Post by Paul S. Mazzola
In Markman v. Westview Instruments, Inc., decided in 1996, the Supreme Court held that the construction of a patent should be decided by a judge and treated as a question of law. Since Markman, the federal district courts have used pretrial hearings, commonly called "Markman hearings," to interpret appropriate meanings of key relevant words in patent claims. Based on the language of the Markman opinion and perceived instruction contained therein, the United States Court of Appeals for the Federal Circuit has reviewed findings from Markman hearings, including the underlying factual findings, de novo. The de novo review of all facets of claim construction is in tension with Federal Rule of Civil Procedure 52(a)(6), which states a court of appeals "must not . . . set aside" a district court's "[f]indings of fact" unless they are clearly erroneous." To resolve the tension, the Supreme Court decided Teva Pharmaceuticals, Inc. v. Sandoz, Inc. on January 20, 2015.
In Teva, the factual dispute involved interpretation of the term "molecular weight," the calculation (and resulting value and meaning) of which can be achieved by multiple methods; three were considered by the Court. Based on three possible meanings of "molecular weight," Sandoz argued the claim was indefinite under 35 U.S.C. §112, paragraph 2, as recently interpreted in Nautilus, Inc. v. Biosig Instruments, Inc. The dispute required extrinsic evidence in the form of testimony and expert opinion. With competing extrinsic evidence, the United States District Court for the Southern District of New York found that a skilled artisan at the time of the invention would interpret "molecular weight" as calculated by one of the three possible methods, and particularly the one method consistent with Teva's position. Therefore, the district court held the claim was not indefinite.
The Federal Circuit held to the contrary and invalidated the patent. Couched in a "de novo review of the district court's indefiniteness holding," the Federal Circuit "conclude[d] that (Teva's expert's) testimony does not save  claims from indefiniteness." The court did not provide further analysis regarding the same. In essence, the Federal Circuit reviewed the underlying factual findings of the district court de novo.
The Supreme Court adjudged the Federal Circuit's analysis deficient. The Court held that the ultimate question of proper construction of the patent remains a question of law subject to de novo review. The underlying factual disputes, however, like all other factual determinations, remain under the province of FRCP 52(a)(6), subject to review for clear error. In doing so, the Court analogized a patent to other written instruments, pointed to precedent, and cited practical considerations, most notably, the comparative advantage for the district court judge, who has presided over the entire proceeding, to render a proper finding. The Court found unconvincing the argument that it would be unduly difficult for appeal courts to separate factual from legal matters.
To summarize, the ultimate claim construction is a question of law reviewed de novo; when the district court reviews only evidence intrinsic to the patent (i.e., patent documentation and any prosecution history of the patent), the district court's determination will amount solely to a determination of law reviewed de novo; and when a district court reviews extrinsic evidence, the subsidiary factfinding must be reviewed for clear error.
The practical effect of the decision remains to be seen. Admittedly, in the Teva case, the specific finding of fact of the district court was essentially, if not completely, dispositive of the question of law (i.e., the finding that a skilled artisan would interpret "molecular weight" as calculated by one of the three possible methods rendered the claim definite). One could envision, however, as contemplated by the Court, numerous examples where the district court's factual finding is much less central to the question of law, thereby permitting the Federal Circuit to adopt the factual finding but reach a different claim construction and/or conclusion of law. See Teva, supra ("In some instances, a factual finding will play only a small rule in a judge's ultimate legal conclusion about the meaning of the patent term.").
Therefore, even when the findings of fact are incorporated in toto, the Federal Circuit itself, in reviewing the claim construction de novo, is free to decide how much relative weight to give to the findings of fact versus its own, perhaps competing, analysis of the very same facts. Thus, if the Federal Circuit disagrees with the district court's claim construction, even if the findings of fact support the same, the Federal Circuit could adopt said findings of fact while giving them little weight in its overall analysis. Thus, in instances where the underlying factual dispute may be only mildly or moderately impactful of the ultimate question of law (e.g., indefiniteness, allowable subject matter, novelty, obviousness, etc.), the standard of review, for practical purposes, could arguably return to de novo review.
From a legal practice standpoint, the decision may prove valuable to filter out weaker appeals. Prior to the Court's clarification in Teva, a losing litigant, who has already endured significant expense in district court, would be apt to appeal to the Federal Circuit to "relitigate" the claim construction and potentially receive a favorable result. Now, a practitioner must analyze the likelihood of success at the Federal Circuit in light of the findings of fact of the district court; unless, of course, the litigant has a persuasive argument for clear error of the factual findings. The net result may be a decrease in appeals based solely on an unfavorable claim construction.