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Judge Stark Denies Motion for Contempt of Permanent Injunction

Judge Stark has denied a motion to hold a defendant in contempt of the Court’s permanent injunction in the long-standing patent battle between ARRIS Group and SeaChange International. See nCube Corp. v. SeaChange Int’l Inc., C.A. No. 01-011-LPS (D. Del. Oct. 12, 2012). A jury had previously found in favor of ARRIS in its infringement case against SeaChange, and the Court entered a permanent injunction in 2006. In 2009, ARRIS filed its motion, alleging that SeaChange’s design-around did not place its interactive television (ITV) product outside the scope of the patent-in-suit or the Court’s permanent injunction. Judge Stark held that the dispute was amenable to a contempt proceeding under the Federal Circuit’s recent decision in TiVo Inc. v. Echostar Corp., 646 F.3d 869 (Fed. Cir. 2011), and held such a hearing to allow the parties to present evidence on the contempt issue.

Under TiVo, a “party seeking to enforce the injunction must prove both that (1) the newly accused product is not more than colorably different from the product found to infringe and (2) that the newly accused product actually infringes.” Tivo, 646 F.3d at 882. ARRIS contended that SeaChange had made only a minor, insignificant change in its design-around. SeaChange countered that ARRIS improperly relied on a previously-unaccused element and that a finding of contempt can only be based on features that were alleged as infringing at trial. Judge Stark came down on the side of SeaChange, explaining that “[u]nder TiVo, the Court must assess whether colorable differences exist between the [accused] functionality . . . of the infringing ITV system and the redesigned . . . functionality that is now implemented . . . [in] the modified ITV system. Having undertaken this analysis, the Court finds that ARRIS has failed to prove, by clear and convincing evidence, that there is no colorable difference between the [accused] functionality in the infringing ITV system and the [accused] functionality in the modified ITV system.” Therefore, Judge Stark concluded, ARRIS had failed to demonstrate the first TiVo prong, and the contempt motion should be denied.

Despite finding that ARRIS had not shown a lack of colorable differences between the original, infringing product and SeaChange’s new, modified product—and therefore that a contempt finding was inappropriate—Judge Stark proceeded to consider whether the modified product infringed the patent-in-suit under the second TiVo prong. He concluded: “Having considered both parties’ arguments and evidence on the issue of infringement, the Court finds that ARRIS has failed to provide clear and convincing evidence that SeaChange’s modified ITV system actually infringes [the asserted claim]. To the contrary, SeaChange—although it does not bear the burden of proof—has come forward with significant evidence of non-infringement.” Accordingly, while he did not find non-infringement, Judge Stark determined that SeaChange had prevailed under the high standard of TiVo and denied ARRIS’s motion for contempt.

nCube Corp. v. SeaChange Int’l Inc., C.A. No. 01-011-LPS (D. Del. Oct. 12, 2012).

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