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Dr Systems, Inc v. Eastman Kodak Co.

August 24, 2009


The opinion of the court was delivered by: Marilyn L. Huff, District Judge United States District Court



On April 24, 2009, Plaintiff DR Systems, Inc. filed a motion for partial summary judgment for limitation of damages under 35 U.S.C. § 287. (Doc. No. 77.) On May 26, 2009, Defendant filed a response in opposition to Plaintiff's motion for partial summary judgment. (Doc. No. 87.) On June 1, 2009, Plaintiff submitted a reply in support of its motion. (Doc. No. 90.) On June 8, 2009, the Court heard oral argument on Plaintiff's motion for partial summary judgment. Allison Goddard and Dina Hayes appeared on behalf of the Plaintiff. Stephen Hankins and Paul Previde appeared on behalf of the Defendant. The Court subsequently deferred ruling on Defendant's motion for partial summary judgment to allow the parties to conduct court-ordered depositions and submit supplementary reports. (Doc. Nos. 97, 103, 106.) For the following reasons, the Court grants DR Systems's motion for partial summary judgment and limits infringement damages to infringement occurring after Kodak's October 2007 letter. The Court's ruling is without prejudice to Kodak's ability to seek reconsideration in the manner provided by law upon showing an earlier actual notice date or that no patented articles were sold.


This is a patent infringement case involving U.S. Patent No. 5,414,811 ("the '811 Patent"), of which Eastman Kodak Company ("Kodak") is the owner by assignment. (Compl. ¶¶ 1, 10; Ex. A ['811 Patent].) The '811 Patent was filed on February 25, 2994 and issued on May 9, 1995. '811 Patent. It is entitled "Method and Apparatus for Controlling Rapid Display of Multiple Images from a Digital Image Database" and claims a technology that decreases the time necessary for an electronic display device to sequentially display images in a database and allows for multiple images to be displayed and manipulated simultaneously.

On October 11, 2007, corporate counsel for Kodak sent a letter to DR Systems, Inc. regarding the '811 Patent, enclosing the Patent itself and expressing Kodak's opinion that there were "close similarities between the claims of this patent and certain medical image management products provided by DR Systems (e.g. Dominator Diagnostic Reading Station, The Web Dominator, and associated Vitrea software)." (Compl. ¶ 7; Mot. for Summ. J. Ex. G.) For purposes of this motion, DR Systems agrees that this letter constituted sufficient notice as to all of the accused products in this action. (Reply at 6.) Based on that letter and the parties' subsequent discussions, DR System developed an apprehension that Kodak would commence infringement litigation, and filed its Complaint for declaratory judgment of non-infringement and invalidity on April 14, 2008. (Compl. ¶ 7.) Kodak subsequently filed its Answer and Counterclaim alleging that several DR Systems products infringe the '811 Patent. (Doc. No. 9.)

Kodak has granted licenses under the '811 Patent to certain third parties, including: SAS Institute Inc. on March 29, 1996 (Mot. Ex. A at 1, 4, 15.); Apple Computer, Inc. on October 17, 1995 (Id. at 17, 21, 32.); Color Concept on June 25, 1995 (Id. at 35, 38, 46.); and Mind Systems Co., Ltd. on April 22, 1996 (Id. at 48, 51, 60.). In May 2007, Onex Corporation acquired the Health Group of Eastman Kodak Company, and Carestream Health began operating as a company within the Onex family of companies. (Decl. of Julie Lewis ISO Mot.

["Lewis Decl."] at Mot. Ex. E. ¶ 3.) In June 2007, Kodak sold its medical imaging arm to Carestream Health, which states that it has a non-exclusive license to practice the technology of the '811 Patent under the asset purchase agreement. (Id. ¶ 4.)

DR Systems moves for summary judgment limiting damages to infringement occurring before Kodak's October 11, 2007 letter, arguing that Kodak and its licensees have failed to appropriately mark products embodying the technology of the '811 Patent, violating 35 U.S.C. § 287.


I. Motion for Partial Summary Judgment -- Legal Standard

Federal Rule of Civil Procedure 56 governs summary judgment. Section (b) provides that "a party against whom relief is sought may move at any time, with or without supporting affidavits, for summary judgment on all or part of the claim." Fed. R. Civ. P. 56(b). A motion for summary judgment should be granted "if the pleadings, the discovery and disclosure materials on file, and any affidavits show that there is no genuine issue as to any material fact and that the movant is entitled to judgment as a matter of law." Fed. R. Civ. P. 56(c). "[O]n issues in which the non-movant bears the burden of proof, . . . the movant need not 'produce evidence' showing the absence of a genuine issue of material fact in order to properly support its summary judgment motion." Exigent Tech., Inc. v. Atrana Solutions, Inc., 442 F.3d 1301, 1307-08 (Fed. Cir. 2006) (quoting Celotex Corp. v. Catrett, 477 U.S. 317, 325 (1986)). A party opposing a motion for summary judgment "may not rely merely on allegations or denials in its own pleading" but has the obligation submit affidavits or other evidence that sets out specific facts showing a genuine issue for trial. Fed. R. Civ. P. 56(e)(2).

The Supreme Court explains that "[s]ummary judgment procedure is properly regarded not as a disfavored procedural shortcut, but rather as an integral part of the Federal Rules as a whole, which are designed 'to secure the just, speedy and inexpensive determination of every action.'" Celotex, 477 U.S. at 327 (quoting Fed. R. Civ. P. 1). The Court ...

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