IP Law Daily Use of non-executable applets by Kayak, Orbitz, and others did not infringe Parallel Networks’ patent
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Thursday, July 6, 2017

Use of non-executable applets by Kayak, Orbitz, and others did not infringe Parallel Networks’ patent

By Robert Margolis, J.D.

The U.S. Court of Appeals for the Federal Circuit has affirmed summary judgment of noninfringement for several defendants, including Kayak.com and Orbitz, agreeing with a district court’s conclusion that their use of certain non-executable applets on their websites did not infringe a patent owned by Parallel Networks, LLC. The court’s nonprecedential decision also affirmed the district court’s denial of defendants’ motion to award them attorney fees (Parallel Networks, LLC v. Kayak Software Corp., July 5, 2017, Chen, R.).

District court proceedings. Parallel asserted U.S. Patent No. 6,446,111 ("the ‘111 Patent") against more than 100 defendants for their use of certain applets on their websites. The claims against several defendants—Kayak Software Corp., d/b/a Kayak.com (Kayak); Orbitz LLC, Orbitz Worldwide, Inc., Orbitz Worldwide, LLC, Orbitz Away LLC (collectively, Orbitz); Wolverine World Wide, Inc. (Wolverine); and Shoebuy.com LLC—proceeded to summary judgment. The district court granted summary judgment of noninfringement for Kayak, Orbitz, and Wolverine, holding that their accused applets did not meet the "executable applet" claim limitation in the ‘111 Patent.

The appellate court in an earlier decision "construed the asserted claims of the ‘111 [P]atent to require that the applet be executable or operable when it is generated and before it is transmitted to the client." As a result, when a client still needs to "obtain" information to execute the applet, it means that the applet is not executable or operable as required by the ‘111 Patent. Based on that construction, and Parallel’s admission in its opening brief on summary judgment that the defendants’ accused applets relied on resources that were "transmitted separately" to be executable, the district court granted summary judgment of noninfringement to Kayak, Orbitz, and Wolverine.

Parallel took a different approach with Shoebuy—it did not oppose Shoebuy’s summary judgment motion of noninfringement, but instead offered to dismiss its infringement claim with prejudice in exchange for Shoebuy’s agreement to dismiss its invalidity counterclaim with prejudice. When the parties reached an impasse, and failed to complete this mutual covenant, the district court granted summary judgment dismissing both the infringement claim and the invalidity counterclaim with prejudice, relying on the purported covenant. Shoebuy sought reconsideration, arguing that the dismissal of its invalidity counterclaim should be without prejudice, but the district court denied the motion.

Finally, the district court denied the defendants’ motion for attorney fees under Section 285 of the Patent Act, holding that the case was not exceptional.

Infringement. The court affirmed the district court’s holding that the accused applets of Kayak, Orbitz, and Wolverine did not infringe the ‘111 Patent. The district court "correctly held" that the accused applets were not executable under the previously established construction of that term once they were transmitted from a server to a client device. Parallel’s above-described admission in the district court was fatal to its claim, the court held. Parallel had attempted to back away from that admission by revising in its reply brief its explanation of how Kayak’s applet was executable, but the district court refused to consider that change of position and the appellate court held that decision to be correct.

Attorney fees. The appellate court also affirmed the district court’s conclusion that the case was not an "exceptional" case for which attorney fees may be awarded to the prevailing party. The appellate court rejected the defendants’ argument that the case was exceptional because Parallel pursued claims against defendants whose applets were no different than those the appellate court had held in its prior opinion to be non-infringing. Comparing the defendants’ applets with those previously addressed, the court found "some daylight" between the two. The appellate court also found no evidence in the record to support defendants’ assertion that Parallel instituted the lawsuit only to extract nuisance value settlements and thus litigated the case unreasonably.

Invalidity counterclaim. The appellate court agreed with Shoebuy that dismissal of its invalidity counterclaim should have been without prejudice. The district court’s conclusion that Parallel and Shoebuy had entered a covenant was clearly erroneous, the court held.

The case is Nos. 2015-1681 and 2016-1944.

Attorneys: Timothy J.H. Craddock (Klemchuk LLP) for Parallel Networks, LLC. David Brandon Conrad (Fish & Richardson P.C.) for Kayak Software Corp., d/b/a Kayak.com; Orbitz LLC; Orbitz Worldwide, Inc.; Orbitz Worldwide, LLC; Orbitz Away LLC; and Wolverine World Wide, Inc.

Companies: Parallel Networks, LLC; Kayak Software Corp., d/b/a Kayak.com; Orbitz LLC; Orbitz Worldwide, Inc.; Orbitz Worldwide, LLC; Orbitz Away LLC; Shoebuy.com LLC; Wolverine World Wide, Inc.

MainStory: TopStory Patent FedCirNews

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