Free Additional Attachments to Main Document - District Court of Arizona - Arizona

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Ira M. Schwartz (I.D. No. 010448) Michael A. Cordier (I.D. No. 014378) DeCONCINI McDONALD YETWIN & LACY, P.C. 7310 N. 16th Street, Suite 330 Phoenix, Arizona 85020 Telephone (602) 282-0500 Facsimile (602) 282-0520
Attorneys for Plaintiff

IN THE UNITED STATES DISTRICT COURT IN AND FOR THE DISTRICT OF ARIZONA

DECONCINI MCDONALD YETWIN & LACY, P.C.

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16th Street, Suite 330 Phoenix, Arizona 85020

Erchonia Medical Inc., et al Plaintiff, v. Miki Smith, et al Defendants. ____________________________________ Erchonia Medical Inc., et al Plaintiff, v. Miki Smith, et al Defendants. ____________________________________ Robert E. Moroney, LLC Plaintiff, v. Erchonia Medical, Inc., et al Defendants.

Case No.:CIV 02-2036-PHX-MHM Consolidated with CIV 02-2048-PHX-MHM and CIV 02-2353-PHX-MHM

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ERCHONIA MEDICAL INC. AND KEVIN TUCEK'S OBJECTIONS TO SPECIAL MASTER'S FINAL REPORT AND RECOMMENDATION ON CLAIM CONSTRUCTION

Case 2:02-cv-02036-MHM

Document 337-7

Filed 07/21/2006

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Erchonia Medical Inc. and Kevin Tucek

(collectively referred to as

"Erchonia") object to the Special Master's Final Report and Recommendation on Claim Construction (Final Report). The sole issue objected to is the change in the Final Report

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from the recommendations made in the Special Master's Draft Report and
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Recommendation on Claim Construction ("Draft Report') with regard to the definition of
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"optical arrangement." The Final Report changed the definition of the term "optical
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arrangement" to require that it is a collection of "two or more mirrors, lenses, prisms or
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DECONCINI MCDONALD YETWIN & LACY, P.C.

other optical devices..." (emphasis added). This change is not supported by the findings
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made in the report, and the Special Master incorrectly applied the law in making this
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recommendation.
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I.

Background to Special Master's Final Report. As noted in both the Draft and Final Reports, one of the issues of primary dispute

between the parties was the definition of the term "optical arrangement" as used in the patent, U.S. Patent 6,103,096 (the "'096 Patent"). In their argument, the REM parties contended that this term was drafted in means plus function fashion and as such the term was required to be narrowly construed to only the embodiment shown in the patent. See Final Report, p. 66. Erchonia argued, and the Special Master recommended, that this term was not drafted in means plus function format and therefore was entitled to a broader interpretation. Draft Report, p. 112, Final Report, p. 123. The meaning of this term and its proper construction were the subject of significant debate, and the Special Master goes into great detail in both the Draft and Final Report in his analysis of this issue. Draft Report, p. 65-112, Final Report, p. 65-123. Early on in the debate over this issue, the Special Master identified that the term "optical system" was defined by the McGraw-Hill Dictionary of Scientific and Technical Terms (5th Ed. 1994) as, "a collection comprising mirrors, lenses, prisms and other devices placed in some specified configuration which reflect, refract, dispense, absorb, polarize or

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otherwise act on light." See Draft Report, p. 70; Final Report, p. 73. Neither party objected to this as being the proper definition of the scientific term "optical system." In their brief and at oral argument, the REM parties disputed that the terms "optical

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system" and "optical arrangement" should be defined equivalently. In fact, the REM
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parties argued that "optical arrangement" was a term coined by the inventor and should be
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given a very narrow interpretation. The Special Master's report analyzes this argument
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extensively. Draft Report pp. 84-104; Final Report, pp. 87-109. Based on the many other
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DECONCINI MCDONALD YETWIN & LACY, P.C.

patents using this term, which were cited by the Special Master, and substantial other
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research, the Special Master rejected REM's argument. See Draft Report, p. 112; Final
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Report, p.125.
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The Draft Report with regard to this term concludes by recommending that the Court finds that the term "optical arrangement" is not stated in means-plus-function format or otherwise limited to, "a collimating lens and a line generating prism arranged in serial relationship and mounted in the interior cavity between the semiconductor laser diode and the open forward end of the wand" as proposed by the REM Parties. Draft Report, p. 112. The Special Master then recites that such finding is sufficient to resolve the dispute. Id. Finally he states, "the parties indicated at least general agreement as to what `optical arrangement' meant if that term was not deemed a coined term or specifically defined in the `096 patent." Draft Report, p. 112. In fact, what the parties had essentially agreed upon was that the scientific dictionary definition of optical system, appropriately defined "optical arrangement" in this case. See Draft Report, p. 106; Final Report, p. 110-111, both citing the transcript of the oral Markman hearing held before the Special Master on August 26, 2005 ("Tr.") at p. 43. In response to the Draft Report, the REM Parties filed a Response to Special Master's Draft Report and Recommendation on Claim Construction ("REM Parties Response to Draft Report") for the first time raising concerns about the accuracy of the definition previously discussed by the parties. In particular, they raised two new issues 3
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with the Special Master's suggested definition. They requested that the definition be clarified to require that an optical arrangement be a collection of two or more optical elements, and that the phrase "mirrors, lenses, prisms and other devices" be clarified to

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define these "other devices" are "other optical devices." REM Parties' Response to Draft
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Report, p. 2. This was the first time the issue of the exact language of the definition of
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"optical arrangement" or "optically system" should be anything other than the scientific
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dictionary definition of "optical system."
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Erchonia objected to these changes requested by REM. See Erchonia's Reply to
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Response to Special Master's Draft Report and Recommendation on Claim Construction,
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p. 3-4. Although the change from "other devices" to "other optical devices" does not
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substantially change the meaning in any manner, Erchonia objected that this change was unnecessary and redundant. Erchonia also objected to the requirement that the optical arrangement be required to contain two or more optical elements. Finally, Erchonia objected that these changes were unnecessary and that the scientific dictionary definition previously discussed, and generally agreed to by the parties during oral argument, was appropriate. See REM Parties' Response to Draft Report, p. 2, where REM states, "During the Markman hearing, the parties agreed that if `optical arrangement' is not a means-plusfunction limitation or a coined term, it is essentially analogous to the term `optical system' which is defined by the McGraw-Hill Dictionary as `a collection comprising mirrors, lens [sic], prisms or other devices placed in some specified configuration, which reflect, refract, disperse, absorb, polarize, or otherwise act on light." Citing Tr. p. 40, l. 18 ­ p. 45, l. 23. The parties also discussed a reference made by the REM Parties' counsel during argument referring to a motorized mirror as a mechanical device. Erchonia's counsel requested clarification that any mirror, whether motorized or not, would fall within the definition of part of an optical system. Erchonia believes that this is not an area which the parties dispute, although it is referred to in the recommendation in the Final Report.

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In the Final Report, the Special Master discussed this controversial issue and noted that neither party had adequately addressed this issue. Final Report, p. 120. The Special Master, however, did not request additional briefing on this issue, which was raised for the

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first time only after the parties had submitted extensive briefs and argument on the issues
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of claim construction, and after preliminarily indicating a contrary position. The Special
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Master never addressed in his Final Report why the definition referred to in the Draft
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Report and agreed upon by the parties was inadequate.
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II.
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Argument The REM Parties improperly raised this issue for the first time only after the Draft

Report was issued. Never did the REM Parties assert that the proper definition of "optical
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arrangement" requires two or more optical devices until after the issues regarding claim interpretation had been fully briefed, argued and then preliminarily decided. In fact, the REM parties conceded at oral argument before the Special Master that if the term "optical arrangement" was held not to be a means-plus-function claim or coined term, then this term was equivalent to the term "optical system." See REM Parties' Response to Draft Report, p. 2; Tr. p. 40, ln. 18 ­ p. 45, ln. 23. By this point, the parties had further agreed with the Special Master that the McGraw-Hill Dictionary of Scientific and Technical Terms (5th Ed., 1994) (cited in the Draft Report at p. 70, and in the Final Report at p. 73) was an appropriate definition of "optical system." This definition is, "a collection

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comprising mirrors, lenses, prisms and other devices placed in some specified configuration which reflect, refract, dispense, absorb, polarize or otherwise act on light." In fact, during an exchange at oral argument, Mr. Brunelli, counsel for REM Parties, acknowledged that the term "optical system" was well known in the art. The REM Parties argued the term "optical arrangement" was a unique coined phrase. See Draft Report, p. 106, Final Report p. 110, (quoting the relevant portion of the transcript). Contrary to the REM Parties contention, the Special Master found that "optical arrangement" was not a coined term. Draft Report, p. 112; Final Report, p. 123. This 5
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finding by the Special Master has substantial support in the patent literature and the Special Master referred exhaustively to many issued patents using or referring to "optical arrangements." Draft Report, pp. 84-105; Final Report, pp. 87-110 (referring to over 101

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patents with the term "optical arrangement in the title and over 4000 patent references
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using this term. See particularly Draft Report, p. 87; Final Report, p. 90).
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A.
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A single lens or other optical device can be an "optical arrangement."

The REM Parties argued in their objection to the Draft Report that this definition

DECONCINI MCDONALD YETWIN & LACY, P.C.

needed refinement because the optical arrangement must be comprised of two or more
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mirrors, lenses, prisms or other devices. Nothing in the patent or the prior art requires this
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numerical limitation, and in fact many of the references cited by the Special Master
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indicate otherwise. First, the Special Master in both his Draft and Final Reports refers to a number of patents and other prior art references which show or refer to a single lens as being an "optical arrangement." include: · The Ohshiro Patent, which is a prior art reference to the `096 Patent and was explicitly discussed during the oral argument before the special master, includes a laser light focused with only a cylindrical lens. Draft Report, p. 82. · The Examiner's language in an Office Action, which is part of the `096 File history, and which is cited in the Draft Report and the Final Report, states that it would have been obvious, "to modify the combined device of Ohshiro et al and Blum et al, with Itzkan to provide a line generating prism as an alternative, equivalent means for focusing the light onto the tissue in a line." Draft Report, p. 82 citing Office Action at 4.) This shows that the Patent Examiner considered the possibility of a single prism acting as an optical arrangement. 6
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Draft Report, p. 84-105; Final Report p. 87-110.

Examples

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· U.S. Patent No. 5,200,966, cited by the Special Master quotes the patent as stating, "'optical system 13, which can be a focusing lens or other suitable optical arrangement ..." (emphasis added) (Draft Report, p. 89; Final Report,

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p. 93).
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· U.S. Patent No. 5,822,345, entitled "Diode-Pump Laser System and Method", cited in the Final Report, p. 94 (and the Draft Report, p. 90),

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quotes the patent as stating, "A preferred configuration is a completely
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cylindrical lens, essentially a glass rod segment of proper diameter; other
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optical arrangements, such as lenses having hemispheric cross-sections or
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which correct both fast and slow axes, can also be used to advantage."
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(Emphasis in Final Report). These references in the record demonstrate that one of ordinary skill in the art would regard a single lens or other optical element as an optical arrangement. Evidence which the Special Master improperly concluded was lacking. B. The Special Master Improperly Read Claim Limitations from the Preferred Embodiment into the Claims. In changing his recommendation from the Draft Report, the Examiner committed the error of reading limitations from the preferred embodiment into the claims. The Examiner cited extensive case law indicating that the limitations from the preferred embodiment may not be read into the claims. Final Report, p. 19-23; Draft Report, p. 1822, citing, among other cases, Philips. V. AWH Corporation, 415 F.3d 1303 (Fed. Cir. 2005); See Final Report, p. 20. See also, Eolas Techs., Inc. v. Microsoft Corp. 399 F.3d 1325 (Fed. Cir. 2005). The Special Master determined in part that the preferred embodiment disclosed the optical arrangement as being a prism and a collimating lens indicating that this supported his conclusion that the optical arrangement should be found to contain at least two optical

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elements. However, by his express ruling he did not limit the term "optical arrangement" as being limited to those elements. See Final Report p. 121. In making this modification in the Final Report, the Special Master substantially

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changed the result from his Draft Report, where he ruled that the parties essentially had
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agreed that the scientific definition of "optical system" would apply (assuming, as the
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Special Master Ruled, that AMD's position with regard to means plus function
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interpretation was rejected). The accepted definition of "optical system" is "a collection
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DECONCINI MCDONALD YETWIN & LACY, P.C.

comprising mirrors, lenses, prisms and other devices placed in some specified
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configuration which reflect, refract, dispense, absorb, polarize or otherwise act on light."
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Since the parties had agreed upon this definition, and as demonstrated above this definition
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was supported by the record, there was no basis for changing this after the Draft Report was received. Draft Report, p. 70; Final Report, p. 73. The concept of claim differentiation and the patent file history further demonstrate that these claim limitations cannot be read into the interpretation of the term "optical arrangement." See Draft Report, p. 80-84; Final Report, p. 83-87. The Final Report discusses the implications of `096 patent application claim 5 (issued as claim 4) which was dependent on Claim 1 and which further defined the optical arrangement as being a prism and a collimating lens. Under the concept of claim differentiation, this indicates that in the broader claim 1, the term "optical arrangement" should be given a claim interpretation broader than the limitation given in the issued dependent claim 4. See Final Report, p. 8384. Seachange International Inc. v. C-COR Inc., 413 F.3d 1361, 1368-1369 (Fed.Cir. 2005); Liebel-Flarshiem Co. V. Medrad, Inc., 358 F.3d 898, 910 (Fed. Cir. 2004). While the Special Master specifically noted that this information supports the finding that the term "optical arrangement" cannot be limited to a prism and a collimating lens, he improperly uses this as a basis to find that the term "optical arrangement" is limited to two or more optical elements. However, once he used the concept of claim differentiation to determine that the term "optical arrangement" is not limited to any 8
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particular configuration, he should have realized that this further requires that this term is not numerically limited. Because the narrower dependent claims, Claims 4 and 13, define the optical arrangement as being narrowly defined as two specific elements; the term

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"optical arrangement" as used in the broader claims, should not be so restricted. In fact, it
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should not be limited to any particular configuration nor any particular number of optical
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elements. As shown above, the term "optical arrangement" can include a wide variety of
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configurations and number of optical elements, including configurations of as little as a
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single lens.
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Since the scientific dictionary definition was found to be a proper indication of the
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way in which a person of reasonable skill in the art would interpret this phrase, and no
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party significantly disputed this, the determination should have ended there. The preferred dictionary definition requires only a collection of recited optical elements. It does not specify a numerical unit of this collection. Further, the prior art indicates that in at least some cases, a single lens or single optical arrangement can serve as an optical arrangement. There was no need to vary this definition. C. The Special Master improperly made the question of claim

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interpretation a factual question and applied an improper burden of proof on this issue to Erchonia. Since the ruling in Markman v. Westview Instruments, the interpretation of patent claims has been purely a legal question. Markman v. Westview Instruments, Inc. 517 U.S. 370, 389-390 (1996); Vitronics Corp. v. Conceptronics, Inc., 90 F.3d 1576 (Fed. Cir. 1996). As such, it is inappropriate to assign a burden of proof standard to questions of claim construction. Nikon Corp. v. ASM Lithography B.V., 308 F.Supp.2d 1039, 1057 and fn.11. In Level One Communications Inc. v. Seeq Technology, Inc. the court said, "With respect to burdens of proof on claim construction, this court has determined that since claim construction is a question of law reviewed de novo, it makes no sense to apply burdens of proof." Level One Communications Inc. v. Seeq Technology, Inc., 987 F. Supp. 9
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1191, 1196 citing Northern Telecom Ltd. v. Samsung Electronics Co., Ltd., 1996 WL 532122 at *9 n. 11 (N.D.Cal. Sept.16, 1996). All through the proceedings before the Special Master and through the issuance of the Draft Report, the sole question presented

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was the interpretation of the patent claims as a matter of law.
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After the Draft Report was issued, and the REM parties for the first time
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raised the issue of whether the definition of "optical arrangement" must include a
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minimum of two optical elements, or whether one element may be considered an optical
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arrangement, the analysis by the Special Master changed focus. In particular, in discussing
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this issue, the Special Master stated that there was very little evidence on the issue of
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whether a person of ordinary skill in the art would determine that an optical arrangement
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could be comprised of one lens. He further discusses in detail the burden of proof, and states, "Overall in the real world outside the scope of this case, it may be that one of ordinary skill in the art would accord "optical arrangement" a meaning that includes a single element or device. However, the current record simply does not provide sufficient grounds to reach that conclusion." Final Report, p. 123. As is clear from the language used when reaching this issue, the Special Master changed his role from making a legal determination into that of a finder of fact, and then applied the standard for a fact finder assigning Erchonia a burden of proof, which he determined it had not met. See Final Report, p. 121, ("Nor has Erchonia offered persuasive extrinsic evidence of the same"). As discussed above, Erchonia has pointed to substantial evidence in the record, including those patent references used by the Special Master, to show that a person of ordinary skill in the art would find an optical arrangement to include a single optical element. More importantly though, when addressing this one issue, the Special Master converted his role from being an advisor to the Court on making a legal interpretation to being a finder of fact and then found Erchonia has not met its burden of proof. In this particular instance, the Special Master applied the improper standard, and this recommendation should be rejected by the Court. 10
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III.
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Conclusion For the reasons set forth above, the Court should find that the definition of "optical

arrangement" is "a collection comprising mirrors, lenses, prisms and other devices placed
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in some specified configuration which reflect, refract, dispense, absorb, polarize or
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otherwise act on light." In the alternative, the Court should remand this matter to the
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Special Master for additional proceedings limited to making a legal recommendation on
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the precise issue of whether an "optical arrangement" as used in the `096 Patent should be
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interpreted to require two or more optical elements or whether a single element can serve
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as an optical arrangement.

DATED this 3rd day of April, 2006. DeCONCINI MCDONALD YETWIN & LACY

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By s/Ira M. Schwartz Ira M. Schwartz Michael A. Cordier 7310 N. 16th St., Suite 330 Phoenix, Arizona 85020 (602) 282-0500 Attorneys for Erchonia Medical Inc. and Kevin Tucek

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Certificate of Service I certify that on April 3, 2006, I electronically transmitted the attached document to the Clerk's Office using the CM/ECF System for filing and transmittal of a Notice of Electronic Filing to those attorneys registered with CM/ECF: Michael Warzynski, Esq. JARDINE BAKER HICKMAN & HOUSTON PLLC 3300 N. Central Avenue, Suite 2600 Phoenix, AZ 85012 Co-Counsel for Erchonia Medical Inc. Benjamin B. Lieb, Esq. Robert Brunelli, Esq. SHERIDAN ROSS PC 1560 Broadway, Suite 1200 Denver, CO 80202 Attorneys for Robert E. Moroney, LLC, Robert E. Moroney, and A Major Difference Inc. David Bray, Esq. MARISCAL WEEKS MCINTYRE & FRIEDLANDER PA 2901 N. Central Avenue, Suite 200 Phoenix, AZ 85012 Attorneys for Robert E. Moroney, LLC, Robert E. Moroney, and A Major Difference Inc. Gregory L. Miles, Esq. Lori A. Curtis, Esq. DAVIS MILES PLLC 1550 E. McKellips Road, Suite 101 Mesa, AZ 85203 Attorneys for John and Claudette Brimhall Dominic L. Verstagen, Esq. KUNZ PLITT HYLAND DEMLONG & KLEIFIELD 3838 N. Central Avenue, Suite 1500 Phoenix, AZ 85012 Attorneys for John and Claudette Brimhall Scott A. Salmon, Esq. THE CAVANAGH LAW FIRM 1850 N. Central Avenue, Suite 2400 Phoenix, AZ 85004 Attorneys for George Gonzalez and Lorena Guzman Gordon S. Bueler, Esq. BUELER JONES, LLP 1300 N. McClintock Drive, Suite B-4 Chandler, AZ 85226 Attorneys for Miki Smith and KMS Marketing, Inc. /////

DECONCINI MCDONALD YETWIN & LACY, P.C.

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And a courtesy copy mailed to: Gail R. Peterson, Esq. Cox Smith Matthews 112 East Pecan Street, Suite 1800 San Antonio, TX 78206 Special Master s/Ira M. Schwartz

DECONCINI MCDONALD YETWIN & LACY, P.C.

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