DCT

1:19-cv-03348

Paice LLC v. Bayerische Mo

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I. Executive Summary and Procedural Information

  • Parties & Counsel:
  • Case Identification: 1:19-cv-03348, D. Md., 11/21/2019
  • Venue Allegations: Venue for BMW of North America, LLC is alleged to be proper based on its commission of infringing acts within the district and its maintenance of a regular and established place of business, a Vehicle Distribution Center, in Baltimore. Venue is alleged to be proper for the German parent entity, Bayerische Motoren Werke AG, on the basis that it is not a resident of the United States.
  • Core Dispute: Plaintiff alleges that Defendant’s hybrid and plug-in hybrid vehicles infringe three U.S. patents related to control strategies for hybrid electric vehicle powertrains.
  • Technical Context: The technology concerns methods for optimizing the use of an internal combustion engine and electric motors in a hybrid vehicle to improve fuel efficiency and performance.
  • Key Procedural History: The complaint alleges an extensive history between the parties, beginning in the early 2000s when Paice states it disclosed its technology to BMW. Plaintiff also notes that its patented technology has been licensed by numerous major automakers, including Toyota, Ford, and Honda. The complaint cites prior litigation where U.S. Patent Nos. 7,104,347 and 7,237,634 were found valid and infringed by a jury in a case against Hyundai and Kia. Plaintiff alleges it contacted BMW in February and July 2019 to negotiate a license but received no response.

Case Timeline

Date Event
1998-09-14 Earliest Priority Date for ’347, ’634, ’761 Patents
2006-09-12 U.S. Patent No. 7,104,347 Issues
2007-07-03 U.S. Patent No. 7,237,634 Issues
2010-01-01 Accused Product BMW X6 SUV Hybrid Launch (approx.)
2014-01-14 U.S. Patent No. 8,630,761 Issues
2019-11-21 Complaint Filed

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

U.S. Patent No. 7,104,347 - "Hybrid Vehicles" (Issued Sep. 12, 2006)

The Invention Explained

  • Problem Addressed: The patent’s background section describes the significant inefficiency of conventional internal combustion engines when operated at low torque outputs, a common condition in city and suburban driving that leads to poor fuel economy and higher emissions (’347 Patent, col. 2:54-58; Fig. 1).
  • The Patented Solution: The invention is a control method for a hybrid vehicle that uses a microprocessor to operate the internal combustion engine only under conditions of high efficiency. This is typically when the engine load is above a certain threshold, or "setpoint," such as 30% of its maximum torque output (’347 Patent, Abstract). At loads below this setpoint, the vehicle is propelled solely by an electric motor. The system dynamically determines the required torque and selects the appropriate power source—motor, engine, or both—to meet demand while optimizing fuel consumption and also managing the battery's state of charge (’347 Patent, col. 13:14-41; Fig. 6).
  • Technical Importance: The invention provided a control strategy to make parallel hybrid vehicles more practical by improving fuel efficiency without sacrificing performance or requiring complex transmissions common in prior art designs (’347 Patent, col. 3:1-15).

Key Claims at a Glance

  • The complaint asserts dependent claims 24 and 38, which both depend on independent claim 23 (Compl. ¶¶ 31, 36).
  • The essential elements of independent claim 23 include a method of controlling a hybrid vehicle by:
    • determining the instantaneous torque RL required to propel the vehicle;
    • monitoring the state of charge of the battery;
    • employing at least one electric motor to propel the vehicle when the required torque RL is less than a lower level setpoint SP;
    • employing the engine to propel the vehicle when the required torque RL is between the lower level SP and the maximum torque output MTO;
    • employing both the motor and the engine to propel the vehicle when the required torque RL is more than MTO;
    • employing the engine to also charge the battery when RL is less than SP and the battery's state of charge makes it desirable; and
    • wherein the torque produced by the engine when operated at the setpoint (SP) is substantially less than its maximum torque output (MTO).

U.S. Patent No. 7,237,634 - "Hybrid Vehicles" (Issued July 3, 2007)

The Invention Explained

  • Problem Addressed: Like the ’347 Patent, this patent addresses the inefficiency of internal combustion engines operating outside their optimal torque range (’634 Patent, col. 2:54-58).
  • The Patented Solution: The patent claims a control method similar to that of the ’347 Patent, where the power source is selected based on the instantaneous road load (RL) relative to a setpoint (SP). The key addition is an adaptive element: the method includes the step of "monitoring patterns of vehicle operation over time and varying the SP accordingly." This allows the control system to adjust the threshold for engine engagement based on learned driving habits or repeated routes, further optimizing efficiency (’634 Patent, col. 21:52-54).
  • Technical Importance: This adaptive control strategy allows the hybrid system to tailor its operation to specific driving conditions and user habits over time, moving beyond a purely instantaneous response to road load (Compl. ¶ 48).

Key Claims at a Glance

  • The complaint asserts independent claim 33 (Compl. ¶ 45).
  • The essential elements of independent claim 33 include a method of controlling a hybrid vehicle by:
    • determining the instantaneous road load (RL);
    • operating at least one electric motor to propel the vehicle when the RL is less than a setpoint (SP);
    • operating an internal combustion engine to propel the vehicle when the RL is between the SP and maximum torque output (MTO);
    • operating both the motor and the engine to propel the vehicle when the torque RL is more than the MTO; and
    • monitoring patterns of vehicle operation over time and varying the SP accordingly.

Multi-Patent Capsule: U.S. Patent No. 8,630,761

  • Patent Identification: U.S. Patent No. 8,630,761, "Hybrid Vehicles," issued January 14, 2014 (Compl. ¶ 16).
  • Technology Synopsis: This patent claims a method for operating a hybrid vehicle where the controller uses monitored operational data to derive a "predicted near-term pattern of operation." The propulsion system (engine and motor) is then controlled in response to this predicted pattern, which comprises at least one "repetitive pattern." This represents a further refinement of the adaptive control strategy, moving from varying a setpoint to controlling operations based on a predictive model of the driver's near-term behavior (’761 Patent, Abstract; claim 2).
  • Asserted Claims: Dependent claim 2, which depends on independent claim 1 (Compl. ¶ 55).
  • Accused Features: The complaint alleges that BMW’s "Proactive Driving Assistant" and "ADAPTIVE" modes infringe by "collecting and analyzing historical information regarding vehicle operation to derive a predicted near-term pattern of operation" and controlling the vehicle in response (Compl. ¶ 57).

III. The Accused Instrumentality

Product Identification

  • The accused products are certain BMW hybrid and plug-in hybrid vehicles, including models from the 3-series, 5-series, 7-series, i8, and Mini Countryman lines (collectively, the "Accused Products") (Compl. ¶¶ 31, 45, 54).

Functionality and Market Context

  • The Accused Products feature a powertrain comprising a combustion engine, a synchronous electric motor, and a high-voltage lithium-ion battery (Compl. ¶¶ 33, 56). The complaint alleges these vehicles employ an "intelligent energy management" system that controls the interaction between the engine and motor based on factors including road load and battery state of charge (Compl. ¶¶ 34, 47). This system enables multiple operating modes, including an all-electric mode for low speeds, an engine-driven mode for higher speeds, a "boost function" that uses both power sources for maximum acceleration, and battery-charging modes (Compl. ¶¶ 33-34). The complaint also highlights "Proactive Driving Assistant" and "ADAPTIVE" modes, which allegedly analyze driving patterns and historical information to manage the powertrain (Compl. ¶¶ 35, 48, 57).

IV. Analysis of Infringement Allegations

’347 Patent Infringement Allegations

The complaint includes a diagram showing the layout of the engine, electric motor, and battery in an accused BMW vehicle, which it uses to illustrate the vehicle's basic infringing structure (Compl. ¶ 33, p. 15).

Claim Element (from Independent Claim 23) Alleged Infringing Functionality Complaint Citation Patent Citation
determining the instantaneous torque RL required to propel said vehicle responsive to an operator command The Accused Products employ an "intelligent energy management" system that determines the power required based on "road load and the state of charge of the battery" to manage how the engine and motor work together. ¶34 col. 12:40-49
employing said at least one electric motor to propel said vehicle when the torque RL required to do so is less than said lower level SP The Accused Products operate in an "electric mode under low and moderate speeds," which allegedly occurs when the road load is below the setpoint (SP). ¶34 col. 36:5-10
employing said engine to propel said vehicle when the torque RL required to do so is between said lower level SP and MTO The Accused Products use the combustion engine "[u]nder greater acceleration and at higher speeds," which allegedly occurs when the road load is between the setpoint (SP) and maximum torque output (MTO). ¶34 col. 36:26-34
employing both said at least one electric motor and said engine to propel said vehicle when the torque RL required to do so is more than MTO The Accused Products utilize a "boost function" that employs both the electric motor and the combustion engine to "maximize[s] the car's dynamic performance," allegedly when road load exceeds MTO. ¶34 col. 36:35-45
and employing said engine to propel said vehicle when the torque RL required to do so is less than said lower level SP and using the torque between RL and SP to drive said at least one electric motor to charge said battery... In "BATTERY SAVE mode," the Accused Products allegedly use the combustion engine to propel the vehicle and use excess torque to charge the battery, even when the road load is below the setpoint. ¶34 col. 36:11-25
  • Identified Points of Contention:
    • Scope Questions: A central question may be how the Accused Products determine the need for torque. Does the "intelligent energy management" system calculate an "instantaneous torque RL" as required by the claim, or does it rely on proxies such as accelerator pedal position and vehicle speed, which the patent specification distinguishes its invention from (’347 Patent, col. 13:1-13)?
    • Technical Questions: The infringement analysis may turn on the definition and function of the "setpoint (SP)." The case will likely require evidence establishing what specific, quantifiable threshold the Accused Products use to engage the engine and whether that threshold functions in the manner described by the claim limitations.

’634 Patent Infringement Allegations

Claim Element (from Independent Claim 33) Alleged Infringing Functionality Complaint Citation Patent Citation
determining instantaneous road load (RL) required to propel the hybrid vehicle responsive to an operator command The Accused Products employ "intelligent energy management" that considers, among other things, "road load" to determine how the engine and motor should work together. ¶47 col. 12:40-49
operating at least one electric motor to propel the hybrid vehicle when the RL required to do so is less than a setpoint (SP) The Accused Products operate in an "electric mode under low and moderate speeds," which allegedly takes place when the road load is less than a setpoint. ¶47 col. 36:5-10
operating an internal combustion engine of the hybrid vehicle to propel the hybrid vehicle when the RL required to do so is between the SP and a maximum torque output (MTO) of the engine The Accused Products employ the combustion engine "[u]nder greater acceleration and at higher speeds," which allegedly takes place when the road load is between the setpoint and MTO. ¶47 col. 36:26-34
and monitoring patterns of vehicle operation over time and varying the SP accordingly. The Accused Products employ "Proactive Driving Assistant" and "ADAPTIVE" modes that allegedly "manage the response of the two drive units" by "collecting and analyzing historical information regarding vehicle operation to monitor patterns of vehicle operation over time to vary the setpoint." ¶48 col. 14:1-12
  • Identified Points of Contention:
    • Technical Questions: The primary dispute regarding the ’634 patent will likely center on the final "monitoring patterns" element. A key question for the court will be whether the "Proactive Driving Assistant" and "ADAPTIVE" modes actually vary the setpoint (SP)—the specific torque threshold for engaging the engine—based on historical patterns, or whether they perform a different kind of optimization (e.g., managing battery depletion over a known navigation route) that does not meet this claim limitation.

V. Key Claim Terms for Construction

  • The Term: "setpoint (SP)" (asserted in claims of both the ’347 and ’634 patents)

    • Context and Importance: This term defines the critical threshold that dictates when the vehicle switches from electric-only propulsion to using its internal combustion engine. The entire control logic of the asserted claims hinges on this value. Practitioners may focus on this term because its construction will determine whether a simple, fixed efficiency threshold infringes, or if the term requires a dynamically adjustable value.
    • Intrinsic Evidence for Interpretation:
      • Evidence for a Broader Interpretation: The specification suggests the SP is a load level at which the engine can be operated efficiently, for example, "at least equal to 30% of the engine's maximum torque output" (’347 Patent, Abstract). This language could support an interpretation where the SP is a pre-determined or calculated value representing an efficient operating load.
      • Evidence for a Narrower Interpretation: The specification, particularly in the context of the invention claimed in the ’634 patent, explicitly teaches that the SP can be varied based on "monitoring patterns of vehicle operation over time" (’634 Patent, Claim 33). This could support an argument that the term requires a value that is not merely fixed but is actively adjusted based on historical data.

  • The Term: "monitoring patterns of vehicle operation over time" (’634 Patent, Claim 33)

    • Context and Importance: This term is the central inventive concept distinguishing the asserted claim of the ’634 patent. The infringement question will depend on whether the accused "Proactive Driving Assistant" performs this specific function.
    • Intrinsic Evidence for Interpretation:
      • Evidence for a Broader Interpretation: The shared patent specification describes this concept as potentially being based on an analysis of "trips repeated daily," but does not strictly limit it to such scenarios, suggesting any use of historical data to adjust the control strategy could fall within the term's scope (’347 Patent, col. 43:60-65).
      • Evidence for a Narrower Interpretation: A defendant may argue that the term requires more than just general adaptiveness to current driving style. The language in the related ’761 patent, which specifies "at least one repetitive pattern," could be used to argue that "patterns" in the ’634 patent implies a similar need to identify and act upon learned, recurring routes or behaviors, not just transient conditions (’761 Patent, Claim 2).

VI. Other Allegations

  • Indirect Infringement: The complaint alleges induced infringement, stating that BMW provides user manuals and other materials that instruct customers on how to operate the Accused Products in a manner that directly infringes the patents (Compl. ¶¶ 41, 50, 59). It also alleges contributory infringement on the basis that the vehicles are especially adapted for use in an infringing manner and are not staple articles of commerce suitable for substantial non-infringing use (Compl. ¶¶ 42, 51, 60).
  • Willful Infringement: Willfulness is alleged based on pre-suit knowledge. The complaint asserts that Paice presented its technology to BMW in the early 2000s; that BMW has monitored Paice's patents and litigation history; and that BMW did not respond to direct requests to negotiate a license in 2019 prior to the suit's filing (Compl. ¶¶ 4, 25, 29-30, 44, 53, 62).

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

  • A core issue will be one of technical implementation: does BMW's "intelligent energy management" system operate based on a calculated "instantaneous road load" (a direct torque requirement), as claimed, or does it primarily rely on proxies such as accelerator position and vehicle speed, which the patent specification identifies as a limitation of the prior art it sought to improve?
  • A second key question will be one of functional scope, particularly for the '634 and '761 patents: do BMW's "Proactive Driving Assistant" and "ADAPTIVE" features perform the specific claimed function of "monitoring patterns of vehicle operation over time" to dynamically vary the engine engagement setpoint (SP), or do they perform a different type of route-based optimization that does not alter this fundamental control threshold?