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MONSTER CABLE PRODUCTS, INC. v. QUEST GROUP

October 13, 2005.

MONSTER CABLE PRODUCTS, INC., Plaintiff,
v.
THE QUEST GROUP d/b/a/ AUDIOQUEST, Defendants.



The opinion of the court was delivered by: MARILYN PATEL, District Judge

MEMORANDUM AND ORDER

Plaintiff Monster Cable Products, Inc. filed this patent infringement action against defendant The Quest Group, d/b/a/ AudioQuest ("AudioQuest"). The complaint alleges infringement of United States Patent No. 5,307,416 ("the '416 Patent"), which relates to audio cable technology. The court entered final judgment for defendant on August 8, 2005. Now before the court is defendant's motion for attorneys' fees in the amount of $592,002.14. Having fully considered the parties' arguments and submissions and for the reasons set forth below, the court enters the following memorandum and order.

BACKGROUND*fn1

  Both plaintiff Monster Cable and defendant AudioQuest are manufacturers of connecting cables for audio equipment. Monster Cable is the assignee of the '416 Patent, which relates generally to coaxial cables that make use of a biased conductive shield to reduce electromagnetic interference with the transmitted signal. In January, 2004, Monster Cable filed the instant lawsuit, alleging that AudioQuest's audio cables infringe claims of the '416 Patent. The court resolved the lawsuit in AudioQuest's favor by granting summary judgment of noninfringement on August 8, 2005. Having prevailed on the merits, AudioQuest now seeks to recover in full the attorneys' fees incurred in defending this lawsuit. In support of its motion, AudioQuest alleges a host of abuses beginning with the investigation leading up to the lawsuit, continuing through discovery and claim construction, and culminating in Monster Cable's cross-motion for summary judgment of infringement.

  The parties offer different explanations for the motivation behind this lawsuit. According to AudioQuest, Monster Cable hastily filed the lawsuit in response to AudioQuest's growing success in the marketplace. Specifically, approximately at the same time the lawsuit was filed, a national vendor of home theater systems decided to cease selling Monster Cable's products and entered into an exclusive arrangement with AudioQuest. For its part, Monster Cable claims that it was alerted in the fall of 2003 that AudioQuest's products were similar to the invention claimed in the '416 Patent, that it investigated whether AudioQuest's products likely infringed the '416 Patent, and that as a result of the investigation it filed this lawsuit.

  The extent of Monster Cable's prefiling investigation is the principal issue underlying this motion. Prior to filing the complaint in this lawsuit, Monster Cable performed a physical investigation of one of AudioQuest's products — a one-meter "Jaguar" cable — and prepared a claim chart comparing the Jaguar cable to claim 2 of the '416 Patent. Monster Cable did not perform physical evaluations of AudioQuest's other products. Instead, relying on publicly available specifications for AudioQuest's other biased cable products, Monster Cable accused all such products in its complaint.

  Following fact and expert discovery, the court held a Markman hearing on March 15, 2005, in which it construed six terms used in claim 2 of the '416 Patent. See March 18, 2005 Claim Construction Order. Relevant to the current motion, the court construed the term "coaxial cable" as a "cable with two conductors that share an axis." This construction was unfavorable to Monster Cable, as none of AudioQuest's products has a simple coaxial structure.

  On May 4, 2005, Monster Cable filed a motion seeking leave to request reconsideration of the Markman ruling, citing particular language in an intervening Federal Circuit opinion, Gillette Co. v. Energizer Holdings, Inc., 405 F.3d 1367 (Fed. Cir. 2005). The language in Gillette, read in isolation, might have supported a broader claim construction. The court denied Monster Cable's motion because when read in context the language did not suggest any change in the law. See Order of May 18, 2005.

  After the court issued its Markman ruling, Monster Cable served an interrogatory requesting that AudioQuest provide updated noninfringement contentions. AudioQuest ultimately agreed to provide updated contentions no later than May 12, 2005. On April 25, 2005, while Monster Cable's request was still pending, the parties attended a case management conference at which AudioQuest expressed an intent to file a motion for summary judgment of noninfringement. Allegedly in response to AudioQuest's stated intention, on April 26, 2005 Monster Cable served AudioQuest with 785 requests for admission seeking infringement-related information about the accused products.

  The parties disagree as to the motivation behind and the propriety of the requests for admission. Monster Cable asserts that they were served to allow Monster Cable to prepare for AudioQuest's motion for summary judgment. As Monster Cable had not received AudioQuest's interrogatory response, Monster Cable argues that the requests for admission were necessary insurance. AudioQuest, on the other hand, characterizes the requests for admission as wholly duplicative of the interrogatory and needlessly burdensome.

  On May 12, 2005 AudioQuest served its response to Monster Cable's infringement interrogatory, which consisted of a cursory citation to documents produced during fact discovery and to AudioQuest's forthcoming motion for summary judgment. See Masur Dec., Exh. R. Despite the lack of useful information in the response, Monster Cable subsequently withdrew its requests for admission relating to infringement. On May 16, 2005, AudioQuest filed a motion for summary judgment of noninfringement of the '416 Patent with respect to all of the AudioQuest products at issue, or in the alternative, for summary adjudication of noninfringement of the asserted claims of the '416 Patent with respect to certain products. Monster Cable opposed this motion and cross-moved for summary judgment of infringement with respect to all claim limitations.

  AudioQuest argued for noninfringement on the basis of five claim elements, three of which appear in the preamble of claim 2 of the '416 Patent. Monster Cable's cross motion alleged that the accused products met all limitations in the body of claim 2 and that the language in the preamble did not impose additional limitations. In the alternative, Monster Cable argued that each disputed limit in the preamble was met literally as well as under the doctrine of equivalents. At oral argument, Monster Cable effectively conceded its literal infringement argument but maintained its argument under the doctrine of equivalents.

  In the midst of the summary judgment briefing process, Monster Cable filed a motion to preclude untimely produced evidence and to strike references thereto, alleging that certain documents relied upon by AudioQuest had not previously been produced in discovery. Monster Cable was in error, as all but one of the documents had already been produced. The court denied the motion to preclude and noted that Monster Cable's failure to identify the earlier produced documents bordered on sanctionable misconduct. The court, however, chose not to award sanctions sua sponte.

  The court granted AudioQuest's motion for summary judgment and denied Monster Cable's cross motion on August 8, 2005. In denying Monster Cable's motion, the court held that the language of the preamble was inherently intertwined with the body of the claim, and therefore that the elements of the preamble imposed additional limitations on the claim. The court also held that Monster Cable's literal infringement arguments had no merit, and that the accused AudioQuest products ...


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