MVS Filewrapper® Blog: New and Useful - April 23, 2013

·         In K-Tech Telecoms v. Time Warner Cable, the Federal Circuit confirmed that the standard for evaluating the adequacy of complaints alleging direct patent infringement remains Form 18 of the Appendix of Forms to the Federal Rules of Civil Procedure ("Form 18").  K-Tech filed separate complaints against Direct TV and Time Warner Cable (“TWC”) on the same day, alleging infringement of four patents.  Direct TV and TWC each moved to dismiss under Federal Rule of Civil Procedure 12(b)(6), asserting the complaint, as filed, lacked sufficient factual specificity to state a cause of action for direct patent infringement.  K-Tech sought, and was grated, leave to amend the complaints.  After K-Tech filed its amended complaints, TWC and Direct TV again moved to dismiss under 12(b)(6).  The district court granted the motions to dismiss, stating that the amended complaints failed to cure the defects with the original complaint, namely that the complaints did not explain why K-Tech believed the defendants were utilizing the methods and products protected by the asserted patents, rather than using other noninfringing methods and products, and therefore failed to meet the standards articulated in Bell Atl. Corp. v. Twombly, 550 U.S. 544 (2007) and Ashcroft v. Iqbal, 129 S. Ct. 1937 (2009).  K-Tech appealed the dismissal two weeks before the Federal Circuit issued its decision in R+L Carriers, Inc. v. DriverTech LLC (In re Bill of Lading Transmission & Processing System Patent Litigation), 681 F.3d 1323 (Fed. Cir. 2012). The Federal Circuit consolidated the appeals.

On appeal, K-Tech argued that the amended complaints complied with Form 18 and that the district court applied the incorrect standard.  The defendants argued that sufficiency with respect to Form 18 must be interpreted in light of Twombly and Iqbal, and Ninth Circuit law, and that the amended complaints failed to meet either the plain language of Form 18 or the requirements of Twombly and Iqbal.  The court relied on its recent decision in R+L Carriers in reasserting the sufficiency of Form 18 for pleading patent infringement, and that to the extent any conflict exists between Form 18 and Twombly/Iqbal, the form controls.  Because Form 18 does not include any indication that a patent holder must explain why it believes that a defendant is utilizing the methods and products protected by the asserted patents, rather than using other noninfringing methods and products, such assertions are not required to survive a motion to dismiss.  Further, the court held that the failure of K-Tech to identify a particular allegedly infringing device or devices—by name, model number, or otherwise—did not bar K-Tech from filing a complaint in accordance with Form 18, stating, “A defendant cannot shield itself from a complaint for direct infringement by operating in such secrecy that the filing of a complaint itself is impossible. Nor is a defendant immune from a direct infringement claim because he does not make a ‘device’ but, rather, infringes through a system or method.” 

·         In Lazare Kaplan Int’l, Inc. v. Photoscribe Techs., Inc., the Federal Circuit reversed a decision by the U.S. District Court for the Southern District of New York granting summary judgment of invalidity of two claims of a patent owned by Lazare Kaplan (“LK”), and asserted against  Photoscribe Technologies, Inc. and the Gemological Institute of America (collectively “Photoscribe”).  The Federal Circuit also reversed the district court’s granting of a motion under Federal Rule of Civil Procedure 60(b) filed by Photoscribe that vacated the district court’s prior judgment finding the same claims not invalid.  LK sued Photoscribe alleging infringement of Lazare Kaplan’s patent covering systems and methods for microinscribing gemstones.  In the ensuing trial, the asserted claims of the LK patent were adjudged not invalid and not infringed, either literally or under the doctrine of equivalents.  LK appealed the judgment of noninfringement, but Photoscribe did not appeal the judgment that the asserted claims were not invalid.  On appeal, the Federal Circuit vacated the judgment as based on erroneous claim construction and remanded the case.  On remand, the district court retried both the invalidity and infringement issues, and granted Photoscribe’s motions for summary judgment of invalidity and for relief from the prior judgment under Rule 60(b) while denying LK’s motion for summary judgment of infringement.  LK again appealed the district court’s ruling.

The Federal Circuit, in the second appeal, reversed the grant of relief under Rule 60(b) and vacated the finding of invalidity, with instructions to the district court to reinstate the original judgment of non-invalidity.  The court concluded that the district court erred by allowing Photoscribe to address validity on remand despite its failure to file a cross-appeal from the adverse final judgment on validity in the original trial.  The court also concluded that under Second Circuit precedent, Rule 60(b) could not provide the relief granted by the district court.  The court then remanded the case again, with instructions for the district court to assess infringement under the construction the Federal Circuit had set forth in the prior appeal. 


Judge Dyk dissented in the opinion, arguing that the inconsistency of allowing the patentee to assert infringement based on a broad claim construction while defending against invalidity based on a narrower claim construction should be alleviated by Rule 60(b), notwithstanding the fact that Photoscribe did not appeal the original judgment that the asserted claims were not invalid. 



·         In Aspex Eyewear, Inc. v. Zenni Optical LLC, the Federal Circuit affirmed a decision by the US District Court for the Southern District of Florida holding that Aspex was collaterally estopped from pursuing the suit against Zenni based on earlier litigation between Aspex and Altair Eyewear, Inc. for infringement of the same patents.  The previous Altair litigation involved the same three patents, U.S. Patents No. 5,737,054 (the ’054 patent), No. 6,012,811 (the ’811 patent), and No. 6,092,896 (the ’896 patent), with many of the same claims asserted.  The district court in the Altair litigation held that the ’811 and ’896 patents were not infringed, and the asserted claim of the ’054 patent was invalid for obviousness.  The district court’s rulings were affirmed by the Federal Circuit. 

The district court applied the Altair rulings to the issues in the suit against Zenni, holding that the accused products were materially indistinguishable and the previous decisions settled the question of whether the accused Zenni product could infringe the asserted patents, and Aspex was therefore collaterally estopped from bringing suit against Zenni.  Aspex appealed the district court’s decision, arguing that the issues at stake were not identical because the claim terms that were construed and applied in the Altair litigation were not the same as the claim terms requiring construction in the Zenni suit. The Federal Circuit concluded that every claim asserted against Zenni contained the same limitation, in the same context, that was previously determined to be dispositive of non-infringement.  As a result, even though some of the claims asserted against Zenni were not construed of applied, this did not create a new issue to defeat preclusion.  The court further determined that Aspex had a full and fair opportunity to litigate the asserted patents, and the selection of additional claims for litigation and additional terms for construction could not override the holding of non-infringement.

Estoppel applies to all added limitations in claims, including when present in unamended claims

In a decision Friday, the Federal Circuit affirmed a district court's grant of summary of no literal infringement and that prosecution history estoppel barred application of the doctrine of equivalents.  During prosecution of the patent, a total of three limitations from two different dependent claims were added to the asserted claim in separate amendments, although only two of the limitations were addressed by the applicant and examiner.  The district court held the third element was not literally present in the accused product, and, based on the amendment, could not be present under the doctrine of equivalents.

The Federal Circuit agreed.  The court held it was immaterial that the first amendment (with the "extra" limitation at issue) did not result in allowance; the estoppel applied to each of the added limitations.  Importantly, the court also observed that this presumption of estoppel applied to all claims of the patent containing the limitation, whether or not they were amended:

Thus, in this case, the cancellation of original independent claim 1 coupled with the rewriting of original dependent claim 7 as independent claim 14 gave rise to a presumption of surrender applicable to all limitations, found in any of the claims of the '625 patent, that correspond to the limitations of claim 7.

The court also held that even though the third limitation was not specifically argued, its addition was not tangential to the rationale underlying the amendment, thereby preventing application of prosecution history estoppel.  Specifically, the amendment stated one of the two limitations was not present in the prior art, but added the limitation was not present "in combination with the other structure" of the claims.  This additional language brought the additional limitation into the argument, making it not tangential.  Further, the court held the absence of explanation why the additional limitation was added meant it could not be tangential, because whether an amendment is tangential must be determined from the prosecution record.  Accordingly, the court affirmed the district court's grant of summary judgment of noninfringement.

More detail of Felix v. Am. Honda Motor Co. after the jump.


Reliance on initial expert for rebuttal sufficient to defeat summary judgment

In a decision Tuesday, the Federal Circuit reversed grants of summary judgment in favor of both parties.  The defendant was granted summary judgment of noninfringement, and the plaintiff (and counterclaim defendant) was granted summary judgment on the grounds of no marking under 35 U.S.C. § 287.  Both parties appealed.

The Federal Circuit determined there was a genuine issue of fact regarding infringement under the doctrine of equivalents of the plaintiff's patent.  Only one element of the claim was disputed, and the plaintiff's expert provided a detailed analysis under the function-way-result test.  In response, the defendant's expert testified there were two additional functions of the element in the accused device.  In reply, the plaintiff's expert referred to his previous analysis without explicitly rebutting the defendant's expert's claims.  The Federal Circuit stated the plaintiff's "decision to refer to the evidence already before the court should not be fatal," and held there was sufficient evidence to generate a question of fact on the issue of infringement.  Accordingly, the court reversed the district court's grant of summary judgment on this issue.

Regarding the marking issue, the Federal Circuit noted the defendant only asserted infringement of method claims in its counterclaim.  As such, the Federal Circuit held it was bound by its decision in Hanson v. Alpine Valley Ski Area, Inc., which held that marking is not required when only method claims are asserted in a case.  As such, any failure to mark was irrelevant to the defendant's counterclaims of infringement, and the district court's summary judgment on this issue was reversed as well.

More detail of Crown Packaging Tech., Inc. v. Rexam Beverage Can Co. after the jump.


Irreparable harm to exclusive licensee cannot support injunction; willfulness vacated post-Seagate

In a decision Monday, the Federal Circuit addressed a range of issues and ultimately affirmed a district court's denial of injunctive relief and, in light of the intervening Seagate decision, vacated and remanded the case for reconsideration regarding willfulness. The court also affirmed the district court's finding of no invalidity and the infringement of some claims under the doctrine of equivalents.

Regarding the denial of an injunction, the Federal Circuit agreed with the district court that because the only irreparable harm alleged was to the plaintiff's exclusive licensee, rather than the plaintiff, there was no pertinent evidence of irreparable harm to support granting an injunction. Regarding willfulness, the court determined that the district court's jury instruction (based on the Underwater Devices affirmative duty of care standard) was not correct under the Seagate "objective recklessness" standard. The court held that the improper instruction was not harmless error and remanded the issue to the district court for further consideration as to whether the defendant's conduct was sufficiently reckless to be considered willful.

More on Voda v. Cordis Corp. after the jump.


Claim construction and finding of noninfringement affirmed

In a decision Wednesday, the Federal Circuit affirmed a district court's claim construction and grant of summary judgment of non-infringement.  The patent holder's proposed claim interpretation relied heavily on means-plus-function language and an embodiment in the specification not covered by the claim construction.

The Federal Circuit found that the failure to use clear "means-plus-function language" created a rebuttable presumption that the language recited structural limitations. The court was not troubled by the excluded embodiment and held that the district court's interpretation was well-supported by the specification.

The patent holder also argued that the district court erred by finding no infringement under the doctrine of equivalents. The Federal Circuit affirmed the district court, holding the patent holder's application of the doctrine of equivalents improper as it would have completely eliminated one or more limitations of the claims.

More concerning TIP Sys. v. Phillips & Brooks/Gladwin, Inc. after the jump.



Claim construction and noninfringement affirmed on one patent, vacated on another

In a decision last week, the Federal Circuit vacated a district court's grant of summary judgment of noninfringement of one patent and affirmed summary judgment of noninfringement of another.  The determinations turned on the construction of one claim element in each patent.

In the first patent, the court held that there was sufficient disclosure in the specification to permit the broader construction of the critical term advanced by the patentee.  Judge Lourie dissented from this portion of the opinion, and would have affirmed the district court's construction and, therefore, its summary judgment of noninfringement.

For the second patent, although the only embodiment disclosed in the specification was outside the scope of the district court's construction, nevertheless the court affirmed the construction as it was clear from the claim language, as well as supported by the prosecution history.  As a result, this was a case where there was "highly persuasive evidentiary support" for a construction that excluded the preferred embodiment.
More detail of Lucent Techs., Inc. v. Gateway, Inc. after the jump.


District court's claim construction too narrow, but noninfringement finding affirmed anyway

In a decision yesterday, the Federal Circuit held that a district court construed a claim limitation too narrowly.  However, even under the broader construction, summary judgment was still appropriate, because there was no genuine issue of fact that the accused method still did not practice that element, either literally or under the doctrine of equivalents.

More detail of PSN Ill., Inc. v. Ivoclar Vivadent, Inc. after the jump.


Patentee could not rebut presumption of estoppel; noninfringement finding affirmed

In a decision Friday, the Federal Circuit affirmed a district court decision holding that application of the doctrine of equivalents was barred as the Festo presumptions had not been rebutted.  The court noted that the patentee did not show that the alleged equivalent was unforeseeable at the time of making the narrowing amendment (which was the cancellation of an independent claim and rewriting a dependent claim into independent form) to the claims or that the narrowing amendment bore no more than a tangential relation to the alleged equivalent, the Federal Circuit upheld the district court's finding of noninfringement.

Perhaps most telling was the Federal Circuit's description of the doctrine of equivalents in general.  As stated by the court:  "The foreseeability principle thus relegates the doctrine of equivalents to its appropriate exceptional place in patent enforcement."

Judge Newman dissented, reiterating her position that simply cancelling an independent claim and rewriting a dependent claim in independent form does not narrow the claim, and thus prosecution history estoppel should not even be implicated.  Also, with regard to the facts here, she decries the majority's position that the accused equivalent was unforeseeable even though it was not developed until 10 years after the patent-in-suit issued and was independently patented.  She also faults the majority for finding the amendment not tangentially related to the equivalent in question simply because it relates to the "added" limitation from the dependent claim.

More concerning Honeywell Int'l, Inc. v. Hamilton Sundstrand Corp. after the jump.


If ordinary meaning of claim term does not resolve disputed construction, court must construe term

In a decision last week, the Federal Circuit vacated and remanded a jury's finding of willful infringement case back to a district court, based on errors in claim construction and application of the doctrine of equivalents.  The district court's original Markman hearing determined that no construction was necessary for a particular claim term, "only if," whose scope was disputed by the parties.  The court held the term did not require construction, as it was two simple, plain English words that were well understood.  The district court also permitted the jury to consider infringement under the doctrine of equivalents, finding that while the "only if" limitation was added for a substantial reason relating to patentability, the Festo presumption was rebutted because the rationale underlying the narrowing amendment was tangentially related to the equivalent at issue.

The Federal Circuit held that it was error for the district court not to construe the "only if" limitation.  While the court noted that "district courts are not (and should not be) required to construe every limitation present in a patent's asserted claims," in this case, because "the parties present[ed] a fundamental dispute regarding the scope of a claim term, it [was] the court's duty to resolve it."  The court also determined that the addition of the "only if" limitation during prosecution was not tangential to the alleged equivalent, and therefore application of the doctrine of equivalents was precluded.

More detail on O2 Micro Int'l Ltd. v. Beyond Innovation Tech. Co. after the jump.


Dependent claim can be construed to be broader than independent claim based on prosecution history

In a decision last week, the Federal Circuit held a district court construed 1 of 2 claim terms correctly, and incorrectly concluded that prosecution history estoppel barred application of the doctrine of equivalents to a third claim term because the narrowing amendment was only tangentially related to the equivalent at issue.  As a result, the court affirmed in part, reversed in part, and remanded.

One of the claim construction issues was interesting in that the court held that the prosecution history of the patent overcame the "presumption" of claim differentiation, namely that "dependent claims are presumed to be of narrower scope than the independent claims from which they depend."  This led to the strange result that the scope of some dependent claims was outside the scope of the independent claim from which they depended.  This seems to be contrary to § 112 ¶ 4, which requires a dependent claim "shall be construed to incorporate by reference all the limitations of the claim to which it refers."

Judge Prost dissented from the portion of the ruling regarding prosecution history estoppel, and would have held that the amendment was not tangential to the equivalent in question and therefore that prosecution history estoppel applied.

More detail of Regents of the U. of Cal. v. Dakocytomation Cal., Inc. after the jump.


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