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Telebuyer, LLC v. Amazon. Com, Inc.

United States District Court, W.D. Washington, Seattle

October 16, 2014

TELEBUYER, LLC, Plaintiff,
v.
AMAZON.COM, INC., AMAZON WEB SERVICES LLC, and VADATA, INC., Defendants. AMAZON.COM, INC., AMAZON WEB SERVICES LLC, and VADATA, Counterclaimants,
v.
TELEBUYER, LLC, Counterclaim-Defendant.

ORDER GRANTING MOTION TO LIMIT NUMBER OF CLAIMS AND TO APPOINT A TECHNICAL ADVISOR

BARBARA JACOBS ROTHSTEIN, District Judge.

I. INTRODUCTION

Defendants Amazon.com, Inc., et al. ("Amazon") bring this motion to limit the number of patent claims asserted by Plaintiff Telebuyer, LLC ("Telebuyer") in this litigation, and to appoint a technical advisor. Dkt. No. 145 ("Mot."). Pursuant to this Court's Order and Local Civil Rule 37(a)(2), the parties submitted a joint brief on the issues. Having reviewed the parties' arguments together with all relevant materials, the Court will GRANT the motion. The reasons for the Court's decision are set forth below.

II. BACKGROUND

A. Underlying Dispute

This is an action for patent infringement. Telebuyer alleges that Amazon, by offering goods and services to customers through its websites (including the website www.amazon.com), uses systems and/or methods that directly infringe one or more claims of seven related U.S. Patents: U.S. Patent Nos. 6, 323, 894, 7, 835, 508, 7, 839, 984, 8, 059, 796, 8, 098, 272, and 8, 315, 364 (collectively, the "Asserted Patents"). Amazon alleges that it does not infringe the Asserted Patents, and that the Asserted Patents are invalid. Amazon has also filed counterclaims against Telebuyer seeking declaratory judgment that the Asserted Patents are invalid and have not been infringed.

B. Amazon's Motion to Limit the Number of Patent Claims and to Appoint a Technical Advisor

Amazon asserts that this is a highly complex case involving technical computer-related subjects that span nearly 800 patent claims. Amazon requests that this Court compel Telebuyer to reduce the number of asserted patent claims to "some realistic number" in order to "steer this unnecessarily complicated and unusually expensive case towards a more manageable and rigorous examination of the merits." Mot. at 1. To that end, Amazon requests that the Court order Telebuyer to reduce the number of claims to 32. Id. at 10. Amazon further requests that this Court appoint a technical advisor to assist the Court in understanding both the computing technology "in Telebuyer's business method patents and the more than 60 actual computing technologies that Telebuyer accuses of infringement." Id.

Telebuyer does not dispute that it should reduce the number of asserted patent claims. See, e.g., Dkt. No. 86 Joint Status Report and Discovery Plan ("Joint Status Report") at 2 (stating that Telebuyer must be "appropriately selective and assert a fraction of the claims" that Telebuyer alleges are available to it). In Telebuyer's view, it has demonstrated a good faith effort to conduct this case in an efficient manner by limiting its PLR 120 Disclosures to "27 independent claims and 170 dependent claims."[1] Telebuyer states that it is willing to reduce the number of claims even further-to 20 total, no more than 5 per patent-but only after Amazon produces the core technical documents "necessary for Telebuyer to make an informed selection of claims" and this Court has issued the Claim Construction ( i.e., Markman ) Order. Mot. at 5; Dkt. No. 146 Berliner Decl., Ex. F. Telebuyer concedes that Amazon has produced to date nearly 500, 000 pages of documents, but charges that the production is "worthless" because the "embedded drawings, flowcharts and hyperlinks were removed" and Amazon redacted and/or withheld key aspects of its source code and/or technical documents. Mot. at 4-5.

Telebuyer does not oppose the appointment of a technical advisor. Mot. at 23.

III. DISCUSSION

A. Claim Limitiation

In complex cases, the district court has "broad discretion to administer the proceedings." In re Phenylpropanolamine (PPA) Prods. Liab. Litig., 460 F.3d 1217, 1232 (9th Cir. 2006). The district court may exercise such discretion by requiring a patentee to reduce the number of asserted claims. Eagle Harbor Holdings, LLC. v. Ford Motor Company, 2013 WL 6173761 at *1 (W.D. Wash. Nov. 25, 2013) (citing In re Katz Interactive Call Processing Patent, 639 F.3d 1303, 1311-1312 (Fed. Cir. 2011); see also, Medtronic Minimed Inc. v. Animas Corp., 2013 WL 3322248, at *1 (C.D. Cal. April 5, 2013) ("It is undisputed that for the sake of judicial economy and management of a court's docket, a court may limit the number of asserted claims in a patent case."); Adobe Systems Incorporated v. Wowza Media Systems LLC, 2013 WL 9541126 at *1 (N.D. Cal. May 6, 2013) (noting that "District courts possess the authority to limit patent claimants to a set of representative claims" and ordering the patentee to limit the number of representative claims it would assert to 20 claims); E.D. Tex. Model Claim Litigation Order, at ¶¶ 2-3 (limiting patentees to 10 claims per patent and no more than 32 claims in total by 15 days prior to the start of Markman briefing, and then requiring that the number be reduced by half 28 days prior to expert reports); Fed. Cir. Advisory Comm. Model Order Limiting Excess Patent Claims & Prior Art, at ¶¶ 2-3 (limiting patentees to 32 total claims after production of documents sufficient to show the operation of the accused instrumentalities, and 16 total claims 28 days after the court enters a Markman order).

If a court does order a patentee to limit the number of asserted patent claims, the court should permit the patentee to move for leave to assert additional claims upon a showing of good cause. See, e.g., In re Katz, 639 F.3d at 1310 (noting that district court provided plaintiff with the opportunity to add new claims if plaintiff could establish that the new claims were not duplicative); Stamps.com Inc. v. Endicia, Inc., 437 Fed.Appx. 897, 902-903 (Fed. Cir. 2011) (district court did not abuse its discretion in limiting patentee to 15 claims and denying patentee's motion to pursue additional claims where patentee failed to make a good cause showing for the need to pursue the additional claims); Oasis ...


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