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Trading Technologies International, Inc. v. IBG LLC

United States District Court, N.D. Illinois, Eastern Division

December 5, 2019

IBG LLC AND INTERACTIVE BROKERS LLC, Defendants. IBG's Proposed Construction TT's Proposed Construction Claim Term/Phrase IBG's Proposed Construction TT's Proposed Construction IBG's Proposed Construction TT's Proposed Construction IBG's Proposed Construction TT's Proposed Construction IBG's Proposed Construction TT's Proposed Construction '411 Claim 26 '996 Claim 1 '304 Claim 27



         Plaintiff Trading Technologies International, Inc. (“TT”) sued Defendants IBG LLC and Interactive Brokers Group LLC (collectively “IBG”) for infringement of United States Patent Nos. 6, 766, 304 (the “‘304 Patent”), 6, 772, 132 (the “‘132 Patent”), 7, 676, 411 (the “‘411 Patent”), and 7, 813, 996 (the “'996 Patent”). The Court held a claims construction hearing, at which time it heard argument on IBG's Motion to Strike (Dkt. 1126) and the five claim terms in dispute. (Dkt. 1136). For the reasons stated within, IBG's Motion is granted, and the Court's construction of these terms is set forth below.


         The patents at issue here are related to electronic trading systems and software. The four patents asserted are from the same patent family, titled “Click Based Trading with Intuitive Grid Display of Market Depth.” TT suggests that its family of patents and the software it developed made significant improvements on existing trading software by providing a faster, more efficient means of trading by incorporating a static price axis and a dynamic display of bid and ask indicators that move along a static price axis as market information changes. TT argues that IBG's Trader Workstation, WebTrader, and BookTrader products and modules infringe upon their trading software patents.


         Claim construction resolves disputed meanings in a patent to clarify and explain what the claims cover. See Terlep v. Brinkmann Corp., 418 F.3d 1379, 1382 (Fed. Cir. 2005). The construction of the claims at issue is a legal determination to be made by the court. See Id. (citing Markman v. Westview Instruments, Inc., 52 F.3d 967, 970-71 (Fed. Cir. 1995)). Generally, the terms of a claim are given the ordinary and customary meaning that the terms would have to a person of ordinary skill in the art at the time of the filing date of the patent application. See Phillips v. AWH Corp., 415 F.3d 1303, 1313 (Fed. Cir. 2005). When interpreting an asserted claim, the court looks first to intrinsic evidence: the words of the claims, the patent specification, and the prosecution history. See Id. at 1316-18.

         The claim language is the starting point for claim construction analysis because it frames and ultimately resolves all issues of claim interpretation. See Sumitomo Dainippon Pharma Co., Ltd. v. Emcure Pharmaceuticals Limited, 887 F.3d 1153, 1157-58 (Fed. Cir. 2018); Robotic Vision Sys., Inc. v. View Eng'g Inc., 189 F.3d 1370, 1375 (Fed. Cir. 1997). In some cases, the “ordinary and customary” meaning of the claim language may be readily apparent, even to lay judges, and the court applies the widely accepted meaning of the commonly understood words. See Phillips, 415 F.3d at 1314. In such cases, a general-purpose dictionary may be helpful. See Id. In many cases, however, the court must proceed beyond the bare language of the claims and examine the patent specification. See Id. at 1314-15. “The person of ordinary skill in the art is deemed to read the claim term not only in the context of the particular claim in which the disputed term appears, but in the context of the entire patent, including the specification.” Id. at 1313. The specification is usually dispositive; “'it is the single best guide to the meaning of a disputed term.'” Id. at 1315 (quoting Vitronics Corp. v. Conceptronic, Inc., 90 F.3d 1576, 1582 (Fed. Cir. 1996)). In the specification, the patentee provides a written description of the invention that allows a person of ordinary skill in the art to make and use the invention. See id. at 1323. At times, the patentee uses the specification to “set forth an explicit definition for a claim term that could differ in scope from that which would be afforded by its ordinary meaning.” Rexnord Corp. v. Laitram Corp., 274 F.3d 1336, 1342 (Fed. Cir. 2001).

         The court may also look to the patent's prosecution history. See Phillips, 415 F.3d at 1317. While the prosecution history often lacks the clarity of and is less useful than the specification, it may inform the court of the meaning of a claim term by illustrating how the inventor understood the invention as well as how the inventor may have limited the scope of the invention. See Id. The prosecution history is generally relevant if a particular interpretation of the claim was considered and specifically disclaimed during the prosecution of the patent. See Schumer v. Lab. Comp. Sys., 308 F.3d 1304, 1313 (Fed. Cir. 2002).

         Finally, a court may also consult “extrinsic evidence, ” such as dictionaries, treatises, and expert testimony, to “shed useful light on the relevant art.” Phillips, 415 F.3d at 1317-18. Generally, extrinsic evidence is “less reliable” than intrinsic evidence and is “unlikely to result in a reliable interpretation of patent claim scope unless considered in the context of the intrinsic evidence.” Id. at 1318-19. With respect to the use of dictionaries, technical or general, a court may consult such evidence “so long as the dictionary definition does not contradict any definition found in or ascertained by a reading of the patent documents.” Id. at 1322-23.


         I. IBG's Motion to Strike

         Before addressing the merits of the claim construction, the Court first turns to IBG's Motion to Strike the Declaration of Larry S. Nixon, TT's expert. (Dkt. 1124). IBG claims that Nixon's declaration is improper because Nixon does not have technical skill in the art, it contains improper legal argument, and it contains factual and legal fallacies. (Dkt. 1126). The “'[a]dmission of expert testimony is within the discretion of the trial court.'” Sundance, Inc. v. DeMonte Fabricationg Ltd., 550 F.3d 1356, 1360 (Fed. Cir. 2008) (quoting Acoustical Design, Inc. v. Control Elecs. Co., 932 F.2d 939, 942 (Fed. Cir. 1991). At the claim construction stage, the primary consideration for the Court is whether additional expert testimony is helpful in interpreting the meaning of the contested claim language. See e.g., Senior Indus., Inc. v. Thomas & Betts Corp., 2001 WL 1163680, at *3 (N.D. Ill. Sept. 8, 2001), aff'd 79 Fed.Appx. 427 (Fed. Cir. 2003) (citing Markman, 52 F.3d at 983).

         Here, TT offers Nixon as a patent office procedure expert. (Dkt. 1157, 130:21-23). In his declaration, Nixon opines on the prosecution histories of the patents at issue, USPTO patent application and prosecution procedures, and the definition of certain terms based upon prior litigation and the intrinsic record. To the extent that Nixon offers his own interpretation and legal conclusion of prior eSpeed litigation (Dkt. 1075-2, Part III), his declaration is stricken as improper. See e.g., The Medicines Co. v. Mylan Inc., 2014 WL 1758135, at *6 (N.D. Ill. May 2, 2014) (“She may not, however, give general testimony interpreting patent law.”). The remainder of Nixon's declaration provides an in-depth summary of the USPTO's procedures and the file history of these specific patents. Though there is nothing inherently improper regarding an expert's testimony covering such topics, there is likewise nothing inherently helpful about it either. The Court is familiar with the relevant patent law procedures and is more than capable of understanding the patents' file histories. As such, Nixon's testimony is not necessary to the Court's core mission at this stage- claim construction-and Nixon's testimony is stricken as not relevant and cumulative. See Markman, 52 F.3d at 983.

         II. “static price axis” (‘996 Patent; claim 1)

IBG's Proposed Construction
TT's Proposed Construction

"a line comprising price levels that do not change positions unless a manual re-centering command is received"

"a reference line comprising price levels that do not change positions unless a re-centering or re- positioning command is received."

         With respect to the term “static, ” the parties devoted significant time in their briefs and at oral argument to the meaning, and controlling nature, of previous related litigation-Trading Techs. Int'l, Inc. v. eSpeed, Inc., 595 F.3d 1340 (Fed. Cir. 2010) and Trading Techs. Int'l, Inc. v. Open E Cry, LLC, 728 F.3d 1309, 1312 (Fed. Cir. 2013). eSpeed dealt with the ‘132 and ‘304 Patents and, potentially relevant here, the construction of “static” in those patents. There, the Federal Circuit affirmed the district court's construction of “static” as a line or display of price levels “that do not change positions unless a manual re-centering command is received.” eSpeed, 595 F.3d at 1352 (citations omitted). Open E Cry again concerned the term “static, ” but this time in the context of the ‘055 Patent. The relevant question in Open E Cry was whether the factors that led to the court's construction of “static” in the ‘132 and ‘304 Patents equally applied and carried through to the ‘055 Patent, requiring an identical construction, merely because the ‘055 Patent uses the same term. Open E Cry, 728 F.3d at 1322-23. The Federal Circuit answered that “static” in the ‘055 Patent did not necessarily require the same construction as the ‘132 and ‘304 Patents. Id. at 1323. Instead, “the intrinsic record specific to the ‘055 Patent distinguishe[d] eSpeed and compe[lled] a different result”-notably a construction not limited to manual re-centering. Id. Neither of these prior cases, nor this Court's summary judgment ruling relied upon by IBG, considered, or applied to, the ‘996 Patent currently in question.

         The core dispute with respect to the “static price axis” term is whether the term should be read to be limited to “manual” re-centering. As previewed above, IBG asserts that this question has already been answered in the affirmative by the Federal Circuit in eSpeed. See (Dkt. 1047, pg. 15). Indeed, the district court construed, and the Federal Circuit affirmed that, as to the ‘132 and ‘304 Patents, the claim required a manual re-centering command. eSpeed, 595 F.3d at 1354. However, as highlighted by Open E Cry, the construction of a term is specific to the intrinsic record of the corresponding patent and therefore, identical terms may have varying constructions when considered in light of their respective intrinsic records. Open E Cry, 728 F.3d at 1323. Thus, in construing terms for the ‘996 Patent, the Court is not restricted to how those terms were construed in other contexts.

         Here, the intrinsic record and prosecution history of the ‘996 Patent warrant a different construction of “static price axis” than that seen in the ‘132 and ‘304 Patents. The ‘996 and ‘382 Patents are closely related and were even prosecuted at the same time and before the same examiner. Their relatedness is instructive here. Similarly, at issue in the ‘382 Patent was the term ...

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