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Eastman Kodak Company v. Kyocera Corporation

October 22, 2012

EASTMAN KODAK COMPANY, PLAINTIFF
v.
KYOCERA CORPORATION, DEFENDANT



The opinion of the court was delivered by: Charles J. Siragusa United States District Judge

DECISION AND ORDER

INTRODUCTION

This is an action for breach of contract. Now before the Court is Plaintiff's motion (Docket No. [#105]) for partial summary judgment as to liability. The application is denied.

BACKGROUND

Unless otherwise noted, the following are the undisputed facts of this case, viewed in the light most-favorable to Kyocera, the non-moving party. The reader is presumed to be familiar with prior Decisions and Orders of this Court which discuss some of the underlying facts. See, Decision and Order dated April 14, 2011 [#48]; Decision and Order dated September 17, 2012 [#131] (Hon. Marian W. Payson, United States Magistrate Judge).

On August 21, 2002, Eastman Kodak Company ("Kodak") and Kyocera Corporation ("Kyocera") executed the subject Patent Licensing Agreement ("PLA"). At the same time, the parties executed a side letter, between Kodak's Senior Vice President, Willy Shih, and Kyocera's Director, Deputy General Manager, Yoshihiko Nishikawa, clarifying a portion of the PLA. (Hereinafter, "the Side Letter").

The PLA covers both Digital Cameras and Integrated Digital Cameras.*fn1 Integrated Digital Cameras are "multi-function devices" such as cell phones that include a camera. The subject dispute is limited to royalties on such Integrated Digital Cameras, and specifically, on camera phones. The PLA includes the following "Definitions" and provisions:

1.2 'Digital Camera' shall mean a portable, self-contained device utilizing an Area Image Sensor having at-least three hundred thousand (300,000) pixels, as well as electronics and optical elements that captures [sic] still or motion images of visible radiation and (a) records a digital signal representing such images on a Removable Digital Storage Media or (b) stores at least two such images in internal memory.

*** 1.7 'Integrated Digital Camera' shall mean an integrated, non-separable, self-contained Multi-Function Device that utilizes an Area Image Sensor which Sensor has greater than three hundred thousand (300,000) pixels as well as electronics and optical elements that captures still or motion images of visible radiation and (a) records a digital signal representing such images on a Removable Digital Storage Media or (b) stores at least two such images in internal memory.

*** 1.11 'Licensed Products' shall mean (i) Digital Camera(s) . . . and (ii) for repair or replacement purposes only components of a Digital Camera . . . and (iii) Integrated Digital Camera(s) including without limitation modules that function as Digital Cameras, which modules are to be incorporated into Integrated Digital Camera's [sic] but excluding . . . portions of the Integrated Digital Camera exclusively performing non-camera functions, as those functions are described in the definition of a Multi-Function Device herein, e.g. a voice transmitting/receiving cell phone (hereinafter "Non-Camera Portions") . . . .

*** 1.15 'Multi-Function Device' shall mean a device that performs as a fully functional stand-alone consumer electronic device providing substantial non-camera functions in addition to those typically provided by a digital camera. Examples of such stand-alone consumer electronic devices providing substantial non-camera functions include, but are not limited to a voice transmitting/receiving cellular telephone.

1.16 'Net Sales' in this Agreement shall be determined based on whether a Digital Camera enters the consumer market as a Kyocera Branded Licensed Product or an OEM Licensed Product as defined below. (cont.)

Kyocera Branded Licensed Product

In the case of an arms length sale or other disposal of a Kyocera Branded Licensed Product, Net Sales shall mean the total net revenue received by Kyocera and its Subsidiaries resulting from the sale or placement of such Kyocera Branded Licensed Product ...


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