Texas Hold ‘Em or Texas Hold Up? MAD goes all in in East Texas.
Like that gambler who just doesn’t know when to quit, always looking for the big score, our friends at Mission Abstract Data (MAD) – through their latter-day identity, DigiMedia – are back at the table. On February 14, DigiMedia filed lawsuits against four radio companies with stations in Texas, arguing that the companies have engaged in patent infringement. (You can find links to the complaints, sans attachments, here, here, here and here.) The allegations are essentially identical to those advanced by MAD in federal court in Delaware against seven large radio companies back in March 2011. The fact that the new lawsuits aren’t markedly different from those earlier, still pending, suits actually raises some questions.
We’ve been dutifully following and reporting on the Mission Abstract Data (now “DigiMedia”) patent saga for nearly two years. (Standard disclaimer: we are NOT patent attorneys, and make no claim to special familiarity with patent law in general or as it might apply to MAD’s arguments.) As of late December it looked like the saga was nearing its end. That’s when the United States Patent and Trademark Office (USPTO) – for the second time – reexamined the patents underlying MAD’s claim and appeared to narrow the scope of those patents dramatically.
Despite that apparent setback, MAD has now come roaring back, suing four separate licensees with FM stations in Tyler, Greenville, Denison and Palestine, all in Texas.
The complaints are rather simple, sparse even. They identify each respective defendant, describe MAD’s two patents, and note that, in July, 2012, the USPTO issued a “Reexamination Certificate” confirming the validity of certain claims made in each patent. According to each complaint, the defendant is infringing the patents and, despite DigiMedia’s repeated attempts (by mail, phone and email) to resolve the infringement, none of the defendants has “ taken a license to the ’867 and ’246 patents [or] provided adequate information detailing why no license is required”. DigiMedia seeks the usual damages, with a request for “trebled” (damages multiplied by three) if appropriate, as well as an injunction preventing the defendants from utilizing the allegedly infringing technology.
You may be asking the same question we are. Why are these cases being filed against these defendants just now? As we said, we’re not patent attorneys, so we’re hoping that some actual patent attorneys might offer up their thoughts.
To the non-expert eye, DigiMedia’s timing is curious. When the USPTO issued its second reexamination order regarding the two patents in December, it looked like the end of the line for DigiMedia. Then they moved – again – to lift the stay that has stalled their Delaware lawsuit for more than a year, and the court there scheduled a hearing on that motion for March. Could it be that there’s still some life in DigiMedia’s claims?
Or is there a reason that these defendants were singled out from all possible candidates around the country that have also refused to sign the licensing agreements that MAD and its cohorts have been pushing? One theory: might these stations have been chosen because they are all located in an area under the jurisdiction of a federal court reportedly known for fast-track processing of patent cases. (That would be the U.S. District Court for the Eastern District of Texas, Marshall Division.) Is this simply a last roll of the dice, a double down, an “all in” at the best table it could find? Is MAD trying to get a quick win to revive its flagging campaign before they have nothing left in their wad?
It does appear that they’re trying to move fast. The choice of the Eastern District of Texas, with its reputed “rocket docket”, is one clue. Additionally, it looks like DigiMedia didn’t spent a lot of time on putting these complaints together. As we said, they’re all pretty bare bones and identical to each other – so identical, in fact that the complaint filed against one defendant referred to that defendant with an abbreviation used for one of the other defendants, which suggests that the complaints may have been just a bunch of cut and paste jobs.
What’s peculiar about the complaints is that they don’t mention the USPTO’s December, 2012 further reexamination of MAD’s patents. MAD clearly is aware of that reexamination – they have indicated that they intend to respond to it this month – so why DigiMedia would rely in its complaints on the USPTO’s reexamination action from last July but not say diddly about the more recent reexamination in December is something of a mystery. (Of course, the fact that the December action arguably gutted MAD’s claims might be one serious disincentive, but still, does DigiMedia really think that the court isn’t going to find out about that action sooner or later?)
Whether the latest flurry of lawsuits is anything more than a bluff remains to be seen. We may know more on that score when we get the answers to a few more questions, such as:
Will MAD sue anywhere outside the Marshall Division of the U.S. District Court in the Eastern District of Texas?
What will MAD produce in its response to the USPTO in the second reexamination proceeding that might finally convince the USPTO of the validity of MAD’s various patent claims?
Will the United States District Court for the District of Delaware lift the stay in the first lawsuit and, if so, what will it then do?
At a minimum, DigiMedia’s suits have gotten the defendants’ attention, and our attention, and probably the attention of other similarly situated, small- to mid-sized radio stations. Check back here for updates.