CAFC Vacates Non-Infringement Ruling for Apple Due to District Court Error in Striking Expert Opinion

The U.S. Court of Appeals for the Federal Circuit (CAFC) on Wednesday vacated a district court’s grant of summary judgment of non-infringement for Apple, Inc., holding that the district court abused its discretion in striking an expert infringement opinion. The CAFC opinion was authored by Chief Judge Moore.

The underlying lawsuit was brought by Taction Technology, Inc. against Apple in the U.S. District Court for the Southern District of California, alleging certain Apple products that use haptics technology infringed claims 1–20 of its U.S. Patent No. 10,659,885 and claims 1–17 of its U.S. Patent No. 10,820,117. Apple moved for summary judgment of noninfringement and the district court granted the motion because it said Taction’s expert opinion “contained a new theory in violation of local patent rules and improperly argued claim construction.” And without that expert opinion, the court said Taction had no viable claim of infringement.  The district court further held that even with the expert testimony, the Apple products did not meet the key limitation of the claims based on the court’s revised construction of the term “highly damped output.”

“Damped” means the output “is substantially uniform or flat over the normal operating frequency range of the device.”

The district court’s decision to strike the expert testimony was based on its argument that the expert opinion violated Local Patent Rule 3.1(c) by posing a new infringement theory that Taction had not disclosed in its infringement allegations, namely, that “the combination of the Taptic Engine’s closed loop control system and ferrofluid satisfies the ‘highly damped output’ limitation.” The court said this violated Local Patent Rule 3.1(c) because that rule “requires a ‘chart identifying specifically where each element of each asserted claim is found within each Accused Instrumentality.’”

The court also said that the rule includes “an unwritten ‘how’ requirement that Taction’s infringement contentions failed to satisfy because Taction did not sufficiently explain how the accused products satisfy the ‘highly damped output’ requirement…” And finally, the court struck the opinion regarding the “highly damped output” limitation “because they constituted an improper attempt to argue claim construction to the jury based on a construction Taction had waived.”

On appeal, however, the CAFC agreed with Taction that the district court had abused its discretion in striking the testimony. The Federal Circuit opinion explained:

“The court’s interpretation of Rule 3.1(c) as including an unwritten ‘how’ requirement was arbitrary and improperly reads in a requirement that has no support in the plain language of the rule. The district court also fails to show there is a common practice in the Southern District of California requiring plaintiffs to meet an unwritten ‘how’ requirement such that Taction was on notice.”

While the Northern District of California’s local rules contain language requiring plaintiffs identity “specifically where and how each limitation of each asserted claim is found within each Accused Instrumentality,” the Southern District rules do not overtly articulate such requirements, said the CAFC. The district court relied on an unpublished magistrate judge’s order that is not binding to support its reading of the rule, and while district courts are not “precluded from adding a requirement that is not in the local rules,” in this case, “the parties were not on notice of the requirement and did not have an opportunity to comply,” the opinion added in a footnote.

As for the district court’s contention that Taction’s expert, Dr. Oliver, improperly argued claim construction on a construction theory Taction had waived, the Federal Circuit said this justification for striking the testimony was also an abuse of discretion. The three paragraphs in which the expert opinion mentions the claim construction “at most…supports striking those offending paragraphs, not other portions of the report where Dr. Oliver discusses the ‘highly damped output’ limitation,” wrote the court. Additionally, the district court’s revised construction of “highly damped output” in the summary judgment order essentially matched Dr. Oliver’s construction, and it was therefore “unreasonable” of the court to strike his opinions, the CAFC said.

Turning to the district court’s claim construction, which limited the asserted claims to “transducers with highly damped output,” the Federal Circuit agreed with the district court on this but did not agree that “highly damped” is limited to mechanical damping or that it requires a “Q-factor” of less than 1.5. The opinion noted that, during prosecution of the parent application to both the ‘117 and ‘885 patents, “the patentee stated: ‘Applicant’s invention, in contrast, is directed to transducers with highly damped output.’… This is a clear and unmistakable disclaimer.” While Taction argued that the disclaimer should not apply to the patents at issue because the parent application included a claim that was “materially different” from the asserted claims here, the CAFC said “[i]denticality in claim language is not required for disclaimer to flow through a family.”

However, the appellate court found the rest of the district court’s construction erroneous and ultimately vacated the grant of summary judgment of noninfringement and remanded for further proceedings.