DCT
1:13-cv-01836
TQ Delta LLC v. Zhone Tech Inc
I. Executive Summary and Procedural Information
- Parties & Counsel:
- Plaintiff: TQ Delta, LLC (Delaware)
- Defendant: Zhone Technologies, Inc. (Delaware)
- Plaintiff’s Counsel: Farnan LLP; McAndrews, Held & Malloy, Ltd.
- Case Identification: 1:13-cv-01836, D. Del., 11/20/2013
- Venue Allegations: Venue is asserted based on Defendant's incorporation in the state of Delaware.
- Core Dispute: Plaintiff alleges that Defendant’s Digital Subscriber Line (DSL) customer premise equipment and central office products infringe a portfolio of thirty-two U.S. patents related to various aspects of DSL technology.
- Technical Context: Digital Subscriber Line (DSL) technology enables high-speed data transmission over the copper wire infrastructure of local telephone networks, forming a critical component of broadband internet and video service delivery.
- Key Procedural History: The complaint notes that prior to filing suit, Plaintiff sent three letters to Defendant between June and August 2013 inviting licensing discussions for its DSL patent portfolio. Plaintiff states it received no response. The correspondence indicated a willingness to negotiate a license on reasonable and non-discriminatory (RAND) terms for any standard-essential patent claims.
Case Timeline
| Date | Event |
|---|---|
| 1998-01-26 | Priority Date for U.S. Patent No. 6,445,730 |
| 1999-11-09 | Priority Date for U.S. Patents No. 7,292,627 & 7,471,721 |
| 2000-08-10 | Priority Date for U.S. Patent No. 7,570,686 |
| 2001-10-05 | Priority Date for U.S. Patents No. 7,453,881 & 7,809,028 |
| 2002-09-03 | Issue Date for U.S. Patent No. 6,445,730 |
| 2004-09-25 | Priority Date for U.S. Patent No. 7,451,379 |
| 2007-11-06 | Issue Date for U.S. Patent No. 7,292,627 |
| 2008-11-11 | Issue Date for U.S. Patent No. 7,451,379 |
| 2008-11-18 | Issue Date for U.S. Patent No. 7,453,881 |
| 2008-12-30 | Issue Date for U.S. Patent No. 7,471,721 |
| 2009-08-04 | Issue Date for U.S. Patent No. 7,570,686 |
| 2010-09-14 | Issue Date for U.S. Patent No. 7,796,705 |
| 2010-10-05 | Issue Date for U.S. Patent No. 7,809,028 |
| 2010-11-09 | Issue Date for U.S. Patent No. 7,831,890 |
| 2010-11-16 | Issue Date for U.S. Patents No. 7,835,430 & 7,836,381 |
| 2010-11-30 | Issue Date for U.S. Patent No. 7,844,882 |
| 2011-02-15 | Issue Date for U.S. Patent No. 7,889,784 |
| 2011-04-12 | Issue Date for U.S. Patent No. 7,925,958 |
| 2011-07-12 | Issue Date for U.S. Patents No. 7,978,706, 7,979,778 & 7,978,753 |
| 2011-12-06 | Issue Date for U.S. Patent No. 8,073,041 |
| 2012-01-03 | Issue Date for U.S. Patent No. 8,090,008 |
| 2012-07-10 | Issue Date for U.S. Patent No. 8,218,610 |
| 2012-08-07 | Issue Date for U.S. Patent No. 8,238,412 |
| 2012-09-25 | Issue Date for U.S. Patent No. 8,276,048 |
| 2012-12-18 | Issue Date for U.S. Patent No. 8,335,956 |
| 2013-01-15 | Issue Date for U.S. Patent No. 8,355,427 |
| 2013-03-26 | Issue Date for U.S. Patent No. 8,407,546 |
| 2013-04-16 | Issue Date for U.S. Patent No. 8,422,511 |
| 2013-04-30 | Issue Date for U.S. Patent No. 8,432,956 |
| 2013-05-07 | Issue Date for U.S. Patent No. 8,437,382 |
| 2013-06-11 | Issue Date for U.S. Patent No. 8,462,835 |
| 2013-06-18 | Issue Date for U.S. Patent No. 8,468,411 |
| 2013-06-26 | Plaintiff sends first licensing letter to Defendant |
| 2013-07-12 | Plaintiff sends second licensing letter to Defendant |
| 2013-07-23 | Issue Date for U.S. Patent No. 8,495,473 |
| 2013-08-09 | Plaintiff sends third licensing letter to Defendant |
| 2013-08-20 | Issue Date for U.S. Patent No. 8,516,337 |
| 2013-11-20 | Complaint Filing Date |
II. Technology and Patent(s)-in-Suit Analysis
U.S. Patent No. 8,090,008 - “System and Method for Scrambling the Phase of the Carriers in a Multicarrier Communications System,” Issued January 3, 2012
The Invention Explained
- Problem Addressed: In multicarrier communication systems like DSL, the transmission signal is a linear combination of multiple carrier signals. If the phases of these carriers align constructively, it can create a signal with a high peak-to-average power ratio (PAR). High PAR can lead to signal clipping, increased power consumption, and more stringent linearity requirements for system components (’008 Patent, col. 1:12-2:26).
- The Patented Solution: The invention proposes scrambling the phase of each carrier signal based on a value that is determined independently of the input data bits being modulated onto that carrier. This scrambling is intended to randomize the phase relationship between carriers, reducing the likelihood of high signal peaks and thereby lowering the PAR of the transmitted signal (’008 Patent, col. 2:27-41; Abstract).
- Technical Importance: This technique enables more efficient power usage and potentially lower-cost components in DSL transceivers by mitigating the adverse effects of high PAR.
Key Claims at a Glance
The complaint does not assert specific claims, instead alleging infringement of "one or more claims" (Compl. ¶19). The first independent claim, Claim 1, is presented for analysis:
- A method for scrambling phase characteristics of carrier signals in a first multicarrier transceiver that uses a plurality of carrier signals for modulating a bit stream, wherein each carrier signal has a phase characteristic associated with the bit stream, the method comprising:
- associating each carrier signal with a value determined independently of any bit value of the bit stream carried by that respective carrier signal, the value associated with each carrier signal determined using a pseudo-random number generator;
- computing a phase shift for each carrier signal based on the value associated with that carrier signal; and
- combining the phase shift computed for each respective carrier signal with the phase characteristic of that carrier signal so as to substantially scramble the phase characteristics of the plurality of carrier signals, wherein multiple carrier signals corresponding to the scrambled carrier signals are used by the first multicarrier transceiver to modulate the same bit value.
U.S. Patent No. 8,073,041 - “System and Method for Descrambling the Phase of the Carriers in a Multicarrier Communications System,” Issued December 6, 2011
The Invention Explained
- Problem Addressed: When a transmitter scrambles the phase of carrier signals to reduce PAR, a corresponding receiver must be able to correctly recover the original data. This requires a synchronized method for reversing the scrambling process (’041 Patent, col. 2:50-56).
- The Patented Solution: The invention describes the receiver-side counterpart to the scrambling method. It involves computing a phase shift for each carrier signal based on a value associated with that signal (determined independently of the data bits). This computed phase shift is then used to descramble the received signal, allowing for the correct demodulation of the input bit stream (’041 Patent, Abstract). The system requires synchronization between the transmitter and receiver so both use the same value to compute the phase shifts (’041 Patent, col. 6:49-55).
- Technical Importance: This descrambling method is essential for enabling the practical use of phase scrambling techniques, as it provides the means to recover the data at the receiver, thereby realizing the benefits of a lower PAR transmission signal.
Key Claims at a Glance
The complaint does not assert specific claims, instead alleging infringement of "one or more claims" (Compl. ¶25). The first independent claim, Claim 1, is presented for analysis:
- A method, in a first multicarrier transceiver that uses a plurality of carrier signals for receiving a bit stream, wherein each carrier signal has a phase characteristic associated with the bit stream, the method comprising:
- receiving the bit stream; wherein each carrier signal is associated with a value determined independently of any bit value of the bit stream carried by that respective carrier signal, the value associated with each carrier signal determined by a pseudo-random number generator, a phase shift for each carrier signal is at least based on the value associated with that carrier signal, and the combining of a phase for each carrier signal with the phase characteristic of that respective carrier signal so as to substantially scramble the phase characteristics of the plurality of carrier signals; and
- multiple carrier signals corresponding to the plurality of phase shifted and scrambled carrier signals are used by the first transceiver to demodulate a same bit value of the received bit stream.
Multi-Patent Capsule: U.S. Patent No. 7,292,627 - “System and Method for Scrambling the Phase of the Carriers in a Multicarrier Communications System,” Issued November 6, 2007
- Technology Synopsis: This patent, related to the '008 Patent, addresses the problem of high peak-to-average power ratio (PAR) in multicarrier systems. The proposed solution involves scrambling the phase of carrier signals based on a value determined independently of the input data, thereby reducing the probability of constructive interference that causes high signal peaks.
- Asserted Claims: One or more claims (Compl. ¶31).
- Accused Features: Defendant's DSL CPE Products and DSL CO Products that operate in accordance with the ITU-T VDSL2 (G.993.2) standard (Compl. ¶30).
Multi-Patent Capsule: U.S. Patent No. 7,471,721 - “System and Method for Scrambling the Phase of the Carriers in a Multicarrier Communications System,” Issued December 30, 2008
- Technology Synopsis: This patent addresses the problem of high PAR in multicarrier systems. It discloses a method for scrambling the phase of carrier signals using a value (such as a symbol count) that is independent of the data being modulated, which helps to lower the PAR of the final transmitted signal.
- Asserted Claims: One or more method claims (Compl. ¶36).
- Accused Features: Defendant's DSL CPE Products and DSL CO Products that operate in accordance with the ITU-T VDSL2 (G.993.2) standard (Compl. ¶36).
Multi-Patent Capsule: U.S. Patent No. 8,218,610 - “System and Method for Descrambling the Phase of Carriers in a Multicarrier Communications System,” Issued July 10, 2012
- Technology Synopsis: This patent addresses the receiver-side requirements for a system using phase scrambling. It describes a method for descrambling the phase of received carrier signals using a value that corresponds to the scrambling value used by the transmitter, enabling correct data recovery.
- Asserted Claims: One or more method claims (Compl. ¶42).
- Accused Features: Defendant's DSL CPE Products and DSL CO Products that operate in accordance with the ITU-T VDSL2 (G.993.2) standard (Compl. ¶42).
Multi-Patent Capsule: U.S. Patent No. 8,355,427 - “System and Method for Descrambling the Phase of Carriers in a Multicarrier Communications System,” Issued January 15, 2013
- Technology Synopsis: This patent is directed to the receiver-side descrambling process necessary in a multicarrier system that employs phase scrambling at the transmitter. The method involves using a synchronized value, independent of the modulated data, to reverse the phase scrambling and correctly demodulate the signal.
- Asserted Claims: One or more method claims (Compl. ¶48).
- Accused Features: Defendant's DSL CPE Products and DSL CO Products that operate in accordance with the ITU-T VDSL2 (G.993.2) standard (Compl. ¶48).
Multi-Patent Capsule: U.S. Patent No. 7,453,881 - “Systems and Methods for Mulit-pair ATM Over DSL,” Issued November 18, 2008
- Technology Synopsis: This patent addresses methods for transporting Asynchronous Transfer Mode (ATM) cells over multiple DSL physical layers (PHYs), also known as "bonding." The invention describes distributing an ATM cell stream on a cell-by-cell basis across multiple DSL lines at the transmitter and recombining them at the receiver to recreate the original stream.
- Asserted Claims: One or more claims (Compl. ¶55).
- Accused Features: Defendant's DSL CPE Products and DSL CO Products that operate in accordance with the ITU-T G.bond standard (e.g., G.998.1, G.998.2) (Compl. ¶54).
Multi-Patent Capsule: U.S. Patent No. 7,809,028 - “Systems and Methods for Mulit-pair ATM Over DSL,” Issued October 5, 2010
- Technology Synopsis: This patent relates to combining multiple DSL lines to transport a single stream of ATM cells. The technology involves distributing ATM cells across different DSL physical layers at a transmitter and reassembling the stream at a receiver, enabling higher aggregate data rates.
- Asserted Claims: One or more method claims (Compl. ¶60).
- Accused Features: Defendant's DSL CPE Products and DSL CO Products that operate in accordance with the ITU-T G.bond standard (e.g., G.998.1) (Compl. ¶60).
Multi-Patent Capsule: U.S. Patent No. 7,978,706 - “Combining Multiple DSL Transceivers for a High Data Rate Connection,” Issued July 12, 2011
- Technology Synopsis: This patent describes methods for bonding multiple DSL transceivers to achieve a higher data rate. The invention addresses latency differences between the bonded lines by utilizing transmission parameters to reduce such differences, and uses a counter embedded in the cell header to ensure correct reordering of the data stream at the receiver.
- Asserted Claims: One or more method claims (Compl. ¶66).
- Accused Features: Defendant's DSL CPE Products and DSL CO Products that operate in accordance with the ITU-T G.bond standard (e.g., G.998.1, G.998.2) (Compl. ¶66).
Multi-Patent Capsule: U.S. Patent No. 8,422,511 - “Systems and Methods for Multi-pair ATM Over DSL,” Issued April 16, 2013
- Technology Synopsis: This patent relates to systems for transporting ATM cells over multiple bonded DSL lines. It describes methods for distributing and recombining ATM cell streams across multiple physical layers, a technique used to provide higher aggregate bandwidth to end-users.
- Asserted Claims: One or more method claims (Compl. ¶72).
- Accused Features: Defendant's DSL CPE Products and DSL CO Products that operate in accordance with the ITU-T G.bond standard (e.g., G.998.1, G.998.2) (Compl. ¶72).
Multi-Patent Capsule: U.S. Patent No. 7,796,705 - “DMT Symbol Repetition in the Presence of Impulse Noise,” Issued September 14, 2010
- Technology Synopsis: This patent addresses the problem of initialization message failure in DSL systems due to impulse noise. The proposed solution is to repeat Discrete Multi-tone (DMT) symbols during the initialization phase, allowing the receiver to correctly decode the message even if some symbols are corrupted by noise.
- Asserted Claims: One or more claims (Compl. ¶79).
- Accused Features: Defendant's DSL CPE Products and DSL CO Products that operate in accordance with the ITU-T G.inp (G.998.4) standard (Compl. ¶78).
Multi-Patent Capsule: U.S. Patent No. 7,889,784 - “Multicarrier Modulation Messaging for SNR Per Subchannel During Showtime Information,” Issued February 15, 2011
- Technology Synopsis: This patent addresses the need to exchange diagnostic information, such as signal-to-noise ratio (SNR) per subchannel, during normal operation ("Showtime"). It discloses a robust messaging mode that can be entered to transmit this information even when the primary communication channel is impaired.
- Asserted Claims: One or more claims (Compl. ¶85).
- Accused Features: Defendant's DSL CPE Products and DSL CO Products that operate in accordance with ITU-T ADSL2 (G.992.3), ADSL2+ (G.992.5), and/or VDSL2 (G.993.2) standards (Compl. ¶84).
Note: Due to the high number of patents and the similarity of allegations, capsule summaries for the remaining 20 patents are omitted for conciseness. Each follows a similar pattern of alleging that Defendant's DSL products, by operating in accordance with specified DSL standards (e.g., VDSL2, ADSL2, G.bond, G.inp), infringe patents relating to technologies such as error correction (CRC counter normalization), diagnostic messaging, power management (low power sleep modes), and resource sharing in telecommunications equipment.
III. The Accused Instrumentality
Product Identification
- The accused instrumentalities are Defendant’s "DSL CPE Products" and "DSL CO Products" (Compl. ¶10). These categories include, but are not limited to, modems, gateways, routers, integrated access devices (IADs), DSL Access Multiplexers (DSLAMs), Multi-service access nodes (MSANs), and line cards (Compl. ¶10).
Functionality and Market Context
- The complaint alleges these products provide broadband data access over copper telephone wires by operating in accordance with various established DSL standards (Compl. ¶¶8, 10). The allegations of infringement are tied directly to the functionality mandated by these standards, including ITU-T VDSL2 (G.993.2), ADSL2 (G.992.3), ADSL2+ (G.992.5), G.bond (e.g., G.998.1, G.998.2), and G.inp (G.998.4) (Compl. ¶¶18, 30, 54, 78, 84). The complaint does not provide specific details regarding the accused products' market positioning. No probative visual evidence provided in complaint.
IV. Analysis of Infringement Allegations
The complaint does not provide claim charts or detailed infringement theories mapping claim elements to accused functionality. The infringement allegations are based on the assertion that the accused products practice the claims by operating in accordance with industry standards. The following tables summarize this theory for the first independent claims of the lead patents.
’008 Infringement Allegations
| Claim Element (from Independent Claim 1) | Alleged Infringing Functionality | Complaint Citation | Patent Citation |
|---|---|---|---|
| associating each carrier signal with a value determined independently of any bit value...the value associated with each carrier signal determined using a pseudo-random number generator | Defendant's DSL products that operate in accordance with the ITU-T VDSL2 (G.993.2) standard are alleged to perform this step. | ¶18 | col. 5:1-12 |
| computing a phase shift for each carrier signal based on the value associated with that carrier signal | Defendant's DSL products that operate in accordance with the ITU-T VDSL2 (G.993.2) standard are alleged to perform this step. | ¶18 | col. 5:3-6 |
| combining the phase shift computed for each respective carrier signal with the phase characteristic of that carrier signal so as to substantially scramble the phase characteristics | Defendant's DSL products that operate in accordance with the ITU-T VDSL2 (G.993.2) standard are alleged to perform this step. | ¶18 | col. 5:7-10 |
| multiple carrier signals corresponding to the scrambled carrier signals are used...to modulate the same bit value | Defendant's DSL products that operate in accordance with the ITU-T VDSL2 (G.993.2) standard are alleged to perform this step. | ¶18 | col. 5:10-12 |
’041 Infringement Allegations
| Claim Element (from Independent Claim 1) | Alleged Infringing Functionality | Complaint Citation | Patent Citation |
|---|---|---|---|
| receiving the bit stream; wherein each carrier signal is associated with a value determined independently...determined by a pseudo-random number generator... | Defendant's DSL products that operate in accordance with the ITU-T VDSL2 (G.993.2) standard are alleged to perform this step. | ¶24 | col. 11:3-10 |
| multiple carrier signals corresponding to the plurality of phase shifted and scrambled carrier signals are used by the first multicarrier transceiver to demodulate a same bit value of the received bit stream | Defendant's DSL products that operate in accordance with the ITU-T VDSL2 (G.993.2) standard are alleged to perform this step. | ¶24 | col. 11:11-14 |
Identified Points of Contention
- Scope Questions: A central point of contention will be whether practicing the cited ITU-T standards necessarily infringes the asserted claims. The complaint makes a conclusory allegation without providing a technical analysis demonstrating that compliance with the standard meets every limitation of any given claim. This raises the question of whether the standards allow for non-infringing alternative implementations.
- Technical Questions: The complaint provides no specific evidence of how Defendant’s products actually function beyond the general allegation of standards compliance. A key technical question will be what evidence exists that Defendant's products, in fact, implement the optional or mandatory features of the standards in a manner that maps onto the specific claim elements, such as the use of a "pseudo-random number generator" for determining phase shifts.
V. Key Claim Terms for Construction
The complaint does not provide sufficient detail for a full analysis of claim construction disputes. However, based on the infringement theory, the construction of the following terms from the lead patents may be central to the case.
The Term: "scrambling the phase characteristic" (’008 Patent, Claim 1)
Context and Importance: The scope of this term is critical to the "infringement by standard" theory. Practitioners may focus on this term because its construction will determine whether the phase manipulation techniques described or permitted by the VDSL2 standard fall within the patent's claims.
Intrinsic Evidence for Interpretation:
- Evidence for a Broader Interpretation: The specification describes the invention in general terms as combining a computed phase shift with the existing phase characteristic to "substantially scramble the phase characteristics" (’008 Patent, col. 2:38-41). This could support a construction covering a wide range of phase modification techniques.
- Evidence for a Narrower Interpretation: The claim explicitly recites that the value used for scrambling is "determined using a pseudo-random number generator" (’008 Patent, col. 12:4-6). This language may be used to argue for a narrower construction limited to specific scrambling methods, as opposed to any method that alters phase.
The Term: "demodulate a same bit value" (’041 Patent, Claim 1)
Context and Importance: This term relates to the receiver's ability to correctly recover data from multiple phase-scrambled carriers that were used to modulate the same bit. Practitioners may focus on this term because the dispute may turn on whether the accused products use "multiple carrier signals" for a "same bit value" in the manner claimed, or if the standard specifies a different modulation scheme.
Intrinsic Evidence for Interpretation:
- Evidence for a Broader Interpretation: The specification describes the general problem of communicating over multicarrier systems where input bits are modulated onto carriers (’041 Patent, col. 1:26-34). This context could support a broad interpretation covering standard multicarrier demodulation processes.
- Evidence for a Narrower Interpretation: The claim's specific language linking "multiple carrier signals" to a "same bit value" may be argued to limit the claim to a specific type of modulation or coding scheme that might differ from the one specified in the accused VDSL2 standard.
VI. Other Allegations
- Indirect Infringement: The complaint alleges inducement by "selling, providing support for, and/or providing instructions for use of DSL CPE Products and DSL CO Products to Internet Service Providers... and/or their customers" (Compl. ¶19). It further alleges contributory infringement by selling products that are not staple articles of commerce and are "especially made or especially adapted for use in an infringement" of the patents (Compl. ¶20).
- Willful Infringement: The complaint makes a general allegation of knowledge "at least as of the filing of the Complaint and/or previously at least by willful blindness or otherwise" for each asserted patent (e.g., Compl. ¶19). This alleges at least post-suit willfulness. The pre-suit letters sent in 2013 may be used to argue pre-suit knowledge of the patent portfolio, though the complaint does not explicitly allege they provided notice of the specific patents-in-suit (Compl. ¶¶11-12).
VII. Analyst’s Conclusion: Key Questions for the Case
- A central issue will be one of standards essentiality and claim scope: can Plaintiff prove that compliance with the cited ITU-T DSL standards necessarily infringes the asserted claims? The outcome will likely depend on whether the court construes the claims broadly enough to cover the standards' requirements or narrowly based on specific embodiments disclosed in the patents.
- A key evidentiary question will be one of technical implementation: assuming the standards do not mandate infringement, what evidence will show that Defendant's accused products actually practice the claimed methods? The complaint's reliance on standards compliance alone, without product-specific details, suggests this will be a primary focus of discovery.
- A third question will be one of pre-suit knowledge: did the 2013 letters, which discussed Plaintiff's DSL patent portfolio generally, provide Defendant with sufficient notice of the specific patents-in-suit to support a claim for pre-suit willful infringement? The court will need to determine if general portfolio notifications meet the legal standard for knowledge of infringement by particular patents.