Free Statement - District Court of Arizona - Arizona

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Michael S. Rubin (#005131) David Bray (#014346) MARISCAL WEEKS MCINTYRE & FRIEDLANDER, PA 2901 North Central Avenue, Suite 200 Phoenix, Arizona 85012-2705 Robert R. Brunelli (#20070) Benjamin B. Lieb (#28724) SHERIDAN ROSS P.C. 1560 Broadway, Suite 1200 Denver, Colorado 80202-5141 Attorneys for Robert E. Moroney, LLC, Robert Moroney, and A Major Difference, Inc. IN THE UNITED STATES DISTRICT COURT FOR THE DISTRICT OF ARIZONA Erchonia Medical, Inc., et al. Plaintiffs, v. Miki Smith, et al. Defendants. Erchonia Medical, Inc., et al. ) ) ) ) ) ) ) ) ) ) ) ) ) ) ) ) ) ) ) ) ) ) ) ) ) ) ) ) ) ) ) )

No. CIV 02-2036-PHX-MHM

17 Plaintiffs, 18 v. 19 Miki Smith, et al. 20 Defendants. 21 22 23 24 25 26 27 28 v. Erchonia Medical, Inc., et al. Defendants. Robert E. Moroney, LLC, et al. Plaintiffs,

ROBERT MORONEY'S AND ROBERT E. MORONEY LLC'SSTATEMENT OF FACTS IN SUPPORT OF CONSOLIDATED MOTION FOR SUMMARY JUDGMENT OF NON-INFRINGEMENT OF U.S. PATENT NO. 6,013,096

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1.

In about April or May of 2002, Robert Moroney ("Moroney") received an

unsolicited telephone call from a company in England called Flitton Engineering ("Flitton"), a medical equipment manufacturer. (Declaration of Robert E. Moroney ("Moroney Dec."), ¶ 4, attached as Exhibit A hereto.) Flitton represented to Moroney that it had developed a hand-held cold laser known as the "Radiant Health Laser" and wanted to know if Moroney would be interested in marketing and selling the product in the United States. (Id.) Curious, Moroney flew to England to examine the Radiant Health Laser, purchasing two for further evaluation. (Id.) Moroney later determined that the Radiant Health Laser was of high quality and low price and began importing it into the United States. (Id.) Erchonia initiated the present action for patent infringement on October 15, 2002. (Id.) Robert E. Moroney, LLC ("REM") has sold approximately sixty of the Radiant Health Lasers in the United States under the trademark "Quantum IV" (hereinafter, the "Quantum IV Laser"). (Id.; see also July 26, 2005 Deposition of Paul DeAngelis (DeAngelis Depo. II"), pp. 20-21, attached as Exhibit B hereto.) Moroney has not personally sold any Quantum IV Lasers. (Id., ¶ 8.) 2. The Quantum IV Laser is a therapeutic cold laser consisting primarily of a

control unit and a laser probe, with a cord connecting the control unit to a laser probe. (Moroney Dec., ¶ 5; DeAngelis Depo. II, p. 57, l. 16 - p. 60, l. 2.) 3. The Quantum IV Laser housing includes a membrane keypad with an LCD

display. (DeAngelis Depo. II, p. 59, l. 10 - p. 63, l. 14, and Exhibit 1 thereto; Moroney Dec., ¶ 5.) At the bottom of the housing is a keyed lock switch for turning power to the unit on and off, the entry point for the cord, and a recharging socket. (Id.) 4. The laser probe includes a hollow tube handle and a solid head. (DeAngelis

Depo. II, p. 57, l. 16 - p. 59, l. 9; p. 150, ll. 2-25; Moroney Dec., ¶ 6.) Within the solid head are four laser diode modules. (Id.) Inside the hollow tube handle are the wires connecting to the rear of the four laser diode modules. (Id.) The cord from the control unit enters the hollow tube handle of the probe through a gland that is screwed into the end of the handle. (Id.)

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5.

The laser diode modules primarily utilized in the laser probe were

manufactured by Diode Laser Concepts, Inc. and have part number FAY-MS3-50. (DeAngelis Depo. II, p. 32, l. 5 - p. 33, l. 1; p. 37, ll. 11-25; p. 145, l. 6 - p. 149, l. 4; Exhibit 2 thereto.) These laser diode modules consist of a cylindrical housing with a semiconductor laser diode and a printed circuit board contained in one end, and a screw-in ferrule holding a single collimating lens. (Deposition of Mike Robinson ("Robinson Depo."), p. 103, l. 16 - p. 105, l. 20, and Exhibit 55 thereto, attached as Exhibit C hereto.) These laser diode modules generate a laser beam having an elliptical spot shape. (Id., p. 105, ll. 3-10; DeAngelis Depo. II, p. 147, l. 16 - p. 148, l. 16, and Exhibit 9 thereto; Moroney Dec., ¶ 6.) The laser beam is elliptically-shaped prior to and after passing through the collimating lens. (Robinson Depo., p. 105, ll. 3-10.) All Quantum IV Lasers sold by REM in the United States emitted elliptically-shaped laser beams. (Moroney Dec., ¶ 8.) 6. Other than measuring the elliptically-shaped laser beam emitted by the

Quantum IV Laser, Erchonia has not conducted any investigations concerning the operation or components of the laser diode modules utilized in the Quantum IV Laser, including the shape of the laser beam prior to passing through the collimating lens, whether the laser beam is narrow, and whether the shape of the laser beam is transformed by the collimating lens, and has no evidence thereof. (Deposition of Kevin Tucek ("Tucek Depo."), p. 61, l. 2 - p. 68, l. 8; p. 81, l. 8 - p. 82, l. 11; p. 97, l. 6 - p. 98, l. 24, attached hereto as Exhibit D; Deposition of George Leger, p. 133, l. 7 - p. 135, l. 4, attached hereto as Exhibit E; Rule 30(b)(6) Deposition of Erchonia (Steven Shanks, President) ("Erchonia Depo."), p. 135, l. 20 - p. 140, l. 12, attached hereto as Exhibit F.) 7. Inside the control unit are a number of components, including a battery and

a circuit board mounting a programmable microprocessor. (DeAngelis Depo. II, p. 59, l. 10 - p. 63, l. 14; February 27, 2003 Deposition of Paul DeAngelis (DeAngelis Depo. I"), p. 56, l. 2 - p. 60, l. 11, attached hereto as Exhibit G; Moroney Dec., ¶ 5.) This circuit board also includes a number of supporting components for the microprocessor. (Tucek

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Depo., p. 83, l. 17 - p. 86, l. 12; Moroney Dec., ¶ 5.) The cord from the laser probe enters the housing and the wires within that cord connect to the circuit board. (DeAngelis Depo. I, p. 57, l. 24 - p. 60, l. 11; DeAngelis Depo. II, p. 59, l. 10 - p. 60, l. 2; Moroney Dec., ¶ 5.) 8. The front of the membrane keypad panel has numeric entry buttons and

separate buttons for programming functions of the device, including separate 'start,' 'stop' and 'enter' buttons. (DeAngelis Depo. II, p. 60, l. 3 - p. 62, l. 22; Moroney Dec., ¶ 5.) These are tactile buttons having a normally open position and protected with a vinyl overlay. (DeAngelis Depo. I, p. 30, l. 20 - p. 31, l. 3; DeAngelis Depo. II, p. 135, l. 6 p. 143, l. 7.) When pressed, the tactile buttons send a pulse signal to the microprocessor, which, in turn, has been programmed to control the operation of each of the laser diode modules. (DeAngelis Depo. II, p. 139, l. 5 - p. 142, l. 20; Tucek Depo., p. 88, l. 5 - p. 89, l. 18.) 9. To operate the Quantum IV Laser, the user must first power on the unit by

turning the keyed lock switch from the 'off' to the 'on' position. (Moroney Dec., ¶ 7.) The user then manually enters the operating time, in minutes and seconds, using the numeric buttons on the membrane keypad. (Id.) The entered time is displayed on the LCD display. (Id.) Once the operating time has been entered, the user presses the 'enter' button on the keypad and the device is ready to be used. (Id.) The user then presses the 'start' button on the keypad to turn on the lasers. (Id.) Once the set time has expired, the Quantum IV Laser automatically stops. (Id.) The user may also manually press the 'stop' button on the keypad to turn off the lasers. (Id.) Neither the 'start' or 'stop' buttons alone can singly control the activation and deactivation of the lasers. (Id.) The Quantum IV Laser has no preselected time settings. (Id.) Instead, the user must manually enter, using the numerical tactile buttons on the membrane keypad, the exact time that the user wishes to operate the device. (Id.) 10. United States Patent No. 6,013,096 ("the '096 Patent") issued on January 11,

2000, to Kevin B. Tucek, and is entitled "Hand-Held Laser Light Generator Device." (See

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U.S. Patent No. 6,013,096 ("the '096 Patent"), attached hereto as Exhibit H.) The '096 Patent specification explains that it is directed to: A hand-held laser light generator device includes a wand, a semiconductor diode laser for generating a beam of laser light, an optical arrangement, a housing having an interior chamber, a battery in the housing interior chamber, an electrical cord connecting the laser in the wand with the battery in the housing, an electronic timing circuit, a start switch and a selector knob. The wand, capable of being retained in a user's hand, is an elongated hollow tube and defines an interior cavity. The laser is mounted in the wand interior cavity and therewith is freely movable so as to enable the user to direct the beam of laser light onto a desired location. The optical arrangement mounted in the wand interior cavity receives and transforms the generated beam of laser light into a line of laser light. The electrical timing circuit is disposed in the housing interior chamber and mounted to the housing. The start switch is activatable between on and off positions while the selector knob has multiple period of time length setting positions. The start switch and selector knob are mounted to the housing and accessible at the exterior thereof and are in operable communication with the electrical timing circuit for controlling initiation of generation of and length of the period of time that the laser light beam is generated. ('096 Patent, Abstract.) Figures 1 and 3 of the '096 Patent illustrate this device. ('096

13 Patent, Figs. 1 and 3.) 14 11. 15 device which emitted an elliptically-shaped laser beam. (Tucek Depo., p. 22, l. 10 - p. 31, 16 l. 7.) Tucek was generally aware of the existence of laser diode modules at the time the 17 '096 Patent application was filed. (Id., p. 28, l. 11 - p. 40, l. 22.) 18 12. 19 ('096 Patent, col. 5, ll. 2-4; Figure 19 (see No. 46.) This switch controls activation of the 20 laser emitted by the device. (Id., col. 6, ll. 53-58.) The '096 Patent discloses a selector 21 knob that rotates about an axis to allow the user to select from a limited number of 22 preselected time settings. (Id., col. 5, ll. 4-6; Figures 1 and 19.) The Quantum IV Laser 23 has no preselected time settings and no limit on the number of different time settings for 24 which it is capable of operating. (Moroney Dec., ¶ 7.) Furthermore, the user must 25 manually enter the exact time that the user wishes to operate the Quantum IV Laser using 26 the numerical tactile buttons on the membrane keypad. (Id.) The differences between a 27 start switch having 'on' and 'off' positions together with a rotary selector knob, and the 28 The '096 Patent discloses a single start switch having 'on' and 'off' positions. Prior to filing the '096 Patent application, Tucek built a prototype laser

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membrane keypad on the Quantum IV Laser are substantial. (DeAngelis Depo. II, p. 135, l. 2 - p. 145, l. 3.) 13. Tucek has admitted that the Quantum IV Laser does not have a rotating

selector knob and that the membrane keypad of the Quantum IV Laser functions in a different way than the selector knob: On the Quantum IV it does it a different way. What they are doing is to be able to get their variable timing intervals, it's controlled by their microprocessor; and the input or the timing interval that they program, it's programmed in via the membrane switch but it accomplishes the same thing. (Tucek Depo., p. 89, ll. 13-18 (emphasis added).)

9 14. 10 Kevin B. Tucek. ('096 Patent File History ("File History"), p. 1, attached hereto as 11 Exhibit I.) The original application included twenty claims, of which Claims 1, 11 and 18 12 were independent claims. (File History, pp. 23-29.) Claim 1, as originally submitted in 13 the '096 Patent application, read as follows: 14 15 16 17 18 19 20 21 22 23 24 25 26 27 28 1. A hand-held laser light generator device for use in medical therapy, said device comprising: (a) a wand defining an interior cavity and capable of being retained in a hand of a user; (b) means for generating a beam of laser light mounted in said interior cavity of said wand and therewith being freely movable so as to enable the user to direct said beam of laser light onto a desired location; (c) an optical arrangement mounted in said interior cavity of said wand for receiving the generated beam of laser light from said generating means and for transforming the generated beam of laser light into a line of laser light; (d) a housing defining an interior chamber and having an exterior; (e) means for supplying electrical power to said generating means being disposed in said interior chamber of said housing; (f) means for electrically interconnecting said laser beam generating means and said electrical power supplying means; and (g) means for controlling a period of time said beam of laser light is generated. (File History, p. 23.) 15. On January 15, 1999, the Patent Examiner issued an Office Action rejecting The application for the '096 Patent was filed on November 19, 1997, by

all of the original claims of the '096 patent application. (File History, pp. 42-43.) The Examiner rejected Claim 1 of the application as being obvious under 35 U.S.C. § 103(a) over prior art references Ohshiro in view of Blum. The Examiner explained that:

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Ohshiro et al. teaches a semiconductor laser treatment device in which it is disclosed that the device contains: (a) a wand regarded as a radiation delivery device, 1, and is regarded as being a substantially elongated hollow tube; (b) a means for generating a laser beam via semiconductor laser, 10; (c) a collimating lens or cylindrical lens, 19; (d) a housing separate from the wand, which is shown in Figure 8; (e) means for supplying electrical power to the laser generation means contained in the wand; (f) means for electrically connecting the wand to the housing via a cable, 66; (g) means for controlling a period of time of laser generation via the time control circuit, 39. Additionally, see Figures 1, 7, and 8. The laser diode is regarded as being of the type which uses less than one watt of power, since this device is for use in the treatment of tissue and a large power usage would cause damage to the tissue. Finally, as shown in Figures 8 and 9, the housing contains a cradle for releasably securing the wand therein. Ohshiro does not teach that there is a means for transforming the generated beam of laser light into a line of laser light. Blum et al. teaches an alternative optical treatment device in which it is stated on column 4, line 63-65, that it is known to focus light along a line for the medical procedure. Therefore, it would have been obvious to one skilled in the art to modify the device of Ohshiro et al. with Blum et al. to provide a laser line focusing means as an known alternative means of focusing the light onto the tissue for treatment. (File History, pp. 45-46.)

13 16. 14 amendments to pending Claim 1, among other claims. 15 underlined language indicating the language added by Tucek and language removed 16 surrounded by brackets, are set forth below: 17 18 19 20 21 22 23 24 25 26 27 28 1. (amended) A hand-held laser light generator device for use in medical therapy, said device comprising: (a) a wand in the form of a substantially elongated hollow tube defining an interior cavity and capable of being retained in a hand of a user and freely moved relative to the surface of the skin of a patient to receive the medical therapy; (b) means mounted in said interior cavity of said wand for generating a beam of laser light [mounted in said interior cavity of said wand and therewith being freely movable so as to enable the user to direct said beam of laser light onto a desired location] in the red color spectrum; (c) an optical arrangement mounted in said interior cavity of said wand for receiving the red color spectrum generated beam of laser light from said generating means and for transforming the generated beam of laser light into a substantially planar beam of laser light disposed externally of said wand for producing a line of laser light in the red color spectrum at a desired location on the surface of the patient's skin and with said line of laser light being visible to the user as said wand is held and freely moved by the user in a spaced relationship from and out of contact with the patient; (d) a housing defining an interior chamber and having an exterior; (e) means disposed in said interior chamber of said housing for supplying electrical power to said laser beam generating means [being disposed in said interior chamber of said housing]; These amendments, with In response to the First Office Action, Tucek submitted substantial

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(f) means for electrically interconnecting said laser beam generating means and said electrical power supplying means such that said wand is movable relative to said housing; and (g) means on said housing for controlling a period of time said beam of laser light is generated. (File History, pp. 65-66; emphasis in original.) In support of these amendments, Tucek stated that: [Claim 1 was] amended to more clearly distinguish the invention defined therein over the cited references by incorporating the subject matter of Claim 2 and by reciting further detailed aspects of the laser beam. (File History, p. 71.) 17. The Examiner allowed the amended Claims 1 and 3-20 to issue based upon

Tucek's narrowing amendments and arguments. (File History, p. 83.) Claim 1 of the application issued as asserted Claim 1 of the '096 Patent. (Id., p. 3; '096 Patent, col. 7, ll. 35-67, col. 8, l. 52-col. 9, l. 39.) 18. Erchonia originally asserted that the Quantum IV Laser infringed Claims

1-3, 5-9, 10-12 and 14-16. Erchonia has withdrawn its assertion that the Quantum IV Laser infringes Claims 10-12 and 14-16. (Erchonia Medical Inc. and Kevin Tucek's Report Re Patent Claims ("Report"), pp. 2-4, attached hereto as Exhibit J; Erchonia Medical Inc. and Kevin Tucek's Supplemental Report Re Patent Claims ("Supplement"), p. 2, attached hereto as Exhibit K.) 19. Claim 1, as interpreted, includes the following limitations:

(a) a hand-held wand, which is considerably longer than its width, which is in the form of a hollow tube that defines an interior cavity, and which is capable of being held in the hand of a user and which can be moved without restriction relative to the surface of the skin of a patient receiving medical therapy; (b) a laser that generates a narrow beam of monochromatic, coherent light having a wave length in the red color spectrum and mounted in the interior cavity of the wand; (c) an optical arrangement (defined below) mounted in said interior cavity of said wand for receiving the red color spectrum generated beam of laser light from said generating means and for transforming the generated beam of laser light into a substantially planar beam of laser light disposed externally of said wand for producing a line of laser light in the red color spectrum at a desired location on the surface of the patient's skin and with said line of laser light being visible to the user as said wand is held and freely moved by the user in a spaced relationship from and out of contact -8Document 335 Filed 07/21/2006

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with a patient. "Optical arrangement" has been construed to mean "a collection comprising two or more mirrors, lens, prisms, or other optical devices, placed in some specified configuration, which reflect, refract, dispense, absorb, polarize, or otherwise act on light." That definition allows for a combination of two or more different optical devices. Also, a mirror, whether it is motorized or not is an optical device; (g) an electrical timing circuit, a start switch activatable between on and off positions, and a selector knob having multiple time period length setting positions on said housing. (June 8, 2006 Order adopting Special Master's Final Report and Recommendation on

7 Claim Construction, attached hereto as Exhibit L; Special Master's Final Report and 8 Recommendation on Claim Construction, attached hereto as Exhibit M.) With respect to 9 the limitations of Claim 1 shown above, Erchonia asserts that: limitation (a) is infringed 10 literally or under the doctrine of equivalents; limitation (b) is infringed literally only, 11 including as an "equivalent" under 35 U.S.C. § 112, ¶ 6; limitation (c) is infringed under 12 the doctrine of equivalents only; and limitation (g) is infringed literally only, including as 13 an "equivalent" under 35 U.S.C. § 112, ¶ 6. (Report, pp. 2-4; Supplement, p. 2.) 14 20. 15 collimating lens was well-known at the time of filing of the '096 Patent application. 16 (Erchonia's Objections to Special Master's Final Report and Recommendation on Claim 17 Construction, pp. 6-7, attached hereto as Exhibit N.) 18 Respectfully submitted, 19 20 21 22 23 24 25 26 27 28 Dated: July 21, 2006 By: s/ Benjamin B. Lieb Michael S. Rubin David G. Bray MARISCAL WEEKS MCINTYRE & FRIEDLANDER, P.A. Robert R. Brunelli Benjamin B. Lieb SHERIDAN ROSS P.C. Attorneys for Robert E. Moroney, LLC, Robert Moroney, and A Major Difference, Inc. Erchonia has claimed that the use of a single optical device such as a

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CERTIFICATE OF SERVICE I hereby certify that on July 21, 2006, I electronically transmitted or caused to be transmitted the attached ROBERT MORONEY'S AND ROBERT E. MORONEY LLC'S STATEMENT OF FACTS IN SUPPORT OF CONSOLIDATED MOTION FOR SUMMARY JUDGMENT OF NON-INFRINGEMENT OF U.S. PATENT NO. 6,013,096 to the Clerk's Office using the CM/ECF system for filing and transmittal of a Notice of Electronic Filing to the following ECF registrants: David Geoffrey Bray: [email protected], [email protected]

6 Michael S. Rubin: [email protected], [email protected] 7 Ray Kendall Harris: [email protected], [email protected] 8 Timothy R. Hyland: [email protected], [email protected], [email protected] 9 Steven Plitt: [email protected], [email protected], [email protected] 10 11 12 13 Michael Warzynski: [email protected], [email protected] 14 Scott A. Salmon: [email protected] 15 16 17 18 In addition, a copy of the above-referenced pleading was mailed to the following: 19 20 21 22 23 24 25 26 27 28 DATED THIS 21st day of July, 2006. By: s/ Benjamin B. Lieb Gale Peterson Cox Smith Matthews 112 E Pecan Street, Suite 1800 San Antonio, TX 78205-1521 Gordon Samuel Bueler Bueler Jones LLP 1300 N. McClintock Drive, #B-4 Chandler, AZ 85226 Gregory L. Miles Lori A. Curtis Davis Miles PLLC P.O. Box 15070 Mesa, AZ 85211-3070 Ira M. Schwartz: [email protected], [email protected], [email protected] Michael A. Cordier: [email protected], [email protected], [email protected] Dominic Lewis Verstegen: [email protected], [email protected], [email protected] Bradley R. Jardine: [email protected], [email protected], [email protected]

J:\4888\-7\PLEADINGS\M SJ Non-Infringement\REM SO F in Support of M SJ re Noninfringement of '096 Patent.wpd

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