By Eric Schweibenz
On July 25, 2011, Chief ALJ Paul J. Luckern issued the public versions of Order No. 31 (dated March 25, 2011) and Order No. 32 (dated March 29, 2011) in Certain Electronic Imaging Devices (Inv. No. 337-TA-726).  In the Orders, ALJ Luckern denied Respondents Research In Motion, Ltd., Research In Motion Corporation, Nokia Corp., Nokia Inc., HTC America, Inc., LG Electronics, Inc., LG Electronics U.S.A., Inc., and LG Electronics MobileComm U.S.A., Inc.’s (collectively, “Respondents”) motion for summary determination that (1) the asserted claims of U.S. Patent Nos. 6,134,606 and 6,163,816 are invalid due to the on-sale bar, and (2) Respondents’ accused camera phones do not infringe the asserted claims of U.S. Patent No. 6,262,769 (“the ‘769 patent”).

According to Order 31, Respondents argued that Apple’s offers to license Complainant FlashPoint Technology, Inc.’s (“FlashPoint”) software to Kodak in January 1996 and Minolta in March 1996 were commercial offers to sell that constitute an on-sale bar under § 102(b).  Specifically, Respondents asserted that Apple made a commercial offer to license FlashPoint v. 1.0 source code to Kodak by sending a letter on January 11, 1996 that contained all of the terms necessary for Kodak to create a binding contract through simple acceptance, although the offer included a conditional delivery date instead of a firm delivery date.  FlashPoint countered that the January 11, 1996 letter did not include a delivery date, which “was the material term necessary for Apple to have entered into any alternative business relationship with Kodak,” that “from Apple’s perspective the most important term of any new arrangement with Kodak was a date certain for delivery,” and that based on prior communications between Apple and Kodak, Kodak knew or should have known that Apple did not intend to be bound by the January 11, 1996 letter because it did not include a delivery date, and that the letter was merely an invitation to restart negotiations that had previously come to a halt.  Examining the record in the light most favorable to FlashPoint, ALJ Luckern found a genuine issue of fact regarding whether the January 11, 1996 letter included all of the terms necessary to constitute a commercial offer for sale of the FlashPoint software.

With respect to Minolta, Respondents argued that Apple made a commercial offer for sale of a fully operational version of the FlashPoint software in March 1996, which was accepted by Minolta as evidenced by Minolta’s payment of $2 million in prepaid royalties.  FlashPoint argued in opposition that there has been no witness testimony confirming that a meeting took place between Apple and Minolta, that an agenda for the alleged meeting does not demonstrate that a commercial offer for sale was made, that Respondents rely on a presentation which was never confirmed to have been shown to Minolta, and that the testimony of Apple employees indicates that meetings in which royalty rates were discussed may have occurred in Japan.  The ALJ similarly found genuine issues of fact as to whether a meeting between Apple and Minolta took place, whether that meeting discussed an offer for sale of FlashPoint software, whether any presentations were made to Minolta conveying terms of an offer for sale, and whether any such offer for sale occurred in the U.S.

According to Order 32, Respondents argued that their accused devices do not “properly orient” images so that they are displayed upright for each of the four possible orientations that the device may be held, as they contend the claim language of the ‘769 patent requires.  However, ALJ Luckern found nothing in the plain language of the asserted claims to suggest that the ‘769 invention requires the ability to display images in an upright position for all four possible orientations of the device.  Rather, the ALJ determined that the plain language of the claims appears to only require that the captured image be displayed in a “second orientation” and a “third orientation” associated with the image capture unit, which does not require the image to be displayed upright for all four possible orientations.  Further, contrary to Respondents’ assertions, ALJ Luckern found nothing in the ‘769 specification suggesting that the claimed invention requires displaying upright images for more than two orientations associated with the image capture unit.  Finally, the ALJ was not persuaded by Respondents’ argument that FlashPoint characterized the claimed invention during a co-pending reexamination proceeding as requiring that the displayed image be properly oriented for all four possible orientations in distinguishing over prior art, finding instead that the critical distinction between the prior art reference in question and the ‘769 patent is that the reference does not check the orientation sensor at the time of display, that the reference assumes and does not determine a second orientation, and thus does not perform the claimed step of determining whether the first orientation is different than the second orientation.