PerdiemCo, LLC. v. IndusTrack LLC, 2-15-cv-00727 (TXED November 8, 2016, Order) (Gilstrap, USDJ)
Thursday, November 10, 2016
Customer’s Benefit From Using Software Does Not Create Direction and Control Needed to Support Divided Infringement Claim
The court granted defendant's motion for summary judgment that it did not infringe plaintiff's object tracking patent and rejected plaintiff's divided infringement argument. "[T]he Court is not convinced that [plaintiff's] theory as to how [defendant] conditions a customer’s participation in the accused system rises to the level of 'directs or controls.' [Plaintiff] contends that a customer’s use of the system is conditioned on the customer performing the defining steps because '[defendant] does not provide the full benefit of the accused fleet-tracking services unless customers enter the requisite data.' If that was sufficient to establish divided infringement under § 271(a), then the Supreme Court’s [Limelight Networks, Inc. v. Akamai Techs., Inc., 134 S. Ct. 2111 (2014)] decision would have little meaning. It will always be true that a user’s benefit from using software will increase as the user explores additional functionality. That is not what the Federal Circuit meant by 'conditions participation.' [Plaintiff's] theory stands in stark contrast to the circumstances considered by the Federal Circuit in [Akamai Techs., Inc. v. Limelight Networks, Inc., 797 F.3d 1020 (Fed. Cir. 2015)], in which the accused infringer required customers to sign a standard form contract that delineated which claimed steps the customers 'must perform.' Although the Federal Circuit acknowledged that 'other factual scenarios may arise which warrant attributing others’ performance of method steps to a single actor,' [plaintiff] has not shown this to be such a scenario."