Opinion ID: 210274
Heading Depth: 2
Heading Rank: 1

Heading: Toyota's Appeal

Text: We first address the issues raised in Toyota's appeal of the district court's denial of the motion for JMOL of noninfringement of claims 11 and 39 of the '970 patent. According to Toyota, the jury's finding of infringement of those claims under the doctrine of equivalents must be overturned for three reasons. We disagree.
First, Toyota argues that the expert testimony of Dr. Nichols was legally insufficient to support a finding of infringement under the doctrine of equivalents. Although Dr. Nichols testified before the jury for a day and a half, Toyota claims that the vast majority of his testimony was directed to literal infringement. Specifically, Toyota argues that Dr. Nichols explicitly marked the end of his extensive literal infringement testimony by answering in the affirmative when asked whether [t]he opinion that [he had] expressed thus far . . . relate[d] to literal infringement. J.A. 1218. Immediately thereafter, Toyota contends, Dr. Nichols explicitly transitioned to his equivalence testimony by again answering in the affirmative when asked whether he had also formed an opinion with respect to the Doctrine of Equivalents. Id. Following his answer to that question, the following brief exchange took place before the jury between counsel for Paice and Dr. Nichols: Q. So, assuming that the controllable torque transfer unit is not literally infringed, have you found that . . . the accused vehicles satisfy this limitation under the doctrine of equivalents? A. Yes. It is my opinion that they do. Q. [C]ould you describe that for us by reference to the slide that we see on the screen, Slide 71? A. Well, this particular slide is the Doctrine of Equivalents analysis for the controllable torque transfer unit. I will say that I do believe that it is literally there. However, it provides the function that is to be provided. It provides controllable and variable amounts of torque from two sources to the drive wheels, and I believe that's consistent with the claim construction of the Court. The way in which it does that is it controls a set of gears to receive torque from two input shafts and transfer torque to the drive wheels. Q. And what's the result? A. The results are controlthat the vehicles control to direct torque flow between the motor, the engine and the drive. . . . Id. The Slide 71 referenced by counsel for Paice contained a grid with three rows, with one row corresponding the function of the CTTU, one row corresponding to the way in which the CTTU performed that function, and one row corresponding to the result the CTTU achieved; and two columns, one corresponding to the '970 patent and the other corresponding to the Accused Toyota Vehicles. In each of the grid's six boxes, a red check mark indicated the presence of the function/way/result in both the CTTU and the Accused Toyota Vehicles. This, Toyota says, was the extent of Dr. Nichols's testimony on the subject. We have stated that a patentee must . . . provide particularized testimony and linking argument . . . with respect to the function, way, result test when such evidence is presented to support a finding of infringement under the doctrine of equivalents. Tex. Inst. v. Cypress Semiconductor Corp., 90 F.3d 1558, 1567 (Fed. Cir.1996) (emphasis added). Generalized testimony as to the overall similarity between the claims and the accused infringer's product or process will not suffice. Id. Under this standard, Dr. Nichols's testimony was plainly sufficient. A careful review of the entire transcript from that portion of the trial evinces that the bulk of Dr. Nichols's testimony was not limited to literal infringement. While it is true that the excerpts pointed to by Toyota ostensibly draw a figurative line in the sand separating testimony concerning literal infringement from that concerning equivalence, we do not read Dr. Nichols's testimony to say that every word he uttered from the time he took the stand until the moment he transitioned to the doctrine of equivalents related only to literal infringement. Rather, Dr. Nichols gave a substantial amount of testimonyoccupying over seventy pages of transcriptconcerning the technology disclosed in the patents and the inner workings of the accused vehicles' transaxle units before he even discussed the topic of infringement at all: Q. Now, Dr. Nichols, now that we've discussed some of the components in the patents, could we turn to your infringement analysis. [8] A. Yes. J.A. 1212. It was with his answer to this question that Dr. Nichols indicated to the jury that his infringement testimony was officially beginning. And it was to this starting point that Dr. Nichols was referring a short time later when he answered in the affirmative to the question, [t]he opinion that you've expressed thus far, does that relate to literal infringement? J.A. 1218. Another infirmity in Toyota's argument is that, even if we were to agree that Dr. Nichols did in fact draw some sort of line in the sand with his answer to that question, in so doing he did not thereby render his literal infringement analysis irrelevant to his subsequent equivalence analysis. Our particularized testimony standard does not require Dr. Nichols to re-start his testimony at square one when transitioning to a doctrine of equivalents analysis. Indeed, we think it desirable for a witness to incorporate earlier testimony in order to avoid duplication. The fact that Dr. Nichols did not explicitly do so does not mean he did not implicitly incorporate his earlier testimony. Thus, we reject any notion that Dr. Nichols's equivalence testimony is strictly limited to the few lines pointed to by Toyota. Toyota also argues that Dr. Nichols's other testimony cannot be used to support the jury's verdict due to the absence of any linking argument to tie such testimony to the function/way/result analysis of the CTTU. Again, we find Toyota's characterization of Dr. Nichols's testimony inaccurate. For example, on the morning of December 8, 2005, and before he turned to his literal infringement analysis, Dr. Nichols demonstrated the operation of an actual accused vehicle's transaxle unit to the jury, and in so doing he explained: Q. Okay. And when you say its input, what is it that you're talking about as being input, Dr. Nichols? A. We have torque input from the engine, torque input from MG2, combined torque output to the drive wheels, controllably combined to give you variable torque on the output to drive the wheels. J.A. 1201 (emphases added). Later that same morning, referring to Slide 71, Dr. Nichols explained to the jury that the accused vehicles' transaxle units provide [] the function that is to be provided, i.e.,  controllable and variable amounts of torque from two sources to the drive wheels. J.A. 1218 (emphases added). Thus, within a close proximity of time, Dr. Nichols first demonstrated and explained operation of an actual accused device to the jury, and then linked that demonstration and explanation to the function of the CTTU. Our review of the record reveals that Dr. Nichols's testimony was similarly sufficient with respect to linking the way and result prongs. Nonetheless, Toyota criticizes Dr. Nichols for allegedly failing to identify any specific structure in the accused vehicles' transaxle units corresponding to the CTTU. In particular, Toyota claims that Paice's equivalence argument is supported by nothing more than Dr. Nichols's [g]eneralized testimony as to the overall similarity between the claims and the accused infringer's product. See Appellants' Br. 37-38 (quoting Tex. Inst., 90 F.3d at 1567). This argument is specious in light of the fact that counsel for Toyota spent a substantial portion of his time on cross examination asking Dr. Nichols to help draw a box on a diagram around the exact portion of Toyota's drive train he identified as corresponding to the CTTU. See J.A. 1256. To now suggest on appeal that the jury was never shown specific structure is simply incorrect. Compare Appellants' Br. 38 (Indeed, Dr. Nichols was never asked at trial to identify any alleged equivalent structure in connection with his equivalents analysis.), with J.A. 1256 (Questions by Mr. Badenoch: Exactly what portionwhat device in this diagram of the Toyota Prius transaxle schematic, what are you [Dr. Nichols] calling now the controllable torque transfer unit in your opinion? and Can you [Dr. Nichols] just go over that one more time so that I can draw a box to make sure I've got it right?). Toyota also argues that Dr. Nichols fail[ed] to acknowledge any differences between the CTTU claim limitation and any component or components alleged to be equivalent in order to explain why and how such differences are insubstantial. Appellants' Br. 41. We are unaware of any such acknowledgement requirement in the context of the function/way/result test, and Toyota does not cite any case law standing therefor. In any case, Dr. Nichols was called as a rebuttal witness to answer Dr. Caulfield's testimony. With respect to the question of whether Toyota's accused CTTU is multi-input device or component, Dr. Nichols testified: Q. Now, Dr. Nichols, did you also hear Dr. Caulfield testify yesterday about where the torque from MG2, I'll say intersects the ring gear and where is it, in your understanding, that Dr. Caulfield said that takes place? . . . . A. If I understand him correctly, he takes the position thatwell, actually this plus this plus other elements are all one shaft and as a result it is not an input; it's sort of an input/output flowby and there is no input shaft in MG2. If I understand his testimony. Q. Do you agree with this testimony, Dr. Nichols? A. Well, it's certainly a novel approach. Q. And what is it you mean by a novel approach? A. It's not true. Q. So, you do not agree with it? A. No. . . . This is a ring gear. Without this, the planetary gear unit does not exist. It's not a ring gear shaft, a shaft ring gear. It's a ring gear. Q. Thank you. A. I will add one other thing. If, in fact, it does flow on the outside somehow, which it does not, this is not a dumb device. This would be a very smart device that somehow would have torque flow around the outside of a ring gear which is not a ring gear but a shaft. It simply does not make sense to me. Trial Tr. 141:18-143:4, December 16, 2005. And with respect to the question of whether Toyota's accused CTTU is controlled to transfer variable amounts of torque, Dr. Nichols testified: Q. We heard a lot of testimony about the 72 percent/28 percent torque split within the planetary gear unit. I just want to confirm it. Do you agree or disagree that the torque split always occurs in the planetary gear unit? A. Yes. It's steady state, that's the torque split and it's been consistent on four or five or six people giving testimony. We all agree on that split of steady state. . . . . Q. And yet you still have reached the conclusion that you've reached, Dr. Nichols, regarding whether the planetary gear unit in the Toyota accused vehicles is a controllable torque transfer unit? A. Yes. Q. And how have you reached that in light of the fact that there is a fixed split within the ring gear itself? A. Well, . . . I believe everyone that's given testimony has agreed that itthe [MG2] can provide power independently through the . . . planetary gear unit, although there may be some arguments whether it's through or somehow around the planetary gear unit. Everyone's agreed, and the engine can provide it and then provide it in different combinations. Trial Tr. 145:13-146:18, Dec. 16, 2005. This rebuttal testimony, in conjunction with the testimony given during each side's case in chief, provided the jury with an ample basis upon which to evaluate the insubstantiality of the differences between the CTTU limitation and the accused structure.
The second reason Toyota contends that the jury's equivalence verdict cannot stand relates to Paice's criticism of two patents issued to Berman et al. and assigned to TRW, Inc.: U.S. Patent Nos. 3,566,717 (the '717 patent) and 3,732,751 (the '751 patent) (collectively, Berman/TRW). [9] Both Berman/TRW patents describe a hybrid drive train similar to those in the accused vehicles in that the Berman/TRW drive train design employs an ICE, a traction motor, and a generator coupled to a planetary gear unit. See '751 patent, col. 2, l. 48-col. 3, l. 9. However, unlike Toyota's drive train, the Berman/TRW drive train has two operator-selectable modes of operation, one being designed for lower speeds and the other being designed for higher speeds. See, e.g., id. at col. 4, II. 48-62. Although the Berman/TRW design employs various controllers containing transistors and other electronic circuitry, see id. at figs. 4-5, there is no controlling microprocessor choosing the most appropriate mode of operation. J.A. 1255. The written description of the '970 patent describes the Berman/TRW design as providing [a] more promising `parallel hybrid' approach than other prior art, '970 patent, col. 2, l. 67-col. 3, l. 1, but it nevertheless points to disadvantages of the Berman/TRW design compared to the '970 invention: The present invention relates to such a parallel hybrid vehicle, but addresses certain substantial deficiencies of the Berman et al design. For example, Berman et al show two separate electric motor/generators powered by the internal combustion engine to charge batteries and to drive the vehicle forward in traffic. This arrangement is a source of additional complexity, cost and difficulty, as two separate modes of engine control are required, and the operator must control the transition between the several modes of operation. Further the gear train shown by Berman et al appears to be quite complex and difficult to manufacture economically. [10] Id. at col. 3, II. 16-27 (emphases added). Given this criticism and disavowal of Berman/TRW in the written description, Toyota argues that its drive trainswhich are allegedly based on the configuration of the prior art Berman/TRW patentscannot be captured by Paice's invocation of the doctrine of equivalents. This court has addressed the effects of criticism and disavowal in several cases. For example, in SciMed Life Systems, Inc. v. Advanced Cardiovascular Systems, Inc., the technology at issue related to [b]alloon dilatation catheters . . . used in coronary angioplasty procedures to remove restrictions in coronary arteries. 242 F.3d 1337, 1339 (Fed.Cir.2001). Such catheters were made in one of two configurations: the dual (or adjacent) lumen configuration, or the coaxial lumen configuration. Id. The question on appeal was whether the claimswhich merely specified that the two lumens be separatewere limited in scope, either literally or under the doctrine of equivalents, to the coaxial lumen configuration. Analyzing the claim language in light of the written description, we held, inter alia, that the patentee had distinguish[ed] the prior art on the basis of the use of dual lumens and [had] point[ed] out the advantages of the coaxial lumens used in the catheters that [were] the subjects of the [patents in suit]. Id. at 1343. We read this as support[ing] the conclusion that the claims should not be read so broadly as to encompass the distinguished prior art structure. Id. We further explained that the most compelling portion of the specification was the patentee's statement that the coaxial configuration is `the basic sleeve structure for all embodiments of the present invention contemplated and disclosed herein.' Id. at 1344 (quoting the written description). We were thus led to the inescapable conclusion that the separate limitation was literally limited in scope to the coaxial configuration. Id. at 1342. Relying again on the patentee's criticism of the prior art and the all embodiments statement, we arrived at the same conclusion with respect to equivalent claim scope. However, our analysis turned on a narrower rationale: The principle articulated in [several cited] cases is akin to the familiar rule that the doctrine of equivalents cannot be employed in a manner that wholly vitiates a claim limitation. See Warner-Jenkinson Co. v. Hilton Davis Chem. Co., [520 U.S. 17, 29-30, 117 S.Ct. 1040, 137 L.Ed.2d 146 (1997)]; Athletic Alternatives, [Inc. v. Prince Mfg., Inc., 73 F.3d 1573, 1582 (Fed.Cir.1996)] (specific exclusion principle is a corollary to the `all limitations' rule). Thus, if a patent states that the claimed device must be nonmetallic, the patentee cannot assert the patent against a metallic device on the ground that a metallic device is equivalent to a non-metallic device. The unavailability of the doctrine of equivalents could be explained either as the product of an impermissible vitiation of the non-metallic claim limitation, or as the product of a clear and binding statement to the public that metallic structures are excluded from the protection of the patent. [T]he foreclosure of reliance on the doctrine of equivalents in such a case depends on whether the patent clearly excludes the asserted equivalent structure, either implicitly or explicitly. Id. at 1346-47. Thus, because the patentee had clearly exclude[d] one of only two possible structures, competitors and the public were free to draw the reasonable conclusion that the patentee was not seeking patent protection for catheters that used a dual lumen configuration. Id. at 1347. This court was confronted with a similar fact pattern in Gaus v. Conair Corp., where the technology at issue related to a safety mechanism that prevents fatal shocks to users of electrical appliances such as hairdryers due to immersion of the appliance in water. 363 F.3d 1284, 1285 (Fed.Cir.2004). In particular, the safety mechanism of the patented invention employed protective circuitry designed to detect the invasion of water before any such water could reach the voltage-carrying components of the appliance itself. Id. at 1289. The safety mechanism of the accused appliance, however, would not react until water reached the voltage-carrying components of the appliance. Id. at 1290. This would result in the user experiencing a brief, but non-fatal shock. Id. Ironically, we noted, one of the principal advantages of the claimed invention [over the prior art] touted in the patent's specification was the invention's ability to protect [] the user from such a shock. Id. at 1289. Thus, we held that the patentee's criticism of this prior art characteristic amounted to a surrender of claim scope that the patentee could not reclaim . . . by invoking the doctrine of equivalents. Id. at 1291; see also Dawn Equip. Co. v. Ky. Farms Inc., 140 F.3d 1009, 1016 (Fed.Cir.1998) (holding that statements in the written description touting the ability of the patented invention to overcome disadvantages in the prior art strongly suggest, if not mandate, judgment in [the defendant's favor] where the accused products suffered the very same disadvantages). In this case, Toyota analogizes the '970 patent's criticism of the Berman/TRW design to the criticism of prior art discussed in SciMed, Gaus, and Dawn Equipment. We disagree. As the written description of the '970 patent reveals, the primary disadvantage of the Berman/TRW design is its control system, which relies upon a human operator to select the mode of operation. '970 patent, col. 3, II. 24-25 ([T]he operator must control the transition between the several modes of operation.). Paice overcame this disadvantage by using a microprocessor to determine the most appropriate mode of operation based on its monitoring of control inputs from the driver, as well as several other variables. Id. at col. 6, II. 19-26. Toyota's drive trains use a microprocessor in the same manner as the '970 patent, i.e., the microprocessor determines the most appropriate mode of operation based on its monitoring of control inputs from the driver, as well as several other variables. J.A. 1225. Therefore, the '970 patent's discussion of the Berman/TRW design's disadvantages does not preclude the application of the doctrine of equivalents to Toyota's accused transaxle units. To be sure, the written description of the '970 patent does point out that the Berman/TRW gear train . . . appears to be quite complex and difficult to manufacture economically. Col. 3, II. 26-27. However, to the extent Paice drew a distinction between its design and the Berman/TRW design, the distinction is clearly secondary and equivocal at best. Moreover, it is far from obvious which portion of the gear train is supposed to be quite complex and difficult to manufacture economically. Paice may have been referring to the arrangement of the motors, engine, and planetary gear set, or to the control system described in the Berman/TRW patents. The intrinsic evidence simply does not provide any resolution to this ambiguity. Consequently, this is not a case like SciMed where the patentee selected one configuration for all embodiments of the invention to the exclusion of the only other known configuration. Nor is this a case like Gaus or Dawn Equipment where the patentee touted the invention's improvements over the very same subject matter sought to be recaptured under the doctrine of equivalents. Thus, we find nothing in the written description of the '970 patent that amounts to a disavowal sufficient to overturn the jury's finding of infringement. In spite of the above-mentioned differences between the Berman/TRW design and Toyota's design, Toyota argues that Paice is bound by various statements it made equating the Berman/TRW design to Toyota's design. According to Toyota, Paice's disavowal of the Berman/TRW design relative to the limitations of the '970 claims acts as a disavowal of Toyota's accused transaxle units. In the written description of the '672 patent, Paice distinguished Toyota's Prius I transaxle unit (which also uses a planetary gear unit to combine torque): Various articles describe several generations of Toyota Motor Company hybrid vehicles, stated soon to be available commercially. . . . Toyota describes this vehicle as a series-parallel hybrid; regardless of the label applied, its powertrain appears to be similar to that of the Berman patents described above, that is, torque from either or both of an internal combustion engine and an electric motor are controllably combined in a power-split mechanism and transmitted to the drive wheels through a planetary gearset providing the functionality of a variable-ratio transmission. '672 patent, col. 8, II. 45-65 (emphases added). This statement, however, merely acknowledges what we have already observed, i.e., that both designs utilize a planetary gear unit to output combined torque. That observation does not imply that the Berman/TRW and Prius I designs are identical relative to the limitations of the '970 claims. Indeed, the written description of the '672 patent touts the advantages of its clutch-based design over both the CTTU-based design of the '970 patent and the planetary gear unit design of the Prius I. Id. at col. 9, II. 38-51; col. 12, II. 17-21. This is entirely consistent with the jury's finding that Toyota's planetary gear unit design infringes the CTTU-based design of the '970 patent but not the clutched-based design of the '672 patent. To further buttress its argument that Paice equated the Berman/TRW design with the accused drive trains and disclaimed them, Toyota cites a host of extrinsic evidence, including a Paice business plan explaining the cost disadvantages of the Berman/TRW design, J.A. 12235; a confidential document written by Paice founder Dr. Alex Severinsky describing [t]he Toyota Hybrid Drive as an  EXACT copy of the Berman/TRW design, J.A. 12089; an article quoting a co-inventor of the '088 patent as describing the Toyota TMS system to be a one-on-one copy of the Berman/TRW design, J.A. 15754; a page from Paice's marketing materials asserting that the Toyota Prius is the realization of the 1971 TRW patent, J.A. 15348; an email from Dr. Severinsky to Toyota stating that Paice's technology is quite opposite to your Prius, J.A. 12097; and the following notations hand written by Dr. Severinsky in the margin of an article describing the Prius I: J.A. 12085 (notations read This is TRW not Toyota and This is TRW invention). [11] Although the parties disagree as to whether extrinsic evidence may give rise to a disavowal of subject matter, we need not address this point. Simply put, we reject Toyota's contention that Paice's statements equating the Berman/TRW design to Toyota's design amount to a complete disavowal of the accused transaxle units.
The third and final reason Toyota urges us to overturn the jury's finding of infringement relates to a portion of the opening statement made to the jury by counsel for Paice: And keep in mind that Toyota can cut off damages tomorrow. Toyota can make sure they never have to pay Paice another cent by doing what? By going back to the Prius I and don't use Dr. Severinsky's high voltage/low current invention anymore and stop using road load. J.A. 1130 (emphasis added). According to Toyota, this is a binding judicial admission by Paice that the Prius I does not infringe any of the patents in suit. In Toyota's opinion, the undisputed evidence established that the structural configurations of the accused vehicles are the same as the Prius I for purposes of determining infringement. Appellants' Br. 58. Therefore, Toyota argues, this admission necessarily implies that none of the accused vehicles infringe. The district court agreed with Toyota to a certain extent, and held that the above statement constitutes a binding admission that Prius I does not infringe the patents-insuit. Paice LLC v. Toyota Motor Corp., No. 2:04-CV-211, Docket No. 225, slip op. at 13 (E.D.Tex. Aug. 16, 2006). The district court noted, however, that the jury did not consider whether the claim limitations were met equally by the Prius I as the Prius II. Id. slip op. at 13-14. Therefore, the district court disagreed that the evidence established that the structural configurations of the accused vehicles are the same as the Prius I for purposes of determining infringement. Instead, the court concluded, there is sufficient evidence underlying the jury's verdict and that verdict should not be overturned based on the conclusory admission by Plaintiff's counsel. Id. slip op. at 14. In effect, the district court treated the statement as merely an evidential admission as opposed to a conclusive admission which the jury was free to weigh against the other evidence adduced at trial. [12] See Pickens v. Equitable Life Assurance Soc'y, 413 F.2d 1390, 1393-94 (5th Cir.1969) (holding that a district court properly treated an admission as evidential and submitted it to the jury for consideration). In light of what we view as tenuous logic in Toyota's argument, and the conclusory nature of the admission itself, we think the district court acted well within the confines of its discretion by ruling as it did. Having rejected all three reasons set forth by Toyota for overturning the jury's finding of infringement, we hold that the district court did not err in denying Toyota's motion for JMOL.