United States District Court, D. New Jersey, Camden Vicinage
Eagle View Technologies, Inc. et al., Plaintiffs,
Xactware Solutions, Inc. et al., Defendants.
B. KUGLER, UNITED STATES DISTRICT COURT JUDGE
a patent infringement action brought by Eagle View
Technologies and Pictometry International [together
“Plaintiffs”] against Xactware Solutions and
Verisk Analytics [together “Defendants”]. Before
the Court is Defendants' motion for summary judgment
[“the motion”] under Federal Rule of Civil
Procedure [“Fed. R. Civ. P.” or
“Rule”] 56(a) to equitably estop this
infringement action. For the reasons below, this motion is
appropriate Order accompanies this Opinion.
Background and Procedure
are the owners of the patents at issue that recite,
among other things, business methods, systems, and computer
readable storage media for providing a roof repair estimate.
The claimed invention applies photogrammetric methods, that
is, trigonometric calculations, to images of rooves in aerial
photographs to compute roof measurements, in particular, roof
pitch. Defendant Xactware Solutions, Inc., is a subsidiary of
Defendant Verisk Analytics, and provides online technology
tools and systems to insurance carriers, remodelers and
construction service providers for determining
replacement-cost. The parties have asserted they are
competitors to each other (Doc. 15:¶1).
Court assumes the parties' familiarity with the many
proceedings in this litigation and summarizes only those
events relevant to the motion. On 23 September 2015,
plaintiffs filed their original complaint against defendants
and on 30 November 2015, an amended complaint. Both of these
(ECF Docs. 1 and 30) allege direct and indirect infringement
under 35 U.S.C. § § 271(a) and (b) of at least one
claim of each patent at issue. The case has proceeded through
various milestones, including the Markman hearing
and the Markman opinion (ECF Doc. 332). The parties
have completed discovery, exchanged expert reports and
disclosures, and submitted summary judgment motions aiming to
dispose of certain issues or of the case itself, as well as
motions in limine to exclude experts' testimony
(“Daubert motions”). ECF Doc. 459 - 474.
This is one of the summary judgment motions.
seeking summary judgment that plaintiffs' infringement
action should be equitably estopped, defendants assert
plaintiffs' behavior over a years-long, contracted-for
business relationship misled them into believing plaintiffs
would not sue them for patent infringement. They further
argue they invested substantial resources in their own roof
analytics software in reliance on plaintiffs' behavior,
which materially prejudices them and compels equitable
estoppel of this action and dismissal.
contend the following signal plaintiffs' commitment not
to sue defendants for patent infringement (ECF Doc. 460:1-6):
a six-year, contracted-for business relationship between the
parties from 2008 and lasting through 2014, in which
plaintiffs paid defendants a fee for each of their roof
estimate reports sold through defendants' cost estimation
platform. During that period, although plaintiffs
occasionally communicated in writing that defendants may be
infringing plaintiffs' patents, plaintiffs never sued for
infringement, not even in the face of the parties'
contract dispute nor when suing others for infringement.
Plaintiffs also affirmatively represented in 2014 in the
executed, merger contract between the parties that defendants
did not infringe the relevant patents. Defendants further
assert they invested in the development of their own roof
estimate report products during the 6-year business
relationship because they relied on plaintiffs' continued
non-action. (ECF Doc. 460: 7). Defendants state there is no
dispute of material fact in that plaintiffs' consistent
behavior during the parties' business relationship
completely misled defendants that plaintiffs would ever sue
argue defendants' equitable estoppel defense should be
precluded under Fed.R.Civ.P. 37(c)(1) as defendants did not
disclose the factual and legal bases for the defense with
sufficient specificity in response to plaintiffs'
interrogatories. ECF Doc. 600:1-2. Defendants argue in reply
they included an equitable estoppel counterclaim in their
answers and provided specific evidence to plaintiffs'
interrogatories about equitable estoppel. ECF Doc. 521: 1.
further contend that, during the parties' business
relationship, they did not mislead defendants into believing
they would not sue for infringement and that multiple
documents and emails exchanged between the parties evidence
plaintiffs' notify defendants of possible patent
infringement. Plaintiffs argue that, since such
communications occurred between the parties' C-level
employees and during their contractual relationship, they
cannot support an inference of misleading behavior. Further,
plaintiffs argue, such communications demonstrate the
existence of a genuine dispute of material fact about whether
this action should be equitably estopped (ECF Doc. 500: 3-7)
and necessarily dispel an inference of defendants'
reliance on plaintiffs' inaction. ECF Doc. 500:7. Even if
plaintiffs' behavior were deemed misleading, defendants
cannot have been prejudiced by it as no temporal or causal
nexus exists between defendants' supposed reliance on
plaintiffs' behavior and defendants' actions in
investing in its own roof estimation software. ECF Doc. 500:
judgment is appropriate “if the pleadings, depositions,
answers to interrogatories, and admissions on file, together
with 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” if the
evidence is such that a reasonable jury could return a
verdict for the non-moving party. Anderson v. Liberty
Lobby, Inc., 477 U.S. 242, 248 (1986). A factual dispute
is “material” if it might affect the outcome of
the case under governing law. Id.
movant bears the initial burden of proof to present those
portions of the record it believes demonstrate the absence of
a genuine issue of material fact. Celotex Corp. v.
Catrett, 477 U.S. 317, 322, 106 S.Ct. 2548, 91 L.Ed.2d
265 (1986). After the moving party has met its initial
burden, “the adverse party's response, by
affidavits or otherwise as provided in this rule, must set
forth specific facts showing that there is a genuine issue
for trial.” Fed. R. Civ. P. 56(e).
judgment is appropriate if the non-moving party fails to
rebut by making a factual showing “sufficient to
establish the existence of an element essential to that
party's case, and on which that party will bear the
burden of proof at trial.” Celotex, 477 U.S.
at 322. The evidence introduced to defeat or support a motion
for summary judgment must be capable of being admissible at
trial. Callahan v. AEV, Inc., 182 F.3d 237, 252 n.
11 (3d Cir.1999) (citing Petruzzi's IGA Supermarkets,
Inc. v. Darling-Delaware Co., 998 F.2d 1224, 1234 n. 9
evaluating whether there is a genuine dispute of material
fact, the Court looks at the evidence in the light most
favorable to the non-moving party and draws all reasonable
inferences in their favor (Burns v. Pa. Dep't of
Corr., 642 F.3d 163, 170 (3d Cir.2011)) but neither
weighs the evidence nor makes credibility determinations.
Those are for tasks for the fact finder. Petruzzi's
IGA Supermarkets, 998 F.2d at 1230. Speculation,
conclusory allegations, suspicions, or mere denials do not
suffice to raise a genuine dispute of material fact.
Jutrowski v. Township of Riverdale, 904 F.3d 280,
288-289 (3d Cir. 2018).
estoppel is recognized as a defense sufficient to defeat a
patent infringement claim under 35 U.S.C. § 282(b)
(A.C. Aukerman Co. v. R.L. Chaides Constr. Co., 960
F.2d 1020, 1028 (Fed.Cir.1992) (en banc),
abrogated on other grounds by SCA Hygiene Products
Aktiebolag, et al. v. First Quality Baby Products, LLC, et
al., 137 S.Ct. 954 (2017)) and is a matter committed to
the sound discretion of the trial judge. Id. In
asserting this defense, the defendant has the burden of
“(1) the patentee, through misleading conduct, led the
alleged infringer to reasonably believe that the patentee did
not intend to enforce its patent against the infringer;
(2) the alleged infringer relied on that conduct; and
(3) due to its reliance, the alleged infringer would be
materially prejudiced if the patentee were permitted to
proceed with its charge of infringement.” Aspex
Eyewear, Inc. v. Clariti Eyewear, Inc., 609 F.3d 1305