DCT

3:14-cv-02235

Apple Inc v. Wi LAN Inc

Key Events

Amended Complaint

I. Executive Summary and Procedural Information

Parties & Counsel:
- Plaintiff: Apple Inc. (California)
- Defendant: Wi-LAN, Inc. (Canada)
- Plaintiff’s Counsel: Milbank, Tweed, Hadley & McCloy LLP
Case Identification: 3:14-cv-02235, S.D. Cal., 08/04/2017
Venue Allegations: Plaintiff Apple alleges venue is proper because Defendant Wi-LAN has engaged in business and other acts in and directed to the state of California.
Core Dispute: Plaintiff seeks a declaratory judgment that its products do not infringe, and that the claims are invalid and unenforceable, for six of Defendant’s patents related to wireless communication protocols.
Technical Context: The technology concerns fundamental methods for managing bandwidth, modulating signals, and controlling data transmission in wireless networks, which are core to the operation of modern cellular standards like LTE.
Key Procedural History: The complaint notes a history of litigation between the parties, including at least four prior lawsuits initiated by Wi-LAN against Apple since 2007. This action was precipitated by a notice letter sent by Wi-LAN to Apple on June 16, 2014, alleging that products including the iPhone and iPad infringed the patents-in-suit. Wi-LAN has subsequently filed counterclaims for infringement in this action. The complaint also includes a count for unenforceability based on alleged unclean hands, asserting a pattern of bad-faith litigation by Wi-LAN.

Case Timeline

Date	Event
1999-05-21	Earliest Priority Date for ’723 and ’761 Patents
2000-12-22	Earliest Priority Date for ’145 and ’020 Patents
2000-12-27	Earliest Priority Date for ’757 Patent
2001-01-16	Earliest Priority Date for ’040 Patent
2007-01-09	Apple introduces the first iPhone
2010-04-03	Apple introduces the first iPad
2012-11-13	’040 Patent Issued
2013-06-04	’145 Patent Issued
2013-06-11	’723 Patent Issued
2013-06-11	’761 Patent Issued
2013-09-17	’757 Patent Issued
2013-12-24	’020 Patent Issued
2014-06-16	Wi-LAN sends notice letter to Apple alleging infringement
2017-08-04	Apple files Third Amended Complaint for Declaratory Judgment

II. Technology and Patent(s)-in-Suit Analysis

U.S. Patent No. 8,457,145: "Method and Apparatus for Bandwidth Request/Grant Protocols in a Wireless Communication System" (Issued June 4, 2013)

The Invention Explained

Problem Addressed: In wireless systems with many users (e.g., customer premises equipment or CPEs), efficiently allocating uplink bandwidth is challenging. If a CPE sends a request for the total bandwidth it needs (an "aggregate" request) and the request is lost, the base station remains unaware of the need, causing delays. Conversely, if a CPE sends requests only for additional bandwidth needed ("incremental" requests), a single lost request can cause the base station's understanding of the CPE's total need to become permanently out of sync. (’145 Patent, col. 3:6-4:2)
The Patented Solution: The patent proposes a "self-correcting" protocol that primarily uses efficient, incremental bandwidth requests but supplements them with periodic aggregate requests. (’145 Patent, Abstract). This hybrid approach allows for efficient, low-overhead adjustments via incremental requests, while the periodic aggregate requests serve to re-synchronize the base station and CPE, correcting any discrepancies caused by lost incremental messages. (’145 Patent, col. 5:9-25).
Technical Importance: This method aims to improve the efficiency and robustness of demand-assigned multiple access (DAMA) systems, which are foundational to cellular networks that must support numerous users with fluctuating data demands.

Key Claims at a Glance

The complaint seeks a declaration of non-infringement of all valid claims; a representative independent claim is Claim 1, which recites:
- A method for allocating bandwidth in a wireless communication system.
- Transmitting an incremental bandwidth request from a CPE to a base station.
- Periodically transmitting an aggregate bandwidth request from the CPE to the base station.
- The base station allocating bandwidth based on the received requests.

U.S. Patent No. 8,462,723: "Method and Systems for Transmission of Multiple Modulated Signals Over Wireless Networks" (Issued June 11, 2013)

The Invention Explained

Problem Addressed: In a wireless system, using a single, fixed modulation scheme for all user devices is inefficient. A highly robust (but low data rate) scheme suitable for a user far from the base station is wasteful for a nearby user who could support a much higher data rate. (’723 Patent, col. 1:44-54).
The Patented Solution: The invention describes transmitting data within a single communication frame that is divided into portions, each employing a different modulation scheme (e.g., QAM-4, QAM-16, QAM-64). A "frame control header" at the beginning of the frame contains information that directs each specific user device to the portion of the frame and the corresponding modulation scheme intended for it. (’723 Patent, col. 4:15-38; Fig. 3).
Technical Importance: This technique, a form of adaptive modulation and coding (AMC), allows a base station to maximize overall network throughput by tailoring transmissions to the specific signal conditions of each individual user device in real-time.

Key Claims at a Glance

The complaint seeks a declaration of non-infringement of all valid claims; a representative independent claim is Claim 1, which recites:
- A method for transmitting signals in a wireless system.
- Transmitting a frame control header from a base station.
- The frame control header identifying a plurality of modulation types used for transmitting data.
- Transmitting data from the base station using the plurality of modulation types.
- The data being transmitted within a single frame.

U.S. Patent No. 8,462,761: "Method and System for Adaptively Obtaining Bandwidth Allocation Requests" (Issued June 11, 2013)

Technology Synopsis: This patent, related to the ’723 Patent, details methods for a user device (CPE) to obtain bandwidth. The system uses various polling techniques, including individual polls, multicast polls for groups of users, and a "poll-me" bit that a CPE can set to explicitly request a polling opportunity from the base station. The invention describes adaptively selecting among these techniques to balance efficiency and responsiveness. (’761 Patent, Abstract).
Asserted Claims: All claims; a representative independent claim is Claim 1.
Accused Features: The complaint alleges that Apple's iPhones and iPads, which utilize cellular communication standards for managing bandwidth requests, do not infringe. (Compl. ¶12, ¶38).

U.S. Patent No. 8,615,020: "Method and System for Adaptively Obtaining Bandwidth Allocation Requests" (Issued December 24, 2013)

Technology Synopsis: This patent, related to the ’145 Patent, also describes methods for adaptively managing bandwidth requests. It focuses on different polling states for a user device (e.g., "Active," "Recently Active," "Pausing," "Inactive") based on its recent activity. The base station uses this state to determine the appropriate polling method, such as individual polling for active users and multicast polling for inactive ones, to optimize network resources. (’020 Patent, Abstract; Fig. 14).
Asserted Claims: All claims; a representative independent claim is Claim 1.
Accused Features: The complaint alleges that Apple's iPhones and iPads, which utilize cellular communication standards for managing bandwidth requests, do not infringe. (Compl. ¶12, ¶46).

U.S. Patent No. 8,537,757: "Adaptive Call Admission Control for Use in a Wireless Communication System" (Issued September 17, 2013)

Technology Synopsis: This patent addresses call admission control (CAC)—the process of deciding whether to allow a new connection onto the network. The invention proposes an adaptive CAC method that considers not only the requested bandwidth for a new connection but also the current and "planned" modulation modes (PHY modes) of existing connections. If accepting a new call would exceed available resources, the system can suspend existing connections based on precedence levels. (’757 Patent, Abstract).
Asserted Claims: All claims; a representative independent claim is Claim 1.
Accused Features: The complaint alleges that Apple's iPhones and iPads, which utilize cellular communication standards for call admission, do not infringe. (Compl. ¶12, ¶54).

U.S. Patent No. 8,311,040: "Packing Source Data Packets into Transporting Packets with Fragmentation" (Issued November 13, 2012)

Technology Synopsis: This patent describes a method for efficiently packing multiple, smaller source data units (SDUs) into larger transport packets, known as protocol data units (PDUs). The invention includes methods for fragmenting an SDU if it does not fit entirely within the remaining space of a PDU and using "packing subheaders" and "fragmentation control bits" to indicate the length and arrangement of the various SDUs and SDU fragments within the PDU payload. (’040 Patent, Abstract).
Asserted Claims: All claims; a representative independent claim is Claim 1.
Accused Features: The complaint alleges that Apple's iPhones and iPads, which utilize cellular communication standards for data packetization and fragmentation, do not infringe. (Compl. ¶12, ¶62).

III. The Accused Instrumentality

Product Identification: Apple products such as the iPhone and iPad are identified as the instrumentalities at issue. (Compl. ¶12).
Functionality and Market Context: The complaint broadly describes the accused products as mobile communication devices with cellular connectivity. (Compl. ¶¶ 8-9). It does not provide specific technical details on how the accused products implement the functionalities related to the patents-in-suit. The basis of Wi-LAN's infringement allegations, which prompted this declaratory judgment action, appears to be the products' compliance with standardized wireless communication protocols (e.g., LTE) that govern bandwidth allocation, adaptive modulation, call admission, and data packetization. (Compl. ¶12).

IV. Analysis of Infringement Allegations

As this is a complaint for declaratory judgment of non-infringement, Apple does not present an affirmative infringement theory or include a claim chart. The complaint notes that Defendant Wi-LAN has filed counterclaims of infringement, which would contain such allegations, but that document is not provided. (Compl. ¶14). Therefore, a claim chart summary cannot be constructed from the complaint.

No probative visual evidence provided in complaint.

Identified Points of Contention:
- Scope Questions: The dispute will likely center on whether the methods defined in the cellular standards implemented by Apple's products (e.g., LTE) fall within the scope of the patent claims. For the ’145 Patent, a key question may be whether the LTE standard’s scheduling request (SR) and buffer status report (BSR) mechanisms, taken together, constitute the claimed combination of "incremental" and periodic "aggregate" bandwidth requests.
- Technical Questions: For the ’723 Patent, a central technical question will be whether the Downlink Control Information (DCI) messages transmitted on the Physical Downlink Control Channel (PDCCH) in an LTE system perform the function of the claimed "frame control header" by identifying which modulation schemes are used for data in the corresponding Physical Downlink Shared Channel (PDSCH).

V. Key Claim Terms for Construction

For the ’145 Patent:
- The Term: "periodically transmitting an aggregate bandwidth request"
- Context and Importance: The definition of "periodically" will be critical. If construed narrowly to mean occurring at fixed, regular time intervals, it may not read on systems where aggregate reports are triggered by events or occur at irregular intervals. Practitioners may focus on this term because the specific timing and triggering conditions for aggregate bandwidth reporting in a standard like LTE may not align with a strict, time-based definition of "periodically."
- Intrinsic Evidence for Interpretation:
  - Evidence for a Broader Interpretation: The specification does not appear to explicitly define "periodically." The patent's focus on a "self-correcting" mechanism could support a construction where periodicity is functional (i.e., occurring often enough to ensure correction) rather than strictly temporal. (’145 Patent, col. 5:9-16).
  - Evidence for a Narrower Interpretation: The common dictionary meaning of "periodically" implies regular, cyclical intervals. Further, the specification contrasts the periodic aggregate requests with incremental requests that are not periodic, suggesting a distinction in timing is intended. (’145 Patent, col. 5:9-16).
For the ’723 Patent:
- The Term: "frame control header"
- Context and Importance: This term's construction will determine whether the control signaling in an LTE downlink frame meets this limitation. If "frame control header" is construed to require a single, contiguous block of data at the absolute beginning of a frame, it may not read on standards where control information is interleaved or located elsewhere.
- Intrinsic Evidence for Interpretation:
  - Evidence for a Broader Interpretation: The specification describes the header's function as containing control sections for the physical layer and MAC layer. (’723 Patent, col. 8:10-14). This functional description could support a broader reading on any set of control data that performs these functions, regardless of its specific location or format.
  - Evidence for a Narrower Interpretation: Figure 3 of the patent depicts the "Frame Control Header" 302 as a distinct, initial block preceding all data portions of the subframe. An argument could be made that this embodiment limits the term to a structure that is physically located at the beginning of the frame. (’723 Patent, Fig. 3).

VI. Other Allegations

Indirect Infringement: Apple seeks a declaration of non-infringement for both direct and indirect infringement for each of the patents-in-suit. (Compl. ¶¶ 22, 30, 38, 46, 54, 62).
Willful Infringement: The complaint does not allege willfulness. However, it notes that Wi-LAN sent a notice letter to Apple on or around June 16, 2014, putting Apple on notice of the patents-in-suit. (Compl. ¶12). This event could form the basis for a potential willfulness allegation by Wi-LAN for any infringement occurring after that date.
Unenforceability/Unclean Hands: Apple dedicates Count XIII to a declaration of unenforceability due to unclean hands. (Compl. ¶¶ 69-77). It alleges that Wi-LAN has engaged in a "pattern and practice of improper activity to acquire, license, and assert its patents in bad faith, including by making claims of patent infringement with knowledge that the patents are not actually infringed or are invalid." (Compl. ¶70).

VII. Analyst’s Conclusion: Key Questions for the Case

A core issue will be one of claim scope versus industry standards: do the specific mechanisms for bandwidth management, adaptive modulation, and call admission control as defined in the 3GPP LTE standards (and implemented in Apple's products) meet the limitations of the patent claims, or is there a fundamental mismatch between the patented methods and the standardized ones?
A second key question will be one of invalidity: given the 1999-2001 priority dates of the patent families, will the claimed inventions be found to be novel and non-obvious over the extensive prior art in the field of wireless communications, which was rapidly developing these same concepts for emerging 3G and 4G systems at the time?
Finally, a significant procedural question is one of patent misuse: does Wi-LAN's alleged history of litigation against Apple and over 275 other companies constitute a "pattern and practice of improper activity" sufficient to render the patents-in-suit unenforceable under the doctrine of unclean hands, as alleged by Apple?