In re Innovatio IP Ventures, LLC Patent Litigation, MDL Docket No. 2303, 2013 WL 3874042 (N.D. Ill. July 26, 2013).
The 168 claims made in Innovatio triggered the court’s review of standard essentiality, potentially subjecting them to damages-limiting RAND obligations.
Plaintiff sued numerous Defendants alleging infringement of 23 patents for wireless internet access. Id. at *1. Following discovery, but before claims construction, the parties and the court agreed to evaluate Plaintiff’s potential damages if Defendants were found to infringe. Id. Defendants argued Plaintiff’s patents were all essential to the operation of a wireless standard (Standard Essential Patents, “SEPs”) enacted by the IEEE (Institute of Electrical and Electronics Engineers). Plaintiff was, therefore, required to license those patents using reasonable and non-discriminatory terms (RAND). Id.
The parties waived the right to a jury on the impact of the RAND obligation on damages, agreeing that the court should decide all RAND-related issues. Id.
The narrow issue before the court was which of 168 disputed claims would be considered “standard essential” and potentially subject to Plaintiff’s RAND commitment. Id. at *7.
The court first tackled preliminary issues, determining:
- Assertion of RAND is akin to an affirmative defense, requiring Defendants to establish the RAND commitment for each patent claim. Id. at *7.
- Assessment of “standard-essentiality” under the IEEE bylaws is on a claim-by-claim basis rather than on a patent-by-patent basis. Id. at *7-*8.
- The meaning of “Essential Patent Claims” under the IEEE bylaws. Id. at *8-*10.
The crux of the dispute was whether a patent claim is standard essential when it adds an element to an otherwise SEP claim. Id. at *10. To facilitate the analysis, the parties grouped disputed patent claims. After considering agreed-upon common issues, the court conducted a detailed analysis of the “standard-essentiality” of each category of claims. Id. at *13-*26. Ultimately, the court concluded 15 categories of claims were standard essential. Id. at *27.