“Upper” and “Lower” Claim Limitations Leaves Patent Owner Feeling Down

The Tops Company, Inc. sued Koko’s Confectionery & Novelty for infringement of U.S. Patent No. 6,660,316, and for trade dress infringement.

The claims of the ‘316 patent required upper and lower chambers:

However the district found on summary judgment that while Koko’s Squeezy Squirt Pop had two chambers, they were not upper and lower chambers, nor were they equivalent to upper and lower chambers.

Directional references in claims such as upper and lower, left and right, top and bottom, etc., can cause problems are best avoided unless the directions are important. While Topps may still prevail on appeal, the wording of the claims has complicated their enforcement efforts.

It is Importation that Infringes under 35 USC § 271(g), Not Manufacture

In Syngenta Crop Protection, LLC v. Willowood, LLC, [2018-1614, 2018-2044](December 18, 2019) affirmed-in-part, reversed-in-part, vacated-in-part, and remanded the district court’s judgment in favor of all defendants on infringement of one patent at issue; and against Willowood, LLC, and Willowood USA, LLC, on infringement of the remaining three patents.

The Federal Circuit remanded the dismissal of Syngenta’s copyright claim for a more detailed determination whether FIFRA required defendants to copy the copied portions of Syngenta’s labels.

In a case of first impression reversed the district court’s requirement that that all steps of a patented process be performed by or at the direction or control of a single entity before infringement liability under 35 USC 271(g) can attach.

Section 271(g) provides that “[w]hoever without authority imports into the United States or offers to sell, sells, or uses within the United States a product which is made by a process patented in the United States shall be liable as an infringer.” The Federal Circuit said that this language makes clear that the acts that give rise to liability under § 271(g) are the importation, offer for sale, sale, or use within this country of a product that was made by a process patented in the United States. The Federal Circuit said that nothing in the statutory language suggests that liability arises from practicing the patented process abroad. Rather, the focus is only on acts with respect to products resulting from the patented process. The Federal Circuit concluded that because the statutory language as a whole is clear that practicing a patented process abroad cannot create liability under § 271(g), whether that process is practiced by a single entity is immaterial to the infringement analysis under that section.

The Federal Circuit otherwise affirmed the infringement determinations.

When There is a Dispute Regarding the Proper Scope of the Claims, the Court must Resolve that Dispute

In Omega Patents, LLC v. Calamp Corp., [2018-1309] (April 8, 2019), the Federal Circuit affirm the judgment of no invalidity, affirm-in-part, reverse-in-part, vacate-in-part, and remand the judgment as to direct infringement, and vacated the remainder of the judgment and remanded for a new trial on indirect infringement, compensatory damages, willful infringement, enhanced damages, and attorney’s fees, in a case involving U.S. Patent Nos. 6,346,876, 6,756,885, 7,671,727, and 8,032,278 on multi-vehicle compatible systems that can remotely control various vehicle functions such as remote vehicle starting.

After a trial, a jury found all asserted claims to be not invalid and infringed, and the jury also found that CalAmp willfully infringed a valid patent, and awarded Omega $2.98 million in compensatory damages, which the district court trebled for willfulness, awarded attorney’s fees to Omega, added damages for post-verdict sales and pre-judgment interest, for a total of $15 million, with an on-going royalty rate of $12.76 per unit.

Although CalAmp appealed the construction of several claim terms, the Federal Circuit found that these terms had no impact on the prior art actually introduced at trial, and CalAmp had failed to identify to the district court any other prior art that would be impacted by the claim construction ruling. Thus, the Federal Circuit declined CalAmp’s invitation to speculate as to how additional prior art may have been rendered irrelevant under the court’s claim construction. While CalAmp’s challenge to the district court’s claim construction was preserved under Federal Rule of Civil Procedure 51 for purposes of challenging the jury instructions, CalAmp failed to satisfy the requirements of Federal Rule of Civil Procedure 46 by not seeking admission into evidence of, or at least specifically identifying, the additional prior art.

On the issue of direct infringement, several of the claims required “a transmitter and a receiver for receiving signals from said transmitter.” However the Federal Circuit found that the evidence at trial only showed that the “transmitter” transmits signals to a “receiver” on a cell tower, which can then relay that information to CalAmp’s servers, and the “receiver” receives signals from a “transmitter” on the cell tower. The Federal Circuit agreed that CalAmp did not provide all of the elements of the system, as was entitled to JMOL on direct infringement of these claims.

On the issue of induced infringement, the Omega argued that CalAmp’s customers directly infringed when they used CalAmp’s products. The Federal Circuit noted that for purposes of infringement, a party must put the invention into service, i.e., control the system as a whole and obtain benefit from it, and said there was evidence from which the jury could infer that customers controlled and used the system and received the required benefits. Based on the record, the Federal Circuit conclude that this theory does not warrant setting aside the jury verdict.

The induced infringement of some of the claims depending on the construction of “vehicle device,” which the district court refused to construe, defaulting to the ordinary meaning. The Federal Circuit said that when the parties raise an actual dispute regarding the proper scope of the claims, the court, not the jury, must resolve that dispute. The Federal Circuit added that the court is not absolved of this duty to construe the actually disputed terms just because the specification of the patent defines the term. Even if the parties had agreed to the construction, the Federal Circuit said that the district court was still obligated to give that construction to the jury in its instructions. The Federal Circuit said: in the absence of guidance in the form of proper claim construction, the jury lacked a yardstick by which to measure the arguments and evidence on this issue and assess whether Omega’s infringement theory was a valid one. In particular the Federal Circuit could not discern if the jury found infringement of the claims at issue based upon a theory of infringement inconsistent with the proper construction. Therefore, the Federal Circuit set aside aside the jury’s verdict of infringement, and ordered a new trial.

On the issue of induced infringement, CalAmp argued that the jury’s verdict could not be sustained because the verdict form given to the jury (proposed by CalAmp) did not provide written questions on the issue of inducement. CalAmp argued that the absence of such questions on induced infringement precluded the jury from awarding damages on that basis, but the Federal Circuit said that one cannot use the answers to special questions as weapons for destroying the general verdict. The Federal Circuit concluded that induced infringement was properly before the jury, and, thus, CalAmp was not entitled to JMOL of no induced infringement on that basis.

However CalAmp also complained about the district court’s exclusion of testimony as to CalAmp’s state of mind substantially prejudiced CalAmp’s ability to present its defense for indirect infringement. The Federal Circuit found that this exclusion deprived CalAmp of the opportunity to support its defense that there was no inducement because it reasonably believed it did not infringe the patents at the time CalAmp launched the products at issue. The Federal Circuit vacated the jury’s findings as to indirect infringement and remand for a new trial.

On the issue of damages, the Federal Circuit found that although the infringement of the one claim that was sustained, this was not enough to support a damage award based upon all of the products, and thus the Federal Circuit vacated the compensatory damage award.

On the issue of enhanced damages for willful infringement, the jury was asked whether it had found CalAmp willfully “infringed a valid patent,” without specifying which patent or patents or which claim or claims were willfully infringed. Based on the vacation of several findings of infringement the Federal Circuit could not determine which patents or claims, so the finding of willfulness had to be vacated as did the resulting enhanced damages and attorney’s fees award by the district court, both of which were explicitly based on the willful infringement finding.

Many lessons form this case, including insisting on a claim construction of disputed terms, and being extremely careful drafting jury verdict forms.

Infringement Prior to Notice of Patent Could Not be Willful

In SRI International, Inc., v. Cisco Systems, Inc., [2017-2223] (March 20, 2019), the Federal Circuit affirmed the district court’s denial of summary judgment of ineligibility, adopt its construction of “network traffic data,” and affirmed its summary judgment of no anticipation. The Federal Circuit vacated and remanded the district court’s denial of judgment as a matter of law of no willful infringement, and therefore vacate the district court’s enhancement of damages. The Federal Circuit also vacated the district court’s award of attorneys’ fees and remanded for recalculation. Finally, the Federal Circuit affirmed the district court’s award of ongoing royalties on postverdict sales of products that were actually found to infringe or are not colorably different.

The litigation involved U.S. Patent Nos. 6,484,203 and 6,711,615 directed to network intrusion detection. The Federal Circuit rejected Cisco’s assertion that the claims are just directed to analyzing data from multiple sources to detect suspicious activity. The Federal Circuit found that instead, the claims are directed to an improvement in computer network technology. The focus of the claims is on the specific asserted improvement in computer capabilities—that is, providing a network defense system that monitors network traffic in real-time to automatically detect large-scale attacks. The Federal Circuit concluded that the claims are not directed to an abstract idea under step one of the Alice analysis, and thus did not reach step two.

On claim construction, the Federal Circuit held that SRI’s statements in the prosecution history do not invoke a clear and unmistakable surrender of all preprocessing, including decryption, decoding, and parsing. Accordingly, the Federal Circuit agreed with the district court’s construction of “network traffic data” to mean “data obtained from direct examination of network packets.”

On the issue of anticipation, the Federal Circuit held that SRI’s statements in the prosecution history did not invoke a clear and unmistakable surrender of all preprocessing, including decryption, decoding, and parsing. Accordingly, the Federal Circuit agreed with the district court’s construction of “network traffic data” to mean “data obtained from direct examination of network packets.” On this record, the Federal Circuit concluded that summary judgment was appropriate. The prior art did not expressly disclose directly examining network packets as required by the claims—especially not to obtain data about network connection requests.

On the denial of JMOL on the issue of willfulness, the Federal Circuit agreed that the jury’s finding that Cisco willfully infringed the patents-in-suit prior to receiving notice thereof is not supported by substantial evidence and therefore vacated and remanded them. Among other things, SRI argued that Cisco employeees did not read the patent before their depositions, but the Federal Circuit noted that it is undisputed that these Cisco employees were engineers without legal training. Given Cisco’s size and resources, the Federal Circuit said it was unremarkable that the engineers—as opposed to Cisco’s in-house or outside counsel—did not analyze the patents-in-suit themselves. The Federal Circuit also noted that it was undisputed that Cisco did not know of SRI’s patent until SRI sent its notice letter to Cisco, and that this notice letter was sent years after Cisco independently developed the accused systems and first sold them. Under these circumstances the Federal Circuit vacated the finding of willfulness prior to the Notice letter, and remanded for the district court to determine whether the finding of willfulness after the Notice letter was supported by substantial evidence. The Federal Circuit also vacated the award of enhanced damages and remanded for further consideration along with willfulness.

The Federal Circuit vacated the district court’s award of attorneys’ fees under § 285, remanding solely for recalculation. The Federal Circuit found no error in the district court’s determination that the case was exceptional, agreeing that Cisto had “crossed the line in several regards.” However, there were several entries included by mistake, and the Federal Circuit remanded only for removal of attorney hours clearly included by mistake and consequent recalculation of reasonable attorneys’ fees.

Finally, on the issue of on-going royalty, the Federal Circuit found that the district court did not abuse its discretion in awarding a 3.5% compulsory license for all post-verdict sales. Cisco complained that the court was obligated to consider its design-arounds. The Federal Circuit agreed that Cisco was untimely, finding Cisco did not redesign its products until after trial, and Cisco did not file its motion to supplement until after completion of post-trial briefing.

Collateral Estoppel Does Not Apply Where the Accused Product is Different

In Arcelormittal Atlantique et Lorraine v. AK Steek Corp., [2017-1637] (November 5, 2018), the Federal Circuit vacated and remanded the district court’s grant of summary judgment of non-infringement of U.S. Patent Nos. 6,296,805, RE 44,153, and RE 44,940 on collateral estoppel grounds, because the product involved was materially different from the product in the prior litigation.

In January 2010, ArcelorMittal sued AK Steel for infringement, and the primary issue  of the ’805 patent (the “2010 action”).1 The primary issue in the 2010 action was whether steel sheets produced by AK Steel met the “a mechanical resistance of 1500 MPa or greater” limitation after thermal treatment.  The 2010 action ended in a jury verdict of non-infringement.

In April 2013, ArcelorMittal again sued  AK Steel, who filed a motion to dismiss the case on the basis of collateral estoppel, arguing that the action was estopped by the verdict in the 2010 action.  ArcelorMittal argued that new evidence, obtained after the verdict in the 2010 action, established that AK Steel’s new ULTRALUME products were materially different from the AXN products that were the subject of the prior action, because the ULTRALUME sheets were hot-stamped to achieve a UTS exceeding 1,500 MPa.

The Federal Circuit said that a primary issue in a collateral estoppel analysis with respect to non-infringement is whether the accused product is the same—i.e., the issue sought to be precluded is the same as that involved in the prior action—or whether the accused products have materially changed.  The Federal Circuit concluded that the evidence supports the conclusion that the products are not materially the same.  The evidence, when viewed in the light most favorable to non-movant ArcelorMittal, reflected a material difference in the accused product and AK Steel’s conduct since the 2011 verdict.  The evidence indicated that the production process was no longer “rudimentary,” and that commercial stampers were being utilized, and that the stamped steel is being commercialized. This evidence represented a material difference in the accused products and did not exist during the 2010 action.  Finally the Federal Circuit pointed out that AK Steel’s brochure, created after the 2010 action support an allegation that AK Steel is commercially marketing and supplying steel sheets to auto manufacturers that may exceed 1,500 MPa UTS after hot-stamping

The Old “Practicing the Prior Art” Defense

In 01 Communique Laboratory, Inc. v. Citrix Systems, Inc., [2017-1869] (April 26, 2018), the Federal Circuit affirmed the district court’s Order denying 01 Communique a new trial on the issue of infringement.

The case involved U.S. Patent No. 6,928,479 on a System Computer Product and Method for Providing a Private Communication Portal.  The jury returned a split verdict.
It concluded that Citrix had not established that claims 24 and 45 were invalid, but that Communique had not established that Citrix’s GoToMyPC product infringed those claims.  01 Communique’s moved for a new trial because Citrix resorted to “a well-known defendant’s trick,” known as the “practicing the prior art defense.” which “was improper, misleading, and devastatingly prejudicial to the integrity of the trial.”

The Federal Circuit found that Citrix’s infringement defense was firmly rooted in a
limitation by limitation comparison between the asserted claims and the GoToMyPC product.  The Federal Circuit found that Citrix did argued that under the trial court’s claim construction claims 24 and 45 were valid, but not infringed, but that if Communique attempted to expand the scope of its claims to include Citrix’s systems, then the claims would be invalid in light of the prior art.  The Federal Circuit has previously stated that “there is no ‘practicing the prior art’ defense to literal infringement.  The problem with such a defense is that it can potentially allow a defendant to skirt evidentiary hurdles and conflate the infringement and invalidity inquiries.  While the issue of whether asserted claims read on the prior art is relevant to the question of invalidity, “accused infringers are not free to flout the requirement of proving invalidity by clear and convincing evidence by asserting a practicing prior art defense to literal infringement under the less stringent preponderance of the evidence standard.


While it is clear that an accused infringer cannot defeat a claim of literal infringement or establish invalidity merely by pointing to similarities between an accused product and the prior art, this does not preclude a litigant from arguing that if a claim term must be broadly interpreted to read on an accused device, then this same broad construction will read on the prior art.  The Federal Circuit found that Citrix did not rest on an improper “practicing the prior art” defense, but instead correctly recognized that claim terms must be construed the same way for both invalidity and infringement.

The Federal Circuit rejected the argument that comparisons between the accused device and the prior art is improper, and noted that any prejudice would be cured by the district court’s jury instructions.

The Federal Circuit affirmed the denial of a new trial.


Anda Your Patent is Not Infringed

In Merck Sharp & Dohme Corp. v. Amneal Pharmaceuticals LLC, [2017-1560] (February 9, 2018), the Federal Circuit affirmed the district court, finding that it did not abuse its discretion in denying Merck’s request for additional samples and a new trial, that it did not err in finding that Merck failed to demonstrate that Amneal’s ANDA product, which formed the basis for the district court’s noninfringement finding, was not representative of Amneal’s final commercial product, and that district court did not clearly err in finding that three Raman peaks were required to prove infringement.

On the denial of additional discovery issue, the Federal Circuit reviews a district court’s denial of additional discovery under regional circuit law, and the Third Circuit will not disturb a denial of additional discovery
absent an abuse of discretion and “a showing of actual and substantial prejudice.  The Federal Circuit found the question “a close one.” The Federal Circuit noted that Amneal’s failure to abide by the standing discovery order resulted in a trial situation that was “less than ideal.”  However the Federal Circuit concluded that the district court did not abuse its discretion in denying the additional discovery, noting that the district court took adequate steps to ensure that proceeding with trial would not prejudice Merck.

The Federal Circuit said that the ultimate determination of infringement is a question of fact, which is reviewed for  clear error. The Federal Circuit rejected Merck’s argument that the district court improperly determined infringement of an intermediate product, rather than the final product, as imposing a heightened evidentiary standard in ANDA cases not supported by case law.  The Federal Circuit said that regardless of the type of sample (e.g., commercial or batch), the critical inquiry is
whether it is representative of what is likely to be approved and marketed.

Finally, the Federal Circuit discerne no clear error in the district court’s
fact-finding of noninfringement.  The district court found Amneal’s expert
evidence “at least as consistent and credible” as Merck’s expert and concluded that Merck failed to prove infringement by preponderant evidence.  Amneal’s expert testified that although a single peak can be used at times, three Raman peaks are typically used to absolutely confirm the presence of molecules in complex mixtures like MFM. Because the noninfringement finding was supported by this evidence in the record, the Federal Circuit concluded that the district court did not clearly err in its noninfringement finding.

Software Innovations Make Non-Abstract Improvements to Computer Technology

In Finjan, Inc., v. Blue Coat Systems, Inc., [2016-2520] (January 10, 2018), the Federal Circuit affirmed subject matter eligibility of U.S. Patent No. 6,154,844; affirmed infringement of the U.S. Patent Nos. 6,154,844 and 7,418,731;  affirmed the award of damages of $ 6 million for U.S. Patent No. 7,418,731 and $1.6 million for U.S. Patent No. 7,647,633,  reversed the denial of JMOL of non-infringement of U.S. Patent No.  6,965,968 and vacated the corresponding damage award.

Regarding subject matter eligibility of U.S. Patent No. 6,154,844, the Federal Circuit started at Step 1 of the Alice test, finding that the ’844 patent is directed to a method of providing computer security by scanning a downloadable and attaching the results of that scan to the downloadable itself in the form of a “security profile.”  While the Federal Circuit noted that in Intellectual Ventures I LLC v. Symantec Corp. it held that virus screening is well-known and constitutes an abstract idea, the Federal Circuit said that in the present case “the claimed method does a good deal more.”  The Federal Circuit framed the question as “whether
this behavior-based virus scan in the ’844 patent constitutes an improvement in computer functionality,” and found that it does.  The Federal Circuit said that its cases confirm that software-based innovations can make “non-abstract improvements to computer technology” and be deemed patent-eligible subject matter at
step 1.

The Federal Circuit also rejected the challenge that even if the claimed idea is new, it is still abstract, noting that the claims recite more than a mere result. Instead, the Federal Circuit found that they recite specific steps—generating a security profile that identifies suspicious code and linking it to a downloadable—that accomplish the desired result.

Regarding infringement of the ’844 and ’731 patents, the Federal Circuit found that the JMOL of non-infringement for the first time raised issues of claim construction, which it cannot do: “it is too late at the JMOL stage to argue for or adopt a new and more detailed interpretation of the claim language and test the jury verdict by that new and more detailed interpretation.” The Federal Circuit found the verdict of infringement of these patent was supported by substantial evidence.  Regarding the ‘968 the Federal Circuit agreed with the defendant that the patentee failed to introduce substantial evidence of infringement.

Regarding damages for infringement of the ’844 patent, the Federal Circuit agreed that the patentee failed to apportion damages to the infringing functionality, stating that “[w]hen the accused technology does not make up the whole of the accused product, apportionment is required.”  The Federal Circuit said that the patentee must give evidence
tending to separate or apportion the infringer’s profits and the patentee’s damages between the patented feature and the unpatented features, and such evidence must be reliable and tangible, and not conjectural or
speculative.  The patentee argued that it based the royalty on the “smallest, identifiable technical component” but the Federal Circuit held that this does not insulate them from the essential requirement that the ultimate reasonable royalty award must be based on the incremental value that the patented invention adds to the end product.  Noting that reversal of the denial of JMOL could result in a situation in which Finjan receives no compensation for Blue Coat’s infringement of the ’844 patent, the Federal Circuit remanded to the district court to determine whether Finjan has waived the right to establish reasonable royalty damages under a new theory and whether to order a new trial on damages.  This aspect of the decision caused the district judge in the middle of a trial relating to the same patent to declare a mistrial, and reschedule the infringement and damages cases.

Regarding damages for infringement of the ’731 and ’633 patents, the Federal Circuit held that the awards were supported by substantial, if conflicting, evidence.

This is a rare Step 1 victory for a software inventor, and although the decision will no doubt be cited by hopeful applicants and patent owners, it does not bring any clarity to what it means to claim an abstract idea.

Whether Third Party Acts are Attributable to Infringer in a Divided Infringement Situation is Question of Fact

Travel Sentry, Inc. v. Tropp, [2016-2386, 2016-2387, 2016-2714, 2017-1025] (December 19, 2017), the Federal Circuit vacated summary judgment of non-infringement, finding genuine disputes of material fact regarding whether Travel Sentry directs or controls the performance of certain steps of the claimed methods.

The case involved U.S. Patent Nos. 7,021,537 and 7,036,728 directed to
methods of improving airline luggage inspection through the use of dual-access locks.  The infringement claim hinged on a Memorandum of Understanding (MOU) between Travel Sentry in the TSA.  The district court found that this did not evidence sufficient control by Travel Sentry to constitute infringement.

The Federal Circuit noted that in Akamai V, it affirmed the principle that “[d]irect infringement under § 271(a) occurs where all steps of a claimed method are performed by or attributable to a single entity,” and held that an entity is responsible for others’ performance of method steps where
that entity directs or controls others’ performance or where the actors form a joint enterprise.  The Federal Circuit further noted that liability under § 271(a) could be found when an alleged infringer ‘conditions participation in an activity or receipt of a benefit upon performance of a step or steps of a
patented method and establishes the manner or timing of that performance.

The Federal Circuit said that the district court reasoned that summary judgment was appropriately awarded to Travel Sentry and its licensees
because there was simply no evidence that Travel Sentry had any influence whatsoever on the third and fourth steps of the method carried out by the TSA, let alone that it masterminded the entire patented process.  In so doing the district court incorrectly found that Akamai V did not expand the scope of direct infringement under § 271(a), and did “not disturb the BMC Res./Muniauction test.”

The Federal Circuit reiterated that under Akamai V, “liability under § 271(a) can also be found when an alleged infringer conditions participation in an activity or receipt of a benefit upon performance of a step or steps of a patented method and establishes the manner or timing of that  performance,”  and reiterated that whether a single actor directed or controlled the acts of one or more third parties is a question of fact.

The Federal Circuit pointed to its recent application of § 271(a)  in Eli Lilly v. Teva Parenteral Medicines.  Based upon the reasoning in Akamai V and Eli Lilly, the Federal Circuit said that a reasonable jury could conclude that TSA’s performance of the final two claim steps is attributable to Travel
Sentry such that Travel Sentry is liable for direct infringement under § 271(a).  The Federal Circuit found that the district erred in three respects:

First, it misidentified the relevant “activity” at issue, broadly defining it as “the luggage screening mandated by Congress,” rather than more specifically as “screening luggage that TSA knows can be opened
with the passkeys provided by Travel Sentry.”  Second, the district court misapprehended what types of “benefits” can satisfy Akamai V’s first prong, noting that the jury could find that the ability to open identifiable luggage using a master key, which would obviate the need to break open the lock, was a sufficient benefit.  Third, the court mischaracterized what is required for one to “condition” a third party’s participation in an activity or receipt of a benefit on the third party’s performance of one or more claim steps.

Under the second Akamai prong, the Federal Circuit also found that, drawing all justifiable inferences in Tropp’s favor, a reasonable jury could find that Travel Sentry has established the manner or timing of TSA’s performance.

Is Patent Infringement a High Crime or Misdemeanor?

In addition to all the other wild accusations against him, Donald J. Trump has been accused of patent infringement.  In a suit filed on December 12 in the Norther District of California, Lathan Lycurgus Smith alleges President Trump and the Secret Service and the entire country of patent infringement.  Apparently Mr. Smith is some sort of polymath, with inventions ranging from automobiles to toilet paper.   Mr. Smith’s prayer for relief goes a little beyond 35 USC §§ 283-284, seeking:

  • issuance of all of his patents
  • all the money made from the patents (they must be design patents)
  • an exemption from taxes “for the rest of time”
  • an injunction against making “anything that the Patents are on or involved with”
  • a “full body massage the rest of my life dayly [sic].”

Today’s question is: Is patent infringement a high crime or misdemeanor?