Patent Case Summaries October 12, 2012

Federal Circuit Patent Case Summaries for the Week Ending October 12, 2012

Alston & Bird LLP's weekly Federal Circuit Patent Case Summaries are published by Wolters Kluwer Law & Business as part of its Aspen Publishers product line. The following is a summary of the precedential patent-related opinions issued by the Court of Appeals for the Federal Circuit for the week ending on the date below.

Patent Case Summaries for the Week Ending October 12, 2012 
Chris Byrnes and Wes Achey prepared the summaries in this issue.


Case Summaries

Infringement: Doctrine of Equivalents: Dedication to the Public
Claim Interpretation: Intrinsic Evidence: Importing Limitations from the Specification into Claims
Claim Interpretation: Ordinary Meaning
Litigation Practice and Procedure: Jurisdiction: Moot or Unripe Issues
Litigation Practice and Procedure: Procedure: Summary Judgment: Sufficiency of Evidence
SanDisk Corp. v. Kingston Technology Co., Inc., et al., No. 11-1346 (Fed. Cir. (W.D. Wis.) Oct. 9, 2012). Opinion by Prost, joined by Wallach. Opinion concurring-in-part and dissenting-in-part by Reyna.

Affirming-in-part, vacating-in-part, and remanding the district court’s judgment of infringement for further proceedings, the Federal Circuit held that in determining whether subject matter incorporated by reference into a patent satisfies the disclosure-dedication rule set forth in Johnson & Johnston and its progeny, the court must first find that the host patent sufficiently informs one of ordinary skill in the art that the incorporated document contains subject matter that is an alternative to a claim limitation. The inquiry then shifts to the incorporated document to assess whether the disclosure of that subject matter is of such specificity that one of ordinary skill could identify the subject matter that had been disclosed and not claimed. The Federal Circuit also held that no Article III jurisdiction existed after certain claims had been withdrawn during district court proceedings and that the district court erred in certain claim constructions.

SanDisk Corp. (“SanDisk”) sued Kingston Technology Co., Inc. and Kingston Technology Corp. (collectively “Kingston”) in the U.S. District Court for the Western District of Wisconsin, alleging that Kingston infringed U.S. Patent Nos. 5,719,808 (“the ’808 patent”); 6,149,316 (“the ’316 patent”); 6,426,893 (“the ’893 patent”); 6,757,842 (“the ’842 patent”); and 6,763,424 (“the ’424 patent”), which all relate to various aspects of Electrically Erasable Programmable Read-Only Memory. After the court issued its claim construction order, SanDisk withdrew its infringement allegations with respect to several claims, leaving only certain asserted claims of the ’842, ’316, and ’424 patents at issue. Both parties moved for summary judgment. The court granted SanDisk’s motion as to its claim that Kingston was contributorily infringing certain claims in the ’424 patent but found that Kingston was not infringing with respect to all other claims. The parties then entered into a stipulation, whereby SanDisk dismissed the remaining claims involving the ’424 patent, and Kingston dismissed its related counterclaims.

SanDisk appealed, arguing that the district court erred in its construction of certain terms in the asserted patents and that the district court erred in entering summary judgment as to certain claims in the ’424 and ’316 patents. With regard to the claim construction of certain terms in the ’808, ’893, ’842, ’424, and ’316 patents, the Federal Circuit held that there was no final judgment from the district court on certain claims in the ’808, ’893, or ’842 patents necessary to provide the Federal Circuit with Article III jurisdiction over those claims. Although the district court had never entered a separate order dismissing the relevant claims in those patents, the Federal Circuit noted that the district court had acknowledged in its summary judgment opinion that SanDisk had withdrawn the claims following the claim construction order. Accordingly, the Federal Circuit held that SanDisk’s withdrawal of the claims should be treated as either a Federal Rule of Civil Procedure 15 amendment to the complaint or a Rule 41(a) voluntary dismissal of the claims without prejudice. The Federal Circuit declined to rule on which characterization would be more appropriate, holding that either characterization would remove the claims from contention, thereby providing no final judgment from the district court necessary to provide the Federal Circuit with Article III jurisdiction.

The Federal Circuit also held that the district court erred in its constructions of certain claims properly before the court in the ’424, ’842, and ’316 patents. It based its holding primarily on rulings that the district court misapplied key terms in the specification and terms with precedential meaning within the claims.

With regard to summary judgment as to certain claims in the ’424 and ’316 patents, the Federal Circuit vacated the judgment of noninfringement as to those claims that were erroneously constructed, affirmed the judgment of no literal infringement as to a certain claim in the ’316 patent, and vacated the judgment of noninfringement in both patents under the doctrine of equivalents.

In vacating the judgment of noninfringement in the ’316 patent, the Federal Circuit addressed for the first time the circumstances in which the disclosure of subject matter in a document incorporated by reference amounts to a dedication of that subject matter under Johnson & Johnston Associates, Inc. v. R.E. Service Co., 285 F.3d 1046 (Fed. Cir. 2002), and its progeny. Following the law of Telemac Cellular Corp. v. Topp Telecom, Inc., 247 F.3d 1316, 1329 (Fed. Cir. 2001), the court noted that the disclosure of subject matter in an incorporated document can dedicate that subject matter to the public for purposes of the host patent. However, following the law of Modine Manufacturing Co. v. International Trade Commission, 75 F.3d 1545, 1552 (Fed. Cir. 1996), the court reasoned that incorporation by reference does not convert the invention of the incorporated patent into the invention of the host patent. Thus, in determining whether incorporated subject matter satisfies the disclosure-dedication rule, the Federal Circuit reasoned that it must look first to the teachings of the host patent, which must sufficiently inform one of ordinary skill in the art that the incorporated document contains subject matter that is an alternative to a claim limitation. If it does, then the inquiry shifts to the incorporated document to assess whether the disclosure of that subject matter is of such specificity that one of ordinary skill could identify the subject matter that had been disclosed and not claimed.

Following this two-part inquiry, the Federal Circuit ruled that the ’316 patent’s discussion of an incorporated patent did not sufficiently identify to one of ordinary skill that the incorporated patent contained subject matter that is an alternative to that claimed in the ’316 patent. Accordingly, the court held that the district court erred as a matter of law in finding that the ’316 patent dedicated SanDisk’s proposed equivalent to the public and therefore vacated the judgment of noninfringement.

In an opinion concurring-in-part and dissenting-in-part, Judge Reyna concurred with the majority except for its construction of certain claims in the ’424 patent, which he deemed an improper expansion of SanDisk’s patent.

http://www.cafc.uscourts.gov/images/stories/opinions-orders/11-1346.pdf  


Remedies: Injunctions: Preliminary Injunction
Claim Interpretation: Ordinary Meaning
Claim Interpretation: Intrinsic Evidence: Importing Limitations from the Specification into Claims
Claim Interpretation: Intrinsic Evidence: Prosecution Disclaimer
Apple Inc. v. Samsung Electronics Co., Ltd., et al., No. 12-1507 (Fed. Cir. (N.D. Cal.) Oct. 11, 2012). Opinion by Prost, joined by Moore and Reyna.

In reversing and remanding the district court’s grant of a preliminary injunction, the Federal Circuit held that regardless of the extent to which a patentee may be injured by the sale of a product that allegedly contains infringing features, a preliminary injunction requires a sufficient showing that the patentee’s injury actually flows from the product’s alleged infringement. In addition, the Federal Circuit addressed the district court’s claim construction in view of its potential importance on remand, ruling that the construction should be narrower because of limitations in the specification, a prosecution disclaimer, and the Federal Circuit’s unwillingness to extend the meaning of “plurality” from “at least two” to a hand-picked selection of a larger set.

In early 2012, Apple Inc. (“Apple”) sued Samsung Electronics Company, Ltd., Samsung Electronics America, Inc., and Samsung Telecommunications America, LLC (collectively “Samsung”) in the U.S. District Court for the Northern District of California, alleging infringement of eight patents, including U.S. Patent No. 8,086,604 (“the ’604 patent”). Apple filed a motion for a preliminary injunction based on four of the eight patents, seeking to enjoin the sale of Samsung’s Galaxy Nexus smartphone. The district court granted the preliminary injunction based on the alleged infringement of the ’604 patent. Samsung moved the district court to stay the injunction pending appeal, but the district court denied its request. Samsung then appealed to the Federal Circuit, which granted Samsung’s motion for a temporary stay of the injunction and also agreed to expedite the appeal.

On appeal, the parties disputed the district court’s decision to grant injunctive relief based on the applicable irreparable-harm and likelihood-of-success factors. Applying the law of Apple, Inc. v. Samsung Electronics Co., 678 F.3d 1314 (Fed. Cir. 2012), the Federal Circuit noted that in cases where the accused product includes many features of which only one allegedly infringes, the irreparable-harm factor requires that the patentee also establish that the harm is sufficiently related to the infringement. To this end, the court held that the infringing feature must drive consumer demand for the accused product.

The Federal Circuit rejected Apple’s attempt to use evidence of consumer demand for Apple’s Siri feature to demonstrate that a unified search function on the Galaxy Nexus drove consumer demand for the Galaxy Nexus, despite Apple’s assertion that both Siri and the unified search function practice the ’604 patent. Instead, the court ruled that Apple’s survey evidence—which did not show the unified search feature as being one of the a top-five reasons that consumers choose the Galaxy Nexus—indicated that the irreparable-harm factor was not satisfied.

In addition, the Federal Circuit reviewed the district court’s construction of Claim 6 of the ’604 patent based on the possibility that the claim construction at issue could play an important role on remand. More specifically, the claim term at issue recited “a plurality of modules.” The court ultimately ruled that Apple’s reliance on the district court’s construction and use of the term “plurality” in ResQNet.com, Inc. v. Lansa, Inc., 346 F.3d 1374 (Fed. Cir. 2003), incorrectly characterized the ResQNet holding to the extent it enabled Apple to extend the definition of “plurality” from “at least two” to “a hand-picked selection of a larger set.”

http://www.cafc.uscourts.gov/images/stories/opinions-orders/12-1507.pdf  


Infringement: Doctrine of Equivalents: Prosecution History Estoppel: Generally
Infringement: Doctrine of Equivalents: Hypothetical Claim Analysis
Remedies: Damages: Reasonable Royalty
Litigation Practice and Procedure: Procedure: JMOL Procedure
Energy Transportation Group, Inc. v. William Demant Holding A/S, et al., Nos. 11-1487, -1488, -1489 (Fed. Cir. (D. Del.) Oct. 12, 2012). Opinion by Rader, joined by Plager and Linn.

In affirming the district court’s refusal to order a new trial or relief from judgment after a finding of patent infringement, the Federal Circuit held that when prior art alleged to anticipate an otherwise valid patent does not disclose a claimed feature, a jury can find that the prior art does not prove invalidity by clear and convincing evidence. Further, the Federal Circuit held that when advances in technology affect one’s ability to perform patented functions, substantial evidence can still exist for a jury to find that the improvements are nonetheless infringing under the doctrine of equivalents. The Federal Circuit also ruled that a damages expert utilizing the 25 percent rule does not irretrievably damage the reasonableness of her recommended royalty rates if the expert also presents a separate damages analysis that supports a jury verdict.

The U.S. District Court for the District of Delaware declined to order a new trial or relief from judgment after a jury found that William Demant Holding A/S, WDH Inc., Oticon Inc., Oticon A/S, Bernafon AG, and Bernafon LLC (collectively “Demant”) and Widex A/S and Widex USA, Inc. (collectively “Widex”) infringed U.S. Patent No. 4,731,850 (“the ’850 patent”). Demant and Widex (“Defendants”) appealed. Widex also appealed the district court’s denial of its motion for judgment as a matter of law (“JMOL”) of no willful infringement. Energy Transportation Group, Inc. (“ETG”) cross-appealed the grant of JMOL of noninfringement of U.S. Patent No. 4,879,749 (“the ’749 patent”) on the basis that prosecution history estoppel barred the jury’s finding of infringement under the doctrine of equivalents.

The Federal Circuit affirmed the district court’s denial of JMOL of invalidity and noninfringement under the doctrine of equivalents for the ’850 patent. The court held that expert testimony on the written description provided substantial evidence for the jury determination. Regarding anticipation, the court considered the Graupe prior art reference and held that expert testimony, which states the Graupe reference did not disclose an important claimed feature, provided substantial evidence for the jury determination. On infringement, the court relied on the law in Hughes Aircraft Co. v. United States, 140 F.3d 1470 (Fed. Cir. 1998), to rule that despite technological improvements, the accused devices nonetheless perform the same function in substantially the same way, with substantially the same result, thereby providing substantial evidence for the jury to find infringement. The Federal Circuit did not reach the issue of willfulness because it ruled that no consequences flowed from the district court’s decision on that issue.

The Federal Circuit also rejected Defendants’ request for a new trial on damages. The court ruled that Defendants failed to show that the district court acted irrationally or arbitrarily in finding that a report from the German Federal Cartel Office outweighed any potential prejudice. Further, the court held that its treatment of the 25 percent rule in Uniloc USA, Inc. v. Microsoft Corp., 632 F.3d 1292 (Fed. Cir. 2011), remained intact when a damages expert relied on the rule to calculate damages, but also provided an entirely separate damages analysis that supported the jury’s verdict. The court also held that it could not simply adjust the jury’s damages award in remittitur and held that the district court did not abuse its discretion by following the standard rule of awarding pre-judgment interest.

Regarding the district court’s grant of JMOL of noninfringement of the ’749 patent under the doctrine of equivalents, the Federal Circuit affirmed the court’s application of prosecution history estoppel, ruling that ETG had not overcome the presumption that a narrowing amendment made during prosecution was made to secure the patent.

http://www.cafc.uscourts.gov/images/stories/opinions-orders/11-1487.pdf  

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