Patent Case Summaries April 12, 2023

Patent Case Summaries | Week Ending April 7, 2023

A weekly summary of the precedential patent-related opinions issued by the Court of Appeals for the Federal Circuit and the opinions designated precedential or informative by the Patent Trial and Appeal Board.

Ironburg Inventions Ltd. v. Valve Corp., Nos. 2021-2296, -2297, 2022-1070 (Fed. Cir. (W.D. Wash.) Apr. 3, 2023). Opinion by Stark, joined by Lourie. Dissenting opinion by Clevenger.

Ironburg sued Valve in district court for infringement of a patent directed to a hand-held video game controller. The claimed controller has two controls on the back that include an “elongate member that extends substantially the full distance between the top edge and the bottom edge and is inherently resilient and flexible.”

While the case was pending, Valve filed an IPR petition, which the Patent Trial and Appeal Board partially instituted (as was permitted at that time, prior to the Supreme Court’s SAS decision). The Board issued a Final Written Decision finding certain claims unpatentable based on three instituted grounds without addressing two other grounds in the petition (the “Non-Instituted Grounds”). After the IPR and prior to trial, the district court granted Ironburg’s motion seeking to apply IPR estoppel to the Non-Instituted Grounds and to invalidity grounds that Valve discovered based on a third party’s IPR petition filed after Valve’s IPR petition (the “Non-Petitioned Grounds”).

In a jury trial directed to claims that survived the IPR, the jury found that Valve willfully infringed and awarded Ironburg over $4 million in damages. Post-trial, the district court denied Valve’s motions for judgment as a matter of law and a new trial, and denied Ironburg’s motion for enhanced damages. Both parties appealed.

Addressing Valve’s appeal, the Federal Circuit affirmed the district court on all issues except with respect to estoppel of the Non-Petitioned Grounds, as to which the Federal Circuit vacated and remanded.

First, the court affirmed the district court’s conclusion that the claim terms “elongate member” and “substantially the full distance between the top edge and the bottom edge” were not indefinite. The Federal Circuit explained that “numerical precision is not always required, even when using a term of degree.” Here, “the patent provides sufficient guidance to give one of ordinary skill reasonable certainty as to the scope of the claims.”

Next, the Federal Circuit affirmed the district court’s denial of Valve’s motions for judgment of a matter of law and for a new trial because “the jury had substantial evidence to conclude that the [accused] Steam Controller’s elongate members are ‘inherently resilient and flexible.’” Each juror received a sample Steam Controller, and on appeal Valve identified “no reason why jurors would have been unable to determine for themselves whether the alleged ‘elongate members’ in the Steam Controller may be bent or flexed by the jurors pressing on the device itself, and then evaluating whether it returns to its original unloaded position.”

Next, Valve challenged the district court’s admission of testimony from Ironburg’s corporate representative who is also a co-inventor of the asserted patent. Valve argued that the testimony was unqualified expert opinion testimony. Valve also challenged the district court’s exclusion of testimony from Valve’s corporate representative, who serves as the company’s general counsel. The Federal Circuit found no abuse of discretion in either of these evidentiary rulings.

Next, the Federal Circuit affirmed the district court’s entry of judgment of willful infringement. The parties had stipulated that Valve had notice of the patent, and the jury heard testimony and received evidence that “provided the jury with substantial evidence to support a finding that Valve ‘recklessly’ disregarded Ironburg’s patent rights and, therefore, willfully infringed.”

Lastly, addressing the district court’s estoppel ruling, Valve argued that it could not reasonably have raised either the Non-Instituted Grounds or the Non-Petitioned Grounds in the IPR. The Federal Circuit disagreed as to the Non-Instituted Grounds, as they “were explicitly contained in the petition” and were “raised … during the inter partes review.” Thus, the district court correctly estopped Valve from litigating the Non-Instituted Grounds.

As to the Non-Petitioned Grounds, however, the Federal Circuit agreed with Valve. The district court “improperly placed the burden of proof on Valve, to show that it could not ‘reasonably … have raised’ the Non-Petitioned Grounds in its petition, when instead the burden of proof rests with Ironburg to prove that these were grounds Valve ‘reasonably could have raised’ during the IPR.”

In so ruling, the Federal Circuit announced “the standards by which a determination is to be made as to what invalidity grounds not presented in a petition are estopped pursuant to § 315(e)(2).” The court held “that, provided the other conditions of the statute are satisfied, § 315(e)(2) estops a petitioner as to invalidity grounds a skilled searcher conducting a diligent search reasonably could have been expected to discover, as these are grounds that the petitioner ‘reasonably could have raised’ in its petition.” The court further held “that the burden of proving, by a preponderance of the evidence, that a skilled searcher exercising reasonable diligence would have identified an invalidity ground rests on the patent holder, as the party asserting and seeking to benefit from the affirmative defense of IPR estoppel.”

Finally, the Federal Circuit addressed Ironburg’s cross-appeal seeking an award of enhanced damages for Valve’s willful infringement. The Federal Circuit affirmed the district court’s denial of enhanced damages, as there was no abuse of discretion.

Judge Clevenger dissented with respect to the indefiniteness of the phrase “an elongate member that extends substantially the full distance between the top edge and the bottom edge” of the controller. As he explained, “the artisan needs to know from the patent where along the top edge to start the measurement, and where along the bottom edge to complete the measurement.” In Judge Clevenger’s view, the district court failed to explain “how an ordinary artisan would know with reasonable certainty from the patent how to satisfy the required measurement.”

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Salazar v. AT&T Mobility LLC, et al., Nos. 2021-2320, -2376 (Fed. Cir. (E.D. Tex.) Apr. 5, 2023). Opinion by Stoll, joined by Schall and Stark.

Salazar sued AT&T and others for infringement of a patent directed to a communications, command, control, and sensing system comprising, among other things, “a microprocessor” for performing certain functions. In particular, the asserted claims require “a microprocessor for generating …, said microprocessor creating …, a plurality of parameter sets retrieved by said microprocessor …, [and] said microprocessor generating ….” The district court construed the microprocessor terms to require a single microprocessor that is capable of performing the generating, creating, retrieving, and generating functions.

At trial, a jury found that the accused products did not infringe and that the prior art did not anticipate the asserted claims. At the conclusion of trial, AT&T moved for judgment as a matter of law under Federal Rule of Civil Procedure 50 with respect to “infringement, damages, and preclusion,” but not anticipation. The district court entered judgment reflecting the jury’s verdict.

On appeal, Salazar challenged the district court’s claim construction. In Salazar’s view, “a correct claim construction would encompass one microprocessor capable of performing one claimed function and another microprocessor capable of performing a different claimed function, even if no one microprocessor could perform all of the recited functions.” The Federal Circuit disagreed and affirmed the district court’s claim construction. The Federal Circuit explained: “We agree with the district court that while the claim term ‘a microprocessor’ does not require there be only one microprocessor, the subsequent limitations referring back to ‘said microprocessor’ require that at least one microprocessor be capable of performing each of the claimed functions.” The court analyzed several prior cases involving similar issues and confirmed that “this approach is entirely consistent with our precedent.” Accordingly, the Federal Circuit affirmed the judgment of noninfringement.

The Federal Circuit next addressed a cross appeal by AT&T challenging the district court’s finding that the asserted claims were not invalid as anticipated. AT&T argued that it was reversible error for the district court to hold that the claims were not anticipated. But as the Federal Circuit noted, “AT&T failed to move for judgment as a matter of law under Federal Rule of Civil Procedure 50,” and “its failure to do so dooms this argument.” “A party must make proper motions under Rule 50 in order to appeal an adverse verdict on grounds relating to the sufficiency of the evidence.” Here, AT&T did not move under Rule 50 regarding any validity ground, including anticipation, and so AT&T waived its anticipation challenge on appeal.

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