ruling after they designed around the patent, regardless if the products were once adjudicated to have infringed, or whether the products were sold or in use already or not. Yes regardless what was even said in the injunction.

So TiVo was left to change the argument, insisting that E* was contesting the injunction, which as the E* lawyer told the judge on 9/4 repeatedly, no, E* was not contesting the order, E* agreed with the order, and E* believed they are in compliance with the order through legit design around, as KSM had told them to do.

I am not here to go circular with Greg again, only to point out that TiVo failed to cite a relevant case to prove their argument that even after a successful design around there can still be a contempt, just because how TiVo had interpreted the injunction in certain way. It is very easy for the judge to tell the parties how his injunction should be interpreted, as demonstrated by the StarBrite case E* cited. And one thing StarBrite taught us is, the judge can explain his injunction in a way we cannot even possibly imagine, if that ensures his ruling is in line with Rule 65(d).

So I think one reason the judge is taking so long with this is that both of those issues are difficult ones that require a good bit of thought and consideration. If the answer were as crystal clear as each side's argument above would seem to make it, the judge would have had an easy time picking the obvious right one and issued an order months ago. Now, it is also true that he is busy with other cases, and he may be hoping that a delay might let market forces push E* and TiVo to the negotiating table; but in my opinion, those are lesser reasons for the delay than the scholarly legal issues brought up in this case.

I think it is likely that the judge is too busy, by just looking at his schedule after 9/4 up to the end of the year, he had been and still is totally booked. People complain about our legal system, how costly and how long it takes to resolve legal disputes. I think the only way to help the situation is to increase the federal funding, a pipe dream at this point.