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PICKHOLTZ v. RAINBOW TECHNOLOGIES

December 15, 2000

ANDREW PICKHOLTZ, PLAINTIFF,
V.
RAINBOW TECHNOLOGIES, INC., ET AL., DEFENDANTS.



The opinion of the court was delivered by: Breyer, U.S. District Judge.

MEMORANDUM AND ORDER

This is a lawsuit for infringement of United States Patent No. 4,593,353 (the '353) issued on June 3, 1986. The '353 describes an apparatus for protecting against the unauthorized use of computer software. Plaintiff accuses defendants' "keys," also known as "dongles," marketed under the brand name "Sentinel," of infringing the '353. Now before the Court are the parties' cross-motions for summary judgment.

BACKGROUND

The '353 includes two claims. Claim 1 provides in its entirety:

1. A software protection apparatus using first and second authorization codes and a pseudorandom number, sald software protection apparatus for use with a computer, comprising:
an external memory device having computer software and a first authorization code and a second authorization code at selected data locations, wherein said second authorization code is part of a pseudorandom sequence; means for reading said external memory device, said means located in the computer;
pseudorandom number generator device located in the computer and coupled to said reading means, for generating a pseudorandom number in response to said reading means reading said first authorization code from said external memory device, said first authorization code being read prior to execution of said computer software, said pseudorandom number generator device including a sealed casing, thereby preventing identification of the pseudorandom number generator algorithm;
processing means located in the computer and coupled to said reading means and said pseudorandom number generator device, for comparing the pseudorandom number generated by said pseudorandom number generator device with the second authorization code read from selected data locations in said external memory device, said processing means generating an enable signal in response to a positive comparison of the pseudorandom number with the second authorization code for enabling execution of the computer software stored in said external memory device.

Claim 2 describes in its entirety: "The software protection apparatus in claim 1 wherein said external memory device includes a floppy disc."

In connection with the Claims Construction hearing the parties disputed, among other things, whether "computer" includes peripherals and other devices connected electronically to and communicating with the processing units. The Court concluded that "computer" as used in the claims of the '353 does not include peripherals and construed "computer" to mean "the CPU and main memory on the CPU's circuit board, which, taken together, form a part of a dedicated microcomputer system capable of executing instructions on data, and which exclude connected peripheral devices." April 2000 Memorandum and Order (hereinafter "Order") at 4-7, 16. The Court likewise construed "located in the computer" — another disputed phrase — to mean "located in the CPU or main memory or on the CPU Circuit Board." Order at 10.

Defendants now move for summary judgment on the ground that the accused devices do not literally infringe the limitation that the device comprise a "pseudorandom number generator device located in the computer," and that they also do not infringe under the doctrine of equivalents. Plaintiff has filed a cross-motion for summary judgment seeking a determination that the accused products infringe the '353 as a matter of law.

DISCUSSION

I. STANDARD OF REVIEW FOR SUMMARY JUDGMENT

Summary judgment is appropriate when the "pleadings, depositions, answers to interrogatories, and admissions on file, together with the affidavits, if any, show that there is no genuine issue as to any material fact and that the moving party is entitled to judgment as a matter of law." Fed.R.Civ.P. 56(c). An issue is "genuine" only if there is sufficient evidence for a reasonable fact finder to find for the nonmoving party. See Anderson v. Liberty Lobby, Inc., 477 U.S. 242, 248-49, 106 S.Ct. 2505, 91 L.Ed.2d 202 (1986). A fact is "material" if the fact may affect the outcome of the case. See id. at 248, 106 S.Ct. 2505. "In considering a motion for summary judgment, the court may not weigh the evidence or make credibility determinations, and is required to draw all inferences in a light most favorable to the nonmoving party." Freeman v. Arpaio, 125 F.3d 732, 735 (9th Cir. 1997). A principal purpose of the summary judgment procedure is to identify and dispose of factually unsupported claims. See Celotex Corp. v. Catrett, 477 U.S. 317, 323-24, 106 S.Ct. 2548, 91 L.Ed.2d 265 (1986).

The party moving for summary judgment bears the initial burden of identifying those portions of the pleadings, discovery, and affidavits which demonstrate the absence of a genuine issue of material fact. See id. at 323, 106 S.Ct. 2548. Where the moving party will have the burden of proof on an issue at trial, it must affirmatively demonstrate that no reasonable trier of fact could find other than for the moving party. See id. Once the moving party meets this initial burden, the non-moving party must go beyond the pleadings and by its own evidence "set forth specific facts showing that there is a genuine issue for trial." Fed.R.Civ.P. 56 (e). The non-moving party must "identify with reasonable particularity the evidence that precludes summary judgment." Keenan v. Allan, 91 F.3d 1275, 1279 (9th Cir. 1996) (quoting Richards v. Combined Ins. Co., 55 F.3d 247, 251 (7th Cir. 1995), and noting that it is not a district ...


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