Access practice tools, as well as industry leading news, customizable alerts, dockets, and primary content, including a comprehensive collection of case law, dockets, and regulations. Leverage...
By Tony Dutra
Oct. 28 --An accused infringer's belief that a patent is invalid may negate the required showing of specific intent to encourage infringement, as the U.S. Court of Appeals for the Federal Circuit 6-5 denied a petition for rehearing en banc of a split panel ruling (Commil USA, LLC v. Cisco Sys., Inc., Fed. Cir., No. 2012-1042, 10/25/13).
Two opinions dissenting to the denial were filed, each chastising the panel majority for infusing validity concerns into the infringement analysis.
Commil USA L.L.C. is an Israel-based company that owns a patent (U.S. Patent No. 6,430,395) on a method of improving the handoff between mobile base stations when the user of a mobile device moves throughout a network area.
Cisco Systems Inc. makes WiFi access points and switches. Commil sued Cisco and three other wireless network device makers in the U.S. District Court for the Eastern District of Texas.
A first jury found Cisco liable for direct infringement and awarded $3.7 million in damages. Citing Cisco's counsel's inappropriate posturing at trial, Magistrate Judge Charles Everingham granted Commil's motion for retrial, but limited it to indirect infringement and damages only, and not invalidity. The second jury found in favor of Commil and awarded $63.8 million, and Everingham added $10.3 million in prejudgment interest. Cisco appealed on multiple grounds.
The Federal Circuit panel ruled that the jury instructions in the second trial were erroneous in light of the U.S. Supreme Court's decision on inducement under 35 U.S.C. §271(b) in Global-Tech Appliances Inc. v. SEB S.A., 131 S. Ct. 2060, 2011 BL 142067, 98 U.S.P.Q.2d 1665 (2011) .
All three panel members agreed on that point in the appeal. 720 F.3d 1361, 2013 BL 167369, 107 U.S.P.Q.2d 1290 (Fed. Cir. 2013) . However, in partial dissent, Judge Pauline Newman said “A good-faith belief of patent invalidity may be raised as a defense to willfulness of the infringement, but it is not a defense to the fact of infringement.” She said that Global-Tech “relates to knowledge of infringement, not knowledge of validity.”
And in another partial dissent, Judge Kathleen M. O'Malley faulted the majority for allowing a partial retrial solely on the question of inducement and damages for such inducement.
“In other words, we find that Cisco was denied the right to a fair trial on Commil's induced infringement claim because it was denied the opportunity to pursue a valid defense,” O'Malley said. “In the same breath, however, the majority concludes it is appropriate to retry the case in a posture that would dilute that defense.”
Commil sought rehearing en banc on the argument raised in Newman's dissent.
In the first opinion dissenting to the petition denial, Judge Jimmie V. Reyna focused on the statutory scheme of the Patent Act.
“If a patent is found invalid, that is a complete defense to liability because it negates the patent's existence and thereby extinguishes any exclusionary rights,” he said. “Conversely, if there is a patent--i.e., it is not invalid--then the question is merely whether there has been conduct that actively induces acts of infringement per se.”
Newman generally echoed the comments from her panel dissent. She particularly criticized the panel majority's view that it is “axiomatic that one cannot infringe an invalid patent,” given the court's precedent that whether or not a patent is infringed “is an entirely separate question capable of determination without regard to its validity,” quoting Medtronic, Inc. v. Cardiac Pacemakers, Inc., 721 F.2d 1563, 1583, 220 U.S.P.Q. 97 (Fed. Cir. 1983).
Separately, Cisco sought rehearing by the panel or en banc based on O'Malley's concerns. Its argument was essentially that the partial retrial violated its Seventh Amendment right.
The court denied that petition (Commil USA, LLC v. Cisco Sys., Inc., Fed. Cir., No. 2012-1042, 10/25/13). O'Malley dissented but did not file an opinion.
However, Newman addressed the issue in the next-to-last paragraph of her dissent noted above, saying, “the issues of infringement and validity are interwoven in the new defense of subjective 'belief', and the restricted remand procedure can impart 'confusion and uncertainty, which would amount to a denial of a fair trial,' ” citing Anderson v. Siemens Corp., 335 F.3d 466, 475-76 (5th Cir. 2003).
Mark S. Werbner of Sayles Werbner P.C., Dallas, represented Commil. William F. Lee of Wilmer Cutler Pickering Hale and Dorr LLP, Boston, represented Cisco.
To contact the reporter on this story: Tony Dutra in Washington at email@example.com
To contact the editor responsible for this story: Naresh Sritharan at firstname.lastname@example.org
All Bloomberg BNA treatises are available on standing order, which ensures you will always receive the most current edition of the book or supplement of the title you have ordered from Bloomberg BNA’s book division. As soon as a new supplement or edition is published (usually annually) for a title you’ve previously purchased and requested to be placed on standing order, we’ll ship it to you to review for 30 days without any obligation. During this period, you can either (a) honor the invoice and receive a 5% discount (in addition to any other discounts you may qualify for) off the then-current price of the update, plus shipping and handling or (b) return the book(s), in which case, your invoice will be cancelled upon receipt of the book(s). Call us for a prepaid UPS label for your return. It’s as simple and easy as that. Most importantly, standing orders mean you will never have to worry about the timeliness of the information you’re relying on. And, you may discontinue standing orders at any time by contacting us at 1.800.960.1220 or by sending an email to email@example.com.
Put me on standing order at a 5% discount off list price of all future updates, in addition to any other discounts I may quality for. (Returnable within 30 days.)
Notify me when updates are available (No standing order will be created).
This Bloomberg BNA report is available on standing order, which ensures you will all receive the latest edition. This report is updated annually and we will send you the latest edition once it has been published. By signing up for standing order you will never have to worry about the timeliness of the information you need. And, you may discontinue standing orders at any time by contacting us at 1.800.372.1033, option 5, or by sending us an email to firstname.lastname@example.org.
Put me on standing order
Notify me when new releases are available (no standing order will be created)