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To read comments to this article, go here
Lodsys - Some Interesting New Defenses Arise
Thursday, September 29 2011 @ 08:00 AM EDT

Several of the defendants in the Lodsys v. adidas action have now filed their answers and counterclaims, including Sam's West, Inc, Vitamin Shoppe, Inc., and CVS Pharmacy Inc. Normally this would not be something in which we would be particularly interested - if you have seen one set of answers and counterclaims to an infringement action, the rest are fairly predictable. But that is not the case in this instance. Some of the affirmative defenses asserted by these parties caught our eye because of what they suggest.

It seems there may be something in the prosecution history of these patents that may be problematic for Lodsys. In particular, take a look at the Third Defense in the Sam's West answer (53 [PDF]), the Fifth Defense in the Vitamin Shoppe answer (56 [PDF]), and the Third Defense in the CVS Pharmacy answer (57 [PDF]):

Sam's West Answer:

Third Defense

35. By reason of proceedings in the United States Patent and Trademark Office, and by reasons of amendments, statements, admissions, omissions, representations, disclaimers and/or disavowals made by the applicants or on their behalf, Plaintiff is estopped from asserting infringement of the ‘908 and ‘078 Patents against Sam’s West.

Fourth Defense

36. Plaintiff’s claims are barred to the extent that Plaintiff has dedicated to the public systems, methods, and products disclosed in the ‘908 and ‘078 Patents but not literally claimed therein.

. . .

Seventh Defense

39. Plaintiff’s claims for equitable relief are barred or limited because Plaintiff has adequate remedies at law because Plaintiff has unclean hands.

. . .

Twelfth Defense

44. Plaintiff’s claims are barred to the extent that Plaintiff has consented to Sam’s West engaging in any acts of accused infringement, and to the extent that Plaintiff has waived the right to enforce the ‘908 and ‘078 Patents.

Thirteenth Defense

45. Plaintiff’s claims are barred to the extent that Plaintiff’s allegations of infringement relate to acts that have at all relevant times been by or for the United States and with the authorization or consent of the United States. Sam’s West is entitled to immunity for such activities under 28 U.S.C. § 1498(a).

Fourteenth Defense

46. Any and all products or actions accused of infringement have substantial uses that do not infringe and do not induce or contribute to the alleged infringement of the claims of the ‘908 and ‘078 Patents.
Vitamin Shoppe Answer:

FIFTH DEFENSE
(Estoppel)

Upon information and belief, by reason of proceedings in the U.S. Patent and Trademark Office during the prosecution of the applications that resulted in the ‘078 and ‘908 patents, as shown by the respective file histories, and by reason of the amendment, cancellation or abandonment of claims, and the admissions and other statements made therein by or on behalf of the patentee(s) for each respective patent, Plaintiff is estopped from claiming a construction of the ‘078 and/or ‘908 patents that would cause any valid, enforceable claim thereof to cover or include any method or product manufactured, used, sold, or offered for sale by Vitamin Shoppe.
CVS Pharmacy Answer:

Third Defense

35. By reason of proceedings in the United States Patent and Trademark Office, and by reasons of amendments, statements, admissions, omissions, representations, disclaimers and/or disavowals made by the applicants or on their behalf, Plaintiff is estopped from asserting infringement of the ‘908 Patent against CVS Pharmacy.

Fourth Defense

36. Plaintiff’s claims are barred to the extent that Plaintiff has dedicated to the public systems, methods, and products disclosed in the ‘908 Patent but not literally claimed therein.

. . .

Twelfth Defense

44. Plaintiff’s claims are barred to the extent that Plaintiff has consented to CVS Pharmacy engaging in any acts of accused infringement, and to the extent that Plaintiff has waived the right to enforce the ‘908 Patent.

Thirteenth Defense

45. Plaintiff’s claims are barred to the extent that Plaintiff’s allegations of infringement relate to acts that have at all relevant times been by or for the United States and with the authorization or consent of the United States. CVS Pharmacy is entitled to immunity for such activities under 28 U.S.C. § 1498(a).
Each of those paragraphs suggest there is something untoward lurking in the prosecution history of the patents that may severely limit Lodsys's claims of infringement.

Even some of the other defenses listed above suggest there are actions Lodsys may have undertaken that will further limit its claims of infringement. Of course, it is entirely possible (if not likely) that these various defenses have been asserted by each of these parties merely as a means to preserve the defense, not because they presently have actual evidence to support the defense. Only time will tell.

***************

Docket Updates

DriveTime v. Lodsys

14 - Filed & Entered: 09/16/2011
Order on Stipulation Docket
Docket Text: TEXT ONLY ORDER: The Court having reviewed the Defendant's [13] Stipulation to Extend Response to Plaintiff's Motion for Leave to Conduct Jurisdictional Discovery and to Stay Response to Motion to Dismiss, ORDERED granting the aforementioned stipulation. FURTHER ORDERED that Defendant's shall have up to and including 10/14/11 to file a response to Plaintiff's [10] Motion for Leave to Conduct Jurisdictional Discovery and to Stay Response to Motion to Dismiss. This is a TEXT ENTRY ONLY. There is no PDF document associated with this entry. (NKS)

-- - Filed & Entered: 09/26/2011
Pro Hac Vice Fee Paid
Docket Text: PRO HAC VICE FEE PAID. $ 50, receipt number PHX114044 as to Christopher M Huck. This is a TEXT ENTRY ONLY. There is no PDF document associated with this entry. (BAS)

-- - Filed & Entered: 09/26/2011
Pro Hac Vice Fee Paid
Docket Text: PRO HAC VICE FEE PAID. $ 50, receipt number PHX114045 as to Michael A Goldfarb. This is a TEXT ENTRY ONLY. There is no PDF document associated with this entry. (BAS)

Terminated: 09/26/2011
Motion for Admission Pro Hac Vice
Docket Text: MOTION for Admission Pro Hac Vice as to attorney Michael A Goldfarb on behalf of Lodsys LLC. (BAS)

16 - Filed & Entered: 09/26/2011
Terminated: 09/26/2011
Motion for Admission Pro Hac Vice
Docket Text: MOTION for Admission Pro Hac Vice as to attorney Christopher M Huck on behalf of Lodsys LLC. (BAS)

17 - Filed & Entered: 09/26/2011
Order on Motion for Admission Pro Hac Vice
Docket Text: ORDER pursuant to General Order 09-08 granting [15] Motion for Admission Pro Hac Vice; granting [16] Motion for Admission Pro Hac Vice. Per the Court's Administrative Policies and Procedures Manual, applicant has five (5) days in which to register as a user of the Electronic Filing System. Registration to be accomplished via the court's website at www.azd.uscourts.gov. (BAS)(This is a TEXT ENTRY ONLY. There is no.pdf document associated with this entry.)


Lodsys v. Combay

62 - Filed & Entered: 09/26/2011
Motion for Extension of Time to File Answer
Docket Text: Unopposed MOTION for Extension of Time to File Answer re [26] Amended Complaint, or Otherwise Respond by Iconfactory, Inc.. (Attachments: # (1) Text of Proposed Order)(Findlay, Eric)

63 - Filed & Entered: 09/26/2011
Summons Returned Executed
Docket Text: E-GOV SEALED SUMMONS Returned Executed by Lodsys, LLC. Atari Interactive, Inc. served on 9/26/2011 by CM RRR through Registered Agent, answer due 10/17/2011. (ehs, )

64 - Filed & Entered: 09/27/2011
Summons Issued
Docket Text: E-GOV SEALED SUMMONS Issued as to Combay, Inc.. (ch, )


Lodsys v. adidas

53 - Filed & Entered: 09/26/2011
Answer to Complaint
Docket Text: Sam's West Inc.'s ANSWER to [1] Complaint,, and, COUNTERCLAIM against Lodsys, LLC by Sam's West, Inc..(Kennerly, Christopher)

54 - Filed & Entered: 09/26/2011
Corporate Disclosure Statement
Docket Text: CORPORATE DISCLOSURE STATEMENT filed by Sam's West, Inc. identifying Corporate Parent Wal-Mart Stores Inc for Sam's West, Inc.. (Kennerly, Christopher)

55 - Filed & Entered: 09/27/2011
Answer to Counterclaim
Docket Text: Lodsys ANSWER to [46] Answer to Complaint, Counterclaim by Lodsys, LLC.(Huck, Christopher)

56 - Filed & Entered: 09/27/2011
Answer to Complaint
Docket Text: Original ANSWER to [1] Complaint,, Affirmative Defenses, COUNTERCLAIM against Lodsys, LLC by Vitamin Shoppe, Inc..(Low, John)

57 - Filed & Entered: 09/27/2011
Answer to Complaint
Docket Text: ANSWER to [1] Complaint,,, COUNTERCLAIM against Lodsys, LLC by CVS Pharmacy Inc. (Attachments: # (1) Exhibit A)(Kennerly, Christopher)

58 - Filed & Entered: 09/27/2011
Corporate Disclosure Statement
Docket Text: CORPORATE DISCLOSURE STATEMENT filed by CVS Pharmacy Inc identifying Corporate Parent CVS Caremark Corporation for CVS Pharmacy Inc. (Kennerly, Christopher)


Lodsys v. DriveTime

25 - Filed & Entered: 09/26/2011
Summons Returned Executed
Docket Text: E-GOV SEALED SUMMONS Returned Executed by Lodsys, LLC. ForeSee Results, Inc. served on 7/14/2011 by CM RRR through Registered Agent, answer due 10/3/2011. (ehs, )

26 - Filed & Entered: 09/27/2011
Unopposed Application for Extension of Time to Answer Complaint
Docket Text: Defendant's Unopposed Third Application for Extension of Time to Answer Complaint re ESET, LLC.( Pisano, Nicola)


ESET v Lodsys (Cal.)

12 - Filed & Entered: 09/27/2011
Motion to Continue
Docket Text: Joint MOTION to Continue Hearing on ESET's Motion For Expedited Discovery by ESET, LLC. (Pisano, Nicola)

13 - Filed & Entered: 09/27/2011
Motion to Continue
Docket Text: Joint MOTION to Continue Hearing on Lodsys's Motion to Dismiss by ESET, LLC. (Pisano, Nicola)


******************

Documents

Lodsys v. adidas - 53

IN THE UNITED STATES DISTRICT COURT
FOR THE EASTERN DISTRICT OF TEXAS
MARSHALL DIVISION

LODSYS, LLC,
Plaintiff,
v.
ADIDAS AMERICA INC.;
BBY SOLUTIONS, INC.;
BEST WESTERN INTERNATIONAL, INC.;
CVS PHARMACY, INC.;
SAM’S WEST, INC.;
STANLEY, BLACK & DECKER, INC.;
THE CONTAINER STORE, INC.;
THE TEACHING COMPANY, LLC;
VEGAS.COM, LLC;
VITAMIN SHOPPE, INC.,
Defendants.

CIVIL ACTION NO. 2:11-cv-283

JURY TRIAL DEMANDED

DEFENDANT SAM’S WEST, INC’S ANSWER AND COUNTERCLAIMS TO
PLAINTIFF’S COMPLAINT FOR PATENT INFRINGEMENT

Defendant Sam’s West, Inc. (“Sam’s West”) files this Answer and Counterclaims to Plaintiff Lodsys, LLC’s (“Plaintiff”) Complaint for Patent Infringement (“Complaint”).

THE PARTIES

1. Sam’s West is without sufficient knowledge or information to admit or deny the allegations contained in Paragraph 1 of the Complaint.

2. Sam’s West is without sufficient knowledge or information to admit or deny the allegations contained in Paragraph 2 of the Complaint.

3. Sam’s West is without sufficient knowledge or information to admit or deny the allegations contained in Paragraph 3 of the Complaint.

4. Sam’s West is without sufficient knowledge or information to admit or deny the

1

allegations contained in Paragraph 4 of the Complaint.

5. Sam’s West is without sufficient knowledge or information to admit or deny the allegations contained in Paragraph 5 of the Complaint.

6. Sam’s West admits that it is an Arkansas company with its principal place of business in Bentonville, Arkansas.

7. Sam’s West is without sufficient knowledge or information to admit or deny the allegations contained in Paragraph 7 of the Complaint.

8. Sam’s West is without sufficient knowledge or information to admit or deny the allegations contained in Paragraph 8 of the Complaint.

9. Sam’s West is without sufficient knowledge or information to admit or deny the allegations contained in Paragraph 9 of the Complaint.

10. Sam’s West is without sufficient knowledge or information to admit or deny the allegations contained in Paragraph 10 of the Complaint.

11. Sam’s West is without sufficient knowledge or information to admit or deny the allegations contained in Paragraph 11 of the Complaint.

JURISDICTION AND VENUE

12. With respect to Paragraph 12 of the Complaint, Sam’s West admits that Plaintiff purports to pursue an action for patent infringement and, accordingly, this action arises under the provisions of the Patent Laws of the United States of America, Title 35, United States Code. Sam’s West admits that the Court has subject-matter jurisdiction over Plaintiff’s claims pursuant to 28 U.S.C. §§ 1331 and 1338(a). Sam’s West admits that it is subject to personal jurisdiction in Texas and admits that venue is proper in the Court pursuant to 28 U.S.C. §§ 1391 and 1400. Sam’s West admits that it conducts business activities within the State of Texas and within this

2

District. Sam’s West denies the remaining allegations in Paragraph 12 as they pertain to Sam’s West. Sam’s West is without sufficient knowledge or information to admit or deny the remaining allegations contained in Paragraph 12 of the Complaint.

13. With respect to Paragraph 13 of the Complaint, Sam’s West admits that it is subject to personal jurisdiction in Texas. Sam’s West admits that it conducts business activities within the State of Texas and within this District which include deriving revenue from products and/or services provided to individuals residing in the State of Texas and this District. Sam’s West denies the remaining allegations in Paragraph 13 as they pertain to Sam’s West. Sam’s West is without sufficient knowledge or information to admit or deny the remaining allegations contained in Paragraph 13 of the Complaint.

INFRINGEMENT OF U.S. PATENT NO. 7,222,078 B2

14. With respect to Paragraph 14 of the Complaint, Sam’s West admits that, on its face, United States Patent No. 7,222,078 (the “‘078 Patent”) identifies that it issued on May 22, 2007, and is entitled “Methods and Systems for Gathering Information From Units of a Commodity Across a Network.” Sam’s West admits that a copy of the ‘078 Patent was attached as Exhibit A to the Complaint. Sam’s West denies that the ‘078 Patent was duly and legally issued. Sam’s West is without sufficient knowledge or information to admit or deny the remaining allegations contained in Paragraph 14 of the Complaint.

15. Sam’s West denies the allegations contained in Paragraph 15 of the Complaint.

16. Sam’s West is without sufficient knowledge or information to admit or deny the allegations contained in Paragraph 16 of the Complaint.

17. Sam’s West is without sufficient knowledge or information to admit or deny the allegations contained in Paragraph 17 of the Complaint.

3

18. Sam’s West denies the allegations in Paragraph 18 as they pertain to Sam’s West. Sam’s West is without sufficient knowledge or information to admit or deny the remaining allegations contained in Paragraph 18 of the Complaint.

INFRINGEMENT OF U.S. PATENT NO. 5,999,908

19. With respect to Paragraph 19 of the Complaint, Sam’s West admits that, on its face, United States Patent No. 5,999,908 (the “‘908 Patent”) identifies that it issued on December 7, 1999, and is entitled “Customer-Based Product Design Module.” Sam’s West admits that a copy of the ‘908 Patent was attached as Exhibit B to the Complaint. Sam’s West is without sufficient knowledge or information to admit or deny the remaining allegations contained in Paragraph 19 of the Complaint.

20. Sam’s West is without sufficient knowledge or information to admit or deny the allegations contained in Paragraph 20 of the Complaint.

21. Sam’s West is without sufficient knowledge or information to admit or deny the allegations contained in Paragraph 21 of the Complaint.

22. Sam’s West is without sufficient knowledge or information to admit or deny the allegations contained in Paragraph 22 of the Complaint.

23. Sam’s West is without sufficient knowledge or information to admit or deny the allegations contained in Paragraph 23 of the Complaint.

24. Sam’s West denies the allegations contained in Paragraph 24 of the Complaint.

25. Sam’s West is without sufficient knowledge or information to admit or deny the allegations contained in Paragraph 25 of the Complaint.

26. Sam’s West is without sufficient knowledge or information to admit or deny the allegations contained in Paragraph 26 of the Complaint.

4

27. Sam’s West is without sufficient knowledge or information to admit or deny the allegations contained in Paragraph 27 of the Complaint.

28. Sam’s West is without sufficient knowledge or information to admit or deny the allegations contained in Paragraph 28 of the Complaint.

29. Sam’s West is without sufficient knowledge or information to admit or deny the allegations contained in Paragraph 29 of the Complaint.

30. Sam’s West denies the allegations in Paragraph 30 as they pertain to Sam’s West. Sam’s West is without sufficient knowledge or information to admit or deny the remaining allegations contained in Paragraph 30 of the Complaint.

JURY DEMAND

31. Sam’s West admits that Plaintiff has requested a trial by jury.

PRAYER FOR RELIEF

32. Sam’s West denies any and all allegations contained in the Prayer for Relief of the Complaint as they pertain to Sam’s West and denies that Plaintiff is entitled to any of the relief requested in Paragraphs (a) through (f) of Plaintiff’s Prayer for Relief or to any relief in any form whatsoever from Sam’s West. Sam’s West further denies each and every allegation in the Complaint to which it has not specifically responded.

AFFIRMATIVE AND OTHER DEFENSES

First Defense

33. Sam’s West has not willfully or otherwise infringed, contributed to the infringement of, or actively induced others to infringe any valid and enforceable claim of the ‘908 or ‘078 Patents, either directly or indirectly, either literally or under the doctrine of equivalents. Sam’s West also does not willfully or otherwise infringe, contribute to the

5

infringement of, or actively induce others to infringe any valid and enforceable claim of the ‘908 or ‘078 Patents, either directly or indirectly, either literally or under the doctrine of equivalents.

Second Defense

34. The claims of the ‘908 and ‘078 Patents are invalid for failure to comply with the requirements of Title 35 of the United States Code, including, without limitation, 35 U.S.C. §§ 101, 102, 103 and/or 112.

Third Defense

35. By reason of proceedings in the United States Patent and Trademark Office, and by reasons of amendments, statements, admissions, omissions, representations, disclaimers and/or disavowals made by the applicants or on their behalf, Plaintiff is estopped from asserting infringement of the ‘908 and ‘078 Patents against Sam’s West.

Fourth Defense

36. Plaintiff’s claims are barred to the extent that Plaintiff has dedicated to the public systems, methods, and products disclosed in the ‘908 and ‘078 Patents but not literally claimed therein.

Fifth Defense

37. Plaintiff is prohibited from recovering damages for activities alleged to have occurred before Plaintiff complies with 35 U.S.C. § 287.

Sixth Defense

38. Plaintiff is prohibited from recovering damages for activities alleged to have occurred before Plaintiff provides actual notice of activities alleged to infringe.

Seventh Defense

39. Plaintiff’s claims for equitable relief are barred or limited because Plaintiff has

6

adequate remedies at law because Plaintiff has unclean hands.

Eighth Defense

40. Plaintiff’s claims for injunctive relief are barred because Plaintiff has failed to meet the requirements for injunctive relief.

Ninth Defense

41. Sam’s West has not engaged in any conduct that entitles Plaintiff to attorneys’ fees or costs.

Tenth Defense

42. To the extent that Plaintiff asserts claims and/or requests damages for alleged infringement occurring more than six years before the filling of this action, such claims and relief are barred by the applicable statute of limitations, 35 U.S.C. § 286.

Eleventh Defense

43. Plaintiff’s claims are barred, in whole or in part, by the doctrine of laches.

Twelfth Defense

44. Plaintiff’s claims are barred to the extent that Plaintiff has consented to Sam’s West engaging in any acts of accused infringement, and to the extent that Plaintiff has waived the right to enforce the ‘908 and ‘078 Patents.

Thirteenth Defense

45. Plaintiff’s claims are barred to the extent that Plaintiff’s allegations of infringement relate to acts that have at all relevant times been by or for the United States and with the authorization or consent of the United States. Sam’s West is entitled to immunity for such activities under 28 U.S.C. § 1498(a).

7

Fourteenth Defense

46. Any and all products or actions accused of infringement have substantial uses that do not infringe and do not induce or contribute to the alleged infringement of the claims of the ‘908 and ‘078 Patents.

COUNTERCLAIMS

47. Counter-Plaintiff Sam’s West is an Arkansas company with its principal place of business located at 702 SW 8th St. M/S 0215, Bentonville, Arkansas 72716-0215.

48. Based on information and belief, Plaintiff Lodsys is a Texas limited liability company with its principal place of business in Marshall, Texas.

49. Plaintiff claims to be the owner of U.S. Patent Nos. 5,999,908 (“the ‘908 Patent”) and 7,222,078 (“the ‘078 Patent”) (collectively, the “Lodsys Patents”).

50. This is an action for a declaration that each and every claim of the Lodsys Patents is invalid, unenforceable and not infringed pursuant to the Patent Laws of the United States, 35 U.S.C. § 101, et seq. Accordingly, subject matter jurisdiction of this Court exists under the Federal Declaratory Judgment Act, Title 28, United States Code §§ 2201 and 2202, and under Title 28, United States Code §§ 1331 and 1338(a).

51. An actual, substantial and continuing justiciable controversy exists between Counter-Plaintiff Sam’s West and Counter-Defendant Lodsys with respect to which Counter- Plaintiff Sam’s West requires a declaration of its rights by this Court. Specifically, the controversy relates to the invalidity, unenforceability and non-infringement of the Lodsys Patents and to Counter-Defendant Lodsys’s right to threaten and/or maintain a suit against Counter- Plaintiff Sam’s West and/or its customers for alleged infringement of the Lodsys Patents. Lodsys has chosen this venue to enforce its patents. Venue is proper in this Court and judicial

8

district for counterclaims, pursuant to 28 U.S.C. §§ 1391 and 1400(b).

52. Defendant Sam’s West brings the following counterclaims against Plaintiff Lodsys:

DECLARATORY JUDGMENT OF NON-INFRINGEMENT OF THE ‘908 PATENT

53. Sam’s West realleges and incorporates by reference the allegations of Paragraphs 47-52 as though fully set forth herein.

54. This is an action for declaratory judgment of non-infringement of any and all valid and enforceable claims of the ‘908 Patent.

55. Counter-Defendant Lodsys alleges that Counter-Plaintiff Sam’s West has and is infringing directly and/or by inducing or contributing to the infringement of one or more claims of the ‘908 Patent, that such alleged infringement has thereby damaged Counter-Defendant Lodsys and, unless enjoined, will continue to damage Counter-Defendant Lodsys.

56. Counter-Plaintiff Sam’s West has not willfully or otherwise infringed, contributed to the infringement of, or induced others to infringe, and does not willfully or otherwise infringe, contribute to the infringement of, or induce others to infringe, any valid and enforceable claim of the ‘908 Patent, either directly or indirectly, either literally or under the doctrine of equivalents.

57. There is an actual controversy, within the meaning of 28 U.S.C. §§ 2201 and 2202, between Counter-Plaintiff Sam’s West and Counter-Defendant Lodsys as to whether Counter-Plaintiff Sam’s West has infringed or infringes any valid and enforceable claim of the ‘908 Patent.

58. Counter-Plaintiff Sam’s West requests a judicial determination and declaration of the respective rights and duties of the parties on the disputes recited in Paragraphs 53-57 above. Such a determination and declaration are necessary and appropriate at this time so that the parties

9

may ascertain their respective rights and duties in this regard.

DECLARATORY JUDGMENT OF INVALIDITY OF THE ‘908 PATENT

59. Counter-Plaintiff Sam’s West realleges and incorporates by reference the allegations of Paragraphs 47-58 as though fully set forth herein.

60. This is an action for declaratory judgment of invalidity of any and all claims of the ‘908 Patent.

61. The ‘908 Patent, and each claim thereof, is invalid for failure to comply with one or more of the requirements of Title 35, United States Code, including but not limited to 35 U.S.C. §§ 101, 102, 103 and/or 112.

62. There is an actual controversy, within the meaning of 28 U.S.C. §§ 2201 and 2202, between Counter-Plaintiff Sam’s West and Counter-Defendant Lodsys as to whether there exists any valid claim of the ‘908 Patent.

63. Counter-Plaintiff Sam’s West requests a judicial determination and declaration of the respective rights and duties of the parties on the disputes recited in Paragraphs 59-62 above. Such a determination and declaration are necessary and appropriate at this time so that the parties may ascertain their respective rights and duties in this regard.

DECLARATORY JUDGMENT OF NON-INFRINGEMENT OF THE ‘078 PATENT

64. Sam’s West realleges and incorporates by reference the allegations of Paragraphs 47-63 as though fully set forth herein.

65. This is an action for declaratory judgment of non-infringement of any and all valid and enforceable claims of the ‘078 Patent.

66. Counter-Defendant Lodsys alleges that Counter-Plaintiff Sam’s West has and is infringing directly and/or by inducing or contributing to the infringement of one or more claims

10

of the ‘078 Patent, that such alleged infringement has thereby damaged Counter-Defendant Lodsys and, unless enjoined, will continue to damage Counter-Defendant Lodsys.

67. Counter-Plaintiff Sam’s West has not willfully or otherwise infringed, contributed to the infringement of, or induced others to infringe, and does not willfully or otherwise infringe, contribute to the infringement of, or induce others to infringe, any valid and enforceable claim of the ‘078 Patent, either directly or indirectly, either literally or under the doctrine of equivalents.

68. There is an actual controversy, within the meaning of 28 U.S.C. §§ 2201 and 2202, between Counter-Plaintiff Sam’s West and Counter-Defendant Lodsys as to whether Counter-Plaintiff Sam’s West has infringed or infringes any valid and enforceable claim of the ‘078 Patent.

69. Counter-Plaintiff Sam’s West requests a judicial determination and declaration of the respective rights and duties of the parties on the disputes recited in Paragraphs 64-68 above. Such a determination and declaration are necessary and appropriate at this time so that the parties may ascertain their respective rights and duties in this regard.

DECLARATORY JUDGMENT OF INVALIDITY OF THE ‘078 PATENT

70. Counter-Plaintiff Sam’s West realleges and incorporates by reference the allegations of Paragraphs 47-69 as though fully set forth herein.

71. This is an action for declaratory judgment of invalidity of any and all claims of the ‘078 Patent.

72. The ‘078 Patent, and each claim thereof, is invalid for failure to comply with one or more of the requirements of Title 35, United States Code, including but not limited to 35 U.S.C. §§ 101, 102, 103 and/or 112.

73. There is an actual controversy, within the meaning of 28 U.S.C. §§ 2201 and

11

2202, between Counter-Plaintiff Sam’s West and Counter-Defendant Lodsys as to whether there exists any valid claim of the ‘078 Patent.

74. Counter-Plaintiff Sam’s West requests a judicial determination and declaration of the respective rights and duties of the parties on the disputes recited in Paragraphs 70-73 above. Such a determination and declaration are necessary and appropriate at this time so that the parties may ascertain their respective rights and duties in this regard.

PRAYER FOR RELIEF

Sam’s West prays for judgment as follows:

A. That this Court fully and finally dismiss Plaintiff’s claims against Sam’s West and order that Plaintiff take nothing from Sam’s West;

B. That this Court find that Sam’s West has not infringed, in any manner, any claim of the ‘908 or ‘078 Patents;

C. That this Court find that the ‘908 and ‘078 Patents are invalid and/or unenforceable pursuant to Title 35 of the United States Code;

D. That this Court issue a declaration that the claims of the ‘908 and ‘078 Patents are invalid, unenforceable, and/or not infringed;

E. That this Court award Sam’s West all of its costs of this action;

F. That this Court find that this is an exceptional case and award Sam’s West its attorneys’ fees pursuant to 35 U.S.C. § 285 or otherwise; and

G. That this Court grant Sam’s West such other and further relief as the Court may deem just and proper.

12

Dated: September 26, 2011

Respectfully submitted,

/s/ Christopher W. Kennerly
Christopher W. Kennerly (SBN: 00795077)
[email]
BAKER BOTTS L.L.P.
[address telephone fax]
ATTORNEYS FOR DEFENDANT
SAM’S WEST, INC.

13

CERTIFICATE OF SERVICE

I certify that on September 26, 2011 all counsel of record were served with a copy of this document via the Court’s CM/ECF system per Local Rule CV-5(a)(3).

/s/ Christopher W. Kennerly
Christopher W. Kennerly

14


Lodsys v. adidas - 56

IN THE UNITED STATES DISTRICT COURT
FOR THE EASTERN DISTRICT OF TEXAS
MARSHALL DIVISION

LODSYS, LLC,
Plaintiff,
v.
ADIDAS AMERICA, INC., et al.
Defendants.

CIVIL ACTION NO. 2:11-cv-283

JURY TRIAL DEMANDED

DEFENDANT VITAMIN SHOPPE, INC.’S ANSWER, AFFIRMATIVE
DEFENSES, AND COUNTERCLAIMS TO PLAINTIFF’S COMPLAINT

Defendant Vitamin Shoppe, Inc. (“Vitamin Shoppe”) answers the Complaint of Lodsys, LLC (“Lodsys” or “Plaintiff”) as follows:

THE PARTIES

1. Vitamin Shoppe is without knowledge or information sufficient to form a belief as to the truth of the allegations of paragraph 1 and therefore denies them.

2. The allegations of paragraph 2 are not directed to Vitamin Shoppe, and therefore no answer is required. Vitamin Shoppe is without knowledge or information sufficient to form a belief as to the truth of these allegations and therefore denies them.

3. The allegations of paragraph 3 are not directed to Vitamin Shoppe, and therefore no answer is required. Vitamin Shoppe is without knowledge or information sufficient to form a belief as to the truth of these allegations and therefore denies them.

4. The allegations of paragraph 4 are not directed to Vitamin Shoppe, and therefore no answer is required. Vitamin Shoppe is without knowledge or information sufficient to form a belief as to the truth of these allegations and therefore denies them.

5. The allegations of paragraph 5 are not directed to Vitamin Shoppe, and therefore no answer is required. Vitamin Shoppe is without knowledge or information sufficient to form a belief as to the truth of these allegations and therefore denies them.

6. The allegations of paragraph 6 are not directed to Vitamin Shoppe, and therefore no answer is required. Vitamin Shoppe is without knowledge or information sufficient to form a belief as to the truth of these allegations and therefore denies them.

7. The allegations of paragraph 7 are not directed to Vitamin Shoppe, and therefore no answer is required. Vitamin Shoppe is without knowledge or information sufficient to form a belief as to the truth of these allegations and therefore denies them.

8. The allegations of paragraph 8 are not directed to Vitamin Shoppe, and therefore no answer is required. Vitamin Shoppe is without knowledge or information sufficient to form a belief as to the truth of these allegations and therefore denies them.

9. The allegations of paragraph 9 are not directed to Vitamin Shoppe, and therefore no answer is required. Vitamin Shoppe is without knowledge or information sufficient to form a belief as to the truth of these allegations and therefore denies them.

10. The allegations of paragraph 10 are not directed to Vitamin Shoppe, and therefore no answer is required. Vitamin Shoppe is without knowledge or information sufficient to form a belief as to the truth of these allegations and therefore denies them.

11. Vitamin Shoppe admits that it is a Delaware corporation with its principal place of business in North Bergen, New Jersey.

2

JURISDICTION AND VENUE

12. Vitamin Shoppe admits that this action purports to bring an action arising under the patent laws of the United States, 35 U.S.C. §§ 1 et seq. Vitamin Shoppe also admits that this Court has subject matter jurisdiction pursuant to 28 U.S.C. §§ 1331 and 1338(a). Vitamin Shoppe denies the remaining allegations of this paragraph as they relate to Vitamin Shoppe. As to the other defendants, Vitamin Shoppe is without knowledge or information sufficient to form a belief as to the truth of these allegations and therefore denies them.

13. Vitamin Shoppe admits that it is subject to this Court’s general and specific jurisdiction. Vitamin Shoppe denies the remaining allegations of this paragraph as they relate to Vitamin Shoppe. As to the other defendants, Vitamin Shoppe is without knowledge or information sufficient to form a belief as to the truth of these allegations and therefore denies them.

INFRINGEMENT OF U.S. PATENT NO. 7,222,078 B2

14. Vitamin Shoppe admits that the face of U.S. Patent No. 7,222,078 (the “‘078 patent”) indicates that it is entitled “Methods and Systems for Gathering Information from Units of a Commodity Across a Network” and that it issued on May 22, 2007. Vitamin Shoppe denies that the ‘078 patent was duly and legally issued. Vitamin Shoppe is without knowledge or information sufficient to form a belief as to the truth of the remaining allegations of this paragraph, and therefore denies them.

15. The allegations of paragraph 15 are not directed to Vitamin Shoppe, and therefore no answer is required. Vitamin Shoppe is without knowledge or information sufficient to form a belief as to the truth of these allegations and therefore denies them.

3

16. The allegations of paragraph 16 are not directed to Vitamin Shoppe, and therefore no answer is required. Vitamin Shoppe is without knowledge or information sufficient to form a belief as to the truth of these allegations and therefore denies them.

17. Vitamin Shoppe denies the allegations of paragraph 17.

18. Vitamin Shoppe denies the allegations of paragraph 18, as they relate to Vitamin Shoppe. As to the other defendants, Vitamin Shoppe is without knowledge or information sufficient to form a belief as to the truth of these allegations and therefore denies them.

INFRINGEMENT OF U.S. PATENT NO. 5,999,908

19. Vitamin Shoppe admits that the face of U.S. Patent No. 5,999,908 (the “‘908 patent”) indicates that it is entitled “Customer-Based Product Design Module” and that it issued on December 7, 1999. Vitamin Shoppe denies that the ‘908 patent was duly and legally issued. Vitamin Shoppe is without knowledge or information sufficient to form a belief as to the truth of the remaining allegations of this paragraph, and therefore denies them.

20. The allegations of paragraph 20 are not directed to Vitamin Shoppe, and therefore no answer is required. Vitamin Shoppe is without knowledge or information sufficient to form a belief as to the truth of these allegations and therefore denies them.

21. The allegations of paragraph 21 are not directed to Vitamin Shoppe, and therefore no answer is required. Vitamin Shoppe is without knowledge or information sufficient to form a belief as to the truth of these allegations and therefore denies them.

22. The allegations of paragraph 22 are not directed to Vitamin Shoppe, and therefore no answer is required. Vitamin Shoppe is without knowledge or information sufficient to form a belief as to the truth of these allegations and therefore denies them.

4

23. The allegations of paragraph 23 are not directed to Vitamin Shoppe, and therefore no answer is required. Vitamin Shoppe is without knowledge or information sufficient to form a belief as to the truth of these allegations and therefore denies them.

24. The allegations of paragraph 24 are not directed to Vitamin Shoppe, and therefore no answer is required. Vitamin Shoppe is without knowledge or information sufficient to form a belief as to the truth of these allegations and therefore denies them.

25. The allegations of paragraph 25 are not directed to Vitamin Shoppe, and therefore no answer is required. Vitamin Shoppe is without knowledge or information sufficient to form a belief as to the truth of these allegations and therefore denies them.

26. The allegations of paragraph 26 are not directed to Vitamin Shoppe, and therefore no answer is required. Vitamin Shoppe is without knowledge or information sufficient to form a belief as to the truth of these allegations and therefore denies them.

27. The allegations of paragraph 27 are not directed to Vitamin Shoppe, and therefore no answer is required. Vitamin Shoppe is without knowledge or information sufficient to form a belief as to the truth of these allegations and therefore denies them.

28. The allegations of paragraph 28 are not directed to Vitamin Shoppe, and therefore no answer is required. Vitamin Shoppe is without knowledge or information sufficient to form a belief as to the truth of these allegations and therefore denies them.

29. Vitamin Shoppe denies the allegations of paragraph 29.

30. Vitamin Shoppe denies the allegations of paragraph 30, as they relate to Vitamin Shoppe. As to the other defendants, Vitamin Shoppe is without knowledge or information sufficient to form a belief as to the truth of these allegations and therefore denies them.

5

JURY DEMAND

This paragraph sets forth Plaintiff's request for a jury trial to which no response is required. Vitamin Shoppe also requests a trial by jury on all issues so triable.

PRAYER FOR RELIEF

These paragraphs set forth the statement of relief requested by Plaintiff to which no response is required. To the extent an answer is required, Vitamin Shoppe denies that Plaintiff is entitled to any of the requested relief and denies any such allegations.

AFFIRMATIVE DEFENSES

Vitamin Shoppe’s Affirmative Defenses are below. Vitamin Shoppe reserves the right to amend its Answer to add additional Affirmative Defenses, including instances of inequitable conduct, consistent with the facts discovered in this case.

FIRST DEFENSE
(No Infringement)

Vitamin Shoppe has not and does not infringe, directly, indirectly, literally, under the doctrine of equivalents, contributory, by inducement, or otherwise, any valid and enforceable claim of the ‘078 and/or ‘908 patents and is not liable for any acts of infringement of any such claim of the ‘078 and/or ‘908 patents.

SECOND DEFENSE
(Patent Invalidity)

The claims of the ‘078 and ‘908 patents, respectively, are invalid under one or more sections of Title 35 of the U.S. Code, including, without limitation, one or more of 35 U.S.C. §§ 101, 102, 103 and/or 112.

6

THIRD DEFENSE
(Failure to State a Claim)

Upon information and belief, the Complaint, and each purported claim alleged therein, fails to state facts upon which relief can be granted against Vitamin Shoppe.

FOURTH DEFENSE
(No Willful Infringement)

Should Vitamin Shoppe be found to infringe the ‘078 and/or ‘908 patent(s), such infringement was not willful.

FIFTH DEFENSE
(Estoppel)

Upon information and belief, by reason of proceedings in the U.S. Patent and Trademark Office during the prosecution of the applications that resulted in the ‘078 and ‘908 patents, as shown by the respective file histories, and by reason of the amendment, cancellation or abandonment of claims, and the admissions and other statements made therein by or on behalf of the patentee(s) for each respective patent, Plaintiff is estopped from claiming a construction of the ‘078 and/or ‘908 patents that would cause any valid, enforceable claim thereof to cover or include any method or product manufactured, used, sold, or offered for sale by Vitamin Shoppe.

COUNTERCLAIMS

Counterclaim-Plaintiff Vitamin Shoppe, Inc. (“Vitamin Shoppe”), for its Counterclaims against Counterclaim-Defendant Lodsys, LLC (“Lodsys”) and upon information and belief, states as follows:

THE PARTIES

31. Vitamin Shoppe, Inc. is a corporation with a place of business at 2101 91st St., North Bergen, New Jersey.

7

32. According to paragraph 1 of its Complaint, “Lodsys is a Texas limited liability company with its principal place of business in Marshall, Texas.”

JURISDICTION AND VENUE

33. This Court has jurisdiction over the subject matter of these Counterclaims under, without limitation, 28 U.S.C. §§ 1331, 1338, 2201, and 2202, and venue for these Counterclaims is proper in this district under at least 28 U.S.C. § 1391.

34. This Court has personal jurisdiction over Lodsys because Lodsys has submitted itself to the personal jurisdiction of this Court by commencing this action.

COUNT ONE
(Declaratory Judgment of Non-Infringement of the ‘908 Patent)

35. An actual case or controversy exists between Vitamin Shoppe and Lodsys as to whether United States Patent No. 5,999,908 (“the ‘908 patent”) is not infringed by Vitamin Shoppe.

36. A judicial declaration is necessary and appropriate so that Vitamin Shoppe may ascertain its rights regarding the ‘908 patent.

37. Vitamin Shoppe has not and does not infringe, directly, indirectly, literally, under the doctrine of equivalents, contributory, by inducement, or otherwise, any valid and enforceable claim of the ‘908 patent and is not liable for any acts of infringement of any such claim of the ‘908 patent.

COUNT TWO
(Declaratory Judgment of Non-Infringement of the ‘078 Patent)

38. An actual case or controversy exists between Vitamin Shoppe and Lodsys as to whether United States Patent No. 7,222,078 (the “‘078 patent”) is not infringed by Vitamin Shoppe.

8

39. A judicial declaration is necessary and appropriate so that Vitamin Shoppe may ascertain its rights regarding the ‘078 patent.

40. Vitamin Shoppe has not and does not infringe, directly, indirectly, literally, under the doctrine of equivalents, contributory, by inducement, or otherwise, any valid and enforceable claim of the ‘078 patent and is not liable for any acts of infringement of any such claim of the ‘078 patent.

COUNT THREE
(Declaratory Judgment of Invalidity of the ‘908 Patent)

41. Vitamin Shoppe restates and incorporates by reference its allegations in the previous paragraphs in these Counterclaims.

42. An actual case or controversy exists between Vitamin Shoppe and Lodsys as to whether the claims of the ‘908 patent are invalid.

43. A judicial declaration is necessary and appropriate so that Vitamin Shoppe may ascertain its rights as to whether the claims of the ‘908 patent are invalid.

44. The claims of the ‘908 patent are invalid for failure to meet the conditions of patentability and/or otherwise comply with one or more sections of Title 35 of the U.S. Code, including, without limitation, 35 U.S.C. §§ 101, 102, 103 and/or 112.

COUNT FOUR
(Declaratory Judgment of Invalidity of the ‘078 Patent)

45. Vitamin Shoppe restates and incorporates by reference its allegations in the previous paragraphs in these Counterclaims.

46. An actual case or controversy exists between Vitamin Shoppe and Lodsys as to whether the claims of the ‘078 patent are invalid.

47. A judicial declaration is necessary and appropriate so that Vitamin Shoppe may ascertain its rights as to whether the claims of the ‘078 patent are invalid.

9

48. The claims of the ‘078 patent are invalid for failure to meet the conditions of patentability and/or otherwise comply with one or more sections of Title 35 of the U.S. Code, including, without limitation, 35 U.S.C. §§ 101, 102, 103 and/or 112.

PRAYER FOR RELIEF

WHEREFORE, Vitamin Shoppe, Inc. prays for judgment as follows:

a. A judgment dismissing with prejudice Lodsys’ Complaint against Vitamin Shoppe, Inc. and ordering that Lodsys take nothing by its Complaint;

b. A judgment in favor of Vitamin Shoppe, Inc. on all of its Counterclaims;

c. A declaration that Vitamin Shoppe, Inc. has not and does not infringe, directly, indirectly, literally, under the doctrine of equivalents, contributory, by inducement, or otherwise, any valid and enforceable claim of the ‘908 patent and is not liable for any acts of infringement of any such claim of the ‘908 patent;

d. A declaration that Vitamin Shoppe, Inc. has not and does not infringe, directly, indirectly, literally, under the doctrine of equivalents, contributory, by inducement, or otherwise, any valid and enforceable claim of the ‘078 patent and is not liable for any acts of infringement of any such claim of the ‘078 patent;

e. A declaration that the claims of the ‘908 patent are invalid;

f. A declaration that the claims of the ‘078 patent are invalid;

g. An award of costs to Vitamin Shoppe, Inc. pursuant to 35 U.S.C. § 284;

h. A finding that this is an exceptional case pursuant to 35 U.S.C. § 285 and an award to Vitamin Shoppe, Inc. of its reasonable attorney fees; and

i. Such other and further relief as this Court deems just and proper.

10

Dated: September 27, 2011 Respectfully submitted,

/s/ John C. Low
MCDERMOTT WILL & EMERY LLP
Michael E. Shanahan, Lead Counsel
[address telephone fax email]

John C. Low
(Texas Bar No. 24050960)
MCDERMOTT WILL & EMERY LLP
[address telephone fax email]

J. Thad Heartfield
(Texas Bar No. 09346800)
M. Dru Montgomery
(Texas Bar No. 24010800)
THE HEARTFIELD LAWFIRM
[address telephone fax email]

ATTORNEYS FOR DEFENDANT,
VITAMIN SHOPPE, INC.

CERTIFICATE OF SERVICE

The undersigned hereby certifies that all counsel of record who are deemed to have consented to electronic service are being served with a copy of the foregoing document via the Court's CM/ECF system per Local Rule CV-5(a)(3) on September 27, 2011. Any other counsel of records will be served by U.S. mail on the same date.

/s/ John C. Low
John Cannon Low

11


Lodsys v. adidas - 57

IN THE UNITED STATES DISTRICT COURT
FOR THE EASTERN DISTRICT OF TEXAS
MARSHALL DIVISION

LODSYS, LLC,
Plaintiff,
v.
ADIDAS AMERICA INC.;
BBY SOLUTIONS, INC.;
BEST WESTERN INTERNATIONAL, INC.;
CVS PHARMACY, INC.;
SAM’S WEST, INC.;
STANLEY, BLACK & DECKER, INC.;
THE CONTAINER STORE, INC.;
THE TEACHING COMPANY, LLC;
VEGAS.COM, LLC;
VITAMIN SHOPPE, INC.,
Defendants.

CIVIL ACTION NO. 2:11-cv-283

JURY TRIAL DEMANDED

DEFENDANT CVS PHARMACY INC’S ANSWER AND COUNTERCLAIMS TO
PLAINTIFF’S COMPLAINT FOR PATENT INFRINGEMENT

Defendant CVS Pharmacy, Inc. (“CVS Pharmacy”) files this Answer and Counterclaims to Plaintiff Lodsys, LLC’s (“Plaintiff”) Complaint for Patent Infringement (“Complaint”).

THE PARTIES 1. CVS Pharmacy is without sufficient knowledge or information to admit or deny the allegations contained in Paragraph 1 of the Complaint.

2. CVS Pharmacy is without sufficient knowledge or information to admit or deny the allegations contained in Paragraph 2 of the Complaint.

3. CVS Pharmacy is without sufficient knowledge or information to admit or deny the allegations contained in Paragraph 3 of the Complaint.

1

4. CVS Pharmacy is without sufficient knowledge or information to admit or deny the allegations contained in Paragraph 4 of the Complaint.

5. CVS Pharmacy admits that it is a Rhode Island company with its principal place of business in Woonsocket, Rhode Island.1 6. CVS Pharmacy is without sufficient knowledge or information to admit or deny the allegations contained in Paragraph 6 of the Complaint.

7. CVS Pharmacy is without sufficient knowledge or information to admit or deny the allegations contained in Paragraph 7 of the Complaint.

8. CVS Pharmacy is without sufficient knowledge or information to admit or deny the allegations contained in Paragraph 8 of the Complaint.

9. CVS Pharmacy is without sufficient knowledge or information to admit or deny the allegations contained in Paragraph 9 of the Complaint.

10. CVS Pharmacy is without sufficient knowledge or information to admit or deny the allegations contained in Paragraph 10 of the Complaint.

11. CVS Pharmacy is without sufficient knowledge or information to admit or deny the allegations contained in Paragraph 11 of the Complaint.

JURISDICTION AND VENUE

12. With respect to Paragraph 12 of the Complaint, CVS Pharmacy admits that Plaintiff purports to pursue an action for patent infringement and, accordingly, this action arises under the provisions of the Patent Laws of the United States of America, Title 35, United States Code. CVS Pharmacy admits that the Court has subject-matter jurisdiction over Plaintiff’s claims pursuant to 28 U.S.C. §§ 1331 and 1338(a). CVS Pharmacy admits that it is subject to

_____________________________

1 On September 9, 2011, the Court granted a joint motion to substitute CVS Pharmacy, Inc. for named defendant CVS Caremark Corp. contained in the original complaint. (Dkt. No. 43. )

2

personal jurisdiction in Texas and admits that venue is proper in the Court pursuant to 28 U.S.C. §§ 1391 and 1400. CVS Pharmacy admits that it conducts business activities within the State of Texas and within this District. CVS Pharmacy denies the remaining allegations in Paragraph 12 as they pertain to CVS Pharmacy. CVS Pharmacy is without sufficient knowledge or information to admit or deny the remaining allegations contained in Paragraph 12 of the Complaint.

13. With respect to Paragraph 13 of the Complaint, CVS Pharmacy admits that it is subject to personal jurisdiction in Texas. CVS Pharmacy admits that it conducts business activities within the State of Texas and within this District which include deriving revenue from products and/or services provided to individuals residing in the State of Texas and this District. CVS Pharmacy denies the remaining allegations in Paragraph 13 as they pertain to CVS Pharmacy. CVS Pharmacy is without sufficient knowledge or information to admit or deny the remaining allegations contained in Paragraph 13 of the Complaint.

INFRINGEMENT OF U.S. PATENT NO. 7,222,078 B2

14. With respect to Paragraph 14 of the Complaint, CVS Pharmacy admits that, on its face, United States Patent No. 7,222,078 (the “‘078 Patent”) identifies that it issued on May 22, 2007, and is entitled “Methods and Systems for Gathering Information From Units of a Commodity Across a Network.” CVS Pharmacy admits that a copy of the ‘078 Patent was attached as Exhibit A to the Complaint. CVS Pharmacy denies that the ‘078 Patent was duly and legally issued. CVS Pharmacy is without sufficient knowledge or information to admit or deny the remaining allegations contained in Paragraph 14 of the Complaint.

15. CVS Pharmacy is without sufficient knowledge or information to admit or deny the allegations contained in Paragraph 15 of the Complaint.

3

16. CVS Pharmacy is without sufficient knowledge or information to admit or deny the allegations contained in Paragraph 16 of the Complaint.

17. CVS Pharmacy is without sufficient knowledge or information to admit or deny the allegations contained in Paragraph 17 of the Complaint.

18. CVS Pharmacy is without sufficient knowledge or information to admit or deny the allegations contained in Paragraph 18 of the Complaint.

INFRINGEMENT OF U.S. PATENT NO. 5,999,908

19. With respect to Paragraph 19 of the Complaint, CVS Pharmacy admits that, on its face, United States Patent No. 5,999,908 (the “‘908 Patent”) identifies that it issued on December 7, 1999, and is entitled “Customer-Based Product Design Module.” CVS Pharmacy admits that a copy of the ‘908 Patent was attached as Exhibit B to the Complaint. CVS Pharmacy is without sufficient knowledge or information to admit or deny the remaining allegations contained in Paragraph 19 of the Complaint.

20. CVS Pharmacy is without sufficient knowledge or information to admit or deny the allegations contained in Paragraph 20 of the Complaint.

21. CVS Pharmacy is without sufficient knowledge or information to admit or deny the allegations contained in Paragraph 21 of the Complaint.

22. CVS Pharmacy is without sufficient knowledge or information to admit or deny the allegations contained in Paragraph 22 of the Complaint.

23. CVS Pharmacy denies the allegations contained in Paragraph 23 of the Complaint.

24. CVS Pharmacy is without sufficient knowledge or information to admit or deny the allegations contained in Paragraph 24 of the Complaint.

4

25. CVS Pharmacy is without sufficient knowledge or information to admit or deny the allegations contained in Paragraph 25 of the Complaint.

26. CVS Pharmacy is without sufficient knowledge or information to admit or deny the allegations contained in Paragraph 26 of the Complaint.

27. CVS Pharmacy is without sufficient knowledge or information to admit or deny the allegations contained in Paragraph 27 of the Complaint.

28. CVS Pharmacy is without sufficient knowledge or information to admit or deny the allegations contained in Paragraph 28 of the Complaint.

29. CVS Pharmacy is without sufficient knowledge or information to admit or deny the allegations contained in Paragraph 29 of the Complaint.

30. CVS Pharmacy denies the allegations in Paragraph 30 as they pertain to CVS Pharmacy. CVS Pharmacy is without sufficient knowledge or information to admit or deny the remaining allegations contained in Paragraph 30 of the Complaint.

JURY DEMAND

31. CVS Pharmacy admits that Plaintiff has requested a trial by jury.

PRAYER FOR RELIEF

32. CVS Pharmacy denies any and all allegations contained in the Prayer for Relief of the Complaint as they pertain to CVS Pharmacy and denies that Plaintiff is entitled to any of the relief requested in Paragraphs (a) through (f) of Plaintiff’s Prayer for Relief or to any relief in any form whatsoever from CVS Pharmacy. CVS Pharmacy further denies each and every allegation in the Complaint to which it has not specifically responded.

5

AFFIRMATIVE AND OTHER DEFENSES

First Defense

33. CVS Pharmacy has not willfully or otherwise infringed, contributed to the infringement of, or actively induced others to infringe any valid and enforceable claim of the ‘908 Patent, either directly or indirectly, either literally or under the doctrine of equivalents. CVS Pharmacy also does not willfully or otherwise infringe, contribute to the infringement of, or actively induce others to infringe any valid and enforceable claim of the ‘908 Patent, either directly or indirectly, either literally or under the doctrine of equivalents.

Second Defense

34. The claims of the ‘908 Patent are invalid for failure to comply with the requirements of Title 35 of the United States Code, including, without limitation, 35 U.S.C. §§ 101, 102, 103 and/or 112.

Third Defense

35. By reason of proceedings in the United States Patent and Trademark Office, and by reasons of amendments, statements, admissions, omissions, representations, disclaimers and/or disavowals made by the applicants or on their behalf, Plaintiff is estopped from asserting infringement of the ‘908 Patent against CVS Pharmacy.

Fourth Defense

36. Plaintiff’s claims are barred to the extent that Plaintiff has dedicated to the public systems, methods, and products disclosed in the ‘908 Patent but not literally claimed therein.

Fifth Defense

37. Plaintiff is prohibited from recovering damages for activities alleged to have occurred before Plaintiff complies with 35 U.S.C. § 287.

6

Sixth Defense

38. Plaintiff is prohibited from recovering damages for activities alleged to have occurred before Plaintiff provides actual notice of activities alleged to infringe.

Seventh Defense

39. Plaintiff’s claims for equitable relief are barred or limited because Plaintiff has adequate remedies at law because Plaintiff has unclean hands.

Eighth Defense

40. Plaintiff’s claims for injunctive relief are barred because Plaintiff has failed to meet the requirements for injunctive relief.

Ninth Defense

41. CVS Pharmacy has not engaged in any conduct that entitles Plaintiff to attorneys’ fees or costs.

Tenth Defense

42. To the extent that Plaintiff asserts claims and/or requests damages for alleged infringement occurring more than six years before the filling of this action, such claims and relief are barred by the applicable statute of limitations, 35 U.S.C. § 286.

Eleventh Defense

43. Plaintiff’s claims are barred, in whole or in part, by the doctrine of laches.

Twelfth Defense

44. Plaintiff’s claims are barred to the extent that Plaintiff has consented to CVS Pharmacy engaging in any acts of accused infringement, and to the extent that Plaintiff has waived the right to enforce the ‘908 Patent.

7

Thirteenth Defense

45. Plaintiff’s claims are barred to the extent that Plaintiff’s allegations of infringement relate to acts that have at all relevant times been by or for the United States and with the authorization or consent of the United States. CVS Pharmacy is entitled to immunity for such activities under 28 U.S.C. § 1498(a).

Fourteenth Defense

46. Any and all products or actions accused of infringement have substantial uses that do not infringe and do not induce or contribute to the alleged infringement of the claims of the ‘908 Patent.

COUNTERCLAIMS

47. Counter-Plaintiff CVS Pharmacy is a Rhode Island company with its principal place of business located at One CVS Drive, Woonsocket, Rhode Island.

48. Based on information and belief, Plaintiff Lodsys is a Texas limited liability company with its principal place of business in Marshall, Texas.

49. Plaintiff claims to be the owner of U.S. Patent No. 5,999,908 (“the ‘908 Patent”).

50. This is an action for a declaration that each and every claim of the ‘908 Patent is invalid, unenforceable and not infringed pursuant to the Patent Laws of the United States, 35 U.S.C. § 101, et seq. Accordingly, subject matter jurisdiction of this Court exists under the Federal Declaratory Judgment Act, Title 28, United States Code §§ 2201 and 2202, and under Title 28, United States Code §§ 1331 and 1338(a).

51. An actual, substantial and continuing justiciable controversy exists between Counter-Plaintiff CVS Pharmacy and Counter-Defendant Lodsys with respect to which Counter- Plaintiff CVS Pharmacy requires a declaration of its rights by this Court. Specifically, the

8

controversy relates to the invalidity, unenforceability and non-infringement of the ‘908 Patent and to Counter-Defendant Lodsys’s right to threaten and/or maintain a suit against Counter- Plaintiff CVS Pharmacy and/or its customers for alleged infringement of the ‘908 Patent. Lodsys has chosen this venue to enforce its patent. Venue is proper in this Court and judicial district for counterclaims, pursuant to 28 U.S.C. §§ 1391 and 1400(b).

52. On March 3, 2011, Lodsys sent a letter to CVS Caremark (parent of CVS Pharmacy) regarding “Infringement of U.S. Patent Nos. 5,999,908, 7,133,834, 7222,078, and 7620,565….” The letter asserted that CVS Caremark’s activities infringed, among others, the ‘908 Patent: “this letter constitutes our notice that CVS Caremark Corporation is infringing at least claim 37 of US 5,999,908 as it relates to consumer surveys conducted in connection with visitors viewing your company’s website.” The Letter demanded that CVS Caremark take a license to, among others, the ‘908 Patent. A copy of the letter is attached as Exhibit A to this Answer and Counterclaims to the Complaint.

53. Defendant CVS Pharmacy brings the following counterclaims against Plaintiff Lodsys:

DECLARATORY JUDGMENT OF NON-INFRINGEMENT OF THE ‘908 PATENT

54. CVS Pharmacy realleges and incorporates by reference the allegations of Paragraphs 47-53 as though fully set forth herein.

55. This is an action for declaratory judgment of non-infringement of any and all valid and enforceable claims of the ‘908 Patent.

56. Counter-Defendant Lodsys alleges that Counter-Plaintiff CVS Pharmacy has and is infringing directly and/or by inducing or contributing to the infringement of one or more claims of the ‘908 Patent, that such alleged infringement has thereby damaged Counter-

9

Defendant Lodsys and, unless enjoined, will continue to damage Counter-Defendant Lodsys.

57. Counter-Plaintiff CVS Pharmacy has not willfully or otherwise infringed, contributed to the infringement of, or induced others to infringe, and does not willfully or otherwise infringe, contribute to the infringement of, or induce others to infringe, any valid and enforceable claim of the ‘908 Patent, either directly or indirectly, either literally or under the doctrine of equivalents.

58. There is an actual controversy, within the meaning of 28 U.S.C. §§ 2201 and 2202, between Counter-Plaintiff CVS Pharmacy and Counter-Defendant Lodsys as to whether Counter-Plaintiff CVS Pharmacy has infringed or infringes any valid and enforceable claim of the ‘908 Patent.

59. Counter-Plaintiff CVS Pharmacy requests a judicial determination and declaration of the respective rights and duties of the parties on the disputes recited in Paragraphs 54-58 above. Such a determination and declaration are necessary and appropriate at this time so that the parties may ascertain their respective rights and duties in this regard.

DECLARATORY JUDGMENT OF INVALIDITY OF THE ‘908 PATENT

60. Counter-Plaintiff CVS Pharmacy realleges and incorporates by reference the allegations of Paragraphs 47-59 as though fully set forth herein.

61. This is an action for declaratory judgment of invalidity of any and all claims of the ‘908 Patent.

62. The ‘908 Patent, and each claim thereof, is invalid for failure to comply with one or more of the requirements of Title 35, United States Code, including but not limited to 35 U.S.C. §§ 101, 102, 103 and/or 112.

63. There is an actual controversy, within the meaning of 28 U.S.C. §§ 2201 and

10

2202, between Counter-Plaintiff CVS Pharmacy and Counter-Defendant Lodsys as to whether there exists any valid claim of the ‘908 Patent.

64. Counter-Plaintiff CVS Pharmacy requests a judicial determination and declaration of the respective rights and duties of the parties on the disputes recited in Paragraphs 60-63 above. Such a determination and declaration are necessary and appropriate at this time so the parties may ascertain their respective rights and duties in this regard.

PRAYER FOR RELIEF

CVS Pharmacy prays for judgment as follows:

A. That this Court fully and finally dismiss Plaintiff’s claims against CVS Pharmacy and order that Plaintiff take nothing from CVS Pharmacy;

B. That this Court find that CVS Pharmacy has not infringed, in any manner, any claim of the ‘908 Patent;

C. That this Court find that the ‘908 Patent is invalid and/or unenforceable pursuant to Title 35 of the United States Code;

D. That this Court issue a declaration that the claims of the ‘908 Patent are invalid, unenforceable, and/or not infringed;

E. That this Court award CVS Pharmacy all of its costs of this action;

F. That this Court find that this is an exceptional case and award CVS Pharmacy its attorneys’ fees pursuant to 35 U.S.C. § 285 or otherwise; and

G. That this Court grant CVS Pharmacy such other and further relief as the Court may deem just and proper.

11

Dated: September 27, 2011

Respectfully submitted,

/s/ Christopher W. Kennerly
Christopher W. Kennerly (SBN: 00795077)
[email]
BAKER BOTTS L.L.P.
620 Hansen Way [address telephone fax]
ATTORNEYS FOR DEFENDANT
CVS PHARMACY, INC.

12

CERTIFICATE OF SERVICE

I certify that on September 27, 2011 all counsel of record were served with a copy of this document via the Court’s CM/ECF system per Local Rule CV-5(a)(3).

/s/ Christopher W. Kennerly
Christopher W. Kennerly

13



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