NEUROPTICS, INC. v. BRIGHTLAMP, INC.

CourtDistrict Court, S.D. Indiana
DecidedSeptember 16, 2021
Docket1:19-cv-04832
StatusUnknown

This text of NEUROPTICS, INC. v. BRIGHTLAMP, INC. (NEUROPTICS, INC. v. BRIGHTLAMP, INC.) is published on Counsel Stack Legal Research, covering District Court, S.D. Indiana primary law. Counsel Stack provides free access to over 12 million legal documents including statutes, case law, regulations, and constitutions.

Bluebook
NEUROPTICS, INC. v. BRIGHTLAMP, INC., (S.D. Ind. 2021).

Opinion

UNITED STATES DISTRICT COURT SOUTHERN DISTRICT OF INDIANA INDIANAPOLIS DIVISION

NEUROPTICS, INC., ) ) Plaintiff, ) ) vs. ) ) No. 1:19-cv-04832-JMS-MG BRIGHTLAMP, INC., ) ) Defendant. )

ORDER

Plaintiff NeurOptics, Inc. ("NeurOptics") and Defendant Brightlamp, Inc. ("Brightlamp") both manufacture and sell pupillometers1 and related products. NeurOptics brought this action, alleging patent infringement in connection with Brightlamp's "Reflex" Mobile Pupillometer Application ("Reflex"). [Filing No. 1.] Brightlamp denied infringement and filed counterclaims alleging that NeurOptics' patents identified in the Complaint were not infringed, are invalid, and are unenforceable, and that NeurOptics had engaged in "antitrust activities" in violation of the Sherman Act. [Filing No. 48-1.] The parties attempted to reach a settlement, resulting in a telephone conversation and subsequent email exchange between NeurOptics' and Brightlamp's CEOs. Brightlamp now takes the position that the email exchange culminated in a valid and enforceable settlement agreement and moves to dismiss this action on that basis, but NeurOptics disagrees. Brightlamp's Renewed Motion to Enforce Settlement Agreement and Dismiss this Action, [Filing No. 69], is fully briefed and ripe for the Court's decision.

1 "Pupillometer" can also be spelled "pupilometer," and refers to a device used to measure the pupil. See Pupillometer, OXFORD ENGLISH DICTIONARY, https://www.oed.com/view/Entry/154783?redirectedFrom=pupillometer#eid (last visited Sept. 16, 2021). To the extent the parties did so in their correspondence quoted in this Order, the Court utilizes both spellings interchangeably. I. BACKGROUND

On March 27, 2019, NeurOptics' counsel, Nathaniel Dilger, sent a demand letter to Brightlamp's CEO, Kurtis Sluss. [Filing No. 70-1 at 5-13.] The letter stated that NeurOptics "holds an extensive and wide-reaching intellectual property portfolio that is focused on protecting all aspects of NeurOptics' pupillometer technology," asserted that Brightlamp's Reflex application "infringe[d] multiple NeurOptics patents," and declared that a patent recently issued to Brightlamp was "unpatentable and invalid in view of NeurOptics' own patent portfolio and must therefore be dedicated to the public." [Filing No. 70-1 at 5.] In the letter, Mr. Dilger repeatedly referenced NeurOptics' "patent portfolio." [Filing No. 70-1 at 5 ("NeurOptics has for many years developed an extensive patent portfolio protecting its pupillometer technology."); Filing No. 70-1 at 7 ("Despite the breadth and coverage of the NeurOptics' patent portfolio, Brightlamp has announced plans to introduce its own mobile pupillometer, known as 'Reflex.'"); Filing No. 70-1 at 10 ("Because Brightlamp knew of both NeurOptics and its extensive patent portfolio, NeurOptics believe[s] this infringement was both willful and deliberate . . . ."); Filing No. 70-1 at 11 ("Notably, NeurOptics' patent portfolio predates [Brightlamp's patent] by nearly two decades.").] The letter identified 22 specific patents held by NeurOptics that it believed were infringed by the Reflex application, but explicitly stated that NeurOptics believed other patents not specifically listed had also been infringed. [Filing No. 70-1 at 5-6; Filing No. 70-1 at

10 ("The discussion above is only exemplary and is not intended to be an exhaustive explanation of the patents or claims infringed by Brightlamp's Reflex product. NeurOptics in fact believes that the Reflex product unquestionably infringes . . . additional claims from additional NeurOptics patents.").] The demand letter did not lead to a resolution of NeurOptics' allegations, and on December 6, 2019, NeurOptics filed its Complaint. [Filing No. 1.] The Complaint alleges that Brightlamp infringed "at least U.S. Patent No. 6,820,979 (the "'979 Patent") and U.S. Pat[ent] No. 9,402,542 ([the] "'542 Patent") (collectively, the 'Asserted Patents.')." [Filing No. 1 at 1.]

The Complaint further stated: "NeurOptics in fact believes that the Reflex pupillometer . . . may have infringed various claims from additional NeurOptics patents, including potentially [five other enumerated patents]. As NeurOptics completes its investigation, it expects to amend this complaint to identify any additional infringed patents." [Filing No. 1 at 7.] NeurOptics never filed an amended complaint. On May 15, 2020, Mr. Dilger presented NeurOptics' settlement demand to Brightlamp's counsel. [Filing No. 70-3 at 2-3.] The demand contained the following proposed terms: 1. For a period of 6 years, Brightlamp will agree to neither market nor knowingly offer for sale or sell its accused pupilometer application to hospitals or licensed medical professionals. 2. Brightlamp will pay NeurOptics $7,5000 (sic) 3. In return for the above, NeurOptics will covenant not to sue Brightlamp on NeurOptic's (sic) pupillometer patent portfolio, subject to the field of use restriction above. 4. The parties will dismiss with prejudice all claims and counterclaims, with each side bearing its own costs and fees.

[Filing No. 70-3 at 3.] On July 22, 2020, Mr. Sluss, Brightlamp's CEO, and William (Bill) Worthen, NeurOptics' CEO, discussed this litigation via telephone. [Filing No. 70-1 at 2; see also Filing No. 72-5 at 6.] Following the telephone conversation, Mr. Worthen sent an email to Mr. Sluss, thanking him for the call and proposing "a potential business solution." [Filing No. 72-5 at 6-7.] Specifically, Mr. Worthen proposed the following terms: 1. For a period of 4 years, Brightlamp will agree to neither market nor knowingly offer for sale or sell its accused pupilometer application to hospitals. 2. In return for the above, NeurOptics will (a) forego its claim for damages and (b) covenant not to sue Brightlamp on NeurOptic's (sic) pupillometer patent portfolio, subject to the field of use restriction above. 3. Both parties will dismiss with prejudice all claims and counterclaims, with each side bearing its own costs and fees.

[Filing No. 72-5 at 6.]

Mr. Sluss responded via email, stating, in relevant part:

I propose the following settlement to mitigate unnecessary expenditure from your side and, as you put it in our call earlier today, to get this suit over with and put it to bed.

1. Brightlamp will agree to neither market to hospitals nor knowingly offer for sale or sell its accused pupilometer application to hospitals, up to the expiration of the patents-in-suit (i.e. August 1, 2021). 2. Brightlamp to pay NeurOptics $5,000 3. In return for the above, NeurOptics will (a) forego its claim for damages and (b) covenant not to sue Brightlamp on NeurOptics' pupillometer patent portfolio, subject to the field of use restriction above. 4. Both parties will dismiss with prejudice all claims and counterclaims, with each side bearing its own costs and fees.

Please let me know if you accept the above settlement offer or if you would like to continue with court proceedings as scheduled.

[Filing No. 72-5 at 5-6.]

Mr. Sluss responded via email, suggesting that Brightlamp pay NeurOptics $2,500 rather than $5,000, but not making any other proposed changes. [Filing No. 72-5 at 4.] Mr. Worthen then responded, "$4k and we[']re done/good to go." [Filing No. 72-5 at 4.] Mr. Sluss replied: "Let's meet in the middle then between $1k and $5k. If you can agree to $3,000 then we can wrap this up." [Filing No. 72-5 at 3-4.] Mr. Worthen responded: "Ok." [Filing No. 72-5 at 3.] Mr. Sluss then sent a final email on July 24, 2020, stating:

Thanks, happy we can come to an arrangement. This is what I will be sending to my legal team as far as our agreed upon terms: 1.

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