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Federal Circuit Review No. 76-2.
Jury Instruction On Meaning Of Claim Term Cannot Be Challenged After Agreed To By Parties
Akamai Techs., Inc. v. Limelight Networks, Inc., No. 2009-1372, 2009-1380, 2009-1416, 2009-1417, 2015 U.S. App. LEXIS 19848 (Fed. Cir. Nov. 16, 2015) (Before Linn, Moore, and Prost , CJ.) (Opinion for the court, Linn, J.). Click Here for a copy of the opinion.
In 2006, Akamai sued Limelight for infringing three patents. The district court’s claim construction of “tagging” in the ‘703 patent was “providing a ‘pointer’ or ‘hook’ so that the object resolves to a domain other than the content provider domain” such as a particular group of computers “from which an optimal server is to be selected.” This was the agreed construction by both parties and was read to the jury. Based on this construction, Limelight argued that a single optimal server must be selected, and Akamai argued that several servers could qualify as optimal. The district court construed optimal server as requiring the selection of a content server that is better than the other choices based on criteria established by the specification.
After the jury found infringement and awarded Akamai lost profits, royalties, and price erosion damages, the district court granted JMOL of no infringement. Both parties appealed, and the Federal Circuit reversed. On appeal, Limelight argued alternative grounds for overturning the jury verdict and challenged the damages award.
According to Limelight, the district court’s construction of “tagging” was limited to using a “pointer” or “hook” to prepend or insert a virtual server hostname into a URL. The Court rejected “prepending” as a claim limitation because even though the ‘703 patent described prepending as a preference, there was no indication from the claims or prosecution history that tagging was limited to this preferred embodiment. The Court found no error in the jury instructions and held that Limelight was bound to the stipulated construction of “tagging” originally read to the jury.
The Court also held no error in the district court’s construction of “optimal server,” rejecting Limelight’s argument that “optimal” was restricted to a single “best” server. The district court properly relied on intrinsic evidence to construe “optimal server” as “one or more content servers that are better” based on certain criteria in the specification. The Court held the tagging system was not limited to serving from a single server that was the “aggregate best” of these criteria, but instead capable of choosing one or more servers based on any of the criteria.
There was also no error in the district court’s damages calculation, which was based on the lost-profits analysis of Akamai’s expert. The expert opined that Akamai and Limelight were direct competitors and Akamai maintained a dominant market share and that the demand for Akamai’s product was relatively inelastic, meaning the demand in quantity did not change significantly even if the price decreased by a certain percentage. Limelight argued that its customers were less likely to buy Akamai’s product since it sold at half of the price. In his calculation, the expert correctly adjusted market elasticity by 25% and excluded the lowest 25% of Limelight’s customers based on the assumption that Akamai’s product would be 25% less in demand than Limelight’s. Accordingly, the Court affirmed and also reinstated affirmance of the district court’s judgment of non-infringement of the remaining two patents-in-suit.