Last week the United States Court of Appeals for the Federal Circuit issued a decision in Wi-LAN, Inc. v. Apple, Inc. The dispute dates back to February 2, 2011, when Wi-LAN sued Apple Inc. and other technology companies in the United States District Court for the Eastern District of Texas for infringing claims 1 and 10 of U.S. Patent No. RE37,802 (the ‘802 patent). Wi-LAN alleged that Apple and the other companies infringed the patent by manufacturing and selling products complying with various wide-area communication standards. The jury found that Apple did not infringe and that the claims were invalid. The district court denied Wi-LAN’s motion for judgment as a matter of law (“JMOL”) and for a new trial with respect to infringement, but it granted Wi-LAN’s motion for JMOL of no invalidity.
On appeal to the Federal Circuit Wi-LAN challenged the trial court’s denial of JMOL and its motion for a new trial on infringement. Apple cross-appealed the grant of JMOL of no invalidity. Hearing the case were Judges Reyna, Wallach ad Hughes, with Judge Reyna authoring the opinion for the panel.
Because the jury’s verdict of non-infringement was supported by substantial evidence, the Federal Circuit affirmed the district court’s denial of JMOL as to non-infringement. Further, because the trial court’s JMOL determination of no invalidity was based on a post-verdict reconstruction of the claims, the Federal Circuit reversed the district court’s grant of JMOL of no invalidity.
Asserted claim 1 of the ‘802 patent recites a transceiver for transmitting data using three components:
1. A transceiver for transmitting a first stream of data symbols, the transceiver comprising:
a converter for converting the first stream of data symbols into plural sets of N data symbols each;
first computing means for operating on the plural sets of N data symbols to produce modulated data symbols corresponding to an invertible randomized spreading of the first stream of data symbols; and
means to combine the modulated data symbols for transmission.
Asserted claim 10, which depends on claim 1, adds means for receiving and decoding the data symbols.
At trial, Apple argued that it did not infringe because claim 1 requires randomizing the data symbols before combining them, and that Apple’s products perform these steps in the reverse order. Claim 1 recites that the computing means must “produce modulated data symbols corresponding to an invertible randomized spreading” and that the converter must “combine the modulated data symbols.” Apple argued that because “the modulated data symbols” refers back to the earlier recited “modulated data symbols corresponding to an invertible randomized spreading,” the data symbols to be combined must have already been randomized.
The Federal Circuit agreed that the ordering requirement was consistent with the description of the invention in the specification. Each embodiment discussed in the specification randomizes the data symbols before combining them. Therefore, the Court said that the intrinsic record made clear that the asserted claims cover only structure that randomizes data symbols in parallel before combining them for transmission. As a result, Wi-LAN was unable to prove literal infringement.
Notwithstanding, Wi-LAN argued that even if they could not prove direct infringement, a structure that performs the steps in the reverse order should properly be found to infringe under the doctrine of equivalents. Curiously, the Federal Circuit disagreed because in order for the doctrine of equivalents to be applicable the differences between the two elements must be “insubstantial” to one of ordinary skill in the art, citing Warner-Jenkinson v. Hilton Davis Chem. The Federal Circuit said that it believed that substantial evidence supported the jury’s verdict that the order difference was not insubstantial.
What makes the Federal Circuit decision on the doctrine of equivalents curious is exactly how they could possibly know whether there was any evidence, let alone substantial evidence, to support the jury’s verdict. Frankly, there seems to be no way to know what the jury’s verdict was, or what the jury thought relative to the doctrine of equivalents.
Indeed, exactly how the Federal Circuit came to the determination that there was evidence to support the jury verdict on the doctrine of equivalents is unclear. The verdict form used by the jury did not include a separate question specific to the doctrine of equivalents, so it seems the Federal Circuit is at best hoping the jury even considered the doctrine of equivalents theory, let alone in a way that is required given the law and facts relevant to the case.
The Federal Circuit did say that the jury was properly instructed on the doctrine of equivalents, but it seems to me that the panel is purely guessing that there was substantial evidence to support the jury verdict on the doctrine of equivalents. Without any way to know what the jury thought, or even what they concluded, or even if they concluded anything relating to the doctrine of equivalents, how could there be substantial evidence?
The fact that the Federal Circuit was so cavalier about finding substantial evidence to support a non-existent jury verdict relating to the doctrine of equivalents is particularly disturbing given the panel’s own view of that theory of infringement. Wi-LAN pointed out that even Apple’s expert admitted that changing the order of operations would save as few as twenty transistors out of millions found on the chip, which sounds rather insubstantial if you ask me. But don’t take my word for it, the Federal Circuit said that Wi-LAN’s argument has merit, but still didn’t find it sufficient to disturb the jury’s verdict. Exactly what verdict is a mystery given that the jury verdict did not include any separate questions on the doctrine of equivalents.
Perhaps whether the jury considered the doctrine of equivalents, and whether reversing the order should fall within the doctrine of equivalents, is moot given that the jury found the claims invalid.
The district court vacated the jury’s verdict of invalidity because a reasonable jury should have understood that the first computing means must randomize the symbols using complex multipliers while the prior art used only real multipliers. While acknowledging that the original construction did not specifically provide for a complex multiplier, the district court nevertheless found such a component required because throughout the trial, both sides took the position that the complex multiplier found in Figure 8 was necessarily included in the Court’s construction.
The Federal Circuit was unhappy with what they characterized as a new claim construction at the JMOL stage, saying that it is too late to argue for or adopt a new claim construction at the JMOL stage. At this stage the question is merely whether substantial evidence supports the jury’s verdict, which seems unfair. If the district court was correct to observe that the defendants admitted throughout trial that a complex multiplier is necessary than an updated construction would seem perfectly appropriate. Although, the time to have addressed the need for an updated claim construction based on the evidence and arguments presented at trial would have been when the jury instructions were given.