DCT

2:23-cv-00316

Celerity IP, LLC v. LG Electronics, Inc.

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I. Executive Summary and Procedural Information

  • Parties & Counsel:
  • Case Identification: 2:23-cv-00316, E.D. Tex., 06/30/2023
  • Venue Allegations: Venue is alleged to be proper for the foreign parent, LG Electronics, Inc., as it may be sued in any judicial district. For the domestic subsidiary, LG Electronics U.S.A., Inc., venue is based on its alleged regular and established places of business within the Eastern District of Texas.
  • Core Dispute: Plaintiffs allege that Defendants’ 4G/LTE compliant cellular devices infringe five U.S. patents related to fundamental wireless telecommunication technologies.
  • Technical Context: The patents-in-suit relate to specific functional protocols within the 4G/LTE mobile communication standards, which are foundational to the operation of modern smartphones and wireless devices.
  • Key Procedural History: The complaint alleges that the asserted patents were declared by Plaintiff Innovative Sonic Ltd. to the European Telecommunications Standards Institute (ETSI) as being essential to the 4G/LTE standard. It further alleges that Defendant LG had notice of the patents through its participation in ETSI, its own citation of several of the patents during patent prosecution, and direct pre-suit communications, including letters and claim charts, beginning in August 2018.

Case Timeline

Date Event
2005-04-05 Earliest Priority Date for ’059 Patent
2005-08-15 Plaintiff declares ’059 patent family to ETSI
2007-10-22 Earliest Priority Date for ’558 Patent
2008-06-10 Earliest Priority Date for ’708 Patent
2008-08-27 Earliest Priority Date for ’514 Patent
2008-09-30 Earliest Priority Date for ’756 Patent
2010-02-16 ’059 Patent Issued
2011-07-12 Plaintiff declares ’514, ’558, ’708, and ’756 patent families to ETSI
2012-07-17 ’708 Patent Issued
2014-08-12 ’756 Patent Issued
2015-09-01 ’558 Patent Issued
2018-05-22 ’514 Patent Issued
2018-08-15 Plaintiff sends LG a letter identifying the Asserted Patents
2019-03-20 Plaintiff sends LG claim charts for ’514, ’558, and ’059 patents
2019-05-28 Plaintiff sends LG additional claim charts for ’708 patent family
2020 LG Stylo 6 (Exemplary Accused Product) Launch
2023-06-30 Complaint Filed

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

U.S. Patent No. 9,979,514 - "Method and Apparatus for Handling HARQ Process of Semi-Persistent Scheduling"

Issued May 22, 2018.

The Invention Explained

  • Problem Addressed: The patent describes a potential for "unexpected data combination" in wireless systems using both dynamic scheduling (DS) and semi-persistent scheduling (SPS) (Compl. ¶18; ’514 Patent, col. 2:16-19). The New Data Indicator (NDI) field, used to signal whether a data packet is new or a retransmission, has different meanings for DS and SPS. The patent notes that comparing an NDI from a DS transmission with one from an SPS transmission is "meaningless" and can lead to processing errors (’514 Patent, col. 2:23-30).
  • The Patented Solution: The invention proposes a method to resolve this ambiguity. When a user equipment (UE) configured for SPS receives a second NDI for a specific Hybrid Automatic Repeat Request (HARQ) process, it is instructed to "consider a next transmission to be received... as a first transmission" (’514 Patent, claim 1). This effectively resets the state for that HARQ process, avoiding an invalid comparison with a prior NDI and ensuring data integrity (’514 Patent, Abstract; col. 6:1-8).
  • Technical Importance: This technique provides a clear rule for handling a specific but critical ambiguity in the LTE HARQ protocol, which is important for ensuring the reliability of services like Voice over IP (VoIP) that rely on SPS (’514 Patent, col. 1:35-42).

Key Claims at a Glance

  • The complaint asserts at least independent claim 1 (Compl. ¶51).
  • Essential elements of independent claim 1 include:
    • Configuring a semi-persistent scheduling (SPS) functionality utilizing at least one HARQ process;
    • Receiving a first new data indicator (NDI) addressed to an SPS cell radio network temporary identifier (SPS C-RNTI); and
    • Considering a next transmission as a first transmission when receiving a second NDI addressed to a C-RNTI for the same HARQ process, to avoid incorrect NDI comparison.
  • The complaint does not explicitly reserve the right to assert dependent claims.

U.S. Patent No. 9,124,558 - "Method and Apparatus of Handling Data Decryption for a Packet Data Convergence Protocol Layer in a Wireless Communication System"

Issued September 1, 2015.

The Invention Explained

  • Problem Addressed: During a network handover, a UE resets its security variables (e.g., Hyper Frame Number) to establish a secure connection with the new target base station. However, data packets that were transmitted by the original source base station may still be in transit or buffered and arrive at the UE after this reset. Attempting to decrypt these old packets with the new security keys will fail, leading to data loss or corruption (’558 Patent, col. 2:10-39).
  • The Patented Solution: The patent teaches a method where, upon handover, the UE first uses the security variables corresponding to the original source base station to decipher any outstanding packets received from it. Only "after using the security variables to decipher all the data packets received from the source base station" does the UE reset the variables for communication with the new target station (’558 Patent, claim 1; Abstract).
  • Technical Importance: This procedure ensures that data is not lost or garbled during a cellular handover, which is critical for maintaining a seamless user experience for continuous data streams like media broadcasts (’558 Patent, col. 2:42-45).

Key Claims at a Glance

  • The complaint asserts at least independent claim 1 (Compl. ¶61).
  • Essential elements of independent claim 1 include:
    • Initiating a handover procedure from a source base station to a target base station;
    • Using security variables corresponding to the source base station to decipher packets received from it; and
    • Resetting the security variables only after deciphering all data packets from the source base station.
  • The complaint does not explicitly reserve the right to assert dependent claims.

U.S. Patent No. 8,223,708 - "Method and Apparatus for Handling Scheduling Information Report"

Issued July 17, 2012.

  • Technology Synopsis: This patent addresses a resource allocation conflict in a UE when it needs to send both a Buffer Status Report (BSR) and a Power Headroom Report (PHR) but has insufficient uplink resources for both (Compl. ¶20). The invention resolves this by specifying that the resource allocation priority of the BSR's MAC control element is higher than that of the PHR, ensuring the more critical buffer status information is sent first (’708 Patent, Abstract; col. 5:35-44).
  • Asserted Claims: At least claim 1 (Compl. ¶71).
  • Accused Features: The accused functionality is the implementation of the 4G/LTE standard in LG devices, which allegedly includes prioritizing BSR over PHR as claimed (Compl. ¶¶65, 40-41).

U.S. Patent No. 7,664,059 - "Error Handling in a Wireless Communications System"

Issued February 16, 2010.

  • Technology Synopsis: The patent discloses a method for a transmitter to detect an erroneous sequence number in a status report from a receiver, particularly in the edge case where all previously sent data packets have been successfully acknowledged (Compl. ¶21). The invention provides a specific logical check (VT(A) ≤ SN < VT(S)) to correctly identify that a negatively acknowledged packet in such a scenario must be the result of a protocol error, a situation not properly handled by prior art methods (’059 Patent, Abstract; col. 6:35-44).
  • Asserted Claims: At least claim 1 (Compl. ¶81).
  • Accused Features: The accused functionality is the implementation of error handling for status reports in LG's 4G/LTE-compliant devices (Compl. ¶¶75, 40-41).

U.S. Patent No. 8,804,756 - "Method and Apparatus for Improving Interaction Between Scheduling Request Procedure and Random Access Procedure"

Issued August 12, 2014.

  • Technology Synopsis: This invention addresses potential transmission conflicts that can occur when a UE, after failing to get a response to a Scheduling Request (SR), escalates to a full Random Access (RA) procedure (Compl. ¶22). To prevent the UE's pre-configured transmission resources (e.g., for SPS) from colliding with the resources used for the RA procedure, the patent teaches deactivating all such pre-configured resources before initiating the RA procedure (’756 Patent, Abstract; col. 2:30-41).
  • Asserted Claims: At least claim 1 (Compl. ¶91).
  • Accused Features: The accused functionality is the management of SR and RA procedures in LG's 4G/LTE-compliant devices, which allegedly includes deactivating pre-configured resources as claimed (Compl. ¶¶85, 40-41).

III. The Accused Instrumentality

Product Identification

The complaint identifies the accused instrumentalities as LG's cellular devices that are 4G/LTE compliant, naming the "LG's Stylo 6 smartphone" as an exemplary product (Compl. ¶¶40-41, 49). A list of accused "LG Devices" is referenced as Exhibit 6, though the exhibit itself is not attached to the complaint (Compl. ¶40).

Functionality and Market Context

The core accused functionality is the devices' compliance with the 4G/LTE ETSI standard (Compl. ¶40). The complaint includes a screenshot from an LG specification sheet for the Stylo 6, which lists its network connectivity as "LTE/UMTS/GSM/WCDMA/CDMA" to support the allegation of 4G/LTE compliance (Compl. ¶41). This screenshot from the LG Stylo 6 specifications shows its advertised network compatibility (Compl. ¶41, p. 11). The complaint alleges that Defendants derive substantial revenue from selling these devices within the judicial district (Compl. ¶9).

IV. Analysis of Infringement Allegations

The complaint references exemplary claim charts attached as exhibits but does not include them in the filing (Compl. ¶¶49, 59, 69, 79, 89). The infringement theories are therefore summarized below in prose.

'514 Patent Infringement Allegations

  • The complaint's theory is that infringement is a necessary consequence of compliance with the 4G/LTE standard (Compl. ¶¶40, 45). It alleges that LG's devices, when operating with semi-persistent scheduling, are required by the standard to implement the claimed method of handling HARQ processes. Specifically, to avoid data errors, the devices allegedly must treat a transmission as new upon receiving a second NDI for a C-RNTI, thereby practicing the patented invention (Compl. ¶¶18, 49).

Identified Points of Contention

  • Scope Question: Does the term "considering a next transmission...as a first transmission" require a specific action (e.g., a buffer flush), or can it be satisfied by any logic that achieves the same outcome? The defense may argue for a narrower interpretation tied to specific implementation details not present in their devices.
  • Technical Question: A key evidentiary question will be whether the 4G/LTE standard mandates the exact logic of claim 1, or if it permits alternative, non-infringing methods for handling NDI comparisons in SPS. The analysis will likely focus on whether LG's actual implementation performs the claimed steps.

'558 Patent Infringement Allegations

  • The infringement theory is also based on compliance with the 4G/LTE standard, specifically during network handovers (Compl. ¶¶19, 55). The complaint alleges that to prevent data corruption from out-of-sequence packets, LG's devices must use the security variables from the source base station to decrypt any remaining packets before resetting those variables for the target base station, thereby infringing the claim (Compl. ¶¶55, 59).

Identified Points of Contention

  • Scope Question: The claim requires resetting variables "after" deciphering "all" data packets from the source. A central dispute may be over the meaning of "all." Does this require confirmation that no more packets are pending, or is it a more flexible standard? LG may argue its devices reset based on a different trigger that does not meet this strict temporal sequence.
  • Technical Question: What evidence demonstrates that LG's devices perform this specific two-stage process? The case will likely require examination of the device's PDCP layer source code to determine the precise timing of the security variable reset relative to the decryption of straggler packets.

V. Key Claim Terms for Construction

For the ’514 Patent

  • The Term: "considering a next transmission ... as a first transmission" (from claim 1)
  • Context and Importance: This phrase describes the core functional step of the invention. Its construction will determine the specific behavior an accused device must exhibit to infringe. Practitioners may focus on this term because infringement hinges on whether the device's internal HARQ logic performs an operation that meets this definition.
  • Intrinsic Evidence for Interpretation:
    • Evidence for a Broader Interpretation: The specification describes the problem as avoiding a "meaningless" comparison, suggesting that any logical step that bypasses or resets this comparison to treat the data as new could fall within the claim's scope (’514 Patent, col. 2:23-30).
    • Evidence for a Narrower Interpretation: The flowchart in Figure 4 depicts a distinct step, which could be argued to require a specific, affirmative action rather than a passive outcome (’514 Patent, Fig. 4, step 406). The term "first transmission" has a defined meaning in the HARQ protocol, which could be used to argue for a more limited technical scope.

For the ’558 Patent

  • The Term: "resetting the security variables after using the security variables to decipher all the data packets received from the source base station" (from claim 1)
  • Context and Importance: This temporal clause is critical to the claim, as it defines the sequence of operations. The infringement analysis will turn on whether LG's devices follow this exact timing. Practitioners may focus on this term because it creates a potential point of non-infringement if LG can show its devices reset variables based on a different event.
  • Intrinsic Evidence for Interpretation:
    • Evidence for a Broader Interpretation: A plaintiff might argue that "after...all" should be interpreted functionally, meaning once the process of deciphering the known buffered packets is complete, without requiring a definitive signal that no more packets will ever arrive from the now-disconnected source station.
    • Evidence for a Narrower Interpretation: The plain language "decipher all the data packets" suggests an absolute condition. A defendant could argue this requires waiting for a timeout or other confirmation that the source-packet buffer is empty, and that their devices reset based on a different, more efficient trigger (e.g., successful connection to the target station) that occurs before "all" packets are necessarily deciphered.

VI. Other Allegations

Indirect Infringement

The complaint alleges that LG induced infringement by providing its customers, subsidiaries, and cellular network providers with product manuals, marketing materials, and other technical information that instruct on the use of the accused devices in a manner that practices the patented methods (Compl. ¶¶47, 57, 67, 77, 87).

Willful Infringement

The complaint alleges willful infringement based on extensive pre-suit knowledge. The asserted grounds for knowledge include: (1) LG's membership in ETSI and alleged awareness of Plaintiffs' declarations of the patents as essential to the 4G/LTE standard, dating to as early as 2005 (Compl. ¶¶23-30); (2) LG's own citation of the ’708, ’059, and ’756 patents in information disclosure statements during the prosecution of its own patents (Compl. ¶31); and (3) a series of direct communications, including letters and claim charts, sent to LG beginning in August 2018 (Compl. ¶¶32-39, 50, 60).

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

  • A central issue will be one of inevitable infringement: The complaint's theory rests on the premise that compliance with the 4G/LTE standard compels the use of the patented inventions. A key question for the court will be whether the standards, in fact, mandate the claimed methods, or if they permit alternative, non-infringing implementations that LG could have used in its devices.
  • A second core issue will be one of technical implementation versus claim scope: Beyond the standards, the case will depend on a factual comparison of how LG's devices actually operate. A key evidentiary question will be whether the specific logic in LG's software—for handling HARQ processes, handover decryption, and other functions—maps directly onto the sequence of steps required by the asserted claims, or if there is a functional or temporal divergence that places the products outside the claims' literal scope.
  • Finally, a pivotal question for damages will be one of objective recklessness: Given the multifaceted allegations of pre-suit knowledge, including ETSI declarations, LG's own patent prosecution history, and direct notice with claim charts, can LG demonstrate that it proceeded with a good-faith, reasonable belief that the patents were invalid or not infringed, or did its continued sales constitute willful blindness to Plaintiffs' rights?