IP Law Daily, PATENT—D. Minn.: Post-trial motions denied in text message tracking patent dispute, (Dec 7, 2023)

By Kevin M. Finson, J.D.

Both sides’ post-trial motions were denied because the jury’s verdict was supported by expert testimony and other evidence and the case was not exceptional.

A patentee was not entitled either to post-verdict judgment as a matter of law or a new trial, the U.S. District Court in St. Paul has held. The jury’s verdict was supported by expert testimony and there were no exceptional circumstances to support overturning it (CellTrust Corp. v. ionLake, LLC, December 6, 2023, Wright, W.).

CellTrust Corporation (CellTrust) was the owner of U.S. Patents Nos. 9,775,012 (the ’012 patent) and 10,778,837 (the ’837 patent), which were both entitled “System and Method for Tracking SMS Messages” and described a system to track mobile communications for audit compliance requirements. CellTrust brought suit against ionLake, LLC (ionLake) and its governing members, alleging that ionLake’s MyRepChat product infringed multiple claims of both patents. After an eight-day trial, the jury rendered a verdict of no infringement and also found that the asserted claims were invalid. IonLake filed a petition for attorney fees, and CellTrust moved for judgment as a matter of law and simultaneously moved for a new trial or to alter or amend the judgment.

Judgment as a matter of law. CellTrust argued that the jury’s non infringement finding was inconsistent with the court’s claim construction on the issue of whether the asserted claims required “directly” sending communications or allowed them to be sent indirectly. The court held that it had not actually made a claim construction ruling, and that substantial evidence, including even CellTrust’s own expert’s testimony, supported the jury’s verdict.

As for invalidity, CellTrust argued that testimony about the state of the art at the time was uncorroborated and that ionLake had failed to rebut secondary indicia of non-obviousness including industry praise. The court held that the testimony was sufficiently corroborated by circumstantial factors and that CellTrust had failed to establish a nexus between the claimed inventions and the alleged secondary considerations.

New trial. CellTrust argued that a new trial was warranted because ionLake made improper arguments, including alleging that CellTrust abused the patent system, misled the Patent Office, willfully deceived ionLake and its owners, and concealed evidence. The court held that all of these statements had passed unobjected-to during trial, so the issues were waived.

CellTrust also argued that a new theory of non-infringement was raised for the first time at trial, but the court held that this was related enough to the already-disclosed arguments that CellTrust was unable to show it had a reasonable probability of impacting the result. The court also reaffirmed its claim construction and jury instructions.

Attorney fees. ionLake argued that the case was exceptional and therefore warranted an award of fees due to discovery deficiencies, but the court held that these were waived because ionLake did not challenge the alleged deficiencies during the discovery period. Similarly, ionLake argued that the case was litigated unreasonably and had no basis in fact, but the court held that CellTrust, although unsuccessful, was not shown to have litigated in bad faith. Most importantly, the allegedly frivolous claims were not challenged by ionLake through early dispositive or Daubert motions.

The court denied all of the post-trial motions.

The Case is No. 0:19-cv-02855-WMW-DJF.

Attorneys: Christopher Duane Bright (Snell & Wilmer LLP) for CellTrust Corp. Casey Allen Kniser (Law Office of Casey A. Kniser LLC) for ionLake, LLC.

Companies: CellTrust Corp.; ionLake, LLC

Cases: Patent MinnesotaNews