Document ID: s3://data.kl3m.ai/documents/govinfo/USCOURTS/USCOURTS-ca13-14-01167/USCOURTS-ca13-14-01167-0/pdf.json

Parties Involved:
Info-Hold, Inc.
Appellant
Muzak LLC
Appellee

Document Text:

United States Court of Appeals 

for the Federal Circuit ______________________ 

INFO-HOLD, INC.,

Plaintiff-Appellant

v.

MUZAK LLC,

Defendant-Appellee

______________________ 

2014-1167

______________________ 

Appeal from the United States District Court for the 

Southern District of Ohio in No. 1:11-cv-00283, Judge 

Timothy S. Black.

______________________ 

Decided: April 24, 2015 

______________________ 

DANIEL JOSEPH WOOD, Info-Hold, Inc., Cincinnati, 

OH, JAMES L. KWAK, Standley Law Group LLP, Dublin, 

OH, argued for plaintiff-appellant.

BARRY EASTBURN BRETSCHNEIDER, Baker & Hostetler 

LLP, Washington, DC, argued for defendant-appellee. 

Also represented by MICHAEL EDWARD ANDERSON,

BRIDGET SPRINGER MERRITT; JOHN FRANK MURPHY, Philadelphia, PA; KEVIN W. KIRSCH, Cincinnati, OH.

______________________ 

Before REYNA, WALLACH, and TARANTO, Circuit Judges.

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2 INFO-HOLD, INC. v. MUZAK LLC

REYNA, Circuit Judge.

This case comes before us on appeal of numerous rulings unfavorable to Info-Hold, Inc. (“Info-Hold”), owner of 

U.S. Patent No. 5,991,374 (the “’374 patent”), the sole 

patent in the dispute. Info-Hold asserted the ’374 patent 

against Muzak LLC (“Muzak”) and Applied Media Technologies Corporation (“AMTC”) in separate lawsuits

before the same judge in the United States District Court 

for the Southern District of Ohio. Those suits led to 

separate appeals, which were argued on the same day 

before the same panel. We address the issues raised in 

Info-Hold’s appeal in the AMTC suit in a separate opinion.

Following claim construction, the district court granted summary judgment to Muzak that, notwithstanding 

infringement, Info-Hold was not entitled to reasonable 

royalty damages, and that Muzak did not induce infringement of the ’374 patent. For the reasons set forth 

below, we reverse the grant of summary judgment of no 

damages for infringement, we vacate the summary judgment of no induced infringement, and we affirm the 

district court’s construction of the sole claim term in 

dispute. 

BACKGROUND

The ’374 patent is directed to systems, apparatuses, 

and methods for playing music and messages (e.g., advertisements) through telephones and public speaker systems. Playback order of the music and message tracks is 

set on a remote server. The remote server generates and 

sends control signals to message playback devices, telling 

them to access and play back tracks in a specified order. 

One use of the disclosed technology involves directing the 

output of the message playback devices to a public address system at retail stores, so customers can hear the 

music and advertisements while shopping. The output of 

the message playback device can also be directed to a 

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INFO-HOLD, INC. v. MUZAK LLC 3

music-on-hold (“MOH”) system, which plays the tracks 

over the telephone to callers who are on hold. The inventor of the patent, Joey C. Hazenfield, assigned the patent 

to Info-Hold in exchange for a 5 percent royalty on sales of 

products embodying the patent’s technology. (“Hazenfield 

Assignment”). 

Prior to the filing of the suit against Muzak, a thirdparty requester initiated an ex parte reexamination of the 

’374 patent. To overcome prior art during reexamination, 

Info-Hold amended several independent claims by adding 

the limitation “when a caller is placed on hold” to specify 

the timing of track playback. Info-Hold argued to the 

examiner that, after the addition of the limitation “when 

a caller is placed on hold,” the claims were patentable

because the prior art “fails to teach, or even suggest, a 

music-on-hold-compatible telephone system or playing 

messages or generating signals when callers are placed on 

hold . . . .” J.A. 473. The examiner allowed the claims on 

the basis of Info-Hold’s argument. J.A. 361. Independent 

claim 7 is representative of the technology claimed in the 

’374 patent and recites:

7. A programmable message delivery system for 

playing messages on message playback devices at one or more remote sites comprising:

a communication link;

a plurality of message playback devices, each of said message playback devices communicating with a respective 

telephone system and comprising a 

storage device for storing messages 

and for playing selected ones of said 

messages through an output of said 

message playback device when a caller 

is placed on hold; and

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4 INFO-HOLD, INC. v. MUZAK LLC

a computer remotely located from said 

plurality of message playback devices 

and operable to generate and transmit 

control signals via said communication 

link for controlling at least one of said 

plurality of message playback devices;

each of said plurality of message playback devices 

being adapted to receive said control signals 

via said communication link and being programmable to access at least one of said messages from said storage device and to provide 

said accessed message to said output in accordance with said control signals when a 

caller is placed on hold; 

wherein said computer comprises a display device 

and is programmable to generate screens on 

said display device that include user selectable menu items for selection by an operator to define relationships between said 

plurality of message playback devices and 

said messages, the screens guiding an operator to make choices selected from the group 

consisting of which of said messages are to be 

played, which of said plurality of message 

playback devices are to play said selected 

messages, a time of day when said control 

signals are to be transmitted to said message 

playback devices, a date on which said control 

signals are to be transmitted to said message 

playback devices, a sequence in which said selected messages are to be played, and how 

many times to repeat at least one of said selected messages in said sequence, and to generate said control signals to implement said 

choices via said message playback devices.

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INFO-HOLD, INC. v. MUZAK LLC 5

’374 patent reexamination certificate, col. 1 ll. 28-67

(emphasis added). 

The parties in this case make and sell MOH systems. 

Info-Hold sells a product called “Info-Link” that purportedly embodies the features of the ’374 patent, including 

remote programming capabilities and the ability to select 

messages for playback at particular locations. Muzak 

makes and sells two music and messaging delivery devices, the Encompass LE 2 and the Encompass MV, which 

Info-Hold alleges infringe the ’374 patent. 

LITIGATION HISTORY

In 2006, Info-Hold contacted Muzak on at least two 

occasions regarding the possibility that Muzak’s products

infringe the ’374 patent. On February 21, 2006, InfoHold’s in-house counsel, Daniel Wood, sent a letter to 

Muzak’s General Counsel, Michael Zendan, drawing 

attention to the ’374 patent and asking whether any of 

Muzak’s products might practice the patented technology. 

Mr. Wood specifically requested to be informed of the 

results of any “detailed analysis of the ’374 patent” already conducted by Muzak. Mr. Wood also requested that 

Muzak conduct such an analysis. J.A. 2890. Muzak did 

not respond to Info-Hold’s letter. 

Mr. Wood called Mr. Zendan in June 2006. In that 

conversation, Mr. Wood explained the technology alleged 

to be covered by the ’374 patent. Mr. Wood inquired 

whether Muzak’s products included the ability to control 

music and/or message playback at one or more other 

locations from a single, remotely located computer. See, 

e.g., J.A. 2815, 6:17-21; 2816, 13:14-22. During the course 

of the conversation, Mr. Zendan expressed surprise upon 

learning that the ’374 patent covered the playback of 

music as opposed to only messages. Mr. Zendan stated, 

“We’re talking about the music, how they control their 

music. . . . Well . . . yeah, we have a system where there 

probably is some control of the music.” J.A. 2817, 14:1-7. 

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In light of this fact, Mr. Zendan told Mr. Wood that he 

would take another look at the ’374 patent in relationship 

to Muzak’s products. Id. at 14:17-22. Mr. Zendan asked 

whether Info-Hold wanted Muzak to “look at our technology from the standpoint of . . . music that you would hear 

in a store . . .” Id. at 15:22-16:5. Mr. Wood replied, “Yes.” 

Id. at 16:6.

Info-Hold filed suit in May 2011, alleging that Muzak 

infringed the ’374 patent through the manufacture and 

sale of Muzak’s Encompass LE 2 and Encompass MV

products. Info-Hold also alleged that Muzak induced and 

contributed to the infringement of the ’374 patent. Muzak 

answered, seeking a declaratory judgment that the ’374 

patent was invalid and that it did not indirectly infringe

the patent. 

During the Markman phase of the litigation, the parties requested construction of several terms, including the 

term “when a caller is placed on hold.” The parties’ 

dispute focused on whether “when” meant at the moment 

the caller was placed on hold (Muzak’s position) or during 

the period the caller was on hold (Info-Hold’s position). 

The district court construed this term to mean “at the 

moment a caller is placed on hold.” Based on the district 

court’s construction, the parties stipulated to noninfringement of the asserted independent claims of the 

’374 patent containing the phrase “when a caller is placed 

on hold,” and all claims depending from those independent claims.

On the issue of damages, the parties disagreed about 

the royalty to which Info-Hold would be entitled if infringement were found. Info-Hold attempted to base its 

damages case on the report and testimony of its expert, 

Robert White, who performed tax and audit work for InfoHold for fifteen years prior to the suit. Mr. White employed the entire market value rule, though his report 

was silent on whether the patented features drove deCase: 14-1167 Document: 62-2 Page: 6 Filed: 04/24/2015
INFO-HOLD, INC. v. MUZAK LLC 7

mand for the accused products. As part of the reasonable 

royalty analysis, Mr. White considered a license of the 

’374 patent to Trusonic, Inc. (“Trusonic License”), entered 

into as part of a litigation settlement, and the Hazenfield 

Assignment. Mr. White’s royalty calculation relied on the 

25-percent rule of thumb. Muzak introduced the report of 

its expert, David Paris. Mr. Paris considered the Trusonic 

License, the Hazenfield Assignment, a settlement agreement between Muzak and a third party for use of patents 

comparable to the ’374 patent, the license of several InfoHold patents to a third party related to MOH systems, 

and the financial data of Info-Hold and Muzak during the 

relevant period. Based on these sources of information, 

Mr. Paris determined that a royalty between 1 and 2

percent was reasonable, if infringement were established. 

The parties filed numerous summary judgment motions. Those that are relevant to this appeal are Muzak’s 

motions for summary judgment that (1) Muzak did not 

induce infringement of the ’374 patent; (2) Info-Hold is 

not entitled to lost profits; and (3) Info-Hold is not entitled 

to reasonable royalty damages. The district court granted 

each of these motions. The district court granted Muzak’s 

motion that it did not induce infringement on the basis 

that Muzak did not possess actual knowledge that the 

acts it allegedly induced constituted infringement of the 

’374 patent. Further, no pre-suit communication between 

Mr. Wood and Mr. Zendan identified which claims were 

allegedly infringed or which products were allegedly 

infringing. J.A. 59-60. The court granted Muzak’s motion 

that Info-Hold was not entitled to lost profits because 

Info-Hold never introduced evidence of the profits it 

earned from solely the patented technology. J.A. 65-67. 

Muzak’s summary judgment motion related to reasonable royalty damages was combined with a motion to 

strike the expert report of Mr. White, Info-Hold’s damages 

witness, and to preclude his testimony. Because Mr. 

White was not qualified to aid the understanding of the 

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8 INFO-HOLD, INC. v. MUZAK LLC

trier of fact on the issue of damages, and because he based 

the royalty rate in his report upon the 25-percent rule of 

thumb, which this court discredited in Uniloc USA, Inc. v. 

Microsoft Corp., 632 F.3d 1292 (Fed. Cir. 2011), the 

district court struck the report and precluded his testimony. J.A. 81-87. Turning to Muzak’s motion on reasonable 

royalties, the district court explained that Info-Hold did 

not disclose any other expert witness, and Info-Hold’s lay 

witnesses were not qualified to testify on the issue of 

damages. According to the district court, this left InfoHold without any evidence to make a prima facie case 

regarding reasonable royalty damages. J.A. 88-89. Thus, 

the court granted summary judgment to Muzak on the 

issue of reasonable royalty damages. J.A. 89.

Muzak also filed a motion for summary judgment of 

non-infringement on all asserted claims and that all 

asserted claims are invalid for lacking enablement. InfoHold filed a motion for summary judgment on the issue of 

infringement. Before ruling on these motions, the district 

court ordered Info-Hold to show cause why final judgment 

should not be entered against Info-Hold in light of its 

inability to prove lost profits or reasonable royalty damages. In its order ruling on Info-Hold’s show cause memorandum, the court reasoned that after the exclusion of the 

evidence from Mr. White, Info-Hold had “not demonstrated that it [wa]s entitled to any measurable remedy,” 

including a reasonable royalty. J.A. 98-99. Thus, the 

court entered final judgment against Info-Hold and dismissed the case.

Info-Hold appeals (1) the propriety of the district 

court’s entry of summary judgment against it, and subsequent dismissal, based on a purported inability to prove 

any reasonable royalty damages; (2) the construction of 

the term “when a caller is placed on hold”; and (3) the 

grant of summary judgment of no induced infringement 

based on supposed lack of evidence of knowledge or willful 

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INFO-HOLD, INC. v. MUZAK LLC 9

blindness. We have jurisdiction under 28 U.S.C. 

§ 1295(a)(1).

DISCUSSION

I. DAMAGES

Info-Hold argues that the district court is required to 

award some amount of damages when infringement is 

proven. An award is necessary, it argues, even when 

there is little or no satisfactory evidence as to the amount 

of the reasonable royalty, because the court must still 

employ the Georgia-Pacific factors, sua sponte, to determine the royalty rate. Info-Hold contends that the district court’s dismissal on summary judgment for alleged 

lack of evidence of a reasonable royalty is erroneous 

because the court failed to invoke a Georgia-Pacific analysis.

According to Info-Hold, there were numerous pieces of 

evidence properly admitted to the record from which the 

district court could determine a reasonable royalty. InfoHold points to evidence it cited to the district court in its 

opposition to Muzak’s motion for summary judgment that 

Info-Hold was not entitled to a reasonable royalty, including the Hazenfield Assignment, the Trusonic License, and 

documents relied upon by both experts in forming their 

opinions. Info-Hold also points to evidence of record that 

was not cited in its opposition, including a declaration by 

Mr. Hazenfield and the deposition transcripts of Mr. 

Hazenfield and Mr. Paris. Thus, even without Info-Hold’s 

expert’s report, Info-Hold contends that there were numerous pieces of record evidence from which a reasonable 

royalty could be determined. 

Muzak responds that the district court correctly

struck Mr. White’s expert report, leaving Info-Hold with 

no evidence upon which a reasonable royalty determination could be made. Addressing the evidence Info-Hold 

alleges was of record, Muzak points out that Mr. White 

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10 INFO-HOLD, INC. v. MUZAK LLC

testified that the Hazenfield Assignment and Trusonic 

License were not overly relevant to a reasonable royalty 

determination. Muzak argues that the documents relied 

upon by Mr. Paris in his expert report are not admissible 

because they cannot be authenticated. According to 

Muzak, the Sixth Circuit prevents one party from calling 

another party’s expert, even if the latter party does not 

intend to use the expert. Without the ability to call Mr. 

Paris as a witness, Muzak argues that Info-Hold would 

have no one to authenticate the documents on which he 

relied.

A. The District Court’s Decision To Strike Mr. White’s 

Report And Preclude His Testimony

For issues not unique to patent law, we apply the law 

of the regional circuit. Allergan, Inc. v. Athena Cosmetics, 

Inc., 738 F.3d 1350, 1354 (Fed. Cir. 2013). The Sixth 

Circuit reviews a district court’s evidentiary rulings, 

including the grant of a motion to strike and the decision 

to exclude expert testimony, for an abuse of discretion. 

Andler v. Clear Channel Broadcasting, Inc., 670 F.3d 717, 

722 (6th Cir. 2012); Seay v. Tenn. Valley Authority, 339 

F.3d 454, 480 (6th Cir. 2003). “A district court abuses its 

discretion if it bases its ruling on an erroneous view of the 

law or a clearly erroneous assessment of the evidence.” 

Newell Rubbermaid, Inc. v. Raymond Corp., 676 F.3d 521, 

527 (6th Cir. 2012) (internal quotation marks and citation 

omitted).

The district court did not abuse its discretion in striking Mr. White’s expert report. The district court stated 

that Info-Hold’s reliance on the entire market value rule, 

without presenting evidence that the patented features 

drove customer demand, was “improper” and itself sufficient to strike Mr. White’s evidence. J.A. 92; cf. J.A. 85. 

Info-Hold has not appealed this basis for striking the 

report. Mr. White’s damages analysis was also deficient 

because he relied on the 25-percent rule, which this court 

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INFO-HOLD, INC. v. MUZAK LLC 11

discredited as “fundamentally flawed” in Uniloc. 632 F.3d 

at 1315 (deeming evidence relying on the 25-percent rule 

as inadmissible for failing to tie the royalty base to evidence in the case). We therefore affirm the striking of Mr. 

White’s evidence. 

B. The District Court’s Grant Of Summary Judgment 

For A Purported Lack Of Damages Evidence

The Sixth Circuit reviews a grant of summary judgment de novo. Loyd v. St. Joseph Mercy Oakland, 766 

F.3d 580, 588 (6th Cir. 2014). Summary judgment is 

appropriate when there is no genuine issue of material 

fact for trial and the moving party is entitled to judgment 

as a matter of law. Fed. R. Civ. P. 56(a); Kalich v. AT&T 

Mobility, LLC, 679 F.3d 464, 469 (6th Cir. 2012). A 

genuine issue of material fact exists when there is evidence sufficient to allow a jury to return a verdict for the 

nonmoving party. Loyd, 766 F.3d at 588 (quoting Anderson v. Liberty Lobby, Inc., 477 U.S. 242, 249 (1986)). In 

reviewing a grant of summary judgment, the Sixth Circuit 

accepts all of the nonmovant’s evidence as true and draws 

all reasonable inferences in the nonmovant’s favor. Id.

(citing Liberty Lobby, 477 U.S. at 255).

In Apple Inc. v. Motorola, Inc., 757 F.3d 1286, 1328 

(Fed. Cir. 2014), we explained that at “summary judgment . . . a judge may only award a zero royalty . . . if 

there is no genuine issue of material fact that zero is the 

only reasonable royalty.” Therefore, if there exists a 

factual issue regarding whether the patentee is due any 

non-zero royalty, the district court must deny summary 

judgment. Id. Where the patentee’s proof is weak, the 

court may award nominal damages. Id. Moreover, we 

explained that a patentee’s failure to show that its royalty 

estimate is correct is insufficient grounds for awarding a 

royalty of zero. Id. By extension, the exclusion of the 

patentee’s damages evidence is not sufficient to justify 

granting summary judgment. As we made clear in Dow 

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12 INFO-HOLD, INC. v. MUZAK LLC

Chemical Co. v. Mee Indus., Inc., 341 F.3d 1370, 1381 

(Fed. Cir. 2003), 35 U.S.C. § 284 requires the district 

court to award damages “in an amount no less than a 

reasonable royalty” even if the plaintiff’s has no evidence 

to proffer. We explained that, in such a case, the district 

court should consider the Georgia-Pacific factors “in 

detail, and award such reasonable royalties as the record 

evidence will support.” Id. at 1382 (footnote omitted). 

Here, as in Apple, the issue of infringement has not 

been decided. The district court granted summary judgment to Muzak on the issue of reasonable royalty damages because, after striking its expert’s report and 

precluding him from testifying, Info-Hold was unable to 

make a prima facie case as to any reasonable royalty rate. 

There was other record evidence which the district court 

could use as a basis for determining a reasonable royalty, 

even after the exclusion of Mr. White’s report and testimony. In his deposition, Mr. Paris affirmed that reasonable royalty rates for Muzak’s Encompass LE 2 and 

Encompass MV systems would be 1 and 2 percent, respectively. He also discussed the Trusonic License, the royalty paid to Mr. Hazenfield under his assignment of the 

patent to Info-Hold, the profitability of the accused systems, and more. 

The Federal Rules of Civil Procedure allow the use of 

deposition testimony for any purpose allowed by the 

Federal Rules of Evidence. Fed. R. Civ. P. 32(a)(2). An 

Advisory Committee Note to Rule 32(a) explains that the

rule was updated to make “clear that the rules of evidence 

are to be applied to the depositions offered at trial as 

though the deponent were then present and testifying at 

trial” so as to eliminate “certain technical hearsay objections” based on the deponent’s “absence from court.” 

Here, Muzak has not specifically objected to the admissibility of Mr. Paris’ deposition testimony. We leave to the 

district court to decide whether the deposition may be 

considered in determining the reasonable royalty rate. In 

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INFO-HOLD, INC. v. MUZAK LLC 13

any case, there is other record evidence to demonstrate 

the existence of a genuine issue of material fact as to 

whether zero is a reasonable royalty rate. 

In light of the foregoing, we reverse the district court’s 

grant of summary judgment because there was no evidence of record supporting a zero royalty and the evidence 

of record which could be used to determine a non-zero 

royalty was ignored. We further remand the case to the 

district court for further proceedings consistent with this 

opinion.

II. INDUCED INFRINGEMENT

To prove inducement of infringement, the patentee 

must “show that the accused inducer took an affirmative 

act to encourage infringement with the knowledge that 

the induced acts constitute patent infringement.” Microsoft Corp. v. DataTern, Inc., 755 F.3d 899, 904 (Fed. 

Cir. 2014) (citing Global-Tech Appliances, Inc. v. SEB 

S.A., 131 S. Ct. 2060, 2068 (2011)). The inducement

knowledge requirement may be satisfied by a showing of 

actual knowledge or willful blindness. Commil USA, LLC 

v. Cisco Sys., Inc., 720 F.3d 1361, 1366 (Fed. Cir. 2013), 

cert. granted on other grounds, 135 S. Ct. 752 (2014). 

Willful blindness is a high standard, requiring that the 

alleged inducer (1) subjectively believe that there is a 

high probability that a fact exists and (2) take deliberate 

actions to avoid learning of that fact. Global-Tech, 131 S. 

Ct. at 2070. 

Issues of material fact remain as to whether Muzak 

acted with knowledge that its actions constituted infringement of the ’374 patent. The record shows that 

Info-Hold repeatedly contacted Muzak in an effort to put 

Muzak on notice of the ’374 patent and Muzak’s patent 

infringement. During the conversation between Mr. Wood

and Mr. Zendan, Mr. Zendan raised questions about the 

specific functionality alleged to be covered by the ’374 

patent. See J.A. 2817, 14:1-3. Mr. Zendan admitted that 

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14 INFO-HOLD, INC. v. MUZAK LLC

Muzak had a system where there was probably some 

control of the music. Id. at 14:5-7. Mr. Zendan told Mr. 

Wood he would “look again at [Info-Hold’s] patent.” Id. at 

14:19-20. Despite Mr. Wood’s letter requesting that Mr. 

Zendan honor his statement to look into whether Muzak’s 

systems infringed the ’374 patent, there is no evidence 

that Muzak did so. 

This record raises issues of material fact as to whether Muzak may have subjectively believed there was a high 

probability it infringed the ’374 patent and took deliberate 

actions to avoid learning whether it actually did. In other 

words, the record raises the issue of whether Muzak 

willfully blinded itself to whether it acted to induce infringement after becoming aware of the existence and 

alleged functionality of the ’374 patent. See Global-Tech, 

131 S. Ct. at 2070. 

Therefore, we vacate the district court’s grant of 

summary judgment of no induced infringement and 

remand for further consideration on the issue of Muzak’s 

willful blindness.

III. CONSTRUCTION OF “WHEN A CALLER 

IS PLACED ON HOLD” 

During claim construction, the parties sought competing constructions of the term “when a caller is placed on 

hold,” as that term influenced whether music or message 

playback had to begin at the time the caller was placed on 

hold, or could begin at some time prior to, and independent of, when a caller was placed on hold. As used in this 

term, the word “when” could either mean during a period 

of time (e.g., she played sports when she was in high 

school) or at one moment of time (e.g., the lights go on 

when you flip the switch). The district court construed 

the term to mean “at the moment a caller is placed on 

hold.” 

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Our review of a district court’s claim construction 

based solely on the patent’s intrinsic record is de novo. 

Teva Pharm. USA, Inc. v. Sandoz, Inc., 135 S. Ct. 831, 

841 (2015). The words of a claim are generally given their 

ordinary and customary meaning, as understood by one of 

ordinary skill in the art reading the claims in the context 

of the specification and prosecution history. Thorner v. 

Sony Computer Entm’t Am. LLC, 669 F.3d 1362, 1365 

(Fed. Cir. 2012). “Claims must be interpreted with an eye 

toward giving effect to all terms in the claim.” Becton, 

Dickinson & Co. v. Tyco Healthcare Grp., LP, 616 F.3d 

1249, 1257 (Fed. Cir. 2010) (citation and internal quotation marks omitted). 

We hold that the district court’s construction remains 

faithful to our principles of construction and is supported 

by the intrinsic evidence. Claims of the ’374 patent cover 

actions such as accessing messages from a storage device, 

providing the accessed messages to the playback device, 

and playing the messages on the playback device, each 

occurring “when” the caller is “placed on hold.” See, e.g., 

’374 patent, claims 7, 17 (’374 patent reexamination 

certificate, col. 1 ll. 37 & 48-49; col. 2 l. 61). There is no 

disclosure that any of these actions, or any other action, 

occurs before or while the caller is on hold. Every instance of the words “on hold” in the ’374 patent is preceded by the word “placed.” Thus, to construe this term to 

not require that playback starts at the time the caller is 

placed on hold, as Info-Hold asks us to do, would be to 

read the word “placed” out of the claims of the patent. 

Our precedent prohibits us from adopting such a construction. See Becton, Dickinson, 616 F.3d at 1257. 

Here, the intrinsic evidence supports the district 

court’s construction determinations. During reexamination of the ’374 patent, Info-Hold amended the claims by 

adding the limitation “when a caller is placed on hold” to 

avoid anticipation by the prior art. Info-Hold argued that 

the addition of this limitation overcame the prior art 

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16 INFO-HOLD, INC. v. MUZAK LLC

because the prior art did “not teach, or even suggest . . . 

playing messages or generating signals when callers are 

placed on hold.” J.A. 473. As claim 7 shows, the generated signals “control” the message playback devices by 

directing them to access messages and play them back 

through the output. If the signals themselves are generated “when callers are placed on hold,” as Info-Hold 

argued during reexamination, then the playback resulting 

from the control signal must also occur at that time, not 

before the caller is placed on hold. Thus, both the prosecution history and the claim language support a construction of the term “when a caller is placed on hold” to mean 

“at the moment the caller is placed on hold.”

For these reasons, we affirm the district court’s construction of the term “when a caller is placed on hold.”

CONCLUSION

Because record evidence exists upon which the district 

court can base a reasonable royalty analysis, we reverse

the grant of summary judgment that Info-Hold cannot 

prove damages. We vacate the grant of summary judgment that Muzak did not induce infringement on the 

basis that there is a genuine issue of material fact as to 

Muzak’s subjective belief regarding its infringement of the 

’374 patent. Finally, because the district court’s construction of the term “when a caller is placed on hold” gives 

meaning to all claim terms and is supported by the intrinsic record, we affirm the district court’s construction. We 

remand the case for further proceedings consistent with 

this opinion.

AFFIRMED-IN-PART, REVERSED-IN-PART,

VACATED-IN-PART AND REMANDED

COSTS

Each party shall bear its own costs.

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