Source: http://patents.hdp.com/?cat=16
Timestamp: 2019-04-21 17:10:23+00:00

Document:
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 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.
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.
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.
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.
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.
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.
whether it is representative of what is likely to be approved and marketed.
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.
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.
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.
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.
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.
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.
patented method and establishes the manner or timing of that performance.
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.
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.
Is Patent Infringement a High Crime or Misdemeanor?
Today’s question is: Is patent infringement a high crime or misdemeanor?
defendants, of all of those claims except claim 5; and finding infringement by both defendants of claims 1–3, 5-9, and 12–15 of U.S. Patent No. 8,318,800, and by Watson of claims 10 and 11 as well.
proposed labels prevented a finding of intent to encourage an infringing use. The Federal Circuit found no legal or logical basis for the suggested limitation on inducement.
On the obviousness issue, Watson and Sandoz only challenged the district court’s finding of no expectation of success. The Federal Circuit said that although the evidence might well have supported the opposite finding, it could not conclude that the district court clearly erred in its finding.
disclaimer” that also limits the scope of the claims of the ’800 patent, despite the absence of any limiting language in the ’800 patent’s claims.
disclaimers are directed to specific claim terms that have been omitted or materially altered in subsequent applications (rather than to the invention itself), those disclaimers do not apply. The general ruling being that a prosecution disclaimer will only apply to a subsequent patent if that patent contains the same claim limitation as its predecessor.
about claims that lack the narrowing limitation.
scope of the claims of the ’800 patent should not be limited so as to exclude polysorbate surfactants.
identified the accused product, but that Lifetime had not adequately pleaded its case.
The district court concluded that Lifetime had not adequately pleaded direct infringement because the claims require both a two-part seal and an RV, and Trim-Lok only manufactures seals. The district court rejected Lifetime’s argument that Trim-Lok had “assisted with the installation, directed the installation, or directly installed” the Trim-Lok seal as confusing liability for direct infringement with liability for contributory infringement, which the court characterized as imposing liability “based on an offer to sell a component, material, or apparatus,” and dismissed the complaint for direct infringement.
As to indirect infringement, the district court concluded that Lifetime had not alleged any facts from which intent to infringe could be inferred in this case, and dismissed the complaint for indirect infringement as well.
The Federal Circuit found that Lifetime adequately alleged that Trim-Lok directly infringed, observing that one who “makes” a patented invention without authorization infringes the patent. The Federal Circuit said that commercial manufacture is not the only way that a combination can infringe; limited internal manufacture and use can also infringe. The Federal Circuit said that although Lifetime did not allege that Trim-Lok made the RV onto which it installed the seal, Lifetime did allege that Trim-Lok installed the seal onto the RV; that is, Lifetime alleged that Trim-Lok made an infringing seal-RV combination. The Federal Circuit found that Trim-Lok’s demand for more detail “asks for too much,” noting that there is no requirement for Lifetime to prove its case at the pleading stage.
misconduct alleged. The Federal Circuit found that specific allegations that former employees Busch and Torrey had knowledge of the patent and its scope when they joined Trim-Lok, making it plausable that Trim-Lok had knowledge of the patent. The Federal Circuit also found adequate pleading of intent to infringe, noting that Lifetime alleged that after gaining knowledge of the patent and the products covered by the patent Trim-Lok assisted in the installation of the same time of seal on a RV, never having previously made or sold such seals.
The Federal Circuit also agreed with Lifetime that pleading contributory patent infringement only requires pleading knowledge of the patent, not also an intent to infringe the patent.

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