Opinion ID: 210220
Heading Depth: 3
Heading Rank: 3

Heading: Microsoft's Request for a New Trial

Text: Microsoft requests a remand for a new trial based on three allegedly erroneous jury instructions and an intervening change in law concerning infringement under 35 U.S.C. § 271(f). We do not find these arguments persuasive.
Under the law of the Fifth Circuit, two requirements must be met before a new trial will be granted based on an erroneous jury instruction: First, the challenger must demonstrate that the charge as a whole creates substantial and ineradicable doubt whether the jury has been properly guided in its deliberations. Second, even if the jury instructions were erroneous, we will not reverse if we determine, based upon the entire record, that the challenged instruction could not have affected the outcome of the case. Hartsell v. Doctor Pepper Bottling Co., 207 F.3d 269, 272 (5th Cir.2000).
The district court instructed the jury that [a]n inventor's testimony of conception must be corroborated in a single document. It later conceded that this instruction was improper, but nonetheless held that it did not constitute harmful error under the circumstances because Microsoft never presented, much less relied, on the testimony of an individual inventor. Instead, Microsoft represented to the court that `[f]or its § 102(g) defense, Microsoft did not need to name a particular person. . . . Microsoft corporately both conceived and reduced to practice before Mr. Colvin.' JMOL Opinion at 26 (quoting Microsoft's JMOL motion) (emphasis added). The district court expressed reservations concerning the propriety of asserting corporate conception, but it expressly declined to decide this issue, and simply held that because Microsoft admitted that it never presented oral testimony of an individual inventor who allegedly conceived the anti-piracy portion of BP 98, this instruction was simply not relevant to the verdict. Id. at 27 & n. 10. Because we agree that this instruction was not relevant, we need not and do not address the merits of Microsoft's claims regarding corporate conception. On appeal, Microsoft now contends that the jury could have assumed that one of its witnesses, Mr. Hughes, was an inventor. This argument is not persuasive. Microsoft cannot argue below that it did not and need not name an individual inventor, see id. at 26-27, yet now assert that the jury would have concluded precisely the opposite. Therefore, as the district court correctly concluded, whether such testimony must be corroborated by a `single document' was not an issue in the case. Thus, the improper instruction could not create sufficient error to warrant a new trial on the issue of anticipation. Id. at 27-28. Furthermore, this instruction could not have affected the outcome of the case, Hartsell, 207 F.3d at 272, in light of the substantial evidence supporting the conclusion that Microsoft's BP 98 was not a reduction to practice of the asserted claims as discussed supra.
Although the district court properly instructed the jury that Microsoft had the burden of proving invalidity by clear and convincing evidence, see SRAM, 465 F.3d at 1357, Microsoft contends that the district court abused its discretion by refusing to further instruct the jury that Microsoft's burden is more easily carried when the references on which the assertion is based were not directly considered by the examiner during prosecution. We disagree. See Uniroyal, Inc. v. Rudkin-Wiley Corp., 837 F.2d 1044, 1050 (Fed.Cir. 1988) (The burden of proof is not reduced when prior art is presented to the court which was not considered by the PTO.); Bio-Rad Labs., Inc. v. Nicolet Instrument Corp., 739 F.2d 604, 615 (Fed.Cir.1984) (The introduction of prior art not considered by the PTO does not change the burden of proof or the requirement that evidence establish the presumption-defeating facts clearly and convincingly.), abrogated on other grounds by Markman, 52 F.3d 967. Despite Microsoft's reliance on cases indicating that a party may more easily meet this clear and convincing evidence burden when the references at issue were not before the examiner, see, e.g., Am. Hoist & Derrick Co. v. Sowa & Sons, Inc., 725 F.2d 1350, 1359-60 (Fed.Cir. 1984), it cites no authority compelling courts to provide such an instruction, and we agree with the district court that it might lead the jury to believe that the burden of proof is less than clear and convincing when prior art was not considered by the PTO. JMOL Opinion at 22. Accordingly, we hold that the district court did not abuse its discretion in refusing to provide the jury with Microsoft's requested instruction.
Microsoft also requests a remand in light of the Supreme Court's decision in KSR Int'l Co. v. Teleflex Inc., ___ U.S. ___, 127 S.Ct. 1727, 167 L.Ed.2d 705 (2007), based on the district court's instruction to the jury that to find an asserted claim obvious, you must find that there was some teaching, suggestion or incentive to combine the items in the prior art into the particular claimed combination. z4 responds that Microsoft would not be entitled to a new trial regardless of the outcome in KSR [3] because the only direct evidence of obviousness introduced by Microsoft was the conclusory testimony of its expert. See Upjohn Co. v. Mova Pharm. Corp., 225 F.3d 1306, 1311 (Fed.Cir.2000) (noting that there must be factual support for an expert's conclusory opinion); see also JMOL Opinion at 10 (noting that it was questionable whether Defendants even established a prima facie case of obviousness). Although Microsoft asserts that the jury certainly could have reached a conclusion of obviousness on this record, Reply Br. at 30, it fails to identify specific evidence or arguments establishing even a prima facie case of obviousness under the factors outlined in Graham v. John Deere Co., 383 U.S. 1, 17, 86 S.Ct. 684, 15 L.Ed.2d 545 (1966). Therefore, we find no abuse of discretion here by the district court.
Finally, Microsoft requests a remand for a new trial on damages in light of Microsoft v. AT & T , because the jury made its damages determination based on worldwide sales of the accused products. Although the Supreme Court issued the Microsoft v. AT & T opinion after the parties had filed their briefs in this case, Microsoft argues that it preserved its right to argue damages under 35 U.S.C. § 271(f) by moving in limine to exclude evidence of foreign sales of the accused products. See Micro Chem., Inc. v. Lextron, Inc., 317 F.3d 1387, 1391 (Fed.Cir.2003) (holding that under Rule 103(a) of the Federal Rules of Evidence, once a court makes a definitive evidentiary ruling on the record, a party need not renew an objection to preserve appeal rights). z4 counters that Microsoft has no basis to argue damages based on global sales because it failed to renew its motion in limine on this issue, see Fed. R.Civ.P. 50(b); Unitherm Food Sys., Inc. v. Swift-Eckrich, Inc., 546 U.S. 394, 404, 126 S.Ct. 980, 163 L.Ed.2d 974 (2006) (holding that a party is not entitled to pursue a new trial on appeal unless that party makes an appropriate postverdict motion in the district court), and because Microsoft failed to properly present the issue on appeal by mentioning it only in a footnote in its opening brief. See Smith-Kline Beecham Corp. v. Apotex Corp., 439 F.3d 1312 (Fed.Cir.2006) (holding that arguments raised only in footnotes are not preserved). We reject Microsoft's request for a retrial on damages because we find no properly-defined § 271(f) issue in the record. While we question the merits of Microsoft's reliance on its denied motion in limine to preserve this argument for appeal in light of the district court's admonition that its rulings on the pre-trial motions in limine were not definitive rulings, JMOL Opinion at 17; Fed R. Evid. 103(a) (requiring a definitive ruling to preserve a claim of error for appeal without renewing an objection), we need not decide whether Microsoft properly preserved any § 271(f) arguments. This is because the jury did not and could not have relied on § 271(f) in determining its damages award. The complaint alleged infringement using only language from § 271(a) ([W]hoever without authority makes, uses, offers to sell, or sells any patented invention, within the United States or imports into the United States any patented invention during the term of the patent therefor, infringes the patent.). The jury instructions similarly only paralleled the language of § 271(a): Any person or business entity that, without the patent owner's permission, makes, uses, offers for sale, or sells within the United States any product or method that is covered by at least one claim of a patent, before the patent expires, infringes the patent. At oral argument, Microsoft asserted that Microsoft v. AT & T is relevant because this case involves accused products that were identical to those of the Microsoft v. AT & T case and distributed using the same golden master distribution system discussed in that opinion. See Oral Arg. at 36:05-36:46, available at http://www.cafc. uscourts.gov/ oralarguments/mp3/XXXX-XXXX.mp3. While that may be true, the asserted claims in this case differ significantly from those at issue in Microsoft v. AT & T , and thus raise different infringement issues. Moreover, Microsoft points to nothing in the record to establish that z4 ever argued that Microsoft supplie[d] or cause[d] to be supplied in or from the United States all or a substantial portion of the components of a patented invention, where such components are uncombined in whole or in part, in such manner as to actively induce the combination of such components outside of the United States in a manner that would infringe the patent if such combination occurred within the United States. 35 U.S.C. § 271(f)(1). Because no § 271(f) issues were presented to the jury, and because the jury instructions communicated the requirements for finding infringement only under § 271(a), we must assume that the jury properly confined its analysis and ultimate finding of liability to the instructions given under § 271(a). See, e.g., Shannon v. United States, 512 U.S. 573, 585, 114 S.Ct. 2419, 129 L.Ed.2d 459 (1994) (declining to depart from the almost invariable assumption of the law that jurors follow their instructions). Without more, a damages award based in part on global sales does not necessarily implicate § 271(f). Microsoft may or may not have legitimate arguments regarding the propriety of considering specific foreign sales in a damages calculation for infringement under § 271(a), but it raised no such arguments here. Additionally, we find no evidence in the record that Microsoft presented any evidence to the district court segregating domestic and foreign sales. Therefore, we find no merit in Microsoft's request for a remand on these grounds. Because Microsoft failed to explain what § 271(f) issues it defined below, let alone preserved, we deny Microsoft's request for a new trial on damages.