FEDERAL CIRCUIT DECISIONS FOR WEEK ENDING AUGUST 25, 2017
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1 P+S FEDERAL CIRCUIT SUMMARIES VOL. 9, ISSUE 35 FEDERAL CIRCUIT DECISIONS FOR WEEK ENDING AUGUST 25, 2017 Icon Health & Fitness, Inc. v. Octane Fitness, LLC, No , (August 25, 2017) (nonprecedential) Patent Nos. 5,104,120 ( 120 patent) and 6,019,710 ( 710 patent) Supreme Court s exceptional case standard under 35 U.S.C. 285 for award of attorney fees An exceptional case is simply one that stands out from others with respect to the substantive strength of a party s litigating position or the unreasonable manner in which the case was litigated. Facts/Background: Icon sued Octane alleging that Octane infringed the 120 and 710 patents. Octane sent a letter to ICON to put ICON on notice that Octane reserves its rights against Icon for costs required to respond to discovery, review documents and things produced by Icon, or otherwise address Icon s assertion of the 120 patent in this lawsuit. Two weeks later, the parties filed a stipulation dismissing with prejudice any and all claims against the other, asserted or unasserted, relating to [the 120 patent]. As for the 710 patent, Octane won on summary judgment but the district court denied Octane s motion for attorney s fees. The Federal Circuit affirmed the denial of attorney s fees but the Supreme Court reversed and remanded. Upon remand, the district court awarded $1.6 million in attorney s fees for the litigation relating to the 710 patent, but did not award fees relating to the 120 patent and the appellate and remand proceedings. Both parties appealed. ICON appealed the finding that this case was exceptional, and Octane appealed the denial of fees relating to the 120 patent and the appellate and remand proceedings. Holding: Affirmed. ICON argued that the district court abused its discretion in finding the case exceptional because it previously found that the case was not exceptional on the same facts. The Federal Circuit disagreed because the Supreme Court, in its opinion, changed the standard for finding a case exceptional and the district court did not abuse its discretion when finding this case exceptional under the new standard. The Federal Circuit affirmed the denial of fees relating to the 120 patent and the appellate and remand proceedings. Regarding the former, the Federal Circuit relied on the parties stipulation which unambiguously dismissed all claims relating to the 120 patent, including a claim for fees under 285. The Federal Circuit also declined to further examine the minutia of the fee award, [because the] district court provided a reasonable analysis of the calculation of the fee award.
2 Page 2 In re Chudik, No (August 25, 2017) (nonprecedential) Patent App. No. 13/068,309 ( 309 application) Negative limitations are construed in light of the specification Under the broadest reasonable interpretation standard, the claim language configured for [some result] may be broadly construed to cover any structure capable of achieving that result Facts/Background: The 309 application is directed to a humeral implant used in shoulder replacement surgery. Claim 5 is independent and recites: A humeral implant comprising a humeral surface component having a non-articular surface configured for long-lasting fixation of the implant on a humeral head and no stem. The Board determined that claim 5 and dependent claims 6-15 are not patentable over the prior art. Dr. Chudik appealed. Holding: Affirmed. The Federal Circuit only considered claim 5 (which the Board determined to be anticipated by the prior art), because Dr. Chudik s arguments for the patentability of dependent claims 6-15 depends on claim 5. In the appeal, Dr. Chudik challenged the Board s findings, and the Federal Circuit specifically addressed three of them. First, Dr. Chudik argued that the prior art disclosed a stem and thus did not meet the negative limitation of claim 5, in particular its recitation of no stem. The Federal Circuit disagreed because the stem as described in the 309 specification is a physically distinct and separate component from the implant and the portion of the structure disclosed in Leonard, which Dr. Chudik is arguing corresponds to the stem, is not a physically distinct and separate component from the implant. Second, Dr. Chudik argued that Leonard does not disclose a non-articular surface configured for long-lasting fixation, because Leonard discloses a sliding contact between the humeral head and the platen. The Federal Circuit disagreed because the claim language merely requires that the non-articular surface be configured for long-lasting fixation (interpreting configured for as capable of ) and that Dr. Chudik has not pointed to any evidence in the record that the structure of Leonard is incapable of long-lasting fixation. Third, Dr. Chudik argued that Leonard does not disclose the humeral implant limitation of claim 5 because Leonard is directed to a glenoid implant. The Federal Circuit, however, did not view this distinction as a patentable distinction because [t]he patentability of an apparatus claim depends on the claimed structure, not on the use or purpose of that structure. The Federal Circuit was unpersuaded by Dr. Chudik s remaining arguments, and affirmed the Board s decision because it applied the correct law and its decision is supported by substantial evidence.
3 Page 3 In re Stepan Co., No (August 25, 2017) (precedential, 2-1) Patent App. No. 12/456,567 ( 567 application) When a claim is directed to a particular combination of materials that achieve a desired result, prior art combinations of the same materials, but with different composition ratios, that fail to achieve the desired result are relevant as evidence of non-obviousness. Facts/Background: The 567 application is directed to herbicidal formulations containing glyphosate salt with a surfactant system. The invention disclosed in the 567 application is based on the unexpected discovery that surfactant systems comprising dialkoxylated alkylamine, water miscible solubilizer and amine oxide allow for formulation of ultra-high loaded ( highstrength ) glyphosate salt concentrates possessing high or no cloud points. The 567 application explains that it is advantageous to formulate glyphosate with a surfactant system exhibiting a high cloud point to obviate the necessity of waiting for the temperature of the glyphosate salt reaction product [which is created at about 75ºC] to cool down. The examiner rejected claim 1 based on routine optimization to select and adjust the surfactants, which are taught in the prior art, to achieve the claimed cloud point above at least 70ºC and the Board affirmed. Holding: Vacated and remanded. The Federal Circuit held that the Board erred because the Board (1) failed to adequately articulate its reasoning, (2) erroneously rejected relevant evidence of nonobviousness, and (3) improperly shifted to Stepan the burden of proving patentability. According to the Federal Circuit, the Board erred in finding obviousness because it did not explain why it would have been routine optimization to select and adjust the claimed surfactants to achieve a cloud point above at least 70ºC, requiring the Board to provide some rational underpinning explaining why a person of ordinary skill in the art would have arrived at the claimed invention through routine optimization. In addition, the Federal Circuit held that the Board further erred in failing to articulate why a person of skill in the art would have had a reasonable expectation of success and in rejecting the teachings that the prior art combinations failed to achieve the desired cloud point as evidence of non-obviousness. Such evidence was relevant to non-obviousness because it is relevant to whether a skilled artisan would have had a reasonable expectation of success to achieve a cloud point above at least 70ºC with the claimed surfactant systems. Finally, according to the Federal Circuit, the Board improperly shifted the burden of proving patentability to Stepan. In shifting the burden, the Board relied on case law in which the patentee claimed a range within the prior art and had to rebut a prima facie case of obviousness by showing criticality of its claimed range. However, the Federal Circuit concluded that this line of case law did not apply to this case. First, the Board did not establish a prima facie case of obviousness because it failed to adequately articulate its reasoning. Second, the claimed surfactant system contains four elements. The first three describe the surfactants [and] the fourth element limits the combination of those surfactants to only those combinations that produce a cloud point above at least 70ºC or no cloud point at all. The fourth limitation is an element of the claimed invention, and the PTO has the burden to show that this fourth limitation is met.
4 Page 4 In re Walter, No (August 21, 2017) (nonprecedential) Patent No. 7,513,711 ( 711 patent) If a claim employs a term of degree, the intrinsic record must provide those skilled in the art with objective boundaries with which to assess the term s scope. If it does not, the claim is indefinite. Facts/Background: Mr. Walter is an inventor on the 711 patent. Mr. Walter requested reexamination of the 711 patent and during reexamination the PTO rejected the issued claims as obvious. In response, Mr. Walter amended the claims to recite a block-like support structure and submitted an expert declaration to argue for a plain and ordinary meaning of block-like as a solid support structure made up of discreet [sic] pieces or blocks which[,] when joined together in some manner, assemble into a complete structure or apparatus. The examiner, however, maintained the obviousness rejection and further rejected the claims for lack of written description and indefiniteness. The Board affirmed the examiner s rejections for lack of written description and indefiniteness but reversed the obviousness rejection on the grounds that it could not ascertain the meaning of the amended claims. Mr. Walter appealed. Holding: Affirmed. The Federal Circuit held that the claims of the 711 patent, as amended during reexamination, are indefinite, and did not reach the Board s decision on written description. According to the Federal Circuit, block-like is a term of degree and this term renders the claims of the 711 patent indefinite because there is no guidance in the intrinsic record for determining its scope and nothing in the intrinsic record offers objective boundaries for ascertaining whether a given shape falls into either [block-like or non-block-like] category. The Federal Circuit also noted that the prosecution history compounded the uncertainty of the meaning of the term block-like. During reexamination, Mr. Walter described block-like in different and often inconsistent ways, and vacillated between the different constructions of the term. The Federal Circuit concluded that the term s ill-defined boundaries coupled with the patentee s erratic use of the term fails to inform skilled artisans about the scope of the invention with reasonable certainty to reach its decision of indefiniteness. However, in reaching its decision, the Federal Circuit declined to adopt the Board s implicit determination that a patent claim is indefinite because the specification uses a term differently from its dictionary definition and stated, [i]f there is a conflict between the specification and a general purpose dictionary as to a claim s proper meaning, the specification controls.
5 Page 5 Nidec Motor Co. v. Zhongshan Broad Ocean Motor Co., No (August 22, 2017) (precedential, per curiam) Patent No. 7,626,349 ( 349 patent) A party who has been served with a complaint for infringement of a patent has one year to file an IPR petition against the patent. A person who files an IPR petition late may be permitted to join as a party to an earlier instituted IPR petition under 35 U.S.C. 315(c). Facts/Background: The 349 patent, assigned to Nidec, is directed to low-noise HVAC systems. The 349 patent claims a motor controller that employs sinewave commutation instead of the conventional square-wave commutation to achieve quieter operation of HVAC systems. Zhongsan filed an IPR against the 349 patent on the ground of obviousness over two references (Bessler, which teaches an HVAC system and Kocybik, which teaches with sine-wave commutation in electric motors) and on the ground of anticipation by Hideji, a Japanese reference. The Board instituted the IPR as to obviousness but declined to institute the IPR as to anticipation because Zhongsan had failed to provide an affidavit attesting to the accuracy of the translation of Hideji. About a month later (more than one year after Zhongsan had been served with a complaint alleging infringement of the 349 patent), Zhongsan filed a second IPR, asserting that the claims of the 349 patent were anticipated by Hideji, this time with the requisite affidavit. At the same time, Zhongsan requested joinder of the refiled IPR with the instituted first IPR pursuant to 35 U.S.C. 315(c) (which allows joinder at the discretion of the PTO). The three-panel Board declined to institute the second IPR because the second IPR was time-barred and 35 U.S.C. 315(c) did not apply, reasoning that the joinder provision does not permit a party to join issues to a proceeding to which it is already a party. Zhongsan requested a rehearing of the three-panel Board s decision, and the rehearing was granted by an expanded panel of five judges. The expanded panel set aside the original panel s decision and concluded that 315(c) permits the joinder of any person who properly files a petition under 311, including a petitioner who is already a party to the earlier instituted [IPR]. The expanded panel later issued a decision in the joined proceedings, determining that all of the challenged claims are unpatentable under 35 U.S.C. 103 and under 35 U.S.C Nidec appealed. Holding: Affirmed as to obviousness. The Federal Circuit did not resolve the issues of joinder and anticipation because they do not affect the outcome of this case. Nidec challenged the Board s obviousness finding on the grounds that Bessler teaches simplifying conventional HVAC systems by removing the system controller and incorporating sinewave commutation would increase complexity. The Federal Circuit rejected this argument because Bessler merely stated as its object an HVAC system that does not require a system controller and nothing in Bessler criticizes, discredits, or otherwise discourages the use of sinewave commutation in HVAC systems. In any case, the Federal Circuit reasoned, the sinewave commutation would be implemented in the motor controller of Bessler, which is different from the system controller. Nidec also argued that Bessler did not disclose a system controller, which is an element of all of its claims. However, the 349 patent states that a system controller may be a thermostat and the Federal Circuit relied on a thermostat in Bessler as teaching that element.
6 Page 6 Thought Inc. v. Oracle Corp., No (August 21, 2017) (nonprecedential) Patent No. 5,857,197 ( 197 patent) When construing a claim term, it is instructive to look at the context in which the claim term is used within the asserted claim, in other claims, and in the specification. Facts/Background: Thought is the owner of the 197 patent which is directed to a system and method for object-oriented programs to access data in a relational database application. Thought sued Oracle, alleging that Oracle s TopLink program and related applications infringed the claims of the 197 patent. Oracle denied infringement and asserted a counterclaim of invalidity. The district court issued a claim construction order in which it construed object as an instance of a class. It did not construe the term extracting. The district court granted Oracle summary judgment of noninfringement because Thought failed to raise a material issue of fact that the accused software performed the claim limitation extracting the object attributes and the object name from the object for two independent reasons. First, it held that the claim language and specification make clear that the term extracting refers to extracting a subset of information from an object. Second, in light of the construction of object as an instance of a class, it held that Thought did not demonstrate that the accused software extracts the object name and object attributes from a singular instance of a class. Holding: Affirmed. Thought argued on appeal that the TopLink program s find() method, which receives two separate parameters, meets the extracting the object attributes and the object name from the object claim limitation. Oracle argued that the find() method does not perform any extracting from the object because wholesale copying or passing along of a reference to an object does not meet the plain and ordinary meaning of that limitation. The Federal Circuit agreed with the district court and Oracle that the plain and ordinary meaning of extracting... from the object cannot mean merely passing along or copying the entire object, including the container of the thing extracted. Relying on the plain language and context of the full clause from which the limitation extracting... from the object is taken, the Federal Circuit reasoned that the word from indicates the source from which the extracted thing is taken. Analogizing object to a container, the Federal Circuit concluded that [t]aking, or making an exact copy of, the container and all of the contents held within the container is not extracting the contents from the container. The Federal Circuit further noted that [t]he claim, read in the context of the specification, strongly supports this conclusion and [t]he use of the terms extracting and obtaining in other claims further supports the conclusion. Oracle additionally argued that the TopLink program s find() method draws the two pieces of information, which are alleged by Thought to be the object attributes and the object name, from two different objects and thus does not meet the claim limitation which requires extraction from a single object. The Federal Circuit agreed with the district court and Oracle on this point also.
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