Patent Case Summaries September 20, 2023

Patent Case Summaries | Week Ending September 15, 2023

Columbia Sportswear North America, Inc. v. Seirus Innovative Accessories, Inc., Nos. 2021-2299, -2338 (Fed. Cir. (S.D. Cal.) Sept. 15, 2023). Opinion by Prost, joined by Reyna and Hughes.

Columbia sued Seirus for infringement of a design patent directed to “the ornamental design of a heat reflective material, as shown and described” in various figures. Columbia asserted infringement against Seirus’s HeatWave products, which have a wavy pattern with the “Seirus” logo throughout the design. A jury found that Seirus did not infringe, and Columbia appealed.

On appeal, Columbia challenged the district court’s handling of Seirus’s “comparison prior art,” including the district court’s instructions to the jury on that issue. In design-patent cases, the test for infringement is the “ordinary-observer” test. The Federal Circuit explained that, in applying the ordinary-observer test, comparison prior art is considered “in cases where the claimed and accused designs are not plainly dissimilar.” The court stated that in such cases, including this case, “the ordinary-observer test should be applied with reference to prior-art designs, because those designs can inform the perspective of the hypothetical ordinary observer.”

Addressing Columbia’s challenge to the district court’s handling of the comparison prior art, the Federal Circuit stated that “the proper scope of comparison prior art that may be used in an infringement analysis is an issue of first impression.” The court ultimately agreed with Columbia’s view, ruling that “to qualify as comparison prior art, the prior-art design must be applied to the article of manufacture identified in the claim.”

The Federal Circuit added that “whether a particular reference meets that standard for comparison prior art—i.e., whether it discloses a design applied to the article of manufacture identified in the claim—is a question of fact reserved for the fact finder (at least, where there could be reasonable disagreement on that fact question such that it has not been reduced to a question of law).” “But the standard itself is legal.” And here, the district court’s “failure to provide [the standard] was error—albeit quite an understandable one, given that [the court has] only now articulated the standard.” The Federal Circuit concluded that the district court’s failure to provide the applicable standard to the jury warranted vacating the noninfringement judgment and remanding.

Next, Columbia challenged the jury instructions implicating the Seirus logo that appears throughout the design of the accused HeatWave products. The Federal Circuit explained that “because design-patent infringement does not consider consumer confusion as to source, such infringement is not avoided ‘by labelling.’” “But,” the court continued, “logos are hardly irrelevant, either.”

The court summarized the law as follows: “The takeaway is: just because consumers might not be confused about an accused product’s source, that alone would not preclude an ordinary observer from deeming the claimed and accused designs similar enough to constitute design-patent infringement. … At the same time, however, just because a logo’s potential to eliminate confusion as to source is irrelevant to design-patent infringement, its potential to render an accused design dissimilar to the patented one—maybe even enough to establish non-infringement as a matter of law—should not be discounted.”

Here, the district court’s jury instruction recited the ordinary-observer test for infringement and added that the jury need not find that any purchasers were actually deceived or confused by the appearance of the accused products. On appeal, Columbia insisted that the instructions should have clarified that consumer confusion as to source is irrelevant, or that likelihood of confusion (in addition to actual confusion) need not be found. But the Federal Circuit disagreed: The district court’s instructions “could hardly be called incorrect statements of law,” and there was no abuse of discretion in not including Columbia’s requested clarifications.

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Apple Inc. v. Corephotonics, Ltd., Nos. 2022-1350, -1351 (Fed. Cir. (PTAB) Sept. 11, 2023). Opinion by Stoll, joined by Linn and Stark.

Apple filed two IPR petitions challenging the claims of a patent owned by Corephotonics directed to creating “portrait photos” using a digital camera by combining images taken by a wide lens and a tele lens to create a fused still image. The Patent Trial and Appeal Board issued a final written decision in both proceedings finding that Apple had not met its burden to show that the challenged claims were unpatentable as obvious.

In the first IPR, the parties disputed the construction of a claim term requiring the fused image to have “a point of view of the Wide camera.” Apple argued that the term means that the fused image must maintain only Wide perspective POV or Wide position POV, while Corephotonics argued that the term means that the fused image must maintain both. The Board agreed with Corephotonics and found that, applying the construction, Apple had not established unpatentability.

On appeal, the Federal Circuit determined that the claim language “does not clearly counsel as to the meaning of point of view.” The claims state that the fused image must maintain “a point of view of the Wide camera.” However, the specification, while “not a model of clarity,” described “different types of point of view—Wide position, Wide perspective, Tele position, and Tele perspective.” Because the claims require merely “a” point of view of the Wide camera, the Federal Circuit ruled that the disputed term “requires only that the fused image maintain Wide perspective point of view or Wide position point of view, but does not require both.” The court thus vacated the Board’s final written decision in the first IPR and remanded.

In the second IPR, “the Board based its decision almost entirely on its determination that the declaration submitted by Apple’s expert … was unreliable because of a typographical error.” Corephotonics had mentioned the error “in passing only once in the background section of its Response” and “did not mention the error again,” and Corephotonics “did not rely on this error in any of its arguments on the merits.”

On that record, the Federal Circuit ruled that the Board’s determination (that the typographical error “was essentially dispositive of the issues in the case”) did not satisfy the notice requirements of the APA. The parties “had no reason to anticipate that the typographical error would be the basis for the Board’s decision, given that the parties did not brief, argue, or even suggest this error was dispositive or would impact the claimed lens parameters.” Thus, the Federal Circuit vacated the Board’s final written decision in the second IPR and remanded.

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Netflix, Inc. v. DivX, LLC, No. 2022-1138 (Fed. Cir. (PTAB) Sept. 11, 2023). Opinion by Stoll, joined by Hughes and Stark.

Netflix filed an IPR petition challenging the claims of a DivX patent relating to encoding, transmission, and decoding of multimedia files. Netflix asserted that the challenged claims would have been obvious in view of “Zetts” as modified by “Kaku.”

During the IPR, DivX argued that Kaku is non-analogous art and therefore not properly considered in an obviousness determination. Netflix disagreed and asserted that both the DivX patent and Kaku concern AVI files as well as encoding and decoding multimedia files. The Board ruled that Netflix had not met its burden of showing that Kaku is analogous art because, according to the Board, Netflix failed to identify the field of endeavor for either the DivX patent or Kaku. Netflix appealed.

The Federal Circuit explained that there are “two separate tests to define the scope of analogous art: (1) whether the art is from the same field of endeavor, regardless of the problem addressed and, (2) if the reference is not within the field of the inventor’s endeavor, whether the reference still is reasonably pertinent to the particular problem with which the inventor is involved.” The Board found that Netflix failed to meet its burden under either test.

As to the first test—the same field of endeavor—the Federal Circuit held that “the Board abused its discretion in determining that Netflix failed to articulate a field of endeavor.” Netflix identified two alternative theories for what it viewed as the patent’s and Kaku’s overlapping fields of endeavor—“AVI files” or “encoding and decoding multimedia files.”

The Federal Circuit stated that although Netflix “did not formulaically articulate a field of endeavor using those exact words, our precedent does not require the use of magic words.” The Board therefore “erred by imposing a higher burden than that required by our precedent.” Thus, the court remanded to allow the Board to decide the factual question of whether Kaku is directed to the same field of endeavor as the DivX patent.

As to the second test—reasonable pertinence—the Federal Circuit ruled that substantial evidence supported the Board’s finding. The Board had found that Kaku addressed a different problem than that addressed by the DivX patent. And the Federal Circuit ruled that, based on the evidence presented and “the Board’s thorough consideration of the record,” “we cannot say that the Board’s finding is unreasonable.”

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