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Massachusetts Institute of Technology v. Micron Technology, Inc.

United States District Court, D. Massachusetts

June 17, 2016

MASSACHUSETTS INSTITUTE OF TECHNOLOGY, Plaintiff,
v.
MICRON TECHNOLOGY, INC.; APPLE, INC.; ELPIDA MEMORY, INC.; MICRON MEMORY JAPAN, INC.; and ELPIDA MEMORY USA, INC., Defendants.

          MEMORANDUM AND ORDER ON DEFENDANTS' MOTION FOR ATTORNEYS' FEES UNDER 35 U.S.C. § 285

          SAYLOR, J.

         This is a motion for attorneys' fees, arising out of a patent infringement action concerning fuses in integrated circuits. In February 2015, after spending seven years negotiating a licensing agreement, plaintiff Massachusetts Institute of Technology filed suit against defendants Micron Technology, Inc.; Elpida Memory, Inc.; Micron Memory Japan, Inc.; and Elpida Memory USA, Inc.[1] The complaint alleged that defendants' laser-fuse technology infringed on MIT's U.S. Patent No. 6, 057, 221 ("the '221 patent").

         Shortly after MIT filed suit, defendants petitioned the Patent Trial and Appeal Board ("PTAB") for inter partes review ("IPR"), seeking a declaration that the '221 patent was invalid. Defendants contended that the '221 patent was invalid because prior art in a Japanese patent application anticipated the patent and rendered it obvious. In November 2015, the PTAB granted defendants' petition to review the validity of the '221 patent. Because the PTAB usually invalidates patents after instituting full IPR review, MIT requested that the Court enter an adverse judgment and dismiss the case.

         Defendants did not assent to dismissal. Instead, they have moved for attorneys' fees and costs pursuant to 35 U.S.C. § 285. Defendants contend that this case is exceptional because MIT asserted unreasonable infringement and validity arguments and engaged in vexatious litigation conduct. Among other things, defendants allege that MIT and the lead inventor, Dr. Joseph Bernstein, intentionally misled the United States Patent and Trademark Office ("PTO").

         Under § 285, district courts have the authority to award attorney's fees and costs in "exceptional" cases. For the reasons set forth below, this case does not rise to the level of an "exceptional" case warranting the imposition of attorneys' fees. It appears that MIT pressed not-unreasonable infringement positions, rebutted defendants' invalidity challenges with legitimate--but ultimately unmeritorious--arguments, and conducted the litigation in a good faith manner. Accordingly, defendants' motion for attorneys' fees and costs will be denied.

         I. Background

         The technology at issue involves fuses in integrated circuits. In integrated circuits, each fuse has a cut-link pad on a substrate that is electrically connected to two conductive lines. A laser in the circuit can instantly disconnect the cut-link pad, creating an open circuit and blowing the fuse.

         In May 2000, the '221 patent was issued to lead inventor Dr. Joseph Bernstein, who conceived of the invention while pursuing his Ph.D. at MIT. Bernstein and his co-inventor assigned the patent to MIT and another university. Fuse technology was well-established in integrated circuitry when Bernstein applied for the patent. However, the '221 patent included two important limitations. First, it claimed a cut-link pad that was at least ten percent wider than the connecting electrical lines. Second, it claimed a cut-link pad that was substantially less thermally resistant than the connecting lines.

         In May 2008, MIT contacted Elpida, a Japanese manufacturer of dynamic random-access memory products that rely on integrated circuits, and notified the company that it needed a license for the '221 patent. In support of its assertions, MIT sent Elpida a copy of the '221 patent and drawings demonstrating alleged infringement by one of Elpida's products.

         Over the next two years, MIT and Elpida exchanged correspondence and met multiple times to discuss the validity of the patent and MIT's infringement assertion. Elpida contended that the patent was not valid because a Japanese patent application by Koyou anticipated it or rendered it obvious. Specifically, Elpida contended that Koyou disclosed a cut-link pad that was substantially wider and less thermally resistant than the connecting electrical lines. As to MIT's infringement assertion, Elpida contended that its accused product lacked electrically-conductive lines "on a substrate, " as required by the '221 patent claims, because the lines in its product passed vertically into and through the substrate.

         In March 2011, negotiations between the parties broke down. MIT, without notifying Elpida, requested that the PTO reexamine the validity of the '221 patent. With its reexamination petition, MIT provided the PTO with all of the prior art that Elpida had identified during their negotiations, including Koyou. MIT also submitted written reasons why it believed the patent was novel and non-obvious despite Koyou--the same arguments that it provided to Elpida during the parties' negotiations.

         Three examiners from the PTO's Central Reexamination Unit initially rejected all of the claims of the '221 patent as unpatentable over Koyou. In response, MIT submitted an inventor declaration, in which Bernstein explained his reasoning in support of the conclusion that a person having ordinary skill in the art would not read Koyou as (1) affirmatively disclosing a cut-link pad having a width at least ten percent greater than the width of each connecting electrical line, and (2) suggesting a cut-link pad having substantially less thermal resistance than the lines. Agreeing with Bernstein's conclusions, the PTO issued a notice of intent to issue an ex parte reexamination certificate for the patent.

         After the reexamination, MIT reengaged Elpida in negotiations. Although Elpida contended that MIT had misrepresented Koyou to the PTO, the parties nearly reached a settlement. MIT lowered its settlement demand to $500, 000, at least in part, because Elpida was in bankruptcy and planned to eliminate laser fuses from its product line. Although the parties reached a settlement agreement in principle, they failed to finalize an agreement because of a disagreement over the scope of the license.

         In February 2015, after seven years of negotiations, MIT filed suit against defendants for patent infringement. In May 2015, defendants filed a petition with the PTAB seeking IPR of the '221 patent, and this Court stayed the case pending resolution of that petition. In support of their petition, defendants submitted an expert declaration from a litigation consultant who ...


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