Court Opinion

ID: 4254999
Source: CourtListenerOpinion
Date Created: 2018-03-15 16:00:37.768862+00
Date Added: 2024-06-11T09:36:47.677134
License: Public Domain

NOTE: This disposition is nonprecedential.

  United States Court of Appeals
      for the Federal Circuit
                 ______________________

   DOMINION ENERGY, INC., fka Dominion Re-
 sources, Inc., VIRGINIA ELECTRIC AND POWER
                     COMPANY,
                  Plaintiffs-Appellees

                            v.

                 ALSTOM GRID LLC,
                  Defendant-Appellant
                 ______________________

                       2017-1158
                 ______________________

   Appeal from the United States District Court for the
Eastern District of Pennsylvania in No. 2:15-cv-00224-
MAK, Judge Mark A. Kearney.
                ______________________

                Decided: March 15, 2018
                ______________________

    JEFFREY K. SHERWOOD, Blank Rome LLP, Washing-
ton, DC, argued for plaintiffs-appellees. Also represented
by DANIEL G. CARDY, SALVATORE P. TAMBURO.

    RICHARD L. RAINEY, Covington & Burling LLP, Wash-
ington, DC, argued for defendant-appellant. Also repre-
sented by BRIAN GERARD BIELUCH, ROBERT JASON
FOWLER, ALI MOJIBI YAZDI.
2                  DOMINION ENERGY, INC.   v. ALSTOM GRID LLC

                  ______________________

    Before MOORE, HUGHES, and STOLL, Circuit Judges.
STOLL, Circuit Judge.
    This is an appeal from a final judgment following a
jury trial in a patent infringement case. Alstom Grid LLC
(“Alstom Grid”) appeals the district court’s (1) denial of
judgment as a matter of law (“JMOL”) of noninfringe-
ment, (2) denial of its motion to vacate or remit the jury’s
reasonable royalty damages award, (3) denial of JMOL of
no willful infringement and grant of enhanced damages,
and (4) grant of a permanent injunction. For the reasons
explained below, we reverse the district court’s denial of
JMOL of noninfringement based on an absence of sub-
stantial evidence to support the jury verdict. For that
reason, we vacate the damages award, judgment of willful
infringement, enhanced damages award, and permanent
injunction. We remand for further proceedings consistent
with this opinion.
                        BACKGROUND
    Dominion Energy, Inc. and Virginia Electric and Pow-
er Company (collectively, “Dominion”) own U.S. Patent
No. 8,437,883, which claims a voltage control and conser-
vation system configured to monitor energy usage at the
energy delivery system and determine one or more energy
delivery parameters at the energy control system. Domin-
ion filed an infringement suit alleging that Alstom Grid
infringed the ’883 patent by “willfully supply[ing],
provid[ing] instructions and training relating to, and
configur[ing] systems with Alstom’s . . . LVM module
control systems” for third-party user Duke Energy Corp.
(“Duke”). J.A. 1251 ¶ 33.
                              I.
    In an effort to increase energy efficiency, electric utili-
ties have been replacing the old “spinning wheel” meters
DOMINION ENERGY, INC.   v. ALSTOM GRID LLC                 3

outside our homes with smart meters. Smart meters
generate advanced metering infrastructure data (“AMI”),
which is sent remotely to the electric utilities to assist in
(1) managing power output and (2) more accurately billing
the consumer for actual usage. AMI is now referred to as
the combination of smart meters with two-way communi-
cations technology for information, monitoring, and
control. In other words, AMI is the protocol used by
smart meters to allow the utility to receive real-time
measurements, including voltages, currents, and power
flows, from various components on the grid. The utility
can also regulate the voltage at different points on the
grid using AMI protocol by issuing control commands that
raise or lower the voltage at those points.
    One way to increase energy efficiency is to optimize
the electric grid to reduce energy lost along the electric
lines, known as conservation voltage reduction (“CVR”).
CVR optimizes voltage on the lines that run from the
electric power substations to homes and businesses. As
electricity is distributed throughout the grid, the voltage
at each user location drops as it gets further away from
the distribution location. Utilities seek to keep voltages
at customers’ locations within a target voltage band (114–
125 volts), but preferably at the lower end of the band,
allowing utilities to conserve voltage. Utilities do this by
applying CVR techniques.
                             II.
     Dominion’s ’883 patent is directed to controlling com-
ponents in a power distribution system using sensors at
multiple distribution locations. According to Dominion’s
complaint, the ’883 patent enables a power utility to
produce less power to satisfy its customers’ needs. Specif-
ically, the ’883 patent claims a voltage conservation and
control system that uses voltage measurements and
exception reports (that is, a warning that the measured
voltage is outside of the target voltage band) from smart
4                  DOMINION ENERGY, INC.   v. ALSTOM GRID LLC

meters to control the voltage supply at a substation or
other distribution location.
    Dominion asserts independent claim 1, which reads:
    1. A voltage control and energy conservation sys-
    tem for an electric power transmission and distri-
    bution grid configured to supply electric power to
    a plurality of user locations, the system compris-
    ing . . . a voltage controller configured to receive
    measurement data from each sensor of a subset of
    the plurality of sensors, wherein the subset in-
    cludes more than one and substantially fewer
    than all of the plurality of sensors, and to generate
    an energy delivery parameter based on a compari-
    son of the measurement data received from the
    subset to a controller target voltage band . . . .
’883 patent claim 1 (emphasis added). Dominion also
asserts independent claim 15 and dependent claim 16.
All three asserted claims require the claim limitation
emphasized above. Thus, the accused product must
compare “measurement data received from the subset [of
sensors] to a controller target voltage band” in order to
infringe the asserted claims. See id. at claims 1, 15, 16
(emphasis added). With that understanding of the rele-
vant claim limitation, we turn to the accused system.
                            III.
     Alstom Grid supplies software to electric utilities to
manage their electric grids. For example, Alstom Grid
sells a distribution management system (“DMS”) software
called e-terradistribution.    E-terradistribution models
every point on the entire grid in order to control all as-
pects of the distribution grid.         Version 3.3 of e-
terradistribution, as installed by Alstom Grid on Duke’s
systems, is the subject of this litigation. Alstom Grid
illustrates its accused system as follows:
DOMINION ENERGY, INC.   v. ALSTOM GRID LLC               5

J.A. 12092. As the diagram shows, an optional add-on to
the e-terradistribution software is the Load and Volt/VAR
Management (“LVM”) module. The LVM module provides
recommendations to manage demand, improve the voltage
quality, and provide reactive support to the surrounding
distribution system. Here, the only functionality of e-
terradistribution that Dominion accuses of infringement
is the use of data from smart meters (that is, AMI data) in
the LVM module when performing CVR.
    At trial, the parties presented testimony regarding
operation of the LVM module, as well as Alstom Grid’s
Distribution Network Analysis Functions (“DNAF”) e-
terradistribution version 3.3 User’s Guide.             See
J.A. 14363–667 (“User’s Guide”). As explained in Sec-
tion 8 of the User’s Guide, the LVM module has an itera-
tive calculation engine called the “Objective Function.”
J.A. 10762; J.A. 14609. In each iteration, the Objective
Function takes into account a large number of constraints
in the system, then uses the grid model to calculate the
voltages that would result at every point on the grid from
hypothetical control adjustments. In some cases, the
calculated voltage from the model differs from the meas-
ured voltage. This difference between the calculated
(model) voltage and measured voltage is the error value.
The software uses the error value to adjust the limits in
6                   DOMINION ENERGY, INC.   v. ALSTOM GRID LLC

the Objective Function—and, accordingly, the model—for
that particular location.
    Specifically, Section 8.1.6 of the User’s Guide discuss-
es the voltage limit adjustment procedure:
    8.1.6 Voltage Limit Adjustment
    In a real distribution system, there may be sever-
    al voltage measurements along the feeder. In an
    ideal case, the voltages calculated from the distri-
    bution power flow should match the voltage
    measurement perfectly. However, because of an
    imperfect model and an under-determined system,
    this rarely happens.
    By setting the Voltage Limit Adjustment option
    on the LVM page of the DNAF Configuration Edi-
    tor to True, this mismatch can be taken into con-
    sideration in LVM.       This option adjusts the
    voltage limit rather than the voltage itself.
    In Figure 46, the high/low voltage limit on the
    specified point can be adjusted as follows:
    Vnewlimit = Vlimit + (Vcal – Vmeas)
DOMINION ENERGY, INC.   v. ALSTOM GRID LLC               7

J.A. 14614. Alstom Grid presented testimony from its
software engineer, Dr. Paul Kuntz, who explained that
the Objective Function runs iteratively until it finds an
optimal control plan for the given constraints. To better
illustrate the Objective Function, we review Dr. Kuntz’s
example:

J.A. 9412. In this example, the model calculates the
voltage at a particular meter to be 116 volts. The meas-
urement, however, shows that the meter is actually at
113 volts, which is 3 volts lower than the calculated
voltage. Thus, the limit-adjustment algorithm will take
the difference between the calculated and measured
voltages (3 volts) and adjust the limits (the target band)
for that specific meter by adding the 3-volt difference. As
a result, the adjusted limits (target band) for this meter
would be 117–129 volts—that is, 3 volts more than the
standard 114–126 volt target band.
    Next, the adjusted limits for this meter are passed in-
to the Objective Function, which runs a hypothetical
control plan for the system, generating a new hypothetical
calculation for this meter. The Objective Function would
compare the hypothetical calculated voltage for this meter
to the adjusted limits. In this example, the calculated
8                 DOMINION ENERGY, INC.   v. ALSTOM GRID LLC

voltage, 116 volts, is outside the adjusted limits, 117–
129 volts. Therefore, the Objective Function would itera-
tively determine the effect of alternative hypothetical
control plans until it finds a solution where the calculated
voltage is within the adjusted limits. Dominion’s expert,
Dr. Richard Brown, agrees that the Objective Function
uses only calculated—not measured—voltages. With this
understanding of the accused functionality, we turn to the
procedural history of this appeal.
                            IV.
    As discussed above, the jury found that the AMI func-
tionality within the LVM module of e-terradistribution, as
installed on Duke’s systems, literally infringed Domin-
ion’s ’883 patent. The jury also found that Alstom Grid
actively and willfully induced the infringement and
awarded Dominion a reasonable royalty of $486,000.
    On October 3, 2016, after two days of bench trial and
post-trial hearings, the district court entered judgment
against Alstom Grid for willful infringement, awarded
$486,000 in damages to Dominion, granted a permanent
injunction against Alstom Grid, and awarded enhanced
damages, doubling the damages to $972,000.
    On October 21, 2016, the district court denied Alstom
Grid’s post-trial motions for JMOL of noninfringement, to
vacate or remit the reasonable royalty damages award,
and for JMOL of no willful infringement and thus no
double damages. Alstom Grid appeals. We have jurisdic-
tion under 28 U.S.C. § 1295(a)(1).
                       DISCUSSION
     We review the denial of a motion for JMOL under the
law of the regional circuit. ClearValue, Inc. v. Pearl River
Polymers, Inc., 668 F.3d 1340, 1343 (Fed. Cir. 2012)
(citing Summit Tech., Inc. v. Nidek Co., 363 F.3d 1219,
1223 (Fed. Cir. 2004)). Under Third Circuit law, we
exercise plenary review over a district court’s rulings on
DOMINION ENERGY, INC.   v. ALSTOM GRID LLC                9

motions for JMOL, applying the same standard as the
district court.    Agrizap, Inc. v. Woodstream Corp.,
520 F.3d 1337, 1341–42 (Fed. Cir. 2008) (citing Gagliardo
v. Connaught Labs., Inc., 311 F.3d 565, 568 (3d Cir.
2002)). Thus, a grant of JMOL is appropriate only where
a party has been fully heard on an issue during a jury
trial and the court finds that a reasonable jury would not
have a legally sufficient evidentiary basis to find for the
party on that issue. Agrizap, 520 F.3d at 1341–42; see
Fed. R. Civ. P. 50(a). As the reviewing court, we are
mindful that we “may not weigh the evidence, determine
the credibility of witnesses, or substitute [our] version of
the facts for the jury’s version.” Agrizap, 520 F.3d at
1341–42 (citing Lightning Lube, Inc. v. Witco Corp.,
4 F.3d 1153, 1166 (3d Cir. 1993)). Here, we examine
literal infringement, which exists only when every limita-
tion recited in the claim is found in the accused device,
exactly. Microsoft Corp. v. GeoTag, Inc., 817 F.3d 1305,
1313 (Fed. Cir. 2016).
    The question before us is whether substantial evi-
dence supports the jury’s finding that the accused system
includes every limitation of the asserted claims. We
conclude that it does not. As discussed above, the assert-
ed claims require “generat[ing] an energy delivery param-
eter based on a comparison of the measurement data
received from the subset to a controller target voltage
band.” See ’883 patent claims 1, 15. The claims require a
comparison of two specific things. Evidence of a compari-
son of something other than those two things does not
support a finding of literal infringement.
    We conclude that no reasonable juror could find that
the accused product compares the measured data to a
controller target voltage band. The evidence presented to
the jury shows that the accused system compares the
measured data to a single calculated voltage, as opposed
to a voltage band as required by the claims. Indeed, it is
10                 DOMINION ENERGY, INC.   v. ALSTOM GRID LLC

the calculated voltage, not the measured data, that the
accused system compares to the voltage band.
    Dominion relies heavily on the testimony of
Dr. Brown, its technical expert. Dr. Brown’s testimony,
however, does not provide substantial evidence to support
the jury’s verdict because his testimony was conclusory,
unsupported, contrary to the evidence in the case, or not
directed to the claim limitation at issue. We address the
problems with his testimony below.
    Dr. Brown repeatedly testified to the jury that the
measured voltage—as opposed to the calculated voltage—
was used to indicate a voltage fault condition in the
accused Duke system. See J.A. 10562. But he did not cite
any particular documents to support his position. Fur-
thermore, his testimony is contradicted by the User’s
Guide, which explains that it is the calculated voltage—
not the measured voltage—that is used to indicate a
voltage fault condition. He further testified that a voltage
measurement comes back from the subset of the smart
meters, and the Alstom Grid controller software compares
the measured voltage to the acceptable voltage band
range of 114–126 volts. But, again, this testimony was
both unsupported by the record evidence and contradicted
by the User’s Guide.
    Dr. Brown also asserted at trial that the demonstra-
tive slides he prepared and presented to the jury showed
the claimed comparison and were based on Alstom Grid’s
source code, deposition testimony, and the User’s Guide.
In particular, he testified that the fact that the controller
software could identify whether or not there was a voltage
fault condition was itself evidence that there was a com-
parison between the measured voltage and the target
voltage band. But Dr. Brown’s testimony does not neces-
sarily show that the measured voltage is compared to a
voltage band. And just saying that something is so does
not make it true, especially when there is no record sup-
DOMINION ENERGY, INC.   v. ALSTOM GRID LLC               11

port and, in fact, the User’s Guide indicates otherwise.
See Yoon Ja Kim v. ConAgra Foods, Inc., 465 F.3d 1312,
1320 (Fed. Cir. 2006) (affirming JMOL of non-
infringement where “conclusory [expert] testimony” was
the basis for infringement); cf. Alpex Computer Corp. v.
Nintendo Co., 102 F.3d 1214, 1222–23 (Fed. Cir. 1996)
(holding that conclusory expert testimony did not support
a finding of infringement). 1
    Dr. Brown also testified about Figure 46 of the User’s
Guide, reproduced above. See J.A. 14614 (Figure 46). As
Dr. Brown explained, Figure 46 shows an error between
the calculated voltage (circle) and the measured voltage
(square). As he further explained, the software calculates
the error between the calculated and measured voltages
(Vcal – Vmeas), then adds the error to the original low/high
limits in the voltage band to obtain modified high/low
limits.   Indeed, Dr. Brown admitted that “everybody
agrees [on] . . . how the software actually works.”
J.A. 10442. Nevertheless, he proceeded to engage in a
discussion of hypothetical situations, illustrating the
different situations that might occur if both, either, or
neither calculated and measured voltages were within the
range. In his hypothetical discussions, Dr. Brown assert-
ed that the Alstom software “will compare the measured
voltage to [the acceptable] range.” J.A. 10436. But this
testimony explicitly contradicts the text of Section 8.1.6,
which only compares the calculated and measured voltag-
es. The text of Section 8.1.6 never discloses or suggests
making a comparison of the measured voltage to any
range. Accordingly, Dr. Brown’s hypotheticals are un-
founded and cannot support the jury’s finding that the
accused system compares the measured voltage to a
controller target voltage band.

   1   Dominion chose to not rely on the doctrine of
equivalents to prove infringement.
12                 DOMINION ENERGY, INC.   v. ALSTOM GRID LLC

    Beyond his conclusory testimony, Dr. Brown made
several critical admissions. First, Dr. Brown agreed that
the accused system compares the calculated voltage—not
the measured voltage—to a target band:
     [Alstom Grid] compare[s] the calculated voltage to
     the measured voltage to determine the error. And
     then they use that error to adjust the limits. And
     then they compare the calculated voltage to the
     adjusted limits in their software.
J.A. 10562–63. Dr. Brown also admitted that the limit-
adjustment algorithm code, which is the key algorithm in
the accused system, does not compare the measured
voltage and a target voltage band. Dr. Brown further
admitted that the accused function “operates on calculat-
ed voltages” and “never uses measured voltage to generate
an energy delivery plan.” J.A. 10489–90, 10493. These
admissions further support our conclusion that a reason-
able jury would not have a legally sufficient evidentiary
basis to find for Dominion on the issue of direct infringe-
ment.
    Finally, Dominion cites Dr. Brown’s testimony and
excerpts from the User’s Guide relating to a so-called
“heuristic mode.”        Appellee Br. at 29–30 (citing
J.A. 10446–48, in which Dr. Brown discussed the heuris-
tic LVM methodology as described in Alstom Grid’s e-
terradistribution 3.3 User’s Guide at Section 8.3.4
(J.A. 14636)). Alstom Grid’s User’s Guide does indeed
teach that the heuristic mode compares the measured
voltage to the target voltage range. It is undisputed,
however, that the accused Duke system does not include
the heuristic mode. See Oral Argument at 20:11–15,
available at http://oralarguments.cafc.uscourts.gov/default
.aspx?fl=2017-1158.mp3 (“There wasn’t any evidence that
[Duke was] using heuristic, your honor, that’s right.”),
20:59–21:09 (“there was no evidence that [Duke] used
heuristic”); J.A. 11306 (stating, in Dominion’s closing
DOMINION ENERGY, INC.   v. ALSTOM GRID LLC              13

statement, that the heuristic mode was not at issue in
this case). Accordingly, Dominion’s reliance on the heu-
ristic mode is misplaced. We conclude that no reasonable
jury could find that the accused Duke system compares
the measured voltage to a voltage range and, accordingly,
we reverse the district court’s denial of JMOL of nonin-
fringement.
                        CONCLUSION
    For the reasons above, we reverse the district court’s
denial of JMOL of noninfringement based on an absence
of substantial evidence to support the jury verdict. Ac-
cordingly, we vacate the damages award, judgment of
willful infringement, enhanced damages award, and
permanent injunction. We have considered Alstom Grid’s
remaining arguments and find them unpersuasive. We
remand the case to the district court for entry of judgment
of noninfringement of claims 1, 15, and 16 and for further
proceedings consistent with this opinion.
  VACATED-IN-PART, REVERSED-IN-PART, AND
                REMANDED
                           COSTS
   Costs to Appellant.