The opinion of the court was delivered by: VITALIANO, D.J.
David Tropp ("Tropp") owns two patents that describe a method of airline luggage screening through the use of a dual-access lock, which enables a traveler to secure his or her luggage while still permitting it to be accessed by a luggage screening entity with a master key. Travel Sentry, Inc. ("Travel Sentry") owns a trademark that it licenses to lock and luggage manufacturers and distributors for use on dual-access luggage locks. On December 4, 2006, Travel Sentry filed a complaint against Tropp in this Court seeking a declaratory judgment of noninfringement, invalidity and non-liability with respect to Tropp's patents; Tropp subsequently counterclaimed for infringement. See Case No. 06-cv-6415 (the "Travel Sentry Action"). On November 3, 2008, Tropp commenced a related action in this Court against more than a dozen luggage manufacturers and/or distributors which are licensed to use Travel Sentry's trademark (the "licensee defendants"), claiming infringement of the same patents. See Case No. 08-cv-4446 (the "Licensee Action").*fn1
In the Travel Sentry Action, Travel Sentry has moved for summary judgment, pursuant to Rule 56 of the Federal Rules of Civil Procedure, on noninfringement and, in the alternative, invalidity. Meanwhile, in the Licensee Action, the licensee defendants have moved for summary judgment on the ground that, pursuant to 28 U.S.C. § 1498(a), Tropp's patents are exclusively amenable to litigation in an action against the United States in the Court of Federal Claims; further, they recently requested permission from the Court to move for summary judgment on noninfringement as well.
For the reasons that follow, Travel Sentry's motion for summary judgment against Tropp on grounds of noninfringement is granted, and the Travel Sentry Action is dismissed. In light of this disposition, the Court orders Tropp to show cause why he should not be estopped from pursuing his infringement claims against the licensee defendants.
The two Tropp-owned patents at issue are: (1) U.S. Patent No. 7,021,537, filed November 12, 2003, and dated April 4, 2006 ("537 patent"); and (2) U.S. Patent No. 7,036,728, filed November 12, 2004 and dated May 2, 2006 ("728 patent").*fn3 Both are entitled "Method of Improving Airline Luggage Inspection." The 728 patent claims priority from and is a continuation-in-part of the 537 patent.
The 537 patent contains four independent claims: 1, 9, 14 and 10. The 728 patent contains two independent claims: 1 and 10. Claim 1 of the 537 patent recites:
A method of improving airline luggage inspection by a luggage screening entity, comprising: making available to consumers a special lock having a combination lock portion and a master key lock portion, the master key lock portion for receiving a master keythat can open the master key lock portion of this special lock, the special lock designed to be applied to an individual piece of airline luggage, the special lock also having an identification structure associated therewith that matches an identification structurepreviously provided to the luggage screening entity, which special lock the luggage screening entity has agreed to process in accordance with a special procedure, marketingthe special lock to the consumers in a manner that conveys to the consumers that the special lock will be subjected by the luggage screening entity to the special procedure, the identification structuresignaling to a luggage screener of the luggage screening entity who is screening luggage that the luggage screening entity has agreed to subject the special lock associated with the identification structure to the special procedureand that the luggage screening entity has a master keythat opens the special lock, and the luggage screening entity acting pursuant to a prior agreement to look for the identification structure while screening luggage and, upon finding said identification structureon an individual piece of luggage, to use the master keypreviously provided to the luggage screening entity to, if necessary, open the individual piece of luggage.
The parties agree that this claim is representative of the independent claims of both patents.*fn4
B. Relevant History of the Parties
The Transportation Security Administration ("TSA"), which is part of the United States Department of Homeland Security ("DHS"), controls airline luggage inspection and is the sole luggage screening entity in the United States. The TSA specifies all inspection procedures and exclusively bears the responsibility of deciding if, when and how any airline luggage is opened or inspected in this country. (TS 56.1 ¶ 12.) It is undisputed that, in the United States, the "luggage screening entity" recited in the 537 and 728 patents is the TSA.
On December 19, 2002 the TSA publicly announced that, as of January 1, 2003, it would begin screening 100% of checked airline luggage for flights originating in the United States, pursuant to a Congressional mandate ("Screening Mandate") instituted in response to the 9/11 terrorist attacks. (TS 56.1 ¶¶ 11, 37.)
John Vermilye ("Vermilye") is the founder and Chief Executive Officer of Travel Sentry.
Vermilye began his career in the airline industry in 1972, working as an Air France baggage loader at Logan Airport in Boston, Massachusetts. Early on, Vermilye learned that United States Customs officers were tasked with opening and inspecting unclaimed luggage, and that, to facilitate their work, luggage lock master keys for the most commonly used luggage brands were collected on large key rings and used to open unclaimed luggage whenever possible. Between 1974 and 1980, Vermilye held various other positions at Logan, working as a ticket agent and in the airport control center. In 1980, he moved to a position in management at Eastern Airlines. During his eight years at Eastern, Vermilye gained more knowledge about and experience with security protocols, serving as the head of corporate baggage operations and chairing an international task force that developed baggage security procedures. Among other things, Vermilye was responsible for Eastern's Central Baggage Tracing ("CBT") facility at Miami Airport, where all of the unclaimed luggage from Eastern's network was collected and opened by airline staff; CBT personnel, much like the Customs officers at Logan with whom Vermilye had worked, attempted to access bags and identify their owners by using previously assembled sets of master luggage keys. (TS 56.1 ¶¶ 6, 7. 9, 10.)
In 1988, Vermilye became the manager of baggage operations for the International Air Transport Association in Geneva, Switzerland, where he wrote the standards for baggage handling for all airlines. (TS 56.1 ¶ 8.) In 2002, he was hired as a consultant by the TSA, where he provided assistance with, among other things, implementation of the Screening Mandate. At the TSA, Vermilye recognized that the agency faced significant challenges in attempting to comply with the Screening Mandate, in light of, among other things, the agency's standard practice and policy of breaking locks on luggage that required inspection. He anticipated that, if the lock-breaking approach was not refined or adjusted in the face of the dramatically increased volume of bags to be inspected, injuries suffered by luggage screeners and thefts of passengers' property would likely skyrocket. (TS 56.1 ¶ 13.)
In September 2002, Vermilye and a team began working on the TSA's customer education program, through which the TSA would inform travelers about its new flight security procedures. While brainstorming about how to develop the program, Vermilye contacted Stephen Rynn, a business acquaintance and the president of Rynn Luggage, a Baltimore-based luggage seller and servicer, to discuss the feasibility of gathering the most common of the "literally hundreds" of master luggage keys in circulation in order to streamline the opening of locked bags. (TS 56.1 ¶ 16.) Vermilye and Rynn both thought that about 80% of luggage locks could be opened with a relatively small number of master keys, and that a luggage screener's odds of locating the right master key to open a given lock were much higher when the screener could identify the lock's manufacturer by visual indicia such as a brand logo or alphanumeric code. (TS 56.1 ¶ 17; TS Reply 56.1 ¶ 17.)
Approximately two months later, Vermilye was formally assigned to assist the TSA with implementing its comprehensive baggage screening policy pursuant to the Screening Mandate. After he persuaded some higher-ups at the TSA that it would be worthwhile to collect a subset of master keys on a ring for screeners to use, Vermilye was tasked with "coordinat[ing] procurement plans for key sets." He contacted Rynn again in connection with the TSA key ring project in late November 2002, and met with him to inquire if Rynn was interested in being retained as a TSA contractor, to gather sets of commonly used luggage keys from manufacturers and assemble rings for TSA use at commercial airports in the United States. (TS 56.1 ¶¶ 18, 19; TS Reply 56.1 ¶ 18.) Rynn was amenable, and Rynn Luggage subsequently contracted to supply the TSA with approximately 1500 key rings ("TSA-Rynn Rings") prior to the Screening Mandate deadline of January 1, 2003. Rynn collected a set of about 35 master keys for each TSA-Rynn Ring, which Rynn and TSA staff estimated could open about 80% of baggage with integrated key locks. (TS 56.1 ¶¶ 20, 23; TS Reply 56.1 ¶ 20.) In December 2003, the TSA prepared instructions and guides for baggage screeners about making efforts to open locked bags with the keys on the TSA-Rynn Rings. (TS 56.1 ¶¶ 21, 22; TS Reply 56.1 ¶¶ 21, 22.)
The TSA-Rynn Ring project was in place by early January 2003, according to plan. However, Vermilye and others at the TSA viewed it as only a temporary solution to the formidable challenge posed by the Screening Mandate. The record reflects that, as of late November and December 2002, Vermilye had started to mull over and speak to others about the "Travel Sentry concept," which the parties agree "is a lock standard that enables the traveling public to lock their checked baggage during travel while still allowing the TSA to open the lock and search the bags as needed, and then re-lock them."*fn5 (TS 56.1 ¶ 2.) According to Rynn, Vermilye told him at their meeting in November 2002 that Vermilye "was in the process of developing a system that would allow the opening of baggage locks with a universal master key held by the TSA." (TS 56.1 ¶ 26; TS Reply 56.1 ¶ 26.) Similarly, Vermilye's supervisor at the TSA, Kurt Krause, recalls that during the period in which the TSA-Rynn Rings were being assembled, in late November and December 2002, Krause, Vermilye and other TSA employees talked about how it would "be great if there was one lock that the consumer used, or two or three locks, to reduce that ring from 50 [keys] to one key that the Government would have, that we would trust the Government to have that key and nobody else;" however, they also agreed that it would be impossible to get such a project approved and implemented in the time frame required by the Screening Mandate. (TS 56.1 ¶ 25; TS Reply 56.1 ¶ 25.)
On or about January 10, 2003, Vermilye and Rynn met for a debriefing on the inception of the TSA's use of the TSA-Rynn Rings. According to Rynn, they also talked more about Vermilye's "Travel Sentry concept"; specifically, they discussed the prospect of a standard dual access lock, identifiable by a standardized indicia or logo, that would reduce the number of keys that screeners had to carry, and Vermilye told Rynn that he was considering simply licensing the concept rather than manufacturing or selling the locks himself. (TS 56.1 ¶ 28; TS Reply 56.1 ¶ 28.) On January 14, 2003, Vermilye went to see a patent attorney, Alicia Meros, for advice about how to protect the Travel Sentry concept as intellectual property, and asked her to perform a patent search on luggage locks. Within days of his meeting with Meros, at her suggestion, Vermilye wrote down descriptions of what the Travel Sentry concept was and when he had thought of it. (TS 56.1 ¶ 27; TS Reply 56.1 ¶ 27.)
Vermilye formally left the TSA on March 7, 2003, and devoted himself to pursuing the Travel Sentry concept. On March 27, 2003, Vermilye presented it at the Travel Goods Association ("TGA") convention in Las Vegas, Nevada. In his presentation materials, Vermilye envisioned that Travel Sentry's mark could be used on any manufacturer's luggage or lock instead of or in addition to the manufacturer's own mark, that the TSA would be willing to train its screeners to use a particular master key on locks demarcated by a Travel Sentry logo or mark, and that manufacturers could market locks and luggage to consumers on the basis that the TSA would recognize their locks and not break them. (TS 56.1 ¶ 30.)
Following the TGA convention, between March and August 2003, Vermilye met with luggage manufacturers and retailers in the United States and abroad to propose his system. By early August 2003, Vermilye had arranged for the creation of lock prototypes, and also claims to have received verbal assurances from the TSA that it would work with him to make the Travel Sentry concept a reality. (TS 56.1 ¶¶ 32-34; TS Reply 56.1 ¶¶ 32-34.) On August 20, 2003, the Wall Street Journal published an article entitled "Travel Watch: Making Up for the Blackout -- Luggage Lockup," describing the Travel Sentry concept. On October 16, 2003, a "Memorandum of Understanding/ Agreement Between the Transportation Security Administration and Travel Sentry Regarding Travel Sentry Certified Locks" ("MOU") was signed.
The MOU, which took effect on November 5, 2003, is the only written agreement between the TSA and Travel Sentry concerning Travel Sentry marked locks. The MOU states that the purpose of the agreement: is to set forth terms by which Travel Sentry will provide TSA, at no cost, with 1,500 complete sets of passkeys for the TSA to distribute to field locations. These passkeys are designed to permit TSA screeners to open checked baggage secured with Travel Sentry certified locks without breaking such locks.
TSA will test these passkeys to ensure their operational suitability.
If TSA determines that Travel Sentry certified locks or the passkeys required for their operation do not perform their intended function, TSA will inform Travel Sentry and this agreement will be considered null and void. TSA takes no responsibility for any damage to locks or baggage secured with Travel Sentry locks, although TSA will make good faith efforts to distribute the passkeys and information provided by Travel Sentry on the use of the ...