“AND” Can Mean “OR” Depending on the Context

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In Kaufman v. Microsoft Corp., [2021-1634, 2021-1691] (May 20, 2022) the Federal Circuit affirmed the district court’s denial of Microsoft’s post-judgment challenges to a $7 million damage award for infringement of U.S. Patent No. 7,885,981, and reversed the district court’s denial of prejudgment interest.

The ’981 patent addresses the creation of user interfaces that permit users to interact with data in relational databases. One of the issues was whether the claim required the automatic generation of an end user interface. The word automatic did not appear on the body of the claim, but the preamble stated that the method involved a “processor for automatically generating and end-user interface.”

Microsoft moved for summary judgment, arguing that that the phrase “automatically
generating” found in the preamble of claim 1 is limiting, and means that “no human labor required,” and thus Microsoft product does not infringe. Microsoft argued that the district court erred in failing to clarify the reach of the “automatically” requirement for the jury, warranting a new trial under O2 Micro because a clarification could reasonably have led the jury to a different verdict. However, the Federal Circuit held that Microsoft failed to preserve its O2 Micro challenge.

The Federal Circuit noted that in the original Markman proceeding, the parties did
not request a construction of the word “automatically” or raise an issue of the scope of the “automatically generating” requirement. During the motion for summary judgment
briefing, Microsoft described the “human labor” involved in use of Dynamic Data, and it
asserted a need for a claim construction under O2 Micro, but it said only that there was “a fundamental legal dispute as to the meaning of “automatic” in the claims, it never clearly said that, apart from what “automatic” means, a construction was needed specifying what functions had to be automatic, i.e., the scope of the “automatically generating” requirement. Further, Microsoft never offered the district court a formulation of such a claim construction resolving that scope issue, including at the at the pre-trial hearing.

The Federal Circuit also rejected Microsoft’s argument, presented for the first time on appeal, that “automatically generating” should be construed broadly to require some defined set of steps beyond those recited by the claims in (a), (b), and (c) to be performed automatically. Microsoft never proposed such a construction to the district court.

Microsoft’s final argument was that there was insufficient evidence to support the jury’s finding infringement, but the Federal Circuit agreed with the district court correctly explained, the jury reasonably that the manual step identified by Microsoft were not part of the claim requirement that were required to be performed automatically.

Finding that Microsoft failed to establish that the district court erred in its claim construction or that the jury’s verdict was not supported by substantial evidence, the Federal Circuit affirmed the jury’s finding that the accused processes come within the “automatically generating” limitation.

Microsoft also argued that the district court erred in the post-trial ruling when it concluded that “and” means “and/or,” contending that the phrase should be given the conjunctive
meaning, so that the client application (constituting the end-user interface) must integrate into each of the individual mode displays (for creating, retrieving, updating, and deleting) all three of the “processes for representing, navigating, and managing said relationships across tables.” The Federal Circuit agreed with the district court’s construction, noting that a claim construction that excludes a preferred embodiment is rarely, if ever correct and would require highly persuasive evidentiary support. The Federal Circuit noted that in the sole embodiment in the patent, a “retrieve” display lacks a “managing” process. The the Federal Circuit said that “and” must be construed as “and/or” so that the claim would cover the only disclosed embodiment.

The Federal Circuit recognized that it cannot redraft claims whether to make them operable or to sustain their validity, or to cause them to encompass the sole described embodiment, it said that that is not what it was doing here. The Court said where there is “only one reasonable construction,” it has recognized that, in certain contexts, the word “and” can reasonably be understood to denote alternatives, rather than conjunctive requirements.

Finally, the Federal Circuit addressed the denial of prejudgment interest. The district court provided two rationales for denying prejudgment interest to Kaufman: first, that the jury
verdict “subsumed interest,” and second, that Mr. Kaufman was responsible for “undue delay” in bringing the lawsuit, causing prejudice to Microsoft. The Federal Circuit said that the jury verdict cannot reasonably be understood to include interest, noting there was no testimony about how the interest would be calculated. The Federal Circuit also said that the district court also erred in finding Kaufman was responsible for undue delay justifying the denial of prejudgment interest. The Federal Circuit said that the fact that Mr. Kaufman
did not sue for five years after he became aware of Microsoft’s potential infringement does not alone justify a finding of undue delay. The Federal Circuit said that Microsoft presented
no evidence as to why Kaufman’s delay was undue.

Not so fast — Letters to Customers + Customer Litigation Required More Analysis Before Dismissing a DJ Action

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In Mitek Systems, Inc., v. United States Automobile Association, [2021-1989] (May 20, 2022), the Federal Circuit affirmed a California district court decision transferring Mitek’s DJ action to Texas, and vacated the Texas District Court’s dismissal of the DJ action, and remanded.

USAA owns U.S. Patent Nos. 8,699,779, 9,336,517, 8,977,571, and 9,818,090, all of which address the use of a mobile device to capture an image of a bank check and to transmit it for deposit. After more than 1000 notice letters to its clients, and an infringement trial against one of its customers, Mitek filed a declaratory judgment action against USAA in the Northern District of California.

USAA moved for dismissal under Rule 12(b)(1) for lack of subject-matter jurisdiction, or for dismissal based on the discretion granted to the district court by the Declaratory Judgment Act. In the alternative, USAA sought transfer to the Eastern District of Texas. The California district court granted USAA’s motion to transfer the declaratory-judgment action to the Eastern District of Texas, without ruling on the motion to dismiss, After transfer of the case, the Texas court took up the motion to dismiss, granting it because there was
no case or controversy between the parties. The Court determined the neither the customer litigation, nor the cease and desist letters were sufficient to support jurisdiction, and even if they did, the court would exercise its discretion to decline jurisdiction.

The Federal Circuit found the district court’s analysis incomplete, among other things no considering contributory and inducement of infringement. The Federal Circuit also found that the district courts analysis under 12(b)(1) failed to distinguish between a facial or a factual challenge.

The Federal Circuit said that on remand the district court’s primary task regarding Mitek’s first asserted basis for establishing a case or controversy will be to ascertain the alleged role of the Mitek technology in the banks’ applications and the alleged role that the Mitek technology plays in infringement claims. Making those core determinations, and considering any other pertinent issues, will supply a fuller basis for the bottom-line assessment of Mitek’s first theory of Article III jurisdiction.

With respect to Mitek’s alternative basis for jurisdiction the USAA’s letters to Mitek customers combined with subsequent indemnification demands — the Federal Circuit also found the district court analysis inadequate. The district court observed that Mitek had submitted only one letter with the Complaint — a letter that came from USAA’s licensing counsel and that did not threaten litigation, include claim charts for the patents-in-suit,
or identify Mitek or particular products as infringing. The Federal Circuit concluded that
the allegations in Mitek’s complaint concerning USAA’s letter campaign and the attached example letter, viewed in light of the Wells Fargo litigation, were sufficient to show a controversy between USAA and Mitek’s customers who received letters.

The Federal Circuit said that a communication from a patent owner to another party, merely identifying its patent and the other party’s product line, without more, does not suffice, but the Court said that here, there is just enough “more.” Given the additional detail in the claim and the customer suit against Wells Fargo, the Federal Circuit said under the totality of the circumstances, there is enough for Mitek’s other customers to reasonably interpret USAA’s actions as an implicit assertion of infringement based on incorporation of Mitek technology. As to the showing of a demand for an indemnity, the Federal Circuit said that this was met too, and that it was not necessary that Mitek further concede liability under the indemnity obligation.

On remand, the Federal Circuit instructed the district court should first determine which Rule
12(b)(1) framework to apply, i.e., determine whether USAA mounted a factual attack on the indemnity allegations of Mitek’s complaint. If it finds that USAA has not mounted a factual attack, the court must closely analyze the relevant indemnity allegations, to determine whether they suffice. If it finds that USAA has mounted a factual attack, the district court must decide how to proceed, including whether the parties should have the opportunity to present additional evidence, and to address issues concerning post-complaint events.

Regarding the discretionary decision to dismiss, the Federal Circuit said that where a discretionary decision rests on an inadequate explanation and might well be different without the deficiencies, it may vacate the decision and remand for reconsideration. In any event, there must be well-founded reasons for declining to entertain a declaratory judgment action. The Federal Circuit said that the district court did not give reasons independent of its reasons for its jurisdictional dismissal, which it held to be deficient in various respects, and cannot stand. The Federal Circuit vacated the discretionary dismissal.

PTAB Should Have Resolved Dispute Among Authors of a Reference to Determine Whether They All Made Contributions to the Ultimately Claimed Subject Matter

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In Google LLC, v. IPA Technologies Inc, [2021-1179, 2021-1180, 2021-1185] (May 19, 2022), the Federal Circuit vacated the PTAB decision that Google had not shown the challenged claims in U.S. Patent Nos. 6,851,115 and 7,069,560 to be unpatentable.

During the prosecution of the ’115 patent, various claims were rejected based on the Martin reference, which the examiner identified as being prior art. In response, SRI contested the prior art status of the reference by submitting inventor declarations by Martin and Cheyer under 37 C.F.R. §1.132, asserting that Dr. Moran was “not a co-inventor of the subject matter described in the subject matter disclosed and claimed in the instant application[s].”
If Dr. Moran was not a co-inventor of the Martin reference, the Martin reference was not prior art because it was made by the same inventive entity as the ’115 and ’560 patents and not “by others.” 35 U.S.C. § 102(a) (pre-AIA).1 After receiving the declarations, the examiner withdrew the rejections based on the Martin reference and continued examining the applications. The patents were granted and ultimately assigned to appellee IPA
Technologies, Inc. (“IPA”).

Google petitioned the Board for inter partes review of various claims of the ’115 and ’560 patents, relying the same Martin reference, and contending that the Martin reference was prior art as work “by others” because it described the work of an inventive entity (Martin,
Cheyer and Dr. Moran) different from the inventive entity of the challenged patents (Martin and Cheyer). The Board instituted IPR, but concluded that Google had not provided sufficient support that Moran was a co-inventor, and dismissed the Petition. On appeal, Google argued that the Board improperly put the burden on Google to provide that the Martin reference had a different inventive entity than the challenged patents.

The Federal Circuit noted that the term “burden of proof” has been used to describe two distinct concepts: the burden of persuasion and the burden of production. The burden of persuasion is “the ultimate burden assigned to a party who must prove something to a specified degree of certainty.” In an IPR, “the burden of persuasion is on the petitioner
to prove ‘unpatentability by a preponderance of the evidence,’ and that burden never shifts to the patentee.” In contrast, the burden of production, or “going forward with evidence,” is a shifting one, “the allocation of which depends on where in the process of trial the issue arises.” The burden of production may be met either by “producing additional evidence” or by “presenting persuasive argument based on new evidence or evidence already of record.”

The Federal Circuit said that Google, as the petitioner, had the ultimate burden of persuasion to prove unpatentability by a preponderance of the evidence and this burden never shifted. It found no error with the Board’s requiring that Google establish the Martin reference was prior art “by another” by showing that Dr. Moran made a significant enough contribution to the portions relied on to invalidate the challenged patents to qualify as a joint inventor of those portions.

Turning to the question of whether Google satisfied its burden, the Federal Circuit said that it is evident that Dr. Moran made general technical contributions to the project, but that that was not the relevant inquiry. To be a joint inventor of the Martin reference, Dr. Moran must have made an inventive contribution to the portions of the reference relied upon and relevant to establishing obviousness. The Federal Circuit said that the testimony of Dr. Moran, if credited, might well establish that he was a co-inventor of the particular portions of the Martin reference relied on by Google. The Federal Circuit found, however, that the Board
did not complete the full Duncan analysis. Instead, it appeared to the Federal Circuit that the Board concluded that Dr. Moran’s testimony was insufficiently corroborated.

The Federal Circuit found that although coauthorship does not presumptively make a co-author a coinventor, it is significant corroborating evidence that a co-author contributed to the invention. Thus, the Federal Circuit said, the issue was not lack of corroboration for
Dr. Moran’s testimony, but rather whether his testimony should ultimately be credited over Cheyer and Martin’s conflicting testimony during the IPR proceedings. The Federal Circuit said that instead of resolving the conflicts, the Board stated that it found the testimony of Dr. Moran, Mr. Martin, and Mr. Cheyer credible. The Federal Circuit thus vacated the Board’s decision, and remanded,

Administrative Economy in Action: IPR that Found Patent Invalid is Retroactively Terminated

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In Atlanta Gas Light Company v, Bennett Regulator Guards, Inc, [2021-1759] (May 13, 2022) the Federal Circuit dismissed Atlanta Gas’ appeal for lack of jurisdiction.

This was the third time this case made it to the Federal Circuit from the PTAB, In its final written decision, the Board, in the underlying inter partes review proceeding, rejected patent owner Bennett Regulator Guards, Inc.’s argument that petitioner Atlanta Gas Light Company was time barred from petitioning for inter partes review under 35 U.S.C. § 315(b). It then determined that the challenged claims were unpatentable over the prior art. Bennett appealed,and in the first appeal, the Federal Circuit disagreed with the Board’s time-bar determination, holding that Atlanta Gas should have been barred; vacated the Board’s unpatentability determination; and remanded with directions to dismiss the IPR (and to further consider a sanctions order that the Board had not yet finalized.)

Before the Board acted on this mandate, however, the Supreme Court held that time-bar determinations were unreviewable in Thryv, Inc v. Click-To-Call Technologies, LP, 140 S. Ct. 1367 (2020), and vacated the Federal Circuit’s decision overruling the Board’s time-bar determination.

On remand from the Supreme Court, the Federal Circuit affirmed the Board’s unpatentability
determination on the merits (while saying nothing about the time bar) and again remanded for the Board to reconsider and finalize its order regarding sanctions. On remand from the Federal Circuit, the Board terminated the proceeding due in part to its reconsideration of its decision on the time bar.

Atlanta Gas appealed, but the Federal Circuit concluded that it lacked jurisdiction to review the Board’s decision to vacate its institution decision, a decision it made based in part on
its evaluation of the time bar and changed Patent and Trademark Office policy. Accordingly, the Federal Circuit dismissed Atlanta Gas’s appeal for lack of jurisdiction.

Posted in IPR

An Affirmative Claim Construction is not Always Needed, But it was Here

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In Sound View Innovations, Inc., v. Hulu, LLC, [2021-1998] (May 11, 2022), the Federal Circuit, whille agreeing with the district court’s claim construction, the Federal Circuit disagreed with the district court’s application of that construction, so it vacated summary judgment of no infringement of U.S. Patent No. 6,708,213 on a “Method for Streaming Multimedia Information over Public Networks.”

Sound View alleged that, under Hulu’s direction, when an edge server receives a client request for a video not already fully in the edge server’s possession, and obtains segments of the video seriatim from the content server (or another edge server), the edge server transmits to the Hulu client a segment it has obtained while concurrently retrieving a remaining segment. The claim at issue specifies a method, involving a content server and intermediate servers (helper servers), to use when a client requests a streaming multimedia (SM) object.

The district court construed the limitation to require that the same buffer in the helper
server—host both the portion sent to the client and a remaining portion retrieved
concurrently from the content server or other helper server. With that claim construction, Hulu sought and obtained summary judgment of non-infringement, arguing that it was undisputed that, in the edge servers of its content delivery networks, no single buffer hosts both the video portion downloaded to the client and the retrieved additional portion. Sound View argued, in response, that there remained a factual dispute about whether “caches” in
the edge servers met the concurrency limitation as construed. The district court held, however, that a “cache” could not be the “buffer” that its construction of the downloading/
retrieving limitation required, and on that basis, it granted summary judgment of non-infringement.

The Federal Circuit citing theapplicant’s statements in the prosecution history, affirm the district court’s construction of the downloading/retrieving limitation, but rejected the district court’s determination that “buffer” cannot cover “a cache,” and therefore vacated the district court’s grant of summary judgment and remanded for further proceedings.

The Federal Circuit noted that all the district court did in construing “buffer” was to declare that it must exclude a “cache.” It said that the district court did not adopt an affirmative construction of what constitutes a “buffer” in the patent. Although there is no per se rule against negative constructions, which in some cases can be enough to resolve the relevant dispute, the Federal Circuit found the court’s construction was inadequate for the second step of an infringement analysis—comparison to the accused products or methods.

The Federal Circuit said that the district court did not decide, and the record does not establish, that “cache” is a term of such uniform meaning in the art that its meaning in the patent must be relevantly identical to its meaning when used by those who labeled the pertinent components of the accused edge servers. In the absence of such a uniformity-of-meaning determination, the district court’s conclusion that the patent distinguishes its buffers and caches is insufficient to support a determination that the accused-component “caches” are outside the “buffers” of the patent. The Federal Circuit said that what was needed was an affirmative construction of “buffer”— which could then be compared to the accused-component “caches” based on more than a mere name, and the district
court did not supply the needed construction.

The Federal Circuit noted an additional reason why an affirmative construction was needed: even in the patent the terms “buffer” and “cache” did not appear to be mutually exclusive,
but instead seem to have at least some overlap in their coverage.

Happy Mother’s Day 2022

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U.S. Patent No. 1,792,572 discloses a container for use in on one of the “nineteen or more recognized holidays, which are featured by retailers dealing in candy, flowers, favors, etc.,” including Mother’s Day, as is clear from the above image,

Dashed Lines Broaden the Scope of a Design Patent, But this is Ridiculous

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On September 14, 2021, U.S. Patent No. D930702, on a Display Screen Portion with Animated Graphical User Interface, issued to Wepay Global Payments LLC. The design patent covers two embodiments: The first embodiment consists of Figs. 1 and 2:

The second embodiment consists of Figs. 3 – 5:

Within weeks of the patent issuance Wepay sued PNC Bank NA. A month later Wepay sued PayPal Inc. and Samsung Electronics Co. Last month Wepay sued JPMorgan Chase Bank NA and Bank of America NA. Then last week, Wepay sued Apple (6:22-cv-00223 in W.D.Texas), Amazon (1:22-cv-01061 in N.D. Ill), Tesla (W.D. Texas), Walmart Stores Inc (1:22-cv-01062 in N.D. Ill.))., and McDonald’s Corp. (1:22-cv-01064 in N.D. Ill.)

With the patent’s liberal use of dashed lines, it appears that Figs. 1 and 3 cover any screen with the a QR code finder pattern – the three black squares in three corners of the QR code. Figs. 2 and 5 cover any screen with the figure “$0.00.” Fig. 4, oddly enough, covers any screen, with or without content.. Since QR codes have been around since 1994, and dollar signs even longer — since the late 18th century, it seems unlikely that this pattern did not appear on an apps display before the September 3, 2020, filing date of the ‘702 patent.

Wepay is asserting the ‘702 to its broadest extent. Looking, for example at the complaint against Apple,

Weoay asserts that Fig. 3 covers the
appearance of a QR icon anywhere on a screen.
Wepay asserts that Fig. 4 covers any screen.
Wepay asserts that Fig. 5 covers the appearance
of any screen with the text “$0.00”

It is hard to fathom what is ornamental about the three squares of a QR code, or the dollar sign or zeros. It is also hard to imagine that if the defendants are infringing now, that they were not infringing before the patent was filed, thus invalidating the patent.

Give the tremendous resources of the defendants, it is difficult to imagine that this patent will be found valid and infringe, we can only hope they don’t destroy the design patent system in the process.

Groundhog Day: Thank you Mr. Sowerby

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The purpose of the patent system is to promote the progress of science and the useful arts. It does so in two ways: First, it incentives invention by providing inventors exclusive rights to new inventions for a limited time. Second, it encourages disclosure and provides a database of information in the form of millions of technical disclosures about all sorts of topics. It is amazing what you can learn from patents, and one such fun fact appropriate for today is that the last name of Punxsutawney Phil, the hero of the day, is Sowerby! This fun fact appears in U.S. Patent No. 10296823, which in Col. 34, lines 21-30, explains the difference between connection and dependency with a Groundhog Day Example:

Black Inventors and Their Inventions

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February is Black History Month, honoring the triumphs and struggles of African Americans throughout U.S. history. Among these triumphs are the inventions black inventors have contributed, many of which were not recognized with a patent because the Patent Acts of 1793 and 1836 barred slaves from obtaining patents because they were not considered citizens. It was not until the Patent Act of 1870 that “any person or persons” having discovered or invented any new and useful art, machine, manufacture, or composition of matter, or any new and useful improvement on any art, machine, manufacture, or composition of matter could apply for and obtain a patent. The breadth and importance of inventions contributed by black inventors is one of the best examples of the value of diversity:

Dry Cleaning

Most historians agree that the first U.S. patent that issued to a black inventor was U.S. Patent No. X3306, issued to Thomas L.  Jennings over two hundred years ago on March 3, 1821, on dry scouring — a method of dry cleaning.

Planter

The second patent that issued to a black inventor was U.S. Patent No. 8447X, issued to Henry Blair (inventor) – Wikipedia on a (Corn) Seed Planter. He also received U.S. Patent No. 15 on a Corn Planter.

Locomotive Lubricators

Elijah McCoy, was a prolific inventor. Among his 57 U.S. patents was U.S. Patent No. 129843 for Improvements in Lubricators for Steam-Engines, on July 28, 1872. It is reputed that his invention was so often duplicated, that people began asking for the “real McCoy.”

Uses for Peanuts

George Washington Carver was a famous scientist and prolific inventors, although he only patented two of his inventions, U.S. Patent 1,522,176, on Cosmetic and Process of Producing the Same, and U.S. Patent 1,632,365, on Process of Producing Paints and Stains.

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