Shure Incorporated v. Clearone, Inc.

District Court, D. Delaware·Decided September 17, 2021·No. 1:19-cv-01343·Unknown

Opinion

IN THE UNITED STATES DISTRICT COURT FOR THE DISTRICT OF DELAWARE

SHURE INCORPORATED and ) SHURE ACQUISITION HOLDINGS, ) INC., ) ) Plaintiffs, ) ) v. ) Civil Action No. 19-1343-RGA-CJB ) CLEARONE, INC., ) ) Defendant. )

REPORT AND RECOMMENDATION Presently pending in this action filed by Plaintiffs Shure Incorporated and Shure Acquisition Holdings, Inc. (“Plaintiffs” or “Shure”) is Defendant ClearOne, Inc.’s (“Defendant” or “ClearOne”) “Motion for Summary Judgment of Non-Infringement[,]” filed pursuant to Federal Rule of Civil Procedure 56 (“the Motion”). (D.I. 443) For the reasons that follow, the Court recommends that ClearOne’s Motion be DENIED. I. BACKGROUND A. Factual Background Shure and ClearOne are competitors in the installed audio-conferencing market. (D.I. 64 at ¶¶ 14-15; D.I. 232 at 3 at ¶ 15) In 2016, Shure introduced a line of microphone arrays called the Microflex Advance (“MXA”). (D.I. 473, ex. A at ¶ 21) In 2019, ClearOne released its microphone array product, the BMA CT, which was followed by the BMA CTH and BMA CT 360 products (collectively, the “BMA CT products” or the “Accused Products”). (Id. at ¶¶ 55, 60; D.I. 451, ex. 3 at 7)1 In this case, Shure alleges that ClearOne’s BMA CT products infringe United States Design Patent No. D865,723 (the “'723 patent”). (D.I. 451, ex. 3 at 7)2 The '723 patent is

entitled “Array Microphone Assembly” and it issued on November 5, 2019. (Id., ex. 1 (hereinafter, “'723 patent”)) It is a continuation of a parent application filed on April 30, 2015, which matured into a utility patent, United States Patent No. 9,565,493 (the “'493 patent”). (Id. at 1-2; id., ex. 2 at 1)3 Shure asserts the sole claim of the '723 patent, which recites “[t]he ornamental design for an array microphone assembly, as shown and described.” ('723 patent at 1) On October 15, 2020, the Court issued a Report and Recommendation regarding claim construction (the “claim construction R&R”), (D.I. 359), which the District Court subsequently adopted, (D.I. 375). The Court construed the '723 patent claim as follows: The ornamental design for an array microphone assembly, as shown in the solid lines and associated claimed surfaces of Figures 1-6 and described in the specification of the '723 patent. The broken lines in Figures 1-6 of the '723 patent form no part of the claimed design. The square shape of the claimed design is functional.

(D.I. 359 at 25-26; D.I. 375)

1 The only differences between the BMA CT and BMA CTH are the product labels and firmware. (D.I. 451, ex. 15 at ¶ 15) The BMA 360 product has a similar (but not identical) housing to the BMA CT and BMA CTH products. (Id., ex. 7 at 3 nn. 3-4)

2 The Court has been referred the instant case for all purposes, up through the case dispositive motions deadline, by United States District Judge Richard G. Andrews. (D.I. 9)

3 In this matter, Shure also asserts a claim of infringement of the '493 patent, (D.I. 64 at ¶¶ 26-41), which is currently stayed, (D.I. 53; D.I. 326; D.I. 391), as well as other federal and state law tort claims, (D.I. 64). None of these other claims are at issue as to the Motion. Any additional facts relevant to this Report and Recommendation will be discussed in Section III below. B. Procedural History On July 18, 2019, Shure filed the instant action against ClearOne in this Court. (D.I. 1)

Briefing on the instant Motion was completed on June 2, 2021. (D.I. 504) A 5-day trial is currently set to begin on November 1, 2021. (D.I. 62 at ¶ 16) II. STANDARD OF REVIEW A. Summary Judgment The Court incorporates by reference its prior discussion of the legal standard for resolving summary judgment motions, found in its August 23, 2021 Report and Recommendation. (D.I. 535 at 3-4) B. Infringement Design patent infringement is a question of fact that must be proven by the patentee by a preponderance of the evidence. Columbia Sportswear N. Am., Inc. v. Seirus Innovative

Accessories, Inc., 942 F.3d 1119, 1129 (Fed. Cir. 2019). Determining whether a design patent has been infringed is a two-part test; first, the court construes the claim to determine its meaning and scope, and second, the fact finder compares the properly construed claim to the accused design. Lanard Toys Ltd. v. Dolgencorp LLC, 958 F.3d 1337, 1341 (Fed. Cir. 2020). The “ordinary observer” test is the sole test for determining whether a design patent has been infringed. Id. (citing Egyptian Goddess, Inc. v. Swisa, Inc., 543 F.3d 665, 670 (Fed. Cir. 2008)). Under that test, infringement is found “[i]f, in the eye of an ordinary observer, giving such attention as a purchaser usually gives, two designs are substantially the same, if the resemblance is such as to deceive such an observer, inducing him to purchase one supposing it to be the other.” Id. (quoting Egyptian Goddess, 543 F.3d at 670). The United States Court of Appeals for the Federal Circuit has explained that in some cases, “the claimed design and the accused design will be sufficiently distinct that it will be clear without more that the patentee has not met its burden of proving the two designs would appear ‘substantially the same’ to the

ordinary observer[.]” Egyptian Goddess, 543 F.3d at 678. In other cases, “when the claimed and accused designs are not plainly dissimilar, resolution of the question whether the ordinary observer would consider the two designs to be substantially the same will benefit from a comparison of the claimed and accused designs with the prior art”; here, differences between the claimed and accused designs that might not be noticeable in the abstract can become significant when a hypothetical ordinary observer is conversant with the prior art. Id. With the ultimate burden of proving infringement resting with the patentee, an accused infringer may establish that summary judgment is proper either by providing evidence that would preclude a finding of infringement, or by showing that the evidence on file fails to establish a material issue of fact essential to the patentee’s case. Novartis Corp. v. Ben Venue Labs., Inc.,

271 F.3d 1043, 1046 (Fed. Cir. 2001); Nike, Inc. v. Sketchers U.S.A., Inc., Case No. LA CV17- 08509 JAK (Ex), 2020 WL 10486482, at *4 (C.D. Cal. Oct. 26, 2020). If the moving party meets this initial burden, the burden shifts to the party asserting infringement to set forth, by affidavit or as otherwise permitted under Rule 56, “‘specific facts showing that there is a genuine issue for trial.’” Anderson v. Liberty Lobby, Inc., 477 U.S. 242, 250 (1986) (citation omitted); see also Nike, Inc., 2020 WL 10486482, at *4. III. DISCUSSION ClearOne moves for summary judgment of non-infringement of the '723 patent. The crux of its argument is that Shure’s evidence of infringement—which, according to ClearOne, must be limited to the opinions of Shure’s infringement expert, Paul Hatch, and to Shure’s final infringement contentions—is legally insufficient and should be wholly discounted. (D.I. 444 at 2 & n.2) First, with regard to Mr. Hatch’s opinions, ClearOne asserts that they violate the Court’s claim construction and relevant law, and must therefore be discarded. (Id. at 7-11) Second, with

regard to Shure’s final infringement contentions (the “final contentions” or the “contentions”), ClearOne claims that they are insufficient to create a triable issue of fact regarding infringement. (Id.

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Shure Incorporated v. Clearone, Inc., (D. Del. 2021).

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