IN THE UNITED STATES DISTRICT COURT FOR THE DISTRICT OF DELAWARE

IMAGEVISION.NET, INC.,

Plaintiff,

V.

INTERNET PAYMENT EXCHANGE, INC.,

Defendant.

) ) ) ) ) ) ) ) ) ) ______________________________ )

Civil Action No. 12-054-GMS-MPT

ORDER CONSTRUING THE TERMS OF U.S. PATENT NO. 7,567,925

After having considered the submissions of the parties and hearing oral argument on the

matter, IT IS HEREBY ORDERED, ADJUDGED, and DECREED that, as used in the asserted

claims ofU.S. Patent No. 7,567,925 (the "'925 Patent"):

I. The term "computing terminal" is construed to have its plain and ordinary

meaning. 1

1 The plaintiff, Imagevision.Net, Inc. ("Imagevision"), contends that the claimed "computing terminal" must be able to receive payments and proposes the term be construed to mean a "computer-based device capable of receiving patient or customer payments." (D.I. 69, Ex. B at I; D.l. 75 at 4.) The defendant, Internet Payment Exchange, Inc. ("IPX"), argues that this term simply refers to a "computer-based device." (D.I. 69, Ex. Bat 1; D.l. 76 at 2-3.) For the reasons that follow, the court gives this term its plain and ordinary meaning.

The Federal Circuit has instructed that "the specification 'is always highly relevant to the claim construction analysis. Usually, it is dispositive; it is the single best guide to the meaning of a disputed term."' Phillips v. A WH Corp., 415 F.3d 1303, 1315 (Fed. Cir. 2005) (quoting Vitronics Corp. v. Conceptronic Corp., 90 F.3d 1576, 1582 (1996)). lmagevision relies upon a line of decisions including Verizon Servs. Corp v. Vonage Holdings Corp., 503 F.3d 1295, 1308 (Fed. Cir. 2007), for the proposition that, while courts generally should not import limitations from the specification into the claims, specification language describing the features of the invention itself can limit the scope ofthe claimed invention. (D.I. 75 at 4; D.l. 111 at 9-10.) Though the court recognizes that the Federal Circuit has employed such an approach on occasion, see, e.g., Verizon Servs. Corp., 503 FJd at 1308; Honeywell Int'l, Inc. v. /IT Indus., Inc., 452 F.3d 1312, 1318 (Fed. Cir. 2006), the specification statements at issue here do not require that the computing terminal be capable of receiving payments. For example, one relevant portion of the '925 Patent's specification states:

The present invention provides for an integrated point of service transaction management system that enable the collection of fees accrued as a result of services rendered by a service provider at a

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I 2. The court does not construe the term "computerized transaction database

associated with each of the at least one processors for relationally and

electronically tracking, within said database and by the single health care service

provider, remotely from each of the at least one computing terminal" at this time.Z

3. The term "the tracking correlates to an increased collection rate of at least one of

the self-pay payments and the overdue self-pay payments from the at least one

single service location, or across multiple locations. To facilitate the collection of fees, a customer assessable terminal may be located at each point of service at a provider location.

'925 Patent at 4:5-11. This passage makes clear that the "present invention" has the capacity to collect payments and that customer terminals can be used to facilitate that collection process. It does not, however, demonstrate that the invention requires the collection of payments through the claimed computer terminals. In contrast to the patents at issue in the decisions cited by Imagevision, the '925 Patent simply does not equate the invention itself with computer terminal collection. See Verizon Servs. Corp., 503 F.3d at 1308. While the court acknowledges that "there is sometimes a fine line between reading a claim in light of the specification, and reading a limitation into the claim from the specification," Comark Commc'ns, Inc. v. Harris Corp., 156 F.3d 1182, 1186 (Fed. Cir. 1998), Imagevision's reliance on the specification statements at issue here appears to fall into the latter category, see Alloc, Inc. v. fTC, 342 F.3d 1361, 1370 (Fed. Cir. 2003) ("[T]his court looks to whether the specification refers to a limitation only as a part of less than all possible embodiments or whether the specification read as a whole suggests that the very character of the invention requires the limitation be a part of every embodiment.").

Unfortunately, IPX's proposed construction also suffers from several defects. IPX provides no evidence to suggest its definition comports with a specialized meaning of the term "computing terminal" to persons of ordinary skill in the art. It also fails to reconcile its "computer-based device" construction with the plain meaning of the term. In fact, as Imagevision points out, IPX's broad construction-a "computer-based device"-appears to read the word "terminal" out of the claim language entirely and would yield absurd results, encompassing any number of computer-based products. (D.I. 75 at 6-7; D.I. 78 at 1-2.)

Neither party has proposed an adequate construction for the disputed term. The court, however, believes it can simply be given its plain and ordinary meaning. "In some cases, the ordinary meaning of claim language as understood by a person of skill in the art may be readily apparent even to lay judges, and claim construction in such cases involves little more than the application of the widely accepted meaning of commonly understood words." Phillips, 415 F.3d at 1314 (internal citations omitted). No evidence has been submitted to suggest that a person of skill in the art would assign this term a specialized, industry meaning, and the court is confident that jury can understand these two common words. As such, the court sees no need to provide further construction.

2 At the Markman hearing, the court indicated that Imagevision's "no construction" approach was untenable-a lay jury would likely be confused by this lengthy term, and that uncertainty would invite untimely claim construction arguments by the parties. (D.I. Ill at 27.) Since the parties' briefing was dedicated principally to the question of whether construction was needed and not to any substantive interpretative disputes that might exist, the court instructed the parties to confer after the hearing and determine whether any agreement could be reached in light of its decision that some construction was necessary. (Id at 27-29.) The parties submitted a joint letter on July 12, 2013 indicating that they were unable to reach any agreement. (D.I. 113.) The court continues to believe that some construction is required, and thus orders the parties to submit supplemental opening claim construction briefs for this term of no more than three (3) pages by August 9, 2013 and supplemental answering briefs ofno more than three (3) pages by August 19,2013.

2

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customer" is limiting and is construed to mean "the tracking provides for

improved collections over systems that are not computerized, multi-point of

service systems."3

4. The term "registration" is construed to have its plain and ordinary meaning.4

3 IPX suggests that this term need not be construed, arguing that it has no limiting effect due to its inclusion in a "wherein" clause. (D.I. 76 at 6.) Specifically, IPX contends that "[t]he claimed phrase simply expresses the intended result of the operation of the system recited in other parts of the claim. It does not limit the claim to any particular structure." (D.I. 81 at 7.) While IPX does not cite to any cases discussing the limiting effect of a "wherein" clause in a system claim, it does reference several that consider the use of a "whereby" clause in apparatus and process claims. (/d.) One ofthese decisions, Texas Instruments Inc. v. fTC, 988 F.2d 1165 (Fed. Cir. 1993), recites the general rule that "[a] 'whereby' clause that merely states the result of the limitations in the claim adds nothing to the patentability or substance of the claim." 988 F.2d at 1172. IPX also relies on the statement in the Manual of Patent Examining Procedure that "adapted to," "adapted for," "wherein," and "whereby" clauses are "examples of language ... that may raise a question as to the limiting effect of the language in a claim." MPEP § 2.111.04 (8th ed. Rev. 9, Oct. 20 12).

The court rejects IPX's position. In Griffin v. Bertina, 285 F.3d 1029 (Fed. Cir. 2002), the Federal Circuit considered a similar situation in which a party opposed giving a "wherein" clause limiting effect but cited only decisions involving "whereby" clauses. 285 F.3d at 1033-34. While the court initially noted that the words "wherein" and "whereby" are different parts of speech, it set aside that concern to emphasize that the limitation inquiries in the cited "whereby" cases were highly fact-specific. /d. at I 034. It then gave limiting effect to one of the "wherein" clauses at issue, noting that it "express[ed] the inventive discovery" rather than "merely stat[ing] the inherent result of performing the manipulative steps." /d.

The court believes the term at issue here likewise appears in a "wherein" clause that does more than simply describe the natural result of combining the previously recited system elements. Rather, it explains the proper use of the "tracking," which is needed to give full form to the system. This conclusion is bolstered by the fact that this limitation was added during prosecution to overcome prior art. (D.I. 79 at JA000187, JAOOOI95.) As the Federal Circuit has noted, "when [a] 'whereby' clause states a condition that is material to patentability, it cannot be ignored in order to change the substance of the invention." Hoffer v. Microsoft Corp., 405 F.3d 1326, 1330 (Fed. Cir. 2005). Accordingly, the court finds that this term should be given limiting effect and requires construction.

While IPX argues that the intrinsic record fails to provide guidance as to the meaning of this term, the court again must disagree. (D.I. 76 at 7.) The '925 Patent's specification suggests that this term has the meaning proposed by Imagevision. The "Background of the Invention" section, for example, recognizes the need for "a system which allows for the collection of customer ... balances through an integrated credit/debit card point-of­service system," as such a system would "enable service providers ... to gain significant heretofore unrealized revenue." '925 Patent at 2:17-26. Reading this statement in conjunction with the language of Claim I, which requires multiple points-of-service and the use of computing terminals to provide the claimed "tracking," the court believes the disputed term requires that "the tracking provides for improved collections over systems that are not computerized, multi-point of service systems."

4 In claim construction briefing, the parties' dispute as to this term centered on the question of whether "registration" was limited to the initial input of patient or customer information. (D.I. 75 at 10-11; D.I. 76 at 7-9.) At the Markman hearing, Imagevision noted that it would be amenable to leaving this term unconstrued, as it believed the concept of"registration" could be understood by the jury. (D.I. Ill at 36.) IPX, however, resisted this path, arguing that both the specification and industry practice introduce some interpretative confusion. (!d. at 37.) Specifically, IPX noted that claimed system can be used with preexisting systems containing preexisting registration information and suggests that there is some uncertainty as to what constitutes a registration in such circumstances.

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5. The term "batch updated" is construed to mean "updated with multiple pieces of

information at one time. "5

(D.I. 81 at 9; D.l. Ill at 37-38.) While IPX expressed optimism that the parties could reach some agreement following the hearing, (D.I. II at 38-39), their July 12, 2013 letter indicated that these efforts failed (D.I. 113 at 2).

The court continues to believe that no construction is required for this term. As discussed at the Markman hearing, "registration" is a term readily understood by a jury, and IPX fails to submit any evidence of a specialized meaning within the industry. (D.I. Ill at 36-38.) While IPX points to the possibility that the claimed system might be integrated with preexisting systems and preexisting registration information, it fails to explain how such integration would undercut the plain meaning of this term. As Imagevision notes, "importation of existing registration information into the claimed system could be the 'initial input of information."' (D.I. 78 at 6.) "In some cases, the ordinary meaning of claim language as understood by a person of skill in the art may be readily apparent even to lay judges, and claim construction in such cases involves little more than the application of the widely accepted meaning of commonly understood words." Phillips, 415 F.3d at 1314 (internal citations omitted). The court believes this is precisely such a case.

5 IPX contends that "batch updated" should be construed to mean "updated periodically," while Image vision suggests that it means "updated with multiple pieces of information at one time." (D.I. 75 at II; D.l. 76 at 19.) IPX relies on several specification statements. For example, the specification describes Figure 32 as "a block diagram which illustrates the operation of the Daily Interactive Process and Batch Interface Process (Periodic) of the system." '925 Patent at 3:45-47. IPX reads this description as equating batch updating with periodic updating. (D.I. 76 at 19.) IPX also references the following specification passage:

More specifically, with respect to Fig. 7, a series of existing legacy applications, and the system of the present invention, may receive and/or provide accessibility to a plurality of updated flat files, which may be updated in real time, such as through the use of the present invention, and such as at the POS, and/or which may be batch-updated, such as nightly.

'925 Patent at 8:13-18. In IPX's view, "[t]he context ofthis sentence clearly indicates that 'batch updating' means updated periodically." (D.I. 76 at I 0.)

These specification statements, however, are at best ambiguous with respect to the present interpretative dispute. As Imagevision noted during the Markman hearing, the language describing Figure 32 can be read as indicating merely that the updating occurs both in batches and periodically-they might be two different concepts, both of which are present in the system. (D.I. Ill at 45.) Likewise, the above-quoted statement from Column 8 can be read narrowly as teaching that one context in which batch updating might occur is where the updating occurs periodically, such as nightly-an understanding that is wholly consistent with Imagevision's proposed construction. (Id at 44-45.)

Yet, the court also is not entirely convinced by Imagevision 's attacks on IPX' s construction. Imagevision suggests that IPX's defmition would effectively insert duplicative language into Claim 8 by changing it to read "[updated periodically] ... at a predetermined interval." (D.I. 75 at 12.) Of course, "interpretations that render some portion of the claim language superfluous are disfavored," Power Mosfet Techs., LLC v. Siemens AG, 378 F.3d 1396, 1410 (Fed. Cir. 2004), and Imagevision argues that a construction of "batch updated" that incorporates the concept of periodic updating would make the subsequent "predetermined interval" language unnecessary, (D.I. 75 at 12). Imagevision, however, fails to appreciate other roles the "predetermined interval" phrase might play in Claim 8. That claim reads:

The system of claim I, further comprising at least one administrator communicatively connected to each of said at least two terminals via the network, wherein the at least one database is batch updated with data from each of the at least two terminals in real time at a predetermined interval determined by the at least one administrator.

'925 Patent at 16:13-18. Even if the court were to adopt IPX's "updated periodically" construction, the "predetermined interval" language would not be rendered superfluous-it would retain independent meaning at least as the grammatical anchor for the subsequent "determined by at least one administrator" requirement.

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l '

6. The term "users of the system are assigned at least one level of access in the

administrator" is construed to mean "users of the system are assigned at least one

level of information access in the administrator."6

7. The term "patient service" is construed to mean "a service that consists of or

furthers the provision of medical care to a patient."7

Ultimately, the court is guided by the fact that the term "batch" is ordinarily understood as referring to a group or a number of items that may be taken as a group. This meaning is consistent with the word's usage throughout the '925 Patent, see, e.g., '925 Patent at 5:30-31, 11:64, and is confirmed by its dictionary definition, see The American Heritage College Dictionary (3d ed. 2000) ("Camp. Sci. A set of data or jobs to be processed in a single program run."). While neither of the proposed constructions directly conflict with the intrinsic evidence, Imagevision's is more consistent with the specification and enjoys some measure of extrinsic support.

6 Imagevision argues that, while this term requires no construction, it might be construed to mean "users of the system are assigned at least one level of information access in the administrator." (D.I. 75 at 13.) IPX, on the other hand, proposes "users of the system are given the ability to view at least one level of information in the system." Two primary differences exist between these definitions. First, IPX's construction would apparently limit the concept of"access" to the ability to "view" information. Additionally, in detailing where the information access occurs, IPX replaces the phrase "in the administrator" with "in the system."

The court disagrees with IPX on both counts. The specification statements referenced by IPX simply do not limit "access" to "viewing," as IPX's briefing would suggest. See '925 Patent at 4:42-49, 8:34-44. While IPX retreated from this narrow construction during the Markman hearing and indicated that it would be amenable to a construction in which "users of the system are given the ability to view, add, modify, or manipulate at least one level of information in the system," that concession does not fully address the parties' dispute. (D.I. 111 at 52.) Rather, as Imagevision notes, IPX's construction further confuses matters by replacing "one level of access" with "one level of information." (!d at 54.) Additionally, IPX's construction replaces the phrase "in the administrator" with "in the system." However, given the parties' agreed-upon definition of the term "administrator," the court believes this substitution is unnecessary.

7 The parties combine their discussion of this term and the below term "non patient service." Image vision argues that a patient service is "a service that consists of or furthers the provision of medical care to a patient." (D.I. 75 at 14.) IPX would limit such services to those "provided by or at the direction of a physician."

The court adopts Imagevision's proposed construction. It is both consistent with the common understanding of this term and draws some support from the specification, which provides:

Thereby, such swiped card authorization, or past due balance information to be paid by the swiped card, may be associated with payment information from other groups, offices, or departments of the same entity, or within the same facility, such as via the batch updates upon terminal closure for that POS. For example, a patient balance due from an X-ray in a medical center may be added with a balance due from a gift shop and from a cafeteria to generate a total balance due.

'925 Patent at 11:6-14. This passage suggests that an "X-ray in a medical center" represents a "patient service" and that services provided in a gift shop or cafeteria are "non patient services," a distinction that comports with Imagevision's construction.

IPX's construction, on the other hand, would add the requirement that "patient services" be "provided by or at the direction of a physician." (D.I. 76 at 12.) This condition, however, finds no support in the '925 Patent itself, and the extrinsic evidence relied upon by IPX is unavailing for reasons addressed in Imagevision's Answering Brief. (D.I. 78 at 9-10.) While IPX complains that the '925 Patent fails to provide a clear redefinition of the term so as to

5

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I 8. The term "non patient service" is construed to mean "a service that does not

consist of or further the provision of medical care to a patient. "8

Dated: July ?-1, 2013

overcome its ordinary, industry meaning, it offers no real evidence that "patient service" in fact is a term of art or that it has the "ordinary" meaning that IPX ascribes to it. In the absence of such evidence and reading the term in light of the specification, the court believes Imagevision's construction is appropriate.

8 The parties combine their discussion of this term and the above term "patient service." For substantially the same reasons discussed in reference to the above term, the court adopts Imagevision's proposed construction of "non patient service." See supra note 7. The court further notes that IPX's construction of this term-"parking, cafeteria, gift shop, pharmacy, durable medical equipment, and laboratory analysis where no physician service is rendered concurrently with the laboratory analysis"-would fail to capture certain healthcare-related services that also do not fit within its definition of "patient services." As Imagevision points out, "services provided by non­physician personnel, such as nurses or rehabilitation experts ... do not seem to fit under either ofiPX's definitions." (D.I. 75 at 16.) Given the specification's background and summary of the invention, the court agrees with Imagevision that such a construction cannot be correct. (Id)

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