Oyster Optics, LLC v. Ciena Corporation

Opinion

1 2 3 6 7 OYSTER OPTICS, LLC, Case No. 17-cv-05920-JSW

8 Plaintiff, ORDER RESOLVING MOTIONS FOR SUMMARY JUDGMENT RE: 9 v. ENABLEMENT AND WRITTEN DESCRIPTION AND RELATED 10 CIENA CORPORATION, PORTIONS OF MOTIONS TO STRIKE TESTIMONY OF DR. GEORGE PAPEN 11 Defendant. AND DR. KEITH GOOSEN

12 Re: Dkt. Nos. 177-4 (178), 181, 184-3 (182), 186-2 (185)1 13

14 This is the second in a series of Orders addressing the parties’ motions for summary 15 judgment and related Daubert motions. This Order addresses (1) the parties’ cross-motions for 16 summary judgment on Defendant Ciena Corporation’s (“Ciena”) affirmative defense of invalidity 17 for lack of enablement; and (2) Plaintiff Oyster Optics LLC’s (“Oyster”) motion for summary 18 judgment on Ciena’s affirmative defense of invalidity for lack of written description. In 19 connection with those motions, Oyster’s moves to strike the testimony and opinions of Ciena’s 20 expert Dr. George Papen (“Dr. Papen”) and Ciena moves to strike the testimony and opinions of 21 Oyster’s expert, Dr. Keith Goosen. The Court has considered the parties’ papers, relevant legal 22 authority, and the record in this case. For the reasons that follow, the Court DENIES the motions 23 for summary judgment and DENIES the motions to strike.2 24 // 25

26 1 The docket numbers in parentheses are redacted versions of motions filed under seal. 27 2 The Court will address the other issues raised by the parties’ motions for summary 2 Oyster accuses Ciena of infringing claims 25, 27-32, and 36-37 (the “Asserted Claims”) of 3 || US. Patent No. 7,620,327, Fiber Optic Telecommunications Card with Energy Level Monitoring 4 || (the “327 Patent”). (Dkt. No. 183, Declaration of Blair M. Jacobs (“5/21/21 Jacobs Decl.”), 5 || §§ 18, 25; Dkt. Nos. 183-18, 183-25, 5/21/21 Jacobs Decl., Ex. 18 (Oyster Infringement 6 || Contentions), Ex. 25 (327 Patent).) The ’327 Patent is directed to a transceiver card for secure 7 || communications over fiber optic networks. (327 Patent at 1:11-13, 2:22-24.) 8 Fiber optic networks use light to communicate. (See id. at 1:20-35.) In traditional 9 || transceiver cards, a “transmitter” modulates the amplitude of a light beam (creating an “optical 10 || signal”) to transmit data. (/d.) “Modulating” refers to putting data on a lightwave carrier. 11 (5/21/21 Jacobs Decl., § 14; Dkt. No. 177-34, Jacobs Decl., Ex. 14 (Deposition of Peter “Rocky” a 12 Snawerdt (“Snawerdt Depo.”) at 77:21-24).) A “receiver,” in turn, converts the light back into

data by reading electronic output. (327 Patent at 1:30-33; see also Snawerdt Depo. at 77:25-78:4

14 || (testifying that demodulation is extracting data from lightwave carrier signal, which is done in the o 15 || receiver).) a 16 Figure 2 of the ’327 Patent shows the common transceiver card architecture: 17 ! □ rp 19 ° Modulator & □ | Transmit Data Stream Laser Control 20 : ' Electronics □ 21 | 7 f ts . ri | ris i Laser ; eo 110

□□□ 233 _— 33 □ 24 ! |To/From Processor Tc \ i 31 rc BI □ | □□□□ 1 ot 135 25 Received Data Stream |_| 26 i 34 1 / 4 □ 1 | Kn / 27 i | Ge i To/From Processor 132 ‘ 1 and Interface t ! 28 it Kas 1 □□ “134

1 A transmitter 10 (outlined in dashed lines at the top) contains a laser 12 that beams light 2 and a modulator 16 that encodes data into that light. (’327 Patent at 4:25-38.) A receiver 11 3 (outlined in dashed lines below the transmitter) has an optical receiver 32 that converts the optical 4 signal back into data. (Id. at 4:64-67.) Optical signals exit the transmitter and enter the receiver 5 through fibers 110 and 111, respectively. (Id. at 4:26-27, 4:48-49.) 6 Claim 25 provides: 7 A transceiver card for a telecommunications box for transmitting data over a first optical fiber and receiving data over a second 8 optical fiber, the card comprising: 9 a transmitter for transmitting data over the first optical fiber, the transmitter having a laser, a modulator and a controller receiving 10 input data and controlling the modulator as a function of the input data, the transmitter transmitting optical signals for 11 telecommunications as a function of the input data; 12 a fiber output optically connected to the laser for connecting the first optical fiber to the card; 13 a fiber input for connecting the second optical fiber to the card; 14 a receiver optically connected to the fiber input for receiving data 15 from the second optical fiber; and 16 an energy level detector to measure an energy level of the optical signals, the energy level detector including a threshold indicating a 17 drop in amplitude of a phase-modulated signal. 18 Claim 36 provides: 19 A transceiver card for a telecommunications box for transmitting data over a first optical fiber and receiving data over a second 20 optical fiber, the card comprising: 21 a transmitter for transmitting data over the first optical fiber, the transmitter having a laser, a modulator and a controller receiving 22 input data and controlling the modulator as a function of the input data, the transmitter transmitting optical signals for 23 telecommunications as a function of the input data; 24 a fiber output optically connected to the laser for connecting the first optical fiber to the card; 25 a fiber input for connecting the second optical fiber to the card; 26 a receiver optically connected to the fiber input for receiving data 27 from the second optical fiber; 1 a splitter to split at least a portion of the optical signals to form a split optical signal; 2 a photodetector to measure the split optical signal, the photodetector 3 outputting an electric voltage to correlating [sic] to an optical power of the split optical signal, and 4 a detector controller connected electrically to the photodetector. 5 The Court will address additional facts as necessary in the analysis. 6 ANALYSIS 7 A. The Court Denies the Motions to Strike. 8 1. Applicable Legal Standards. 9 Under Rule 702, scientific, technical, or otherwise specialized knowledge is admissible if it 10 will assist the trier of fact to understand the evidence or determine a fact in issue, is based on 11 sufficient facts or data, and is the product of reliable methods or principles that have been applied 12 reliably to the facts of the case. Fed. R. Evid. 702(a)-(d). The party proffering an expert bears the 13 burden to show the testimony is admissible. Under Daubert and its progeny, a district court’s 14 inquiry into admissibility “is a flexible one.” Alaska Rent-A-Car, Inc. v. Avis Budget Grp., Inc., 15 738 F.3d 960, 969 (9th Cir. 2013) (citation omitted). In evaluating proffered expert testimony, the 16 trial court is “a gatekeeper, not a fact finder.” Primiano v. Cook, 598 F.3d 558, 565 (9th Cir. 17 2010) (citation and quotation marks omitted). 18 “[T]he trial court must assure that the expert testimony ‘both rests on a reliable foundation 19 and is relevant to the task at hand.’” Id. at 564 (quoting Daubert, 509 U.S. at 597). “Expert 20 opinion testimony is relevant if the knowledge underlying it has a valid connection to the pertinent 21 inquiry. And it is reliable if the knowledge underlying it has a reliable basis in the knowledge and 22 experience of the relevant discipline.” Id. at 565 (citation and quotation marks omitted). “Shaky 23 but admissible evidence is to be attacked by cross examination, contrary evidence, and attention to 24 the burden of proof, not exclusion.” Id. at 564 (citation omitted). The judge is “supposed to 25 screen the jury from unreliable nonsense opinions, but not exclude opinions merely because they 26 are impeachable.” Alaska Rent-A-Car, 738 F.3d at 969. Simply put, “[t]he district court is not 27 tasked with deciding whether the expert is right or wrong, just whether [their] testimony has 1 substance such that it would be helpful to a jury.” Id. at 969-70. 2 A court may consider the following non-exhaustive factors to determine whether expert 3 testimony is sufficiently reliable to be admitted into evidence, including: 4 (1) whether the scientific theory or technique can be (and has been) tested, (2) whether the theory or technique has been subjected to 5 peer review and publication, (3) whether there is a known or potential error rate, and (4) whether the theory or technique is 6 generally accepted in the relevant scientific community. 7 Mukhtar v. Cal. State Univ., 299 F.3d 1053, 1064 (9th Cir. 2002). “[W]hether Daubert’s specific 8 factors are, or are not, reasonable measures of reliability in a particular case is a matter that the law 9 grants the trial judge broad latitude to determine.” Kumho Tire Co., Ltd. v. Carmichael, 526 U.S. 10 137, 153 (1999). 11 2. Dr. Papen. 12 Dr. Papen opines that the ’327 Patent is invalid because the claims fail to comply with the 13 written description requirement and is invalid for lack of enablement because the specification 14 does not disclose or enable a receiver with or without a demodulator. (See Dkt. No. 185-2, 15 Declaration of Paul Kroeger (“Kroeger Decl.”), ¶ 2; Dkt. No. 186-5, Kroeger Decl., Ex. 1, Papen 16 Report, ¶¶ 182-233.) In Oyster’s view, Dr. Papen’s opinion is legally erroneous and should 17 therefore be excluded. Dr. Papen includes the legal standard he applied to determine whether the 18 ’327 Patent was enabled, and he includes an accurate statement of the standard to be applied. 19 (Papen Report, ¶ 193.) 20 Oyster argues that Dr. Papen’s opinion rests on an incorrect construction of the term 21 “receiver,” but Dr. Papen also recognized that the Court did not provide a construction for the 22 term. (Id., ¶ 198.) The Court concludes that Oyster’s challenge goes to the weight the finder of 23 fact should give Dr. Papen’s testimony, rather than its admissibility. Accordingly, it DENIES the 24 motion. 25 3. Dr. Goosen. 26 Ciena argues that the Court should preclude Dr. Goosen from testifying because he copied 27 large portions of another expert’s report in his own report. The portions of the report that Ciena 1 argues that impacts his credibility regarding his opinions on enablement, the Court concludes 2 Ciena’s objections go to weight rather than admissibility. 3 Ciena also moved to strike Dr. Goosen’s opinions on enablement and contended Dr. 4 Goosen misapplied the Court’s claim construction of the term receiver. Dr. Goosen recognized 5 that the Court did not define the term receiver and set forth the applicable legal standard for 6 enablement. (Dkt. No. 208-2, Omnibus Decl. of Paul Kroeger (“Kroeger Decl.”), ¶ 18; Dkt. No. 7 255-24, Kroeger Decl., Ex. Q (Declaration of Keith Goosen, ¶ 2, Ex. A (Goosen Validity Report, 8 ¶¶ 24, 46.) 9 Although Ciena’s arguments focused on the ’898 Patent, to the extent Ciena’s argument 10 includes the ’327 Patent, the Court conclude the objections go to the weight of his testimony rather 11 than its admissibility. 12 B. The Court Denies the Motions for Summary Judgment on the Invalidity Defenses. 13 1. Legal Standards Applicable to Motions for Summary Judgment. 14 A party may move for summary judgment, identifying each claim or defense . . . on which 15 summary judgment is sought.” Fed. R. Civ. P. 56(a). A principal purpose of the summary 16 judgment procedure is to identify and dispose of factually unsupported claims. Celotex Corp. v. 17 Catrett, 477 U.S. 317, 323-24 (1986). Summary judgment, or partial summary judgment, is 18 proper “if the movant shows that there is no genuine dispute as to any material fact and the movant 19 is entitled to judgment as a matter of law.” Fed. R. Civ. P. 56(a). The Court may not weigh 20 evidence or make determinations of credibility. Rather, “[t]he evidence of the non-movant is to be 21 believed, and all justifiable inferences are to be drawn in his favor.” Anderson v. Liberty Lobby, 22 477 U.S. 242, 255 (1986). 23 The party moving for summary judgment bears the initial burden of identifying those 24 portions of the pleadings, discovery, and affidavits that demonstrate the absence of a genuine issue 25 of material fact. Celotex, 477 U.S. at 323; see also Fed. R. Civ. P. 56(c). An issue of fact is 26 “genuine” only if there is sufficient evidence for a reasonable fact finder to find for the non- 27 moving party. Anderson, 477 U.S. at 248-49. A fact is “material” if it may affect the outcome of 1 of persuasion at trial, the party must produce evidence which either negates an essential element of 2 the non-moving party’s claims or show that the non-moving party does not have enough evidence 3 of an essential element to carry its ultimate burden of persuasion at trial. Nissan Fire & Marine 4 Ins. Co. v. Fritz Cos., 210 F.3d 1099, 1102 (9th Cir. 2000). 5 Once the moving party meets its initial burden, the non-moving party must “identify with 6 reasonable particularity the evidence that precludes summary judgment.” Keenan v. Allan, 91 7 F.3d 1275, 1279 (9th Cir. 1996) (quoting Richards v. Combined Ins. Co., 55 F.3d 247, 251 (7th 8 Cir. 1995)). It is not the Court’s task “to scour the record in search of a genuine issue of triable 9 fact.” Id. (quoting Richards, 55 F.3d at 251); see also Fed. R. Civ. P. 56(c)(3) (“The court need 10 consider only the cited materials, but it may consider other materials in the record.”). “A mere 11 scintilla of evidence will not be sufficient to defeat a properly supported motion for summary 12 judgment; rather, the nonmoving party must introduce some significant probative evidence 13 tending to support the complaint.” Summers v. Teichert & Son, Inc., 127 F.3d 1150, 1152 (9th 14 Cir. 1997) (cleaned up). If the non-moving party fails to point to evidence precluding summary 15 judgment, the moving party is entitled to judgment as a matter of law. Celotex, 477 U.S. at 323. 16 The ’327 Patent is presumed to be valid. 35 U.S.C. § 282. In order to prevail on its 17 motion Ciena “must submit such clear and convincing evidence of invalidity so that no reasonable 18 jury could find otherwise.” Eli Lilly v. Barr Labs., Inc., 251 F.3d 955, 962 (Fed. Cir. 2001) 19 (citation omitted). To prevail on its motion, Oyster must be able to show that Ciena “failed to 20 produce clear and convincing evidence on an essential element of” its invalidity defenses. Id. 21 2. Enablement. 22 The United States Supreme Court recently reiterated that the enablement requirement 23 enforces the “quid-quo-pro premise of patent law,” i.e., in return for the patent monopoly, the 24 patentee must “ensure the public has the full benefit of the invention or discovery after the 25 expiration of the patent term.” Amgen, Inc. v. Sanofi, 598 U.S. 594, 604-05 (2023) (cleaned up). 26 To do so, a patent specification must include “a written description of the invention, and of the 27 manner and process of making and using it, in such full, clear, concise, and exact terms as to 1 112(a). The Court also reiterated that “the specification must enable the full scope of the 2 invention as defined by its claims.” Id. at 610. 3 If a patent claims an entire class of processes, machines, manufactures, or compositions of matter, the patent’s specification 4 must enable a person skilled in the art to make and use the entire class. … The more one claims, the more one must enable. … That 5 is not to say a specification always must describe with particularity how to make and use every single embodiment within a claimed 6 class. For instance, it may suffice to give an example (or a few examples) if the specification also discloses some general quality … 7 running through the class that gives it a peculiar fitness for the particular purpose. … In some cases, disclosing that general quality 8 may reliably enable a person skilled in the art to make and use all of what is claimed, not merely a subset. 9 10 Id. at 610-11 (internal quotations and citation omitted). 11 Ciena argues the ’327 Patent is invalid because the specification does not enable a 12 “receiver with a demodulator” or a “receiver without a demodulator.” Oyster argues that Ciena 13 will not be able prevail on this defense because the specification enables a “receiver.” The 14 question of whether a patent is enabled involves two steps. First, one must determine “the precise 15 scope of the invention.” McRO, Inc. v. Bandi Namco Games Am., Inc., 959 F.3d 1091, 1100 (Fed. 16 Cir. 2020). During claim construction proceedings, the parties agreed that “the ordinary meaning 17 of a ‘receiver’ is not limited to receivers without demodulators[.]” (Dkt. No. 127, Claim 18 Construction Order at 11:21-22 (emphasis added).) The Court did not provide a construction for 19 the term “receiver” and subsequently explained that “[t]he ordinary, non-construed meaning of 20 ‘receiver’ includes receivers with all sorts of components, some of which may be demodulators.” 21 (Claim Construction Order at 16:24; Dkt. No. 134, Order Denying Ciena’s Motion for 22 Reconsideration at 2:22-23 (emphasis added).) Thus, under the Court’s construction, a 23 demodulator may be a component of the receiver but it is not necessarily required. 24 Ciena once again argues that during prosecution of the ’898 Patent, which shares a 25 common specification with the ’327 Patent, Oyster conceded that the specification does not enable 26 a receiver with a demodulator. The Court did not decide that Oyster’s amendments to the ’898 27 Patent were an admission. (Claim Construction Order at 15:15-16.) Instead, the Court determined 1 demodulator, … does not clearly render the full scope of the claims non-enabled.” (Claim 2 Construction Order at 15:15-16, 16:14-16) (emphasis added); see also id. at 16:17-18 (“[T]he 3 issue is not nearly clear enough to justify limiting the scope of the claims absent prosecution 4 disclaimer.”).) Accordingly, the prosecution history of the ’898 Patent is not sufficient, on its 5 own, to demonstrate by clear and convincing evidence that the receiver claimed in the ’327 Patent 6 is not enabled. 7 The second step of the enablement analysis examines “whether undue experimentation is 8 required to make and use the full scope of embodiments of the invention claimed.” McRO, 959 9 F.3d at 1100. The following factors guide that analysis: “(1) the quantity of experimentation 10 necessary, (2) the amount of direction or guidance presented, (3) the presence or absence of 11 working example, (4) the nature of the invention, (5) the state of the prior art, (6) the relative skill 12 of those in the art, (7) the predictability of the art, and (8) the breadth of the claims.” In re Wands, 13 858 F.2d 731, 737 (Fed. Cir. 1998). Neither Ciena nor Oyster addresses these factors in their 14 briefs. However, Dr. Goosen and Dr. Papen agree on only one of them: that the art is 15 unpredictable. (Compare Papen Report, ¶¶ 199-212 with Goosen Validity Report ¶¶ 45, 84-90.) 16 Because the Court has denied the motions to strike, it will be up to the finder of fact to determine 17 whose testimony is more persuasive. 18 For these reasons, the Court concludes that neither Oyster nor Ciena has met its burden to 19 show it is entitled to summary judgment on the issue of enablement (or lack thereof) and it 20 DENIES their motions. 21 3. Written Description. 22 Oyster also argues that Ciena will not be able to prevail on lack of written description 23 defense. “A specification adequately describes an invention when it ‘reasonably conveys to those 24 skilled in the art that the inventor had possession of the claimed subject matter as of the filing 25 date.’” Juno Therapeutics, Inc. v. Kite Pharma, Inc., 10 F.4th 1330, 1335 (Fed. Cir. 2021) 26 (quoting Ariad Pharms., Inc. v. Eli Lilly & Co., 598 F.3d 1336, 1351 (Fed. Cir. 2010) (en banc)). 27 This issue generally is a question of fact and “[w]hat is required to meet the written description ] technologic knowledge already in existence.” /d. (cleaned up). Factors which guide the analysis 2 || include “the existing knowledge in the particular field, the extent and content of the prior art, the 3 maturity of the science or technology, [and] the predictability of the aspect at issue.” Ariad 4 Pharms., 598 F.3d at 1351. 5 Again, the parties’ experts present contradictory views on this issue, and it will be up to the 6 || finder of fact to determine whose testimony is more persuasive. 7 Accordingly, the Court DENIES Oyster’s motion. ay 9 || Dated: October 24, 2023 / |} ) 10 | hits United yt Distrigt Judge jf”

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