Posts in Federal Circuit

On May 20, the U.S. Court of Appeals for the Federal Circuit issued a precedential decision in Kaufman v. Microsoft Corp. affirming a jury verdict of $7 million in reasonable royalty damages against Microsoft’s Dynamic Data for generating web applications. The Federal Circuit denied various claim construction arguments advanced by Microsoft on appeal, including several raised on the proper meaning of “automatically generating” within the preamble to asserted claim 1, and reversed the Southern District of New York’s denial of prejudgment interest to Kaufman.

On May 13, the United States Court of Appeals for the Federal Circuit dismissed Bennett Regulator Guards, Inc.’s (Bennett) challenge of a Patent Trial and Appeal Board (PTAB) decision to vacate the institution of an inter partes review (IPR), citing a lack of jurisdiction, since the PTAB’s decision was based in part on its reconsideration of whether the petitioner was time barred from petitioning for IPR under 35 U.S.C. § 315(b). Judge Pauline Newman dissented.

On May 11, the United States Court of Appeals for the Federal Circuit (CAFC) affirmed the claim construction and decision of the United States District Court for the Central District of California to exclude evidence relating to damages but vacated its infringement determination and remanded a case alleging that Hulu, Inc. infringed Sound View Innovations, Inc.’s patent for data streaming technology. Sound View is the owner of expired U.S. Patent No. 6,708,213 (the ‘213 patent), which discloses “methods which improve the caching and streaming of multimedia data (e.g., audio and video data) from a content provider over a network to a client’s computer.” In June 2017, Sound View sued Hulu, alleging that its “Hulu Streaming Video on Demand products” infringed six Sound View patents, though only claim 16 of the ‘213 patent remained at issue on appeal.

There are many reasons why patent holders might want to put potential infringers on notice of their rights. Such communications can serve the salutary goal of encouraging settlement of disputes without resort to lawsuits. And under some circumstances, notice may be legally necessary under 35 U.S.C. § 287 to enable a patent holder to recover damages for infringement. But a patent holder might be reluctant to do this if providing such notice can subject it to personal jurisdiction for a declaratory judgment suit in a remote and inconvenient forum.

In 1950, Jimmy Stewart starred in the iconic movie “Harvey,” which is the story of Elwood P. Dowd, an affable but eccentric man who pals around with an invisible 6’4” rabbit with an affection for martinis and that has the magical power to stop time. In the end of the movie, the viewer is left to believe that some level of insanity in people is good, and that there is some possibility that Harvey actually exists in some form. Fast forward to May 5, 2022. While many Americans were celebrating Cinco de Mayo, the Federal Circuit was asked to address an entity far more fictitious and unbelievable than Harvey the Rabbit, known as “inventive concept,” during oral hearing in In re Killian (Appeal No. 21-2113).

On April 29, the United States Court of Appeals for the Federal Circuit (CAFC) affirmed in part, reversed in part, vacated in part, and remanded a decision of the United States District Court for the Northern District of Illinois regarding alleged infringement by U.S. Venture Inc., (Venture) of certain patents owned by Sunoco Partners Marketing & Terminals L.P., (Sunoco). Sunoco sued Venture, alleging that its operation of butane-blending systems infringed claims of U.S. Patent Nos. 7,032,629 (the ‘629 patent), 6,679,302 (the ‘302 patent), and 9,606,548 (the ‘548 patent). Venture counterclaimed, asserting that the patents were not infringed, were invalid and unenforceable. The district court ultimately awarded Sunoco $2 million in damages, which were trebled to $6 million. Venture appealed the district court decision challenging “(I) [the] rejection of its on-sale-bar defense, (II) [the] determination that it infringed two patents we have since held invalid, (III) [the] construction of two claim terms, and (IV) [the] decision to enhance damages.” On cross-appeal, Sunoco challenged the lower court’s decision not to grant its reasonable-royalty award or lost-profits damages.

The U.S. Court of Appeals for the Federal Circuit on Friday, April 29, held that the Patent Trial and Appeal Board (PTAB) erred in finding that Auris Health, Inc. had failed to demonstrate that the claims of Intuitive Surgical Operations, Inc.’s patent for robotic surgery systems were unpatentable as obvious. The CAFC said the PTAB impermissibly rested its motivation-to-combine finding on evidence of “general skepticism” about the field of invention and thus vacated and remanded.

Patent owners facing inter partes review (IPR) challenges have the option of filing a motion to amend as a contingency plan. This motion, accompanied by proposed substitute claims, allows the patent owner a fallback position if the Patent Trial and Appeal Board (PTAB) finds the original claims unpatentable. If successful, despite the unpatentability of the original claims, the patent owner maintains the substitute claims. While this sounds great in concept, the historical success rate of such motions is low. From October 2012 through March 2020, only 14% of motions to amend were granted. This improved slightly in 2020, to 25%, but dropped back to 18% in 2021 (calculated using data from Docket Navigator). The recent decision in Hunting Titan, Inc., v. DynaEnergetics Europe GmbH thus presents the somewhat rare case in which an amendment was granted by the PTAB and affirmed on appeal. That said, the Federal Circuit’s narrow holding does not indicate an easier future for patent owners’ motions to amend; indeed, the opposite may be true.

Comcast and the High Tech Inventors Alliance (HTIA) filed amicus briefs last week backing a Supreme Court petition brought by Cisco Systems, Inc. last month. The petition asks the Court to consider whether: 1) enhanced damages may be awarded absent a finding of egregious infringement behavior; and 2) whether the U.S. Court of Appeals for the Federal Circuit (CAFC) may award enhanced damages without first allowing the district court to exercise its discretion to decide that issue. Cisco filed the petition for a writ of certiorari on March 16, following a November 2021 decision of the Federal Circuit that reversed a district court’s denial of SRI International’s motion to reinstate a jury’s willfulness verdict against Cisco. That ruling restored the district court’s award of enhanced damages and affirmed an award of attorney fees for SRI. The CAFC specifically clarified that its reference to language in the Supreme Court’s ruling in Halo Elecs., Inc. v. Pulse Elecs., Inc., 136 S. Ct. 1923, 1934 (2016) on a first appeal in the case was not meant to create a heightened requirement for willful infringement.

The U.S. Court of Appeals for the Federal Circuit (CAFC) on Friday directed Judge Alan Albright’s Waco Division of the U.S. District Court for the Western District of Texas to transfer a case brought by CPC Patent Technologies PTY Ltd against Apple to the Northern District of California. The CAFC said the district court erred in weighing the convenience of the witnesses factor as only slightly favoring transfer, noting that the court has historically rejected the view that this factor should be based solely on the distance the witness would have to travel.

On April 18, the United States Court of Appeals for the Federal Circuit (CAFC) reversed and remanded the U.S. District Court for the Northern District of California’s decision dismissing Apple Inc.’s complaint for declaratory judgment of noninfringement for lack of personal jurisdiction. Apple brought the complaint against patent owner Zipit Wireless, Inc. The CAFC found the district court erred in interpreting precedential cases as applying a bright-line rule that patent infringement notice letters and related communications can never form the basis for personal jurisdiction.

Is the scope of a design patent determined by the figures alone? Two recent Federal Circuit decisions highlight that the words describing the article of manufacture in the title and claims can indeed limit the scope and enforceability of a design patent. In particular, the title and claims of the design patent contain important information that provide a more accurate and predictable notice of what is and is not protected by the design patent. Thus, the title and the claims of a design patent are particularly relevant to the scope of the patent—both for procurement and enforcement.

Earlier this week, the U.S. Court of Appeals for the Federal Circuit (CAFC) vacated and remanded a decision by the Patent Trial and Appeal Board (PTAB) in a post grant review where the PTAB concluded that Everstar did not meet its burden to demonstrate the challenged claims were unpatentable as obvious because it failed to show a motivation to combine the asserted prior art. The CAFC found that the PTAB abused its discretion when it refused to consider whether cost reduction would have driven one skilled in the art to combine the asserted prior art.