Federal Tinnus Enters., LLC v. Telebrands Corp., (Fed. Cir. Jan. 24, 2017) (Before Moore, Wallach, and Stoll, J.) (Opinion for the court, Stoll, J.).
The Federal Circuit heard an appeal of a grant of a preliminary injunction from the Eastern District of Texas. The district court adopted a Report and Recommendation (“RR”) from the magistrate judge that a preliminary junction against Telebrands be granted. However, the PTAB, operating in parallel, instituted review of the Tinnus patent, because it found that the claims at issue were more likely than not invalid. Using a deferential standard of review, the Federal Circuit affirmed the district court’s grant of a preliminary injunction.
At issue was whether Telebrands’ balloon filling device infringed a valid patent owned by Tinnus. Telebrands challenged the district court’s conclusions that Tinnus proved a likelihood of success on the merits and irreparable harm. In reviewing preliminary injunctions, since there are mixed question of non-patent and patent law, the Court applies both circuit law (Fifth Circuit) and Federal Circuit law, depending on whether or not the issue “reflects considerations specific to patent issues.” Here, both courts generally review under an abuse of discretion standard. But, under Fifth Circuit law, where a party fails to object to a magistrate judge’s recommendation (RR), a more deferential standard – plain error review – applies.
The Court rejected Telebrand’s challenges to claim construction and the finding of probable infringement. While the RR underlying the injunction did not construe all of the claims terms, the district court did not error because it found that Tinnus was likely to succeed on its infringement claim regardless of the construction of the non-construed terms. Next, the RR’s assessment of infringement using the ordinary meaning of a challenged term was not clear error. And, it was not improper for the RR to rely on circumstantial evidence of infringement (i.e., an instruction manual), because direct evidence is not required to prove infringement and the Court’s precedents have previously approved the use of instruction manuals as evidence of infringement.
The Court reviewed Telebrand’s challenge to definiteness under a plain error standard, because appellants failed to object to the RR’s indefiniteness determination. Under that standard, the Court found there was no error in the finding that the claims themselves provided sufficient guidelines for determining whether or not balloons were “substantially filled.” The level of ordinary skill in the art bolstered this opinion, because a person with an associate’s degree in science or engineering would be able to “determine with reasonably certainty when a water balloon is ‘substantially filled.’”
The Court also reviewed the obviousness analysis for plain error because appellants did not timely object. It rejected the argument that an endoscopic balloon device for obesity surgery was reasonably pertinent to the problem in the Tinnus patent. Thus, there was no clear error in the holding that there was insufficient motivation to combine the asserted prior art references.
Finally, the Court rejected that it was clear error for the district court to rely on evidence pre-dating the patent in order to find irreparable harm. Such evidence is at least circumstantial and demonstrated the possibility of identical harms post-patent. Moreover, there was sufficient post-patent evidence to support a finding of irreparable harm.
Practitioners dealing with a magistrate judge’s report and recommendation should be sure to preserve objections for appeal, since failing to object may lead to a more deferential, plain error standard of review, depending on the applicable circuit law. Further, in seeking a preliminary injunction, evidence of harm from pre-issuance of the asserted patent is relevant to show likelihood of irreparable harm from similar injuries in the future.
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