In a recent decision, the Federal Circuit reversed a jury verdict of willful infringement and a total award of over $100 million based on a modified claim construction.  The court also reversed the finding that one asserted claim was not anticipated, and remanded the case for a redetermination of infringement and whether the remaining claims were valid.

The court considered two competing constructions of the same claim terms, one by the district court in this case, and another by a second district court in an unrelated case involving the same patent.  The Federal Circuit found the second district court's construction to be the proper one, and therefore reversed the construction on appeal (and the related finding of infringement).

More detail of Finistar Corp. v. DirecTV Group, Inc. after the jump.

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In a decision last week, the Federal Circuit affirmed a district court's permanent injunction against a defendant to prevent infringement of a patent.  The district court held the patent not invalid and infringed, based in part on a claim construction that construed the word "and" to mean "or."  Specifically, based on the specification and other claims, the court determined such a construction was consistent with the intrinsic evidence.  The court also rejected each of the defendant's affirmative defenses.

The Federal Circuit affirmed.  Turning first to claim construction, the court held "and" can be interpreted to mean "or" in claim language when the specification warrants that construction.  In this case, interpreting "and" as requiring both elements would have rendered some dependent claims meaningless, as well as excluded the preferred embodiment from the claims.  The court also affirmed the rejection of the affirmative defenses of inequitable conduct, obviousness, enablement.  Notably, in discussing the obviousness issue, the court stated:  "a flexible TSM test remains the primary guarantor against a non-statutory hindsight analysis such as occurred in this case."  It will be interesting to see whether the non-TSM grounds for an obviousness rejection outlined in the USPTO's examination guidelines will survive scrutiny by the Federal Circuit.

More detail of Ortho-McNeil Pharm., Inc. v. Mylan Labs., Inc. after the jump.

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In a decision Friday, the Federal Circuit addressed the issue of post-KSR obviousness and fraudulent misrepresentation. Regarding obviousness, the court held that the secondary indicia of nonobviousness simply could not overcome a "textbook case" of claims involving "a combination of familiar elements according to known methods that does no more than yield predictable results."

Interpreting Pennsylvania law, the Federal Circuit found that the defendant had committed fraudulent misrepresentation when the defendant, despite intending to manufacture a competing device throughout negotiations, entered into confidentiality and distribution agreements with the patentee with the understanding that a long-term cooperative distribution relationship would result. There was also sufficient evidence of the amount of damages that the jury's award was not speculative.

More detail of Agrizap, Inc. v. Woodstream Corp. after the jump.

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In a decision yesterday, the Federal Circuit vacated a preliminary injunction entered in the Northern District of Ohio enjoining the selling and copying of a product used to practice a method claimed in a patent.  In doing so, the Federal Circuit utilized of the traditional four–factor test for preliminary injunctions and specifically analyzed the first factor, likelihood of success on the merits.  The court noted that a defendant need not prove actual invalidity of a patent in order to challenge this factor, only a substantial question of invalidity.  Therefore, it found that there was sufficient evidence of invalidity of the patent such that the factor of  likelihood of success on the merits was not met.  Judge Newman dissented, arguing that the "substantial question of validity" standard was inappropriate.

More details of Erico Int'l Corp.. v. Vutec Corp. after the jump.     

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In a recent decision, the Federal Circuit affirmed a finding of infringement of a patent relating to the detection and classification of Hepatitis C Virus, but remanded the case for a determination of anticipation. 

In arguably the most interesting aspect of the decision, the court vacated the permanent injunction entered against the defendant.  The plaintiff asked for and was awarded damages to compensate for the amount the defendant would have had to pay the plaintiff for a "market entry fee."  As a result, the court reasoned the plaintiff could not assert that it would be irreparably harmed by future sales by the defendant, having already been compensated for the harm caused by the defendant's entry to the market.  The court therefore instructed the district court on remand to determine the amount of royalty due on the defendant's compulsory license under the patent going forward.

The court briefly mentioned the issue of willful infringement after In re Seagate Technology, LLC, but only noted that there was no evidence of objective recklessness by the defendant and therefore the finding of no willful infringement was appropriate.  The court also gave a reminder to parties and lawyers of the potential consequences when being too cavalier toward obligations under the Federal Rules of Civil Procedure.  As explained in the court's footnote 4:

This case aptly demonstrates the pitfalls of playing fast and loose with rules of discovery. Conclusory expert reports, eleventh hour disclosures, and attempts to proffer expert testimony without compliance with Rule 26 violate both the rules and principles of discovery, and the obligations lawyers have to the court. Exclusion and forfeiture are appropriate consequences to avoid repeated occurrences of such manipulation of the litigation process.

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In a decision this week, the Federal Circuit affirmed findings of infringement of two patents by two defendants.  The court also reversed an invalidity ruling of one of one claim that had been the subject of reexamination, but remanded the case to the district court for a determination of the obviousness of one claim based on a revised claim construction and for a determination of damages.

While the case went to the jury pre-KSR, the court held that the district court's jury instructions on obviousness, which focused on the teaching-suggestion-motivation test, including that a motivation to combine references may be found in the nature of the problem to be solved, did not warrant reversal.  This indicates that the effect of KSR on the obviousness analysis may not be as dramatic as some have predicted, at least outside the USPTO.

In addition, the court held that the requirements in 35 U.S.C. § 305 regarding new claims in reexamination proceedings need not be specifically noted by the applicant when adding new claims.  Instead, the court confirmed that the limit on new and amended claims in reexamination is that they may not enlarge the scope of the original claims.

More detail of Cordis Corp. v. Medtronic AVE, Inc. after the jump.

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In a decision Friday, the Federal Circuit affirmed the rejection of all claims subject to reexamination as obvious.  The USPTO had rejected the claims based on a combination of three prior art references.

The court provided an expansive discussion of obviousness post-KSR.  The court noted that where the Federal circuit had gone wrong in KSR was holding that because a prior art reference did not address the same problem as the invention, it was not relevant, or at least less relevant, to the obviousness analysis.  According to the court's opinion today, this "overlooks the fundamental proposition that obvious variants of prior art references are themselves part of the public domain."

As applied to this case, the court held that despite the fact that one prior art reference was directed to a different problem did not make the reference less relevant in the obviousness analysis.  As stated by the court:

[The patentee] mistakenly argues that variants of a circuit connecting 2:1 multiplexers in series are not relevant prior art with respect to [the patent-in-suit] because these variants do not address the same problem, namely an improved multiplexer circuit.  However, this argument overlooks the fundamental proposition that the series circuits in Gorai are prior art within the public domain and the common knowledge of a person of ordinary skill in the art. Thus, the Gorai reference is a relevant prior art reference with respect to the '666 patent and clearly discloses a series 2:1 multiplexer circuit.

Essentially, the court used the prior art to show what one of ordinary skill in the art would have in his or her base of knowledge.  As a result, the USPTO's combination of prior art references, and the concomitant obviousness rejection, were affirmed.

More detail of In re Translogic Tech., Inc. after the jump.

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The USPTO guidelines for obviousness rejections post-KSR appear in today's Federal Register.  The full guidelines can be found here, and are similar to the draft guidelines that surfaced some time ago.  In a nutshell, examiners will officially have seven rationales upon which an obviousness rejection may rely:

1. Combining prior art elements according to known methods to yield predictable results;
2. Simple substitution of one known element for another to obtain predictable results;
3. Use of known technique to improve similar devices (methods, or products) in the same way;
4. Applying a known technique to a known device (method, or product) ready for improvement to yield predictable results;
5. ‘‘Obvious to try’’—choosing from a finite number of identified, predictable solutions, with a reasonable expectation of success;
6. Known work in one field of endeavor may prompt variations of it for use in either the same field or a different one based on design incentives or other market forces if the variations would have been predictable to one of ordinary skill in the art;
7. Some teaching, suggestion, or motivation in the prior art that would have led one of ordinary skill to modify the prior art reference or to combine prior art reference teachings to arrive at the claimed invention.
   

The full document goes into more detail regarding each of these rationales.

Update (1:30 PM):  The USPTO has issued a press release regarding the guidelines.

In a highly anticipated recent decision, the Federal Circuit affirmed the judgment of infringement against Vonage with respect to two Verizon patents, holding that the district court did not err in its construction of the disputed claim terms and that the claims were not obvious.  With respect to a third patent, the Federal Circuit held the district court improperly construed a disputed claim term and therefore vacated the judgment of infringement and remanded for a new trial. 

The Federal Circuit vacated the $58 million damages award and 5.5% royalty in its entirety because the jury did not indicate the portion of the damages award that applied to each patent.  As a result, the court could not determine whether the full amount of damages was still warranted based on infringement of only two of the three patents.  The court also affirmed the injunction as to the two infringed patents.

More detail of Verizon Services Corp. v. Vonage Holdings Corp. after the jump.

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Today the Federal Circuit decided to change the status of Daiichi Sankyo Co. v. Apotex, Inc. (previously blogged about here), from nonprecedential to precedential.  This is noteworthy because this was one of the first obviousness cases decided by the Federal Circuit after KSR, and dealt specifically with one of the Graham factors:  the level of ordinary skill in the art.

Click here for our previous summary, and here for the full decision.