“$1,000 Per Employee” Scanning Patents Hit with Inter Partes Review Requests, Week of May 20, 2013

| May 28, 2013

The Vermont Attorney General made quite a splash last week when it filed a “Consumer Protection Complaint” against MPHJ Technology Investments, a patent assertion entity, accusing it of “unfair and deceptive acts” – specifically addressing misleading patent litigation warning letters to numerous small businesses in Vermont.  The Patent Office will also play a role in this controversy, in view of an inter partes review request filed by Ricoh and Xerox against one of the MPHJ patents (see inter partes review Request No. (5)) and an inter partes review request filed by HP against a second MPHJ patent (see inter partes review Request No. (11))  Requests against the other two MPHJ patents in question are likely to be in the works.

According to the Attorney General’s Complaint, MPHJ sent the letters “through forty wholly-owned shell subsidiary companies,” each located at the same UPS store in Newark Delaware.  The letters state that “[w]e have identified your company as one that appears to be using the patented technology” of four specific patents and one pending patent application.  The letters summarize the technology as permitting “the scanning of a document directly to [an] employee email address as a pdf document.”  Then comes the threat” “[a]s your organization almost certainly uses in its day-to-day operations digital copier/scanner/multifunction equipment which is interfaced to a separate central office computer (an office network), so that digital images may be scanned and transmitted to one or more destinations such as email accounts and other applications, you should enter into a license agreement with us at this time.”  Finally, the punch-line: settlement without court action will require “a payment of $1,000 per employee.” (emphasis added; the per employee fees requested ranged from $900 to $1,200).  This initial letter was typically followed by two, more threatening letters from the shell company’s legal counsel.

The Attorney General contends that the letters constitute unfair practices because, inter alia, they state that legal action will be brought against the recipient when in fact the shell company never intended such litigation, and they state that the shell company has determined that there is infringement when in fact it has made no actual investigation.  The letters, the Attorney General says, are deceptive in that they state that the shell company is the exclusive licensee of the patents when in fact it is one of 40 non-exclusive licensees, and they imply that most other companies have readily paid the royalty fee when in fact that is untrue.  The Attorney General seeks an injunction, plus “…up to $10,000 for each violation… .”

The following inter partes review requests were filed:

(1)       IPR2013-00290 (electronically filed) – U.S. Patent No. 7,670,536 entitled MOLDING-SYSTEM CLAMP and owned by Husky Injection Molding Systems, Ltd. Filed May 20, 2013 by Athena Automation, Inc.

(2)       IPR2013-00292 – IPR2013-00295 (electronically filed) – U.S. Patent No. 6,724,403 entitled SYSTEM AND METHOD FOR SIMULTANEOUS DISPLAY OF INFORMATION SOURCES and owned by SurfCast, Inc. Filed May 22, 2013 by Microsoft. The ‘403 patent is currently the subject matter of a litigation styled SurfCast, Inc. v. Microsoft Corporation (Case No. 2:12-cv-00333-DBH (D. Me.)).

(3)       IPR2013-00296 (electronically filed) – U.S. Patent No. 7,724,879 entitled EFFICIENT COMMUNICATION THROUGH NETWORKS and owned by AIP Acquisition LLC. Filed May 21, 2013 by Level 3 Communications, LLC. AIP Acquisition LLC has asserted the ‘879  patent in a number patent infringement litigations, including AIP AIP Acquisition LLC v. Level 3 Communications, LLC (Case No. 12-617 (D. Del.)); Acquisition LLC v. iBasis, Inc. (Case No. 12-616 (D. Del.)); AIP Acquisition LLC v. Time Warner Cable Inc., et al. (Case No. 12-01692 (D. Del.)); and AIP Acquisition LLC v. Comcast Corporation, et al. (Case No. 12-01690 (D. Del.)).

(4)       IPR2013-00298 (electronically filed) – U.S. Patent No. 5,686,738 entitled HIGHLY NISULATING MONOCRYSTALLINE GALLIUM NITRIDE THIN FILMS and owned by Boston University. Filed May 22, 2013 by Epistar Corp., Everlight Electronics Co., Ltd., and Lite-On Technology Corp. The ‘738 patent is currently the subject matter of litigations styled Trustees of Boston University v. Epistar Corp., et al. (Case No. 1:12-cv-12326 (D. Mass.)); Trustees of Boston University v. Everlight Elec. Co., et al. (Case No. 1:12-cv-11935 (D. Mass.)); Trustees of Boston University v. Lite-On, Inc., et al. (Case No. 1:12-cv-12330 (D. Mass.)).

(5)       IPR2013-00302 (electronically filed) – U.S. Patent No. 7,986,426 entitled DISTRIBUTED COMPUTER ARCHITECTURE AND PROCESS FOR DOCUMENT MANAGEMENT and owned by MPHJ Technology Investments, LLC. Filed May 23, 2013 by Ricoh Americas Corporation and Xerox. The ‘426 patent is currently the subject matter of a declaratory judgment action styled Engineering & Inspection Services, LLC v. IntPar, LLC (Case No. 13-0801 (E. D. La.)). Also, the Vermont Attorney General has filed a consumer protection lawsuit against MPHJ Technology, alleging unfair and deceptive practices associated with assertion of the ‘426 patent (State of Vermont v. MPHJ Technology Investment, LLC (Case No. 282-5-13)).

(6)       IPR2013-00304 (electronically filed) – U.S. Patent No. 5,944,839 entitled SYSTEM AND METHOD FOR AUTOMATICALLY MAINTAINING A COMPUTER SYSTEM and owned by Clouding IP, LLC. Filed May 23, 2013 by Oracle Corporation. The ‘839 patent is currently the subject matter of a litigation styled Clouding IP, LLC v. Oracle Corp. (Case No. 1:12-cv-00642 (D. Del.)). Oracle previously requested inter partes review of a number of claims of the ‘839 patent (see IPR2013-00095). The Board instituted review as to certain of the challenged claims based on one proposed ground of unpatentability, but declined review of the claims based on a second proposed ground of unpatentability. Oracle thus files the instant petition, which is directed to originally challenged claims, to address deficiencies in the rejected ground of unpatentability.

(7)       IPR2013-00305 (electronically filed) – U.S. Patent No. 7,389,836 entitled POWER-ASSISTED CART RETRIEVER WITH ATTENUATED POWER OUTPUT and owned by Dane Industries, Inc. Filed May 23, 2013 by Gatekeeper Systems, Inc. The ‘836 patent is currently the subject matter of a litigation styled Dane Technologies, Inc. v. Gatekeeper Systems, Inc. (Case no. 12-cv-02730-ADM-AJB (D. Minn.)).

(8)       IPR2013-00306 (electronically filed) – U.S. Patent No. 5,590,403 entitled METHOD AND SYSTEM FOR EFFICIENTLY PROVIDING TWO WAY COMMUNICATION BETWEEN A CENTRAL NETWORK AND MOBILE UNIT and owned by Mobile Telecommunications Technologies, LLC. Filed May 23, 2013 by Clearwire Corporation. The ‘403 patent is currently the subject matter of a litigation styled Mobile Telecommunications Technologies, LLC v. Clearwire Corporation (Case No. 2:12-cv-308 (E. D. Tex.)); Mobile Telecommunications Technologies, LLC v. Sprint Nextel Corp. (Case No. 2:12-cv-832 (E. D. Tex.)); Mobile Telecommunications Technologies, LLC v. Apple (Case No. 2:13-cv-258 (E. D. Tex.)).

(9)       IPR2013-00307 (electronically filed) – U.S. Patent No. 8,285,678 entitled CONTINUOUS INTEGRATION OF BUSINESS INTELLIGENCE SOFTWARE and owned by Motio. Filed May 24, 2013 by BSP Software.  The ‘678 patent is the subject of the infringement action styled Motio v. BSP Software LLC et al. (Case No. 4:12-cv-00647 (E.D. Tex.)).

(10)    IPR2013-00308 (electronically filed) – U.S. Patent No. 8,296,076 entitled NONINVASIVE DIAGNOSIS OF FETAL ANEUOPLOIDY BY SEQUENCING and owned by Stanford University. Filed May 24, 2013 by Ariosa Diagnostics.  The ‘076 patent is the subject of an infringement action styled Verinata Health, Inc. et al. v. Ariosa Diagnostics, Inc. et al., (Case No. 12-05501-SI (N.D. Cal)).

(11)    IPR2013-00309 (electronically filed) – U.S. Patent No. 6,771,381 entitled DISTRIBUTED COMPUTER ARCHITECTURE AND PROCESS FOR VIRTUAL COPYING and owned by MPHJ Technology Investments LLC. Filed May 24, 2013 by HP.  The ‘381 patent is the subject of a declaratory judgment action styled Engineering & Inspection Services, LLC v. IntPar, LLC (Case No. 13-0801 (E. D. La.)). Also, the Vermont Attorney General has filed a consumer protection lawsuit against MPHJ Technology, alleging unfair and deceptive practices associated with assertion of the ‘381 patent (State of Vermont v. MPHJ Technology Investment, LLC (Case No. 282-5-13)).

The following ex parte requests were filed:

(1)       90/012,870 (electronically filed) – U.S. Patent No. 8,324,136 entitled SYNERGISTIC BEAD LUBRICANT AND METHODS FOR PROVIDING IMPROVED LUBRICATION TO DRILLING FLUIDS FOR HORIZONTAL DRILLING and owned by Grinding and Sizing Company, LLC, Prince Minerals, Inc., and IGC Technologies, LLC. Filed May 20, 2013.

(2)       90/012,871 (electronically filed) – U.S. Patent No. 6,712,881 entitled CONTINUOUS, LAMINAR FLOW WATER-BASED PARTICLE CONDENSATION DEVICE AND METHOD and owned by Aerosol Dynamics, Inc. Filed May 20, 2013.

(3)       90/012,872 (electronically filed) – U.S. Patent No. 6,019,470 entitled PROGRESSIVE MULTIFOCAL LENS AND MANUFACTURING METHOD OF EYEGLASS LENS AND PROGRESSIVE MULTIFOCAL LENS and owned by Seiko Epson Corp. Filed May 21, 2013.

(4)       90/012,876 (electronically filed) – U.S. Patent No. 7,932,923 entitled VIDEO SURVEILLANCE SYSTEM EMPLOYING VIDEO PRIMITIVES and owned by Diamondback Vision, Inc. Filed May 23, 2013.

(5)       90/012,877 (electronically filed) – U.S. Patent No. 8,144,428 entitled RECORDING TAPE CARTRIDGE AND DRIVE DEVICE FOR REDUCING FRICTION and owned by Fujifilm Corporation. Filed May 24, 2013.

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