June 1, 2024
VoIP-Pal.com Inc. (VPLM) has sued Deutsche Telekom (T-Mobile) ( 6:24-cv-00299) and Verizon (Verizon Wireless) ( 6:24-cv-00298)—repeat defendants in this long-running campaign—over several familiar patents. The cases have been filed in the Western District of Texas, VPLM's preferred venue, where a prior case against each defendant, as well as a suit against Amazon, remains active. For this pair of new complaints, VPLM turns to claims from two of the three familiar patents-in-suit, claims not asserted in prior litigation and therefore not invalidated under Alice in that litigation; as to the third asserted patent, in suit against only T-Mobile, VPLM points to three claims the patentability of which was confirmed in a recent ex parte reexamination (EPR).
As it has in the past, VPLM targets with these patents (8,542,815; 9,179,005; 10,218,606) the provision of the defendants' respective telecommunications networks, telecommunications infrastructure, and hardware or software that support "IP-based messaging and calling capabilities" such as Voice over LTE (VoLTE) and Voice over WiFi (VoWiFi). These patents belong to a family of 12 former Digifonica patents that broadly relate to routing messages between private and public networks based on stored caller profiles. Prosecution of least one related application continues before the USPTO.
VPLM's first wave of litigation, filed in 2016, saw claims from both the '815 and '005 patents litigated. Those earliest cases hit Apple, Twitter, and Verizon (Verizon Wireless in the District of Nevada, but transfers took them to the Northern District of California, where District Judge Lucy H. Koh (since elevated to the Ninth Circuit Court of Appeals) in April 2019 invalidated the asserted claims of various VPLM patents, including claims 1, 7, 12, 27-28, 72-73, 92, and 111 of the '815 patent and claims 49 and 73-75, 77-78, 83-84, 94, 96, and 99 of the '005 patent. The Federal Circuit affirmed those decisions without opinion.
These unfavorable decisions from Judge Koh prompted VPLM to file new suits against many of the same defendants, by that time including Amazon and AT&T (AT&T Mobility), elsewhere—specifically, the Western District of Texas. That 2018 wave focused on other members of this same family, the most recent of which issued in November 2021. 2020 and 2021 waves followed in venue tug-of-war fashion, VPLM filing in West Texas and the defendants filing declaratory judgment actions in Northern California, with Alphabet (Google), Huawei, Meta Platforms, and Samsung eventually added to the campaign and with a some of the cases concerning a separate VPLM patent family, focused on a mobile gateway.
Litigation remains active only as to Amazon, T-Mobile, and Verizon. The last defendant to exit from the campaign was Huawei, the most recent suit against which was dismissed with prejudice on May 13, 2024. That dismissal was with prejudice from the Northern District of Texas, shortly after District Judge Brantley Starr—on April 30, 2024—denied a motion to dismiss a complaint asserting two mobile gateway patents (8,630,234; 10,880,721) because the asserted claims are not drawn to eligible subject matter. The court refused to treat claim 1 of the '234 patent as representative of the remaining asserted claims (claims 10-11, 19-22, 24-25, 28, 30-33, 35, 37-40, 43, 45-48, 51, 53-54, 61-62, 64-65, 70, 72, and 75 of the '234 patent and claims 1, 6, 15-16, 20, 25, 34, 38, 39, 43, 45-46, 49-51, 63, 67, 77, 103-104, 109-110, 124, 130, 135-136, and 138-140 of the '721 patent), some of which contain means-plus-function elements.
As to claim 1 of the '234 patent, Judge Starr ruled that the defendants did not prove that it is directed to the putative abstract idea of "routing a communication based on characteristics of the participant". Rather, "the record before the Court more likely indicates that the claim captures an asserted technological improvement in the function of initiating a phone call from a mobile phone to avoid or reduce roaming or long-distance charges to the user of the mobile phone. In other words, the claim appears to capture the inventors' claimed technological improvement". Judge Starr continued by noting that:
The Court is particularly not persuaded by the Defendants' argument that the claim recites mere routine practices akin to switchboard operations that are performed by a computer. From the record before the Court, this appears to misrepresent the claimed invention and the asserted technological improvement. As described in the specification, the invention does not merely involve the routing of phone calls like a switchboard operator would do. Instead, the invention involves the initiation of a phone call from a mobile phone. This includes a determination of what the best manner would be to initiate the phone call to avoid roaming or long-distance charges. To accomplish this, the invention includes the steps of requesting and receiving an access code from a server. The access code identifies a number that is local to the mobile phone and is associated with the callee. The call is then initiated using the access code, as opposed to directly initiating the call using the callee's phone number. This appears to be the invention and technological improvement captured by claim 1 of the '234 patent, which precludes granting a motion to dismiss at this stage of the case.
(Footnotes omitted.)
VPLM has notified Western District of Texas Alan D. Albright of Judge Starr's decision. Judge Albright presides over separate cases against T-Mobile and Verizon, with trial against Verizon currently set for August 19, 2024; trial against T-Mobile, for November 4, 2024. Pending there are multiple motions, including a sealed motion for summary judgment of invalidity, filed jointly by both defendants (public version here), challenging the asserted claims of the '234 and '721 patents as ineligibly drawn to the abstract idea of "routing a communication based on the participants' characteristics". The motion focuses on claim 30 of the '234 patent as representative of the other asserted claims: claims 32, 38, 51, and 62 of the '234 patent and claims 77, 130, 133, and 138 of the '721 patent. (The defendants argue that claim 30 is actually representative of all claims of both patents.)
The raft of summary judgment and other pretrial motions have been largely sitting fully briefed before Judge Albright since last August. One of the defendants' motions seeks to strike VPLM's damages expert report because, among other things, its author, Jacob H. Salk, cannot be qualified as an expert on damages based on his "education, experience, and independence" and the methodology applied by Salk to calculate damages is infirm. VPLM opposed the defendants' motion, but it has recently, on May 20, 2024, filed a motion for leave to replace Salk entirely, with Phillip Brida, the "Director of Forensic, Litigation, and Valuation Services at Whitley Penn".
VPLM argues good cause on several alleged bases, arguing that it should be permitted to plug the gaps in the Salk report with a Brida report that outlines an unchanged damages theory after an "analysis based on a market theory and/or a cost savings benefits of WiFi offloading in Verizon's infrastructure theory, just as Mr. Salk did". VPLM contends that there will be no prejudice to Verizon because, among other things, there is plenty of time to get the new expert report served and for Brida to sit for a deposition concerning its contents before jury selection is set to start in August. VPLM floats the November 4 date as an alternative, should a continuance be required, noting that Brida needs "one small accommodation" due to his unavailability for trial until August 26, 2024.
Verizon opposes VPLM's request, attacking VPLM's claim to "good cause", citing undue prejudice if this "mulligan and substitution is allowed", and noting that "[d]uring expert discovery in this case, VoIP-Pal offered the deeply flawed opinion from Mr. Jacob Salk that the appropriate reasonable royalty for Verizon's free WiFi Calling service is in excess of a staggering five billion dollars". Such eyepopping damages amounts are par for the course in this campaign. Early damages estimates vaulted into the billions as well. For instance, an earlier complaint filed against Apple provided a "royalty monetization analysis overview" in which a proposed 1.25% royalty rate, when applied to the accused iPhone, iPad, and Mac products, resulted in purported damages in the amount of $2.8B. A similar analysis attached to a concurrent complaint against both AT&T and Verizon laid out damage amounts just over $1.8B (from AT&T) and roughly $2.4B (from Verizon).
Judge Albright has a pretrial conference scheduled in this case for early July. He also presides over the active case against Amazon, which concerns the '606 patent. There, a motion for judgment on the pleadings attacking the asserted claims of that patent under Alice has been fully briefed. The putative abstract idea is by now familiar: "routing a communication based on the participants' characteristics". Amazon argues that claim 1 of the '606 patent is representative of the other asserted claims: claims 3-6, 8-9, 11, 14-15, 18-19, 21-24, 26-27, and 44.
The USPTO issued a reexam certificate for the '606 patent on December 15, 2023. There, the patentability of claims 1, 3-9, 11, 13-16, 18-24, 26-27, 29-30, 32, 35-37, 41-41, and 44 was confirmed, while the remaining existing claims were not reexamined. New claims 50-57 were added through the proceeding and were determined to be patentable. VPLM provided a covenant not to sue Verizon over the '606 patent, presumably to end litigation in the Northern District of California (where Verizon had filed a declaratory judgment action). Thus, the '606 patent is only asserted in the new complaint against T-Mobile. That complaint highlights claims 8, 20, and 32 of the patent.
Both new complaints call out claims 14 and 41 of the '815 patent and claims 57 and 90 of the '005 patent. Hudnell Law Group P.C. filed both complaints for VPLM. A judge has yet to be assigned, and it is not clear that the cases will be given to Judge Albright. This past week, Western District of Texas Chief Judge Alia Moses modified a case assignment order that ends the practice of automatically assigning new cases to a judge that presided over prior, obviously related cases.
Emil Malak, VPLM's current CEO, was one of Digifonica's cofounders. VPLM itself was formed in Nevada in December 1997. This litigation campaign contains prior interesting chapters, including an offer to pay Twitter to end litigation and unusual activity before the Patent Trial and Appeal Board (PTAB); to reach back to those years-old twists and turns, see here. 5/30, Western District of Texas.
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