Judge Sullivan Holds “Substantially” the Same is Close Enough for Collateral Estoppel
On September 30, 2016, District Judge Richard J. Sullivan (S.D.N.Y.) granted the defendants' motion to dismiss, holding one of the two asserted patents invalid under principles of collateral estoppel.
Plaintiff Joao Control & Monitoring Systems ("Plaintiff") had asserted two patents, U.S. Patent Nos. 7,277,010 ("'010 Patent") and 6,587,046 ("'046 Patent"), against a number of defendants, including the City of Yonkers and American Traffic Solutions (collectively, "Defendants"). While one patent claims the use of a website and the other does not, the Court stated that the two patents were "virtually identical," both being directed to an "invention of a system for monitoring a vehicle or premises using two computers located remotely from the vehicle or premises: one computer that records audio or video from the vehicle or premises, and a second computer that receives audio or video information transmitted by the first computer via the Internet."
In a separate proceeding, the '046 Patent was invalidated under § 101 earlier this year by Judge Pallmeyer of the Northern District of Illinois in Joao Control & Monitoring Systems, LLC v. Telular Corp., F. Supp. 3d , 2016 WL 1161287 (Mar. 23, 2016). As a consequence of this earlier decision, Judge Sullivan held that Plaintiff was collaterally estopped from asserting either patent. Regarding the '046 Patent, the Court held that since the Defendant's motion concerned the "identical question" already decided by the prior Court, i.e., the "patentability of the subject matter of [the '046 patent]," collateral applied with respect to that patent. Regarding the '010 Patent, in a rare application of collateral estoppel to two separate patents, the Court held that since the ’010 Patent "in substance" claims the same subject matter, Plaintiff was also collaterally estopped from asserting that patent.
The Court also held that the two patents were invalid under the Court’s independent analysis under § 101. Applying the two-part test under Alice, the Court held: (1) that the Patents are "directed to the abstract idea of remote surveillance or monitoring for security or control purposes"; and (2) that there was nothing "new and useful" in Plaintiff's claims.
-By Ryan Mott and Lewis Popovski
Case: Joao Control & Monitoring Sys., LLC v. Dig. Playground, Inc., et al. No. 12-cv-6781 (RJS), 2016 BL 330888 (S.D.N.Y. Sept. 30, 2016).