As LTO storage technology is beginning to take root in the video surveillance retention market, a lawsuit such as this described below, could ultimately reduce the number of sources to obtain this storage technology and would more than likely increase costs thus stunting the acceptance of this technology in the physical security market. With companies like Quantum and SpectraLogic and others showcasing the low-cost option of long-term video retention when using LTO storage technologies, such a supply-chain lawsuit will not help grow this market.

Sony Corp. of Japan, Sony Storage Media Solutions Corp. of Japan, Sony Storage Media Manufacturing Corp. of Japan, Sony DADC US Inc. of Terre Haute, Indiana, and Sony Latin America Inc. of Miami, Florida (collectively, “Sony”) filed a complaint requesting that the U.S. International Trade Commission (USITC) commence an investigation pursuant to Section 337.

The complaint alleges that Fujifilm Holdings Corp. of Japan, Fujifilm Corp. of Japan, Fujifilm Media Manufacturing Co., Ltd. of Japan, Fujifilm Holdings America Corp. of Valhalla, New York, and Fujifilm Recording Media U.S.A., Inc. of Bedford, Massachusetts (collectively, “Fujifilm”) unlawfully import into the U.S., sell for importation, and/or sell within the U.S. after importation certain magnetic tape cartridges and components thereof that infringe one or more claims of U.S. Patent Numbers 6,674,596 (the ’596 patent), 6,979,501 (the ’501 patent), and 7,029,774 (the ’774 patent) (collectively, the “asserted patents”).

According to the complaint, the asserted patents generally relate to improvements in magnetic-tape and magnetic-tape-cartridge storage technology. In particular, the ’596 patent relates to a magnetic tape cassette having a solid-state memory chip. The ’501 patent relates to a magnetic tape medium that experiences limited shape and dimensional changes, particularly in response to changes in humidity and temperature conditions. Lastly, the ’774 patent relates to magnetic recording media, such as magnetic tapes, that have a backside configured to decrease the pitting or embossment of the media’s magnetic recording surface.

In the complaint, Sony states that Fujifilm imports and sells products that infringe the asserted patents. The complaint specifically refers to Fujifilm tape products that are compliant with the LTO Ultrium generation 4, 5, and 6 formats, as well as the cartridge components, magnetic tape, and memory units comprising such products, as infringing products.

Regarding domestic industry, Sony states that all of its own tape products that comply with the LTO Ultrium generation 4, 5, or 6 formats practice at least one claim of each of the asserted patents. Sony states that it has made significant and substantial investments in the U.S. relating to its domestic industry products, including investments in connection with management, logistics, supply chain, distribution, customer service, and support. Sony further states that it has licensed the asserted patents to International Business Machines Corp. (“IBM”), that many IBM tape products practice the asserted patents, and that IBM has made investments in the U.S. that further support the existence of a domestic industry relating to the asserted patents.

As to related litigation, Sony states that on May 27, 2016, certain Fujifilm entities filed a complaint against certain Sony entities at the ITC asserting infringement of multiple Fujifilm patents relating to magnetic tape cartridges. This complaint led to the institution of ITC Inv. No. 337-TA-1012.

Sony further states that on July 27, 2016, it filed a complaint against certain Fujifilm entities in the U.S. District Court for the Southern District of New York alleging, inter alia, (i) that these entities engaged in anti-competitive conduct in filing their complaint at the ITC that resulted in the institution of the 1012 investigation, and (ii) that certain Fujifilm products infringe the ’596, ’501, and ’774 patents.

Sony further states that on December 15, 2016, it filed ITC and district court complaints against Fujifilm alleging infringement of various Sony patents (other than the asserted patents), and that the ITC complaint resulted in the institution of ITC Inv. No. 337-TA-1036. See our January 20, 2017 post for more details. Sony also states that Fujifilm has filed petitions for inter partes review (IPR) targeting the ’596 patent and another Sony patent, and that the Patent Trial and Appeal Board granted institution of both IPRs in November 2016.

Sony further states that Fujifilm has filed additional IPR petitions targeting the ’501 and ’774 patents but that the Board has not yet ruled on whether to institute IPRs in response to these petitions. Sony also states that it has recently filed multiple IPR petitions targeting the Fujifilm patents asserted in the 1012 investigation but that the Board has not yet ruled on these petitions. Lastly, Sony also refers to various litigations and patent office proceedings in Japan between Sony and Fujifilm relating to magnetic tape cartridges.

With respect to potential remedy, Sony requests that the Commission issue a permanent limited exclusion order and a permanent cease and desist order directed at Fujifilm and related entities.