Greenblum & Bernstein, P.L.C.
Recent Litigation News in Intellectual Property
In This Issue
· Federal Circuit Vacates And Remands Permanent Injunction
· Federal Circuit Vacates Grant Of Summary Judgment
· Federal Circuit Affirms Finding That Claims Were Directed to Ineligible Subject Matter Under 35 U.S.C. § 101
· Federal Circuit Vacates Grant Of Summary Judgment For Lack Of Subject Matter Jurisdiction
· Federal Circuit Reverses Finding Of No Infringement
In Versata Software Inc. et al. v. SAP America Inc. et al. (Appeal Nos. 2012-1029, 1049), the Federal Circuit affirmed the jury’s infringement decision and damages awards, but vacated the trial court’s issuance of a permanent injunction.
The patents-in-suit relate to the field of computer-based pricing of products. The claimed invention leverages hierarchical product and data structures to organize pricing information. After affirming the district court judgment of infringement and the damages award, the Federal Circuit found the breadth of the permanent injunction to be overbroad.
SAP argued that the injunction was overbroad because it prohibited SAP from offering maintenance and additional seats for SAP’s current customers. “Additional seats” refers to increasing the number of users covered under a specific license. SAP did not challenge the portion of the injunction that prohibits it from offering the accused functionality in new sales of its software. The injunction used two key terms: the “Infringing Products” and “the Enjoined Capability.” The enjoined capability was the capability to execute a pricing procedure using hierarchical access of customer and product data. However, the enjoined capability represented only a fraction of the features contained in the infringing products. The Federal Circuit held that the trial court erred by placing emphasis on SAP’s product as a whole, and SAP should be able to provide maintenance or additional seats for prior customers of its infringing products, so long as the maintenance or the additional seat did not involve, or allow access to, the enjoined capability.
The Federal Circuit accordingly vacated certain language from the permanent injunction and remanded to the trial court to modify its order in accordance with the Federal Circuit’s opinion.
Federal Circuit Vacates Grant Of Summary Judgment
In Baron Services, Inc. v. Media Weather Innovations LLC (Appeal Nos. 2012-1285, -1443), the Federal Circuit vacated the district court’s summary judgment and award of attorney’s fees and remanded the case for further proceedings.
Baron owns U.S. Patent No. 6,490,525 (“’525 patent”), which generally relates to systems and methods for weather reporting and forecasting, and more particularly, to computerized systems and methods for reporting and forecasting real-time weather information. Barron sued MWI’s WeatherCall programs for infringement.
MWI filed a summary judgment motion for noninfringement. Baron requested the district court to delay ruling on the summary judgment motion until it had the opportunity to examine MWI’s source code and to depose the witnesses who had submitted affidavits in support of the summary judgment motions. The district court granted the summary judgment motion and held that Baron never “ask[ed] for more time to complete discovery” and failed to “assert it could not prosecute this action without further discovery.” Subsequently, MWI filed a motion for attorney’s fees pursuant to 35 U.S.C. § 285, which the district court granted, and the district court entered judgment awarding MWI $243,757.45 for attorney’s fees.
On appeal, the Federal Circuit found that Baron appeared to have diligently pursued discovery, and under the circumstances, it was improper for the district court to have refused Baron’s request to delay ruling on MWI’s summary judgment motion until Baron had the opportunity to access MWI’s source code and depose the witnesses. The Federal Circuit thus held that the district court abused its discretion by denying Baron’s request under Rule 56(d) to delay ruling on MWI’s summary judgment motion, and vacated the district court’s summary judgment order and the district court’s order and judgment awarding attorney’s fees.
Federal Circuit Affirms Finding That Claims Were Directed to Ineligible Subject Matter Under 35 U.S.C. § 101
In CLS Bank Int’l v. Alice Corporation (Appeal No. 2011-1301), the Federal Circuit, sitting en banc, affirmed the district court decision that Alice’s patents were directed to ineligible subject matter under 35 U.S.C § 101.
The claims of the patents-in-suit were for methods, computer-readable media, and systems for the use of intermediaries to help consummate exchanges between parties (an escrow arrangement). A majority of the judges found the method and computer-readable media claims to be patent-ineligible, while the court divided equally as to the system claims.
Separate opinions were filed by (1) Judge LOURIE, joined by Judges DYK, PROST, REYNA, and WALLACH, (2) Chief Judge RADER and Judges LINN, MOORE, and O’MALLEY, (3) Judge MOORE, joined by Judges RADER, LINN and O’MALLEY, (4) Judge NEWMAN, (5) Judges LINN and O’MALLEY, and (6) Judge RADER filed a 5-page set of “additional reflections.”
Judge Lourie’s opinion adopted an approach for evaluating subject matter eligibility that turned on the “practical likelihood of a claim preempting a fundamental concept.” This approach called for determining whether a claim posed any risk of preempting an abstract idea and, if so, whether the claim limitations added “enough” beyond the abstract idea to sufficiently limit the claim “to a narrower, patent-eligible application of that idea.”
Federal Circuit Vacates Grant Of Summary Judgment For Lack Of Subject Matter Jurisdiction
In Forrester Envionmental v. Wheelabrator Tech. (Appeal No. 2012-1686), the Federal Circuit vacated the district court’s grant of summary judgment on the grounds that the district court lacked subject matter jurisdiction.
Forrester filed suit against Wheelabrator in State court. The complaint alleged four causes of action, all based on New Hampshire state law. Wheelabrator removed the case to the U.S. District Court for the District of New Hampshire. Forrester filed a motion to remand the case to state court, arguing that the district court
lacked subject-matter jurisdiction. In response, Wheelabrator argued that there was federal jurisdiction because Forrester could only recover if it prevailed on a substantial question of U.S. patent law.
The Federal Circuit, citing Gunn v. Minton, 568 U.S. ___, ___, 133 S. Ct. 1059, 1065 (2013), held that even if the allegations contained in Forrester’s complaint necessarily raise a question of patent law, the patent law issues are not “substantial in the relevant sense” under Gunn. As such, the district court lacked subject-matter jurisdiction over Forrester’s claims, and the Federal Circuit vacated the district court’s judgment and remanded to the district court with instructions to remand the case to the New Hampshire state court.
Federal Circuit Reverses Finding Of No Infringement
In Aventis Pharmaceuticals Inc. v. Amino Chemicals, Ltd. (Appeal Nos. 2011-1335,-1336) the Federal Circuit reversed a judgment of no patent infringement.
The parties stipulated to noninfringement following the district court’s Markman opinion. The district court construed the term “substantially pure” to require “at least 98% purity with respect to all impurities.”
The Federal Circuit determined that this construction conflated the purity required for the piperidine end product with that of the CPK intermediate. As such, the district court erred in requiring that “substantially pure” have the same interpretation when applied to the CPK intermediate and the piperidine derivative end product. Because the district court erred in construing “substantially
Pure,” the Federal Circuit reversed and remanded.