Paradox Security Systems, Ltd., Shmuel Hershkovitz, and Pinhas Shpater v. Adt Security Services, Inc. and Digital Security Controls, Ltd.

NOTE: This disposition is nonprecedential
United States Court of Appeals
for the Federal Circuit
__________________________
PARADOX SECURITY SYSTEMS, LTD.,
SHMUEL HERSHKOVITZ, AND PINHAS SHPATER,
Plaintiffs-Appellants,
v.
ADT SECURITY SERVICES, INC. AND
DIGITAL SECURITY CONTROLS, LTD.,
Defendants-Appellees,
AND
MONITRONICS INTERNATIONAL, INC.,
Defendant,
AND
PROTECTION ONE, INC.,
Defendant-Appellee.
__________________________
2010-1012
__________________________
Appeal from the United States District Court for the
Eastern District of Texas in case no. 06-CV-0462, Judge
T. John Ward.
___________________________
Decided: July 19, 2010
___________________________

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PARADOX SECURITY v. ADT SECURITY 2
JOSEPH J. M UELLER , Wilmer Cutler Pickering Hale
and Dorr LLP, of Boston, Massachusetts, argued for
plaintiffs-appellants. With him on the brief were
M ICHAEL A. D IENER , M EGAN BECK BARBERO and
CHRISTOPHER M. STRAW .
J. M ICHAEL JAKES , Finnegan, Henderson, Farabow,
Garrett & Dunner, L.L.P., of Washington, DC, argued for
defendants-appellees ADT Security Services, Inc., et al.
With him on the brief was EDWARD J. NAIDICH .
M AX C ICCARELLI , Thompson & Knight LLP, of Dallas,
Texas, argued for defendant-appellee Protection One, Inc.
With him on the brief were JANE POLITZ BRANDT and J.
M ICHAEL H EINLEN .
__________________________
Before NEWMAN , SCHALL, and BRYSON , Circuit Judges.
SCHALL, Circuit Judge.
Plaintiffs-Appellants Paradox Security Systems, Ltd.,
Shmuel Hershkovitz, and Pinhas Shpater (collectively
“Paradox”) appeal the final decision of the United States
District Court for the Eastern District of Texas granting
judgment as a matter of law (“JMOL”) of noninfringement
of claims 1, 2, and 5 of Paradox’s U.S. Patent No.
RE39,406 (the “’406 patent”). The court granted JMOL of
noninfringement in favor of defendants-appellees Digital
Security Controls, Ltd. (“DSC”) and ADT Security Ser-
vices, Inc. and Protection One, Inc. (individually “ADT”
and “Protection One,” respectively, and, collectively, the
“monitoring defendants”). Paradox Sec. Systems, Ltd. v.
ADT Sec. Services, Inc., Case No. 06-CV-0462, Final
Judgment Order (E.D. Texas, Aug. 27, 2009). We affirm.

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PARADOX SECURITY v. ADT SECURITY 3
D ISCUSSION
I.
The ’406 patent relates to protective elements for
home security systems that communicate with a central
security office via telephone lines. Protective elements
are frequently integrated into the circuitry of such sys-
tems to prevent damage from power surges. The pre-
ferred embodiment disclosed in the ’406 patent employs
two opto-couplers, in contrast to the four or more em-
ployed in the prior art. These opto-couplers protect ele-
ments of a home security system during both incoming
calls from the central security office and outgoing calls
from the home.
Claim 1 of the ’406 patent recites, in relevant part:
A telephone line coupler circuit for con-
necting telephone subscriber equipment to
a telephone line, the circuit comprising:
…
means for controllably providing a low
level DC bias signal to said transmit sig-
nal input and generating sufficient cur-
rent on said transmit signal output to
substantially saturate said gated line
switch and seize said telephone line;
…
means for providing an outgoing AC signal
to said transmit signal input;
….
’406 patent col.4, ll.10-34. Claim 2 employs the same
language. ’406 patent, col.4, ll.49-54.
Claim 5 of the ’406 patent recites, in relevant part:

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PARADOX SECURITY v. ADT SECURITY 4
A telephone line coupler circuit for con-
necting telephone subscriber equipment to
a telephone line, the circuit comprising:
…
a line side transmit signal and DC bias
signal combining circuitry receiving a
transmit communications signal and a DC
bias signal and outputting a combined
signal to said transmit signal input; and
a DC bias voltage generator responsive to
a control signal to provide a low level DC
signal as said DC bias signal, wherein suf-
ficient current is generated on said trans-
mit signal output to substantially saturate
said gated line switch and seize said tele-
phone line.
’406 patent, col.5-6, ll.65-28. Claims 1, 2, and 5 all re-
quire that the DC bias source be controllable (i.e., respon-
sive to a control signal) as a requirement for seizing the
telephone line.
On November 7, 2006, Paradox filed an infringement
suit against DSC and ADT. Paradox accused DSC of
manufacturing and selling home security alarm system
equipment incorporating the circuitry taught by the ’406
patent. It accused ADT of installing, monitoring, and
otherwise “using” the equipment containing the accused
circuitry. Subsequently, in a second amended complaint,
Paradox added defendants Protection One and Monitron-
ics International, Inc. (“Monitronics”), accusing them, like
ADT, of installing and monitoring systems incorporating
the accused circuitry.1
1 Paradox subsequently settled with Monitronics.

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PARADOX SECURITY v. ADT SECURITY 5
As trial approached, ADT and the monitoring defen-
dants filed a motion in limine with respect to the testi-
mony of Paradox’s expert witness, Dr. Tim Williams (“Dr.
Williams”). The defendants contended that Dr. Williams
should be precluded from testifying about the “means for
controllably providing a low level DC bias signal” limita-
tion of claims 1 and 2 because his expert report failed to
(1) identify any components in the accused devices that
performed the recited function or (2) explain why the
structure in the accused devices was the same or equiva-
lent to the structure disclosed in the ’406 patent. The
defendants also contended that, in his deposition three
weeks before trial, Dr. Williams did not or could not
identify the specific structure in the accused devices that
performed the function recited in claims 1 and 2 of “con-
trollably providing a low level DC bias signal,” and that
he did not identify a “DC bias voltage generator respon-
sive to a control signal,” as recited in claim 5.
The district court granted the motion in limine, noting
that “expert testimony will be limited to the scope of the
expert’s timely filed reports.” Paradox Sec. Systems, Ltd.
v. ADT Sec. Services, Inc., Case No. 06-CV-0462, Order, at
2 (E.D. Texas, April 3, 2009). Ultimately, both parties
stipulated to the preclusion at trial of expert witness
testimony that was not disclosed in their Fed. R. Civ. P.
23(a)(2)(B) expert reports.
At the close of Paradox’s case, the district court
granted JMOL of noninfringement with respect to claims
1 and 2, finding that there was insufficient proof in the
record that any reasonable jury could find infringement
with respect to those claims. At the same time, the court
also granted JMOL of noninfringement with respect to
claim 5 because Paradox had failed to present any evi-
dence that the accused devices met the “combining cir-
cuitry” limitation of that claim. The district court also

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PARADOX SECURITY v. ADT SECURITY 6
granted JMOL of noninfringement to the monitoring
companies because Paradox had not presented any evi-
dence that the monitoring defendants had made, used, or
sold any of the accused devices. This appeal timely fol-
lowed.
II.
Paradox’s first issue on appeal arises from the district
court’s exclusion of Dr. Williams’ testimony. As noted, the
court excluded testimony of Dr. Williams relating to
matters that were not within the scope of his expert
report. In the absence of this expert testimony, the dis-
trict court held, no reasonable juror could find infringe-
ment of two limitations recited in claims 1 and 2: (1)
“means for controllably providing a low level DC bias
signal to said transmit signal input and generating suffi-
cient current on said transmit signal output to substan-
tially saturate said gated line switch and seize said
telephone line”; and (2) “means for providing an outgoing
AC signal to said transmit signal input.” ’406 patent
col.4, ll.10-34.
Paradox does not challenge the district court’s exclu-
sion of those portions of Dr. Williams’ testimony that the
court found were not contained within the scope of his
expert report. Rather, it contends that the expert witness
testimony that was not excluded, in addition to non-
expert evidence that was offered, was sufficient to estab-
lish the necessary links between the structures of the
accused devices and the limitations of means-plus-
function claims 1 and 2 of the ’406 patent.2 We do not
agree.
2 Paradox argues that the district court erred by
ruling that expert testimony is required as a matter of
law to link each claim limitation to the corresponding

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PARADOX SECURITY v. ADT SECURITY 7
The means-plus-function limitation in claims 1 and 2
reads as follows:
[M]eans for controllably providing a low level DC
bias signal to said transmit signal input and gen-
erating sufficient current on said transmit signal
output to substantially saturate said gated line
switch and seize said telephone line.
’406 patent, col.4, ll. 25-29, 50-54. The district court
construed the limitation to mean:
[C]ontrollably providing a low level bias signal to
said transmit signal input and generating suffi-
cient current on said transmit signal output to
substantially saturate said gated line switch and
seize said telephone line.
Paradox Sec. Systems, Ltd. v. ADT Sec. Services, Inc., ---
F.Supp.2d ----, Civil Action No. 2:06-CV-462 (TJW), 2008
WL 5378053, at *12 (E.D. Texas Dec. 23, 2008). The court
determined the corresponding structure to be:
A DC bias source coupled to the transmit opto
coupler input, a transmit opto coupler output cou-
pled to a gated line switch input, or equivalents
thereof.
Id.
Paradox maintains that both the DSC circuitry and
that of the preferred embodiment in the ’406 patent
contain a transmit opto-coupler and that such a compo-
nent is readily apparent in the following schematics:
accused structure. We do not read the judge's ruling in
that manner, but instead interpret his ruling as being
simply that the evidence, after the exclusion of Dr. Wil-
liams' testimony, was not sufficient to support a finding of
infringement.

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PARADOX SECURITY v. ADT SECURITY 8
DSC Circuitry ’406 Preferred Embodiment
Referring to other portions of the DSC circuitry and
the ’406 preferred embodiment, Paradox points out that
DSC’s circuitry includes a gated line switch acting as a
“line seize switch” and that the output of DSC’s transmit
opto-couplers is connected to the gate input of DSC’s line
seize switch.
However, another structure that is recited by the
limitations in claim 1 and 2, as construed by the district
court, is “[a] DC bias source coupled to the transmit opto
coupler input.” Such a component is missing from the
DSC schematic circuitry shown above and is not discerni-
ble in other DSC schematics introduced into evidence by
Paradox. The transmit opto-coupler and its inputs are
depicted thus in Paradox’s exemplary schematic:
A
And thus in the ’406 preferred embodiment schematic:

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PARADOX SECURITY v. ADT SECURITY 9
It is evident that there is an input, here labeled “A,”
in the schematic of the DSC transmit opto-coupler. How-
ever, it is not evident that that input is a DC bias input
that is “coupled to the transmit opto coupler input,” as
recited in the district court’s construction of the structure
disclosed in the limitation. Such a DC bias input “coupled
to the transmit opto coupler input” is depicted in the ’406
patent’s preferred embodiment as originating in the DC
bias source (22) and being paired with the signal from the
transmit amplifier (24) via an comparator (the triangle
depicted in the ’406 patent schematic). Nor is it evident
that input A in the DSC schematic performs the recited
function of “generating sufficient current on said transmit
signal output to substantially saturate said gated line
switch and seize said telephone line.”
Paradox maintains, though, that Dr. Williams testi-
fied that the input to the opto-coupler receives the DC
bias signal. Dr. Williams testified on direct examination
as follows:
Mr. Meeker: How do they satisfy the limi-
tation?
Dr. Williams: By circuitry which provides
the DC bias signal and the transmit
line signal and combining those two,

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PARADOX SECURITY v. ADT SECURITY 10
presenting those to the transmit
opto-coupler here.
Q: Where can we find the combining cir-
cuitry? Withdrawn. And let's go to
your report for this. Well, I tell you
what, let me ask you this: Why is
this limitation satisfied?
A: Because DSC circuitry provides a long
signal and a DC bias signal, which
are combined and presented to the
transmit opto-coupler.
Q. With respect to this limitation, where
does this appear in your report? I'm
trying to find it myself. I tell you
what, we'll come back to this. Let's
just -- let's go on, I'll come right back
to this. Sorry about that, Dr. Wil-
liams. What's the next limitation?
J. App. at A4714-15. Shortly thereafter, Dr. Williams
testified further:
Q. What is the next element of that claim,
sir?
A. Adding a DC bias to the electronic
equipment transmit signal coming
from the electronic equipment to ob-
tain a combined signal and feeding
the combined signal to the transmit

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PARADOX SECURITY v. ADT SECURITY 11
opto-coupler, said DC bias being suf-
ficient to generate a low-level DC
bias -- DC output on the line side of
said opto -- transmit opto-coupler.
Q. Do the accused products perform that
step?
A. Yes, they do.
Q. What is the next step, sir -- well, wait.
Excuse me. Back up. How do they
perform that step?
A. They perform it by creating these sig-
nals and providing those signals to
the transmit opto-coupler.
Q. Okay. And where is that shown in the
exemplary circuit?
…
A. That is provided to the transmit opto-
coupler right here in the lower right-
hand corner of … loop 7.
J. App. at 4724-25. However, Dr. Williams’ “loop 7” does
not disclose a DC bias source, but merely an undefined
input to the transmit opto-coupler, as disclosed in the
DSC circuitry schematic with the “A” marking above.

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PARADOX SECURITY v. ADT SECURITY 12
Paradox argues that it is “axiomatic” that any signal
must have a source and that, accordingly, a DC bias
source must be coupled to the input of the transmit opto-
coupler. Although the initial premise of this statement is
correct, the conclusion hardly follows from it. Indeed, Dr.
Williams’ statements were entirely conclusory; he pointed
to no structure in the DSC schematic shown above, or in
any of the other schematics of DSC accused circuitry that
were admitted into evidence, that identified a “DC bias
source coupled to the transmit opto coupler input” as
construed by the court.
Paradox also argues that it introduced sufficient evi-
dence supporting infringement of the “means for provid-
ing an outgoing AC signal to said transmit signal input”
in claims 1 and 2. The district court construed this limi-
tation to mean: “[p]roviding an outgoing AC signal to said
transmit signal input”, which is the input to the transmit
opto-coupler. Paradox, 2008 WL 5378053, at *12. The
district court identified the corresponding structure as
“[w]ires connecting the source of AC signal to the transmit
opto-coupler 20 input through any capacitor or compara-
tor circuit elements.” Id. Paradox contends that all of the
constituent elements of this limitation are met by DSC’s
accused device, viz.: (1) there is a transmit opto-coupler;
(2) there are wires connected to the input of the transmit
opto-coupler; and (3) the transmit opto-coupler receives an
AC signal through those wires from an AC signal source.
As noted above, it is not disputed that the DSC cir-
cuitry has a transmit opto-coupler and connecting wires,
however, Paradox could not demonstrate the presence of
an AC signal source that is comparable to the transmit
amplifier (24) depicted above in the schematic of the
preferred embodiment of the ’406 patent. Paradox argues
that “Dr. Williams testified that the DSC transmit opto-
coupler receives an AC signal on its input. Accordingly,

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PARADOX SECURITY v. ADT SECURITY 13
an AC signal source must be coupled to the input of the
transmit opto-coupler.” Appellant’s Br. at 41 (internal
citation omitted). Apart from making this conclusory
statement, though, Paradox points to no structure in the
schematics of the DSC accused devices that is the “source
of [the] AC signal” and that is connected via wires to the
transmit opto-coupler. Nor can it point to any capacitor
or comparator through which the AC signal is passed.
As noted, Paradox contends that it produced non-
expert evidence that the accused devices infringed the
’406 patent. Specifically, Paradox points to the testimony
of a Mr. Pildner, a lead designer of DSC’s accused devices.
Mr. Pildner testified that the president of DSC observed
Paradox’s circuitry panel at a trade show. Mr. Pildner
also testified that he believed that copying was common-
place within the industry and that schematics of Para-
dox’s circuitry panels were found in DSC’s possession.
Paradox urges that Mr. Pildner’s testimony is evidence
that DSC’s accused devices infringe the ’406 patent.
However, nothing in Mr. Pildner’s testimony identifies a
structure in any of the accused devises constituting a “DC
bias source coupled to the transmit opto coupler input,” as
required by the limitations of claims 1 and 2 of the ’406
patent.
Because Paradox can point to no structure introduced
into evidence that unequivocally identifies a “DC bias
source coupled to the transmit opto coupler input,” or any
“source of [an] AC signal,” the accused DC circuitry fails
to meet every limitation of asserted claims 1 and 2.
Consequently, we affirm the district court’s order grant-
ing JMOL of noninfringement with respect to claims 1
and 2.

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PARADOX SECURITY v. ADT SECURITY 14
III.
Paradox next argues that the district court erred in
its construction of the claim 5 limitation “line side trans-
mit signal and DC bias signal combining circuitry.”
According to Paradox, the district court erred in requiring
that the circuitry combining the “line side transmit sig-
nal” and “DC bias signal” must be on the “line side” of the
telephone line coupler (i.e., on the opposite side of the
opto-coupler breaks from the circuitry of the “equipment
side”). Paradox notes that the district court explicitly
“recognized that this claim construction [does] not encom-
pass the preferred embodiment disclosed in the patent
specification.” Paradox Sec. Systems, Ltd, v. ADT Sec.
Services, Inc., Case No. 06-CV-0462, Order, at *3 n.2 (E.D.
Texas, April 13, 2009). Paradox maintains that this
incorrect claim construction led directly to the district
court’s erroneous grant of JMOL with respect to claim 5.
There are two reasons why we need not resolve this
claim construction issue, however. First, assuming that
the district court did err in construing claim 5 to mean
that the circuitry combining both the AC transmit signal
and the DC bias signal must be on the line side, that error
was harmless. The reason is that Paradox produced no
evidence that either the ’406 patent’s preferred embodi-
ment or DSC’s accused devices conform to either the
construction adopted by the court or to Paradox’s pro-
posed construction. Second, the final limitation of claim 5
requires “a DC bias voltage generator responsive to a
control signal to provide a low level DC signal as said DC
bias signal.” As discussed in Part II above, Paradox failed
to identify this structure in the accused device. We there-
fore affirm the judgment of noninfringement of claim 5.

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PARADOX SECURITY v. ADT SECURITY 15
IV.
Paradox also maintains that the district court erred
by requiring expert testimony to support its claim that
the monitoring defendants infringed the ’406 patent
through their use of DSC’s accused devices. Paradox
argues that the imposition of a per se requirement for
expert testimony is contrary both to statutory law and
this court’s precedent. However, because we affirm the
district court’s grant of JMOL that the accused devices do
not infringe the ’406 patent, we need not reach the ques-
tion of whether the monitoring defendants’ use of the
accused devices was infringing.
V.
For the foregoing reasons, the final judgment in favor
of DSC and the monitoring defendants is affirmed.

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