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Trading Technologies International, Inc. v. Open E Cry, LLC

United States Court of Appeals, Federal Circuit

August 30, 2013

TRADING TECHNOLOGIES INTERNATIONAL, INC., Plaintiff-Appellant,
v.
OPEN E CRY, LLC, AND OPTIONSXPRESS HOLDINGS, INC., Defendants-Appellees, AND TRADESTATION SECURITIES, INC., AND TRADESTATION GROUP, INC., Defendants-Appellees, AND IBG, LLC, THINKORSWIM GROUP, INC., TD AMERITRADE, INC., TD AMERITRADE HOLDING CORP., AND INTERACTIVE BROKERS, LLC, Defendants-Appellees, AND CQG, INC., AND CQGT, LLC, Defendants-Appellees, AND FUTUREPATH TRADING LLC, SUNGARD DATA SYSTEMS, INC., SUNGARD INVESTMENT VENTURES LLC, AND GL TRADE AMERICAS, INC., Defendants-Appellees, AND STELLAR TRADING SYSTEMS, LTD., AND STELLAR TRADING SYSTEMS, INC., Defendants-Appellees, AND ESPEED MARKETS, LP, BGC CAPITAL MARKETS, LP, AND ECCOWARE LTD., Defendants-Appellees, AND ROSENTHAL COLLINS GROUP, LLC, Defendant.

Appeal from the United States District Court for the Northern District of Illinois in consolidated No. 10-CV-0715, Judge Virginia M. Kendall.

Steven F. Borsand, Trading Technologies International, Inc., of Chicago, Illinois, argued for plaintiff-appellant. Of counsel on the brief were Leif R. Sigmond, Jr., Michael D. Gannon, Paul A. Kafadar, and Sarah E. Fendrick, McDonnell Boehnen Hulbert & Berghoff LLP, of Chicago, Illinois. Of counsel were Jennifer Kurcz and Matthew Sampson.

Anthony B. Ullman, Salans LLP, of New York, New York, argued for all defendants-appellees. With him on the brief for FuturePath Trading, LLC, et al., was Lora A. Moffatt. Of counsel on the brief were Philippe Bennett and Aoife Butler, Alston & Bird, LLP, of New York, New York. On the brief for IBG, LLC, et al., were Michael Brett Levin and Christopher P. Grewe, Wilson Sonsini Goodrich & Rosati, of Palo Alto, California, and Natalie J. Morgan, of San Diego, California. On the brief for CQG, Inc., et al., were Adam G. Kelly, William J. Voller, and J. Simone Jones, Loeb & Loeb, LLP, of Chicago, Illinois. On the brief for eSpeed Markets, LP, et al., was Gary A. Rosen, Law Offices of Gary A. Rosen, P.C., of Ardmore, Pennsylvania. On the brief for TradeStation Securities, Inc., et al., were David J. Healey, Fish & Richardson P.C., of Houston, Texas, and Adam Kessel and Kevin Su, of Boston, Massachusetts.

Scott J. Bornstein, Greenberg Traurig, LLP, of New York, New York, for defendants-appellees Open E. Cry, LLC, et al. With him on the brief was James J. Lukas, Jr., of Chicago, Illinois.

Laura A. Lydigsen, Brinks Hofer Gilson & Lione, of Chicago, Illinois, for defendants-appellees, Stellar Trading Systems, Ltd., et al. Of counsel were Ralph J. Gabric and Marc V. Richards.

Before Lourie and Plager, Circuit Judges, and Benson, District Judge. [*]

Lourie, Circuit Judge.

In this patent infringement action, Plaintiff-Appellant Trading Technologies International, Inc. ("TT") appeals from the district court's entry of summary judgment that (i) the asserted claims of TT's U.S. Patents 7, 676, 411 (the "'411 patent"), 7, 693, 768 (the "'768 patent"), 7, 904, 374 (the "'374 patent"), and 7, 685, 055 (the "'055 patent") are invalid for failure to comply with the written description requirement of 35 U.S.C. § 112; and (ii) prosecution history estoppel bars TT from asserting the '055 patent against software products that include certain display functions. The district court premised both holdings on deference to our prior decision in Trading Technologies International, Inc. v. eSpeed, Inc., 595 F.3d 1340 (Fed. Cir. 2010) ("eSpeed"), which considered two related patents from TT's portfolio.

We conclude that eSpeed does not control the issues presented in this appeal, and the district court's rulings based on that case are therefore incorrect. Accordingly, and as described more fully below, we reverse and remand for further proceedings.

Background

A. The TT Patent Family

TT owns a number of related patents generally directed to software used for electronic trading on a commodities exchange, including the '411, '768, '374, and '055 patents at issue in this appeal. Issued between March 2010 and March 2011, those four patents claim priority from U.S. Provisional Patent Application 60/186, 322, filed on March 2, 2000, and U.S. Patent Application 09/590, 692, which was filed on June 9, 2000, and later issued as U.S. Patent 6, 772, 132 (the "'132 patent") on August 3, 2004. The '411, '768, and '374 patents all arose from a series of continuation applications stemming from the parent '132 patent. See, e.g., '411 patent, at [63]. Accordingly, the '411, '768, and '374 patents share a common written description matching that of the progenitor '132 patent in all material respects. In contrast, the '055 patent traces its priority from the '132 patent as a continuation-in-part, see '055 patent, at [63], and as such, the '055 patent contains substantial new matter relative to the original written description of the '132 patent.

In general, the subject TT patents concern a graphical user interface that can display essential data from a commodities market and allow a user to enter electronic trade orders on an exchange. Drawings common to the '411, '768, '374, and '055 patents exemplify several key aspects of the disclosed displays:

(IMAGE OMITTED)

E.g., '411 patent, figs. 3, 4. Figure 3 depicts a trading display that conveys up-to-date market information, including the pending bids and offers at various price points. Column 1005, labeled "Prc, " represents various contract prices for the commodity of interest. Id. col. 7 ll. 55–58. Adjacent to the price column are bid and ask columns 1003 and 1004, labeled "BidQ" and "AskQ, " respectively. Those columns show the current bid quantities (offers to buy) and ask quantities (offers to sell) at each price, id. col. 7 ll. 54–55, and a trader can enter new trade orders by clicking on the bid and ask columns, id. col. 10 ll. 19–23. The "inside market, " labeled 1020, spans the highest current bid price and the lowest current ask price. Id. col. 4 ll. 60–62. In general, the inside market approximates the commodity's market price and therefore marks a focus of trading activity. In figure 3, the inside market includes a highest bid price of 89 and a lowest ask price of 90.

Figure 4 shows the same display, with data for the same market, viewed at a later point in time. '411 patent col. 3 ll. 47–48. Over time, the inside market can "ascend and descend as prices in the market increase and decrease." Id. col. 9 ll. 4–5. As illustration, the inside market in figure 4, labeled 1101, has shifted up the price column to 92/93 from its earlier range of 89/90 in response to intervening trades.

According to the patents, traders able to view and quickly appreciate such detailed market data can more readily identify (and capitalize upon) developing trends in an active market. Id. col. 6 ll. 12–30. To that end, the disclosed graphical user interfaces offer a logical and intuitive means to convey dynamic market information using bid, ask, and inside market indicators that visually track ongoing price fluctuations along the price column. Moreover, the patents combine a market grid, a summary of market orders, and an order entry system into a single display. In short, "[s]uch a condensed display materially simplifies the trading system by entering and tracking trades in an extremely efficient manner." Id. col. 7 ll. 40– 42.

Nonetheless, allowing the inside market to move up and down the display presents a problem: "As the market ascends or descends the price column, the inside market might go above or below the price column displayed on a trader's screen." Id. col. 9 ll. 15–17. Because the inside market informs most trading decisions, the display must provide a way to re-center the price column and bring the inside market back into view. The parent '132 written description shared by the '411, '768, and '374 patents explains that the values in the price column "are static; that is, they do not normally change positions unless a re-centering command is received, " id. col. 7 ll. 64–66, and further describes a "one click" centering feature that allows a user to re-center the price column around the inside market with a single mouse click, id. col. 9 ll. 17– 25.

B. The eSpeed Decision

As noted, this appeal is not the first to reach this court concerning TT's trading software patents. In eSpeed, we considered, inter alia, the correct construction of certain claim terms used in the '132 patent and in another of its many descendants, U.S. Patent 6, 766, 304 (the "'304 patent"). The '304 patent, like the '411, '768, and '374 patents, shares the written description of the parent '132 patent.[1]

In eSpeed, TT had asserted claims from the '132 and '304 patents against several providers of electronic trading software. 595 F.3d at 1347–48. Each of the asserted claims required a graphical user interface having a "static" display of market price information, [2] and the district court had construed that term to require "a display of prices comprising price levels that do not change positions unless a manual re-centering command is received." Id. at 1352. On appeal, TT argued that a "static" price column could work with non-manual modes of re-centering. Id. at 1353.

Relying on the '132 and '304 patents' shared written description, the surrounding claim language, and the relevant prosecution history, we adopted the district court's construction. See id. at 1353–55. In particular, we concluded that "[t]he inventors' own specification strongly suggests that the claimed re-centering feature is manual" because the written description "only discusse[d] manual re-centering commands" and referred to "the present invention" as including a manual one-click re-centering feature. Id. at 1353–54. Consistent with that view, we also noted that the claims of the '132 patent recited an additional limitation stating that the "static" price display would not move in response to changes in the inside market, expressly excluding displays that re-center automatically when the inside market shifts. Id. at 1354. Finally, we highlighted statements made by the applicants during prosecution. Specifically, the examiner had first considered the term "static display" to be indefinite, but the applicants responded by explaining that the values in the price column would not change absent a re- centering command, and the claims were then allowed on that basis. Id. at 1354. Accordingly, the full record before us in eSpeed led us to conclude that the proper construction of "static, " as used in the claims of the '132 and '304 patents, required a price column that moves only in response to a manual re-centering command.

In addition, we rejected TT's attempts to invoke the doctrine of equivalents to find that products practicing automatic re-centering nonetheless infringed its claims to "static" displays. See id. at 1355–57. We held that prosecution history estoppel precluded such infringement theories because the applicants had amended the claims of the '132 and '304 patents to make clear that the claimed "static" price levels did not move in response to changes in the inside market, thus "surrender[ing] any subject matter that moves automatically." Id. at 1357. Thus, in eSpeed, ...


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