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Zipshade Industrial B.V.I. Corp. v. Lowes Home Centers, LLC

United States District Court, C.D. California

June 26, 2017

ZIPSHADE INDUSTRIAL B.V.I. Corp., Plaintiff/Counter-Defendant,
LOWES HOME CENTERS, LLC; WHOLE SPACE INDUSTRIES; and DOES 1-50, inclusive, Defendants/Counter-Claimants.




         This patent infringement case involves patent number 8, 245, 756 (“the '756 Patent”) entitled “Pull Down, Push Up, Shade Apparatus” owned by Plaintiff-Counter Defendant Zipshade International Corporation (“Zipshade”). (First Am. Compl. (“FAC”) ¶ 9, ECF No. 17.) Defendant-Counterclaimant Wholespace Industries Ltd. (“Wholespace”) manufactures Roman shades for Defendant-Counterclaimant Lowe's Homecenter's Allen Roth Brand which allegedly include an infringing apparatus. (Id. ¶¶ 10, 13-19.)

         The '756 Patent allows for the raising or lowering of window shades and Venetian blinds (collectively “window coverings”) by hand. ('756 Patent, Col. 1:10- 13, 22-24, ECF No. 120-2.) Before Plaintiff's invention, such window coverings were typically raised or lowered with the assistance of a pull-cord. (Id. at Col. 1:10- 17.) Designing out the pull-cord makes window coverings easier to manipulate and eliminates any risk of strangulation for small children. (Id. at Col. 1:17-20.) In addition to eliminating the pull-cord, the invention also ensures that window coverings are “automatically kept level.” (Id. at Col. 1:26-27.)

         On June 9, 2016, the Court held a claim construction hearing regarding the five most significant terms as identified by the parties: rotary member, rotor, primary line/lifting cord, secondary line, and coupled. (ECF No. 139.) This claim construction order defines those terms.


         (Image Omitted)

         As might be expected for a common household item like a window covering, the '756 Patent references a long list of prior art dating back decades. The '756 Patent is a continuation in part from patent number 6, 837, 294 (Appl. No. 10/623, 776) (“the '294 Patent”), which itself is a continuation in part from patent number 6, 991, 020 (Appl. No. 10/360, 305) (“the '020 Patent”).

         This case began when Plaintiff filed a complaint alleging a single cause of action for infringement on July 29, 2014. (Compl. ¶¶ 13-19, ECF No. 1.) Plaintiff filed a first amended complaint on August 15, 2014. (ECF No. 17.) On November 10, 2014, Defendants each filed an answer and a counterclaim requesting declaratory relief (noninfringement and invalidity). (ECF Nos. 46-47, 50-51.) Plaintiff filed answers to the counterclaims on December 12, 2014. (ECF Nos. 70-71.)

         On January 5, 2015, Defendant Wholespace filed a petition for inter partes review of the '756 Patent (IPR 2015-00488). (See Stip. to Stay 2, ECF No. 76.) On July 24, 2015, the PTAB denied Defendant Wholespace's request for inter partes review in its entirety citing Defendant Wholespace's failure to: “identify clearly the grounds and references on which [it] is relying to assert that the challenged claims are not patentable; . . . to specify sufficiently where the limitations of the challenged claims are taught or suggested by the cited references; and . . . to provide a sufficiently detailed explanation of the significance of the citations to these references and the Judkins declaration-as required under [various statutes and federal rules].” Wholespace Indus. v. Zipshade Indus. Corp., IPR2015-00488, at 18 (PTAB July 24, 2015). In short, Defendant Wholespace's argumentation and use of references was so poor that the PTAB believed institution of inter partes review would be a waste of time. Id. (“we are not persuaded that the record before us demonstrates a reasonable likelihood that [Defendant Wholespace] will prevail in establishing that at least one challenged claim would have been obvious”).

         On July 29, 2015, Defendant Wholespace filed another petition for IPR seeking to correct the problems highlighted by the PTAB in its July 24, 2015 decision. (Status Report 2-3, ECF No. 82.) On January 29, 2016, the PTAB again rejected Defendant Wholespace's request for IPR. Wholespace Indus. v. Zipshade Indus. Corp., IPR 2015-01632, at 10 (PTAB Jan 29, 2016). The PTAB concluded that Defendant Wholespace's new petition was substantially the same as its previous petition. Id. at 9.

         On February 16, 2016, Plaintiff and Defendants submitted their Joint Claim Construction and Prehearing Statement. (ECF No. 98.) Plaintiff and Defendants agreed that the five most significant (and likely case dispositive) terms are: rotary member, rotor, primary line/lifting cord, secondary line, and coupled. (Joint Claim Construction Prehearing Statement (“JCCPS”) 50, ECF No. 98.) However, they agreed on little else. Plaintiff proposed five additional terms for construction and Defendants put forth countless other terms/phrases for construction based on the sides' initial exchange of terms. (Id. at 2-49.)

         Defendants pointed out in the statement that Plaintiff changed many of its proposed constructions and disclosed its expert witness only four days before the Joint Claim Construction and Prehearing Statement was due in violation of the Northern District of California Local Patent Rules 4-1 and 4-2, which require the exchange of constructions and citations to supporting evidence at least twenty-one days prior to the submission of the Joint Claim Construction and Prehearing Statement. (See Id. at 53- 58; see also N.D. Cal. Patent L.R. 4-1, 4-2). Based on this failure to disclose, Defendants requested that the Court compel Plaintiff to use its originally proffered terms and constructions. (JCCPS 58.) Defendants also requested that the Court exclude Plaintiff's expert witness from testifying. (Id. at 59.) Plaintiff responded by arguing that its redefinition of terms was merely a narrowing of its original list necessary to comply with the Court's ten-term limit and that there was still plenty of time for Defendants to depose the witness before the claim construction hearing. (Id. at 60.)

         On March 15, 2016, Defendants filed a “Motion to Strike Plaintiff's Expert Witness and Expert Witness Summary” from the Joint Claim Construction and Prehearing Statement. (ECF No. 105.) Defendants put forth largely the same arguments they made in the Joint Claim Construction and Prehearing Statement. (Mot. 2-10, ECF No. 105.) Plaintiff also put forth largely the same arguments it made in the Joint Claim Construction and Prehearing Statement, adding that Northern District of California Local Patent Rule 4-4[1] allows for the identification of a witness in either the preliminary exchange or in the Joint Claim Construction and Prehearing Statement. (Opp'n 5-8, ECF No. 109.) The Magistrate Judge took the middle road: granting in part and denying in part Defendants' motion. (ECF No. 115.) She ordered Plaintiff to produce an expert report and make its expert available for deposition and allowed Defendants to identify a rebuttal witness. (Id.)

         On July 15, 2016, the United States Patent and Trademark Office (“PTO”) granted ex parte reexamination of the '756 Patent in light of a “substantial new question of patentability.” (RJN, Ex. A at 6, ECF No. 118.) On January 17, 2017, the PTO issued a reexamination certificate affirming the patentability of all twenty-four of the patent's claims. (ECF No. 127-1.) No changes were made to the claim language, specification, or figures. (Id.)

         On February 21, 2017, the Court issued an order setting the remaining dates and deadlines for claim construction. (ECF No. 130.) On March 30, 2017, Defendants submitted their claim construction brief. (ECF No. 131.) In their brief, Defendants continued to evince a lack of clarity as to exactly which terms would be construed at the claim construction hearing. (Defs. Br. 1-4, ECF No. 131.) Defendants also filed a supplement to their claim construction brief requesting that the Court exclude “the report” of Plaintiff's expert witness, Dr. Pratt, and “any testimony” relating to the report at the claim construction hearing. (Defs. Suppl. Br. 1, ECF No. 132.)

         With Plaintiff and Defendants seemingly still at odds over exactly which terms would be construed at the claim construction hearing, the Court took action to impose some order on the process. On April 7, 2017, the Court informed the parties that it would construe the five most significant terms, which the parties had already briefed and agreed were likely to be case dispositive. (ECF No. 135.) On April 26, 2017, Plaintiff filed its reply. (ECF No. 136.)

         On June 9, 2017, the Court received a demonstration of the technology and held a claim construction hearing. (See ECF No. 139.) At the conclusion of that hearing, the Court took the matter under submission. (Id.)


         Claim construction is an interpretive matter “exclusively within the province of the court, ” that begins with an analysis of the claim language itself. Markman v. Westview Instruments, Inc., 517 U.S. 370, 372 (1996). This process involves an analysis of how a person of ordinary skill in the art (“POSITA”) would interpret the relevant term(s) in light of both the claim in which the term appears and of the entire patent. Phillips v. AWH Corp., 415 F.3d 1303, 1313 (Fed. Cir. 2005). Accordingly, claims must be read in light of the specification, which is “always highly relevant to the claim construction analysis.” Id. at 1315 (internal quotations omitted). That being said, the general rule is that limitations from the specification may not be imported into the claims. Comark Commc'ns, Inc. v. Harris Corp., 156 F.3d 1182, 1186-87 (Fed. Cir. 1998). “[T]he line between construing terms and importing limitations can be discerned with reasonable certainty and predictability if the court's focus remains on understanding how a person of ordinary skill in the art would understand the claim terms.” Phillips, 415 F.3d at 1323.

         The “ordinary and customary meaning” of disputed claim terms is at the heart of claim construction. Phillips, 415 F.3d at 1312-13 (internal quotations and citations omitted). However, in two situations, meanings other than the “ordinary and customary” will supersede: (1) when a patentee sets out a definition and acts as his own lexicographer; or (2) when the patentee disavows the full scope of a claim term either during prosecution or in the specification. Thorner v. Sony Comput. Entm't Am. LLC, 669 F.3d 1362, 1365 (Fed. Cir. 2012).


         A. Admissibility of the Plaintiff's Expert Witness's Report/Testimony

         Plaintiff and Defendants are sharply divided on the issue of whether evidence offered by Plaintiff's expert, Dr. Pratt, should be admitted. Defendants put forth two arguments for excluding Dr. Pratt's report and testimony. (Defs. Suppl. Br. 2-5.)

         1. Dr. Pratt Does Not Possess Sufficient Experience in the Window Coverings Industry to be an Expert or a POSITA

         First, Defendants argue that Plaintiff's expert does not have sufficient experience in the window coverings industry to qualify either as an expert or a POSITA. (Id. at 1, 3-4.) In support of this position, Defendants point out that Dr. Pratt admitted during his deposition that he has no window covering design experience and that he would not be considered a POSITA in that industry. (Id.) Based on these statements and Dr. Pratt's background, Defendants argue that this case is substantially similar to Sport Dimension, Inc. v. Coleman Co., 820 F.3d 1316 (Fed. Cir. 2016) in which the Federal Circuit affirmed a Central District of California court's decision to exclude an expert witness. (Defs. Br. 24.) In Sport Dimension, the issue was whether an industrial design consultant with four decades of experience could provide expert testimony about the design of personal floatation devices, i.e. lifejackets. 820 F.3d at 1323. In finding that the district court did not abuse its discretion in excluding the expert, the Federal Circuit noted that the expert disclaimed any expertise in the field of personal floatation devices, that his opinions were based on his “imagination” rather than any actual experience, and that he never designed a personal floatation device as part of his employment. Id.

         In response, Plaintiff puts forth a number of cases indicating that experts need only meet minimal standards to be admitted under Federal Rule of Evidence 702. (Reply 11, ECF No. 136.) For instance, in Icon-IP Pty Ltd. v. Specialized Bicycle Components, Inc., the court emphasized that the Ninth Circuit “contemplates a broad conception of expert qualifications” and that an expert “need not be officially credentialed in the specific [subject] matter [area] under dispute” to be admitted. 87 F.Supp.3d 928, 938 (2015) (quoting Hangarter v. Provident Life & Accident Ins. Co., 373 F.3d 998, 1015 (9th Cir. 2004) (emphasis in original) and Massok v. Keller Indus., Inc., 147 Fed.Appx. 651, 656 (9th Cir. 2005)); see also United States v. Garcia, 7 F.3d 885, 889-90 (9th Cir. 1993) (noting this “lack of particularized expertise goes to the weight accorded [to] . . . testimony, not to the admissibility of [one's] opinion as an expert” (emphasis added)). The other cases Plaintiff cites confirm this broad conception. See e.g., People v. Kinder Morgan Energy Partners, L.P., 159 F.Supp.3d 1182, 1190 (S.D. Cal. 2016).[2]

         After thoroughly reviewing the cases presented by both sides, the Court has determined that the report and testimony of Plaintiff's expert should not be excluded on relevance grounds. This case is less about the specifics of window coverings and more about the function of a mechanism. Dr. Pratt possesses sufficient general expertise in mechanisms and related education to provide valuable insight on this topic. (See Pratt Report, Ex. 1 at 23 (indicating an explicit expertise in “mechanisms, ” and masters degree in mechanical engineering), 24 (indicating work experience developing mechanisms), ECF No. 120-3); see also Fed. R. Evid. 702 (courts should take into account whether an expert's “specialized knowledge will help [them] understand the evidence or to determine a fact in issue.”). Dr. Pratt is a POSITA with regard to mechanisms.

         In so finding, the Court notes that the present case is distinguishable from Sport Dimension. While not every industrial designer may have sufficient knowledge of personal floatation devices to opine on that subject, every engineer in possession of graduate degree in mechanical engineering should be able to understand the interworkings of a pulley system. Indeed, Plaintiff's expert presents, as part of his report, a sample problem from a third-year engineering textbook that is designed to test engineering students' knowledge of pulley systems. (Pratt Report 16.)

         The Court also notes that its decision here is consistent with its previous decision in Farstone Techonology, Inc. v. Apple Inc., No. 8:13-CV-1537-ODW, 2015 WL 857706, at *4 (C.D. Cal. Feb. 27, 2015). In Farstone Technology, the issue was whether an expert with a doctorate degree in electrical engineering and teaching experience in software and hardware design was sufficiently qualified to testify at a claim construction on the subject of backup/recovery systems even though he lacked specific experience “design[ing] or implement[ing] backup/recovery systems.” 2015 WL 857706, at *4. The Court found that he was, noting that his background was sufficiently related to the subject of backup/recovery systems. Id.

         Based on the related nature of Dr. Pratt's experience, past cases decided by this Court, and the Ninth Circuit's general consensus that “[t]he threshold for [expert] qualification is low for purposes of admissibility, ” the Court will not exclude Dr. Pratt's report or testimony on relevance grounds. In re ConAgra Foods, Inc., 302 F.R.D. 537, 550-51 (C.D. Cal. 2014) (quoting PixArt Imaging, Inc. v. Avago Tech. Gen. IP (Singapore) Pte. Ltd., No. C 10-00544 JW, 2011 WL 5417090, at *4 (N.D. Cal. Oct. 27, 2011)).

         2. Dr. Pratt Failed to Read the Patent Owner's Statement and Prosecution History of the Parent Patents Before Authoring His Report

         Defendants' second argument is that Dr. Pratt's report should be excluded because it is based on an incomplete review of the record. (Defs. Br. 23; Defs. Suppl. Br. 5.) Specifically, Defendants argue that Dr. Pratt did not review “the patent owner's statement of IPR2015-00488 and did not review arguments presented during prosecution of U.S. Patent Application Nos. 10/623, 776 and 10/360, 305.” (Defs. Br. 23.)

         Plaintiff does not deny that Dr. Pratt failed to review the patent owner's statement for IPR2015-00488 and the relevant parent patent prosecution histories in preparing his report. (Reply 14.) However, Plaintiff argues that Dr. Pratt did review the majority of relevant materials (the '756 Patent, the prosecution history of the '756 Patent, and the Joint Claim Construction and Prehearing Statement) and that Dr. Pratt's failure to review the patent owner's statement and the parent patent prosecution histories is inconsequential as these materials ultimately have no effect on any of the constructions. (Id.)

         Federal Rule of Evidence 702 instructs courts to consider expert testimony where (1) the testimony is based upon sufficient facts or data; (2) the testimony is the product of reliable principles and methods; and (3) the expert has reliably applied the principles and methods to the facts of the case. The Court finds that while Dr. Pratt may not have reviewed certain relevant evidence in preparing his report, this oversight does not warrant the draconian measure of exclusion. Primiano v. Cook, 598 F.3d 558, 564 (9th Cir. 2010) (“[s]haky but admissible evidence is to be attacked by cross examination, contrary evidence, and attention to the burden of proof, not exclusion.”). Dr. Pratt's opinions still have some value despite his failure to review the entire record. As the Court is now acutely aware of the specific shortcomings of Dr. Pratt's report, it is more than capable of accounting for those shortcomings and will reduce the weight given to Dr. Pratt's report where appropriate.

         B. Constructions

         1. Rotary Member (34 & 35 in figure)

         (Image Omitted)

Plaintiff's Proposed Construction

Defendants' Proposed Construction

A pulley within the counterbalance mechanism coupled in some way to a spring and having a unique axis of rotation with one or more receiving surfaces. (Pl. Opening Br. 4, ECF No. 120.)

A single pulley such that a double pulley is two rotary members and is not a single rotary member. (Defs. Br. 9.)

         Areas of Disagreement Between the Parties:

         Plaintiff and Defendants disagree over whether a “rotary member” may have more than one receiving surface.

         Plaintiff's Opening Argument:

         Plaintiff's argument is simple: neither the claim nor the specification indicates that rotary members must possess a specific number of receiving surfaces. (Pl. Opening Br. 4.) Plaintiff argues that the defining feature of a rotary member is not the number of receiving surfaces it possesses but rather its unique axis of rotation. (Id. 4- 6.) Plaintiff's expert echoes this assessment. (Pratt Report 9.)

         Defendants' Response:

         Defendants' sole argument is based on a disclaimer/disavowal[3] Plaintiff allegedly made in the patent owner's statement for IPR2015-00488. (Defs. Br. 6-7.) Defendants contend that Plaintiff disclaimed/disavowed any multi-receiving surface structure from being a rotary member. (Id. at 7.) Specifically, Defendants point to ...

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