Inline Connection Corp. v. Verizon Internet Services, Inc.

402 F. Supp. 2d 695, 2005 WL 3333396
CourtDistrict Court, E.D. Virginia
DecidedDecember 6, 2005
DocketCiv.A. 2:05CV205
StatusPublished
Cited by2 cases

This text of 402 F. Supp. 2d 695 (Inline Connection Corp. v. Verizon Internet Services, Inc.) is published on Counsel Stack Legal Research, covering District Court, E.D. Virginia primary law. Counsel Stack provides free access to over 12 million legal documents including statutes, case law, regulations, and constitutions.

Bluebook
Inline Connection Corp. v. Verizon Internet Services, Inc., 402 F. Supp. 2d 695, 2005 WL 3333396 (E.D. Va. 2005).

Opinion

OPINION AND ORDER

MORGAN, Senior District Judge.

This matter comes before the Court on a Motion to Transfer the present action to the United States District Court for the District of Delaware, brought by nine (9) 1 of the named defendants in this action (“Moving Defendants”), and to Sever and Administratively Dismiss Claims against Verizon Virginia Inc. and Verizon South Inc., pending resolution of the action in Delaware. (Doc. 20.) The Court heard arguments in open court on October 4, 2005, and granted the Motion to Transfer from the bench. For reasons set forth below, the Court Orders that the remaining sixteen (16) Defendants that did not join in the instant Motion to Transfer shall be Severed from the present action and further Orders that the severed action be Stayed without prejudice to Inline Communications Corporation taking further action against the severed parties. This Order and Opinion further explains the Court’s ruling.

I. Procedural Background and Factual History

Inline Connection Corporation (“Plaintiff’) is incorporated in Virginia and maintains its principal place of business in Washington, D.C. Complaint at ¶ 1. Plaintiff owns United States Patent Nos. 5,844,-596, 6,236,718, 6,243,446 and 6,542,585 (“patents-in-suit”), which relate to systems and methods for simultaneous transfer of voice and data streams over telephone lines. On April 6, 2005, Plaintiff filed a Complaint with the Alexandria Division of this Court against twenty-five (25) Verizon entities 2 (“Defendants”) (Doc. 1), alleging *697 infringement of these patents-in-suit relating to the provision of Digital Subscriber Line (“DSL”) services for high-speed Internet access to subscribers. The Complaint was thereafter transferred to the Norfolk Division in accord with this Court’s established rotation system. On May 31, 2005, Defendants filed their Answer, (Doc. 17), with the exception of sixteen (16) Defendants 3 that instead filed a Motion to Dismiss for Lack of Personal Jurisdiction. (Doc. 18.)

Plaintiff is currently engaged in parallel litigation involving the same patents-in-suit that are at issue in this case 4 before the United States District Court for the District of Delaware (“Delaware court”). In April and June of 2002, Plaintiff filed complaints with the District of Delaware, naming leading Internet Service Providers (“ISPs”), AOL Time Warner, Inc. and Earthlink, Inc., as well as Verizon Communications, Inc., alleging the same violations of its patents-in-suit. On October 2, 2002, Verizon Communications, Inc. was dismissed without prejudice pursuant to a stipulation of dismissal upon discovering that the company was only a holding company for Verizon companies. 5 After Verizon was dismissed, the Delaware action proceeded against Earthlink and AOL, but Plaintiff did not amend its complaint to add Verizon ISPs or any other Defendants named in the present action.

The Delaware Court has invested substantial time in scheduling conferences, presiding over discovery disputes, and ruling on numerous motions. Further, the Delaware court has spent considerable time familiarizing itself with the relevant technology as evidenced in its detailed opinions. 6 More specifically, the court has issued extensive orders regarding: 1) the proper construction of approximately 15 disputed claim terms, see Ex. D to Ds.’ Mem. in Supp. of Mot. to Trans.; 2) modification of the construction of four of the disputed terms on a motion for reconsideration, see Ex. E to Ds.’ Mem. in Supp. of Mot. to Trans.; and 3) cross motions for summary judgment, see Ex. F to Ds.’ Mem. in Supp. of Mot. to Trans. The Delaware court is presently considering motions for clarification, reconsideration *698 and a broader motion for summary judgment of noninfringement.

While Plaintiff is engaged in litigating its patents-in-suit in Delaware, Plaintiff alleges in this action that each named Defendant has “used, sold and/or offered to sell ... [DSL service] that infringes one or more” of the same patents-in-suit. Complaint at ¶ 26. However, Defendants’ involvement with the provision. of the allegedly infringing service is not entirely coextensive. After reviewing the briefs submitted by both Parties and the evidence presented at the hearing, the undisputed facts place Defendants in four categories with respect to their relationship to. the sale or provision of the allegedly infringing Internet service.

(1) Internet Service Providers: Verizon Internet Services and GTE.Net are ISPs and are the entities responsible for providing Verizon’s DSL service to subscribers. Both are incorporated in Delaware. Complaint at ¶¶ 2-3. Verizon Internet Services’ territory is the eastern United States and GTE.Net’s is the western United States.

(2) Service Companies: Verizon Advanced Data and Verizon Avenue Corp. are Service Companies that have some connection to the provision of DSL services and are incorporated in Delaware. Complaint at ¶¶ 4-6.

(3) General Service Companies: Tele-sector Resources Group, Verizon Services Corp., and Verizon Corporate Services are General Service Providers that provide services such as account management, sales, product management, legal, human resources, regulatory, negotiation and marketing to other Verizon entities and are incorporated in Delaware. Complaint at ¶¶ 6-8.

(4) Individual Operating Telephone Companies (“OTCs”): These remaining eighteen (18) companies provide local telecommunication services to customers within their specific regional localities pursuant to federal tariff. They are incorporated and operate in various states outside of Virginia and Delaware, with the exception of two OTCs incorporated in Virginia, Verizon Virginia Inc. and Verizon South Inc., and two OTCs incorporated in Delaware, Verizon Delaware Inc. and GTE Southwest. Complaint at ¶¶ 9(a)-(r).

The Moving Defendants argue that this action should be transferred to the District of Delaware since Plaintiff is currently engaged in parallel litigation in Delaware involving the instant patents-in-suit. The Moving Defendants contend that Plaintiffs object in filing in the Eastern District of Virginia is to avoid unfavorable rulings on its patents-in-suit in the Delaware action and to utilize this forum’s allegedly faster moving docket to obtain separate expedited rulings. See Ds.’ Mem. in Supp. of Mot. to Trans, at 6. The Moving Defendants further contend that Plaintiff has added the Verizon OTCs to this action to prevent transfer and that the OTCs are wholly unnecessary and peripheral to the present action. See id.

II. Analysis

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Related

Jaffe v. LSI Corp.
874 F. Supp. 2d 499 (E.D. Virginia, 2012)

Cite This Page — Counsel Stack

Bluebook (online)
402 F. Supp. 2d 695, 2005 WL 3333396, Counsel Stack Legal Research, https://law.counselstack.com/opinion/inline-connection-corp-v-verizon-internet-services-inc-vaed-2005.