Greenblum & Bernstein, P.L.C.
Recent Litigation News in Intellectual Property
In This Issue
· Federal Circuit Affirms Order Entering Judgment as a Matter of Law
· Federal Circuit Affirms Jury Finding of Infringement
· Federal Circuit Reverses Finding of inequitable Conduct
· Federal Circuit Holds Declaratory Judgment Plaintiff Who Is a Licensee Has Burden of Proving No Infringement
· Federal Circuit Affirms Dismissal of Declaratory Judgment Action
In Mirror Worlds, LLC v. Apple, Inc. (Appeal No. 2011-1392), the Federal Circuit affirmed the district court order entering judgment as a matter of law.
Mirror Worlds had asserted infringement of three patents. The jury returned a verdict in favor of Mirror Worlds and awarded $208.5 million in damages. In separate rulings, one at the end of Mirror Worlds’ case in chief and another after the jury verdict, the district court entered judgment as a matter of law in Apple’s favor, finding that Apple was not liable as a matter of law for infringement of any of the asserted patent claims and vacating the damages verdict. Specifically, the district court concluded that Mirror Worlds did not establish infringement of the asserted claims of two of the patents under the doctrine of equivalents because the accused products did not have an equivalent of a “cursor or pointer.” The district court also concluded that Mirror Worlds failed to offer substantial evidence that Apple performed each step of the claimed methods in the third patent and that the evidence presented at trial was not sufficient to support the damages award.
On appeal, the Federal Circuit reviewed the evidence and found the testimony presented was insufficient to allow a reasonable juror to find that Mirror Worlds had met its burden of proof in showing that the accused product had the equivalent of a “cursor or pointer.” The Federal Circuit stated, with respect to the first two patents, that reading the “cursor or pointer” limitation out of the claim improperly vitiates claim language by allowing the exact opposite of what is required. As such, the Federal Circuit held that the district court correctly found that Mirror Worlds failed to provide substantial evidence to the jury to support a verdict of infringement.
With respect to the third patent, the Federal Circuit held that there was a lack of substantial evidence on which a jury could render a verdict of direct infringement or for inducement of infringement. Accordingly, the Federal Circuit affirmed the district court’s grant of judgment as a matter of law.
Federal Circuit Affirms Jury Finding of Infringement
In K-TEC, Inc. v. Vita-Mix Corp. (Appeal Nos. 2011-1244, -1484, -1512), the Federal Circuit affirmed the jury finding of infringement.
At trial, it was held that Vita-Mix infringed the asserted claims of two U.S. patents, that two prior art references were not analogous art for the purposes of an obviousness analysis, that substantial evidence supported the jury’s findings that the asserted claims were not invalid, that Vita-Mix’s infringement was willful, and that K-TEC, Inc. was entitled to approximately $11 million in reasonable royalty and lost profits damages.
The patents-in-suit claim a “blending jar” that comprises “four side walls” and a “fifth truncated wall” arranged in a specific geometry. According to the patents, using this geometry, the vortex created when blending liquid inside the container moves away from the central axis and toward the truncated wall. The shifted vortex creates a flow pattern in which, during blending, the liquid will climb up the corner opposite the truncated wall and will be lower at the truncated wall. That flow pattern reduces cavitation in the container, increasing the speed and efficiency with which smoothies and other beverages can be made.
Vita-Mix argued that two references were analogous art for an obviousness analysis because they were “reasonably pertinent” to the particular problem K-Tec was trying solve. The district court found, that the two references, which related to non-blending containers and food mixers, were not reasonably pertinent.
The Federal Circuit held that the district court properly granted summary judgment that the asserted prior art references were not analogous art. The Federal Circuit stated that “to qualify as prior art for an obviousness analysis, a reference must qualify as ‘analogous art,’ i.e., it must satisfy one of the following conditions: (1) the reference must be from the same field of endeavor; or (2) the reference must be reasonably pertinent to the particular problem with which the inventor is involved. [Citation omitted]. A reference is reasonably pertinent if it, as a result of its subject matter, ‘logically would have commended itself to an inventor’s attention in considering his problem.’”
Federal Circuit Reverses Finding of inequitable Conduct
In 1st Media, LLC v. Electronic Arts, Inc. et al. (Appeal No. 2010-1435), the Federal Circuit reversed a finding of inequitable conduct.
The district court found that during prosecution of the patent-in-suit, the named inventor and his attorney withheld three material references and information about rejections in two related prosecutions from the United States Patent and Trademark Office (“PTO”). The district court then held that inequitable conduct rendered the patent-in-suit unenforceable.
On appeal, the Federal Circuit noted that the Therasense case changed the standard for proving inequitable conduct based on nondisclosure of a reference to the PTO. Under the Therasense standard, absent affirmative egregious misconduct, a defendant must prove by clear and convincing evidence both of the separate requirements that: (1) “the patentee acted with the specific intent to deceive the PTO”; and (2) the non-disclosed reference was but-for material. In order to show that the patentee acted with the specific intent to deceive the PTO, a defendant must prove “that the applicant knew of the reference, knew that it was material, and made a deliberate decision to withhold it.” The Federal Circuit stated that a failure of proof on any element precludes a finding of inequitable conduct. “[T]o meet the clear and convincing evidence standard, the specific intent to deceive must be ‘the single most reasonable inference able to be drawn from the evidence.’” The Federal Circuit noted further that a district court can no longer infer intent to deceive from non-disclosure of a reference solely because that reference was known and material. A patentee need not offer any good faith explanation for its conduct unless and until the accused infringer has met its burden to prove intent to deceive by clear and convincing evidence.
The Federal Circuit reviewed the record, and found that the district court did not discuss or consider whether there was any deliberate decision on either the applicant’s or attorneys’ part to withhold the references from the PTO. Accordingly, the Federal Circuit specifically held that, because the accused infringer Appellees could not prove on the record that either the applicant or his attorney made a deliberate decision to withhold references from the PTO, and because Appellees acknowledged that the record is complete, the district court order had to be reversed. The Federal Circuit did not decide whether any of the references were but-for material.
Federal Circuit Holds Declaratory Judgment Plaintiff Who Is a Licensee Has Burden of Proving No Infringement
In Medtronic Inc. v. Boston Scientific Corp. and Mirowski Family Ventures, LLC (Appeal Nos. 2011-1313 and 1372), the Federal Circuit held that the district court relied on a legally incorrect allocation of the burden of proof to find noninfringement.
Medtronic had filed a complaint in the U.S. District Court for the District of Delaware seeking declaratory judgment of noninfringement and invalidity of two patents assigned to Mirowski Family Ventures, LLC (“MFV”). The district court entered judgment of noninfringement in favor of Medtronic and judgment of validity and enforceability in favor of MFV. MFV appealed the district court’s judgment of noninfringement and Medtronic cross-appealed the district court’s claim construction on which its judgment of validity is based.
The district court held a bench trial and ruled that the defendants, as patentees, had the burden to prove infringement. The district court then found that MFV’s expert testimony lacked sufficient foundation because of his failure to consider each limitation of each asserted claim in comparison to each accused product before rendering his infringement opinions. The district court also found that defendants had failed to prove literal infringement by a preponderance of the evidence. The district court further found MFV’s expert report and testimony conclusory and insufficient to show that the products infringed the patents-in-suit under the doctrine of equivalents.
The Federal Circuit stated that the contract at-issue required MFV to identify products it believed were covered by the contract. After MFV identified those products, Medtronic was required to either pay royalties on them, or sue for declaratory judgment that the products were not covered. Thus, the Federal Circuit concluded, Medtronic was the party requesting relief from the district court: it already has a license; it cannot be sued for infringement; it is paying money into escrow; and it wants to stop. In contrast, MFV sought nothing more than to be discharged from the suit and be permitted to continue the quiet enjoyment of its contract. In other words, Medtronic, and not MFV, was asking the court to disturb the status quo ante and to relieve it from a royalty obligation that it believes it does not bear. As such, the Court held that Medtronic must present evidence showing that it is entitled to such relief.
The Federal Circuit held the district court’s conclusion that defendants had failed to prove literal infringement by a preponderance of the evidence could not stand, and reversed the district court’s order. Thus, because the license in this case prohibited Boston Scientific from pursuing infringement counterclaims, Medtronic had the burden of proving no infringement.
Federal Circuit Affirms Dismissal of Declaratory Judgment Action
In Matthews Int’l Corp. v. Biosafe Eng., LLC (Appeal Nos. 2012-1044), the Federal Circuit affirmed a district court’s dismissal of a declaratory judgment action.
At the district court, Biosafe moved to dismiss all counts of Matthews’ amended complaint for lack of declaratory judgment jurisdiction. The district court granted Biosafe’s motion to dismiss, concluding that Matthews had not made “meaningful preparation” to conduct potentially infringing activity, since the parameters used in the operation of Matthews’ devices were not settled and those devices could be operated with parameters outside of the various ones specified in the asserted patents. The district court further held that the potentially infringing features of the accused system were “fluid and indeterminate,” and thus Matthews’ claim lacked the necessary reality to satisfy the constitutional requirements for declaratory judgment jurisdiction.
The Federal Circuit agreed with the district court that the action lacked the immediacy and reality required to support the exercise of declaratory judgment jurisdiction. Accordingly, the dismissal of the declaratory judgment action was affirmed.