Fresh From the Bench: Latest Federal Circuit Court Cases
CASE OF THE WEEK
SIPCO, LLC v. Emerson Electric Co., Appeal No. 2018-1635 (Fed. Cir. Nov. 17, 2020)
Our Case of the Week is one of two cases we revisit following further precedential decisions issued by the Federal Circuit this week (see our write-up of Network-1 Techs. below for the other). In this case, the Federal Circuit reconsidered its prior ruling on remand from the Supreme Court following its decision in Thryv, Inc. v. Click-to-Call Technologies, LP, 140 S. Ct. 1367 (2020). The Federal Circuit panel held that, following Thryv, it had no jurisdiction to decide whether a patent was a covered business method (CBM) patent subject to CBM review.
Network-1 Technologies, Inc. v. Hewlett-Packard Company, Appeal Nos. 2018-2338, -2339, -2395, -2396 (Fed. Cir. Nov. 20, 2020)
A panel of the Court issued a modified opinion in this case, making a minor change in one paragraph to acknowledge an argument made by Network-1 that had not been acknowledged in the original panel opinion—though the Court declined to consider the issue. Our write-up of the original panel decision can be found here.
In this case, the Federal Circuit affirmed a jury’s infringement and damages verdict concerning appellant GlaxoSmithKline’s use of a pharmaceutical patent directed to composite particles used in dry-powder inhalers to promote improved dispersion of active ingredient in the lungs. On infringement, the Court affirmed the district court’s claim construction of the patent’s “composite active particles” term as not limited to particles formed by the milling process disclosed in the patent, as references in the specification to that process being required were outweighed by references indicating it was only a preferred method, and during prosecution, the applicant’s distinction of particles formed by a different process was more reasonably read to distinguish the prior art particles based on their structure rather than on how they were formed. The Court also found the jury’s finding as to another limitation was supported by substantial evidence of experimental testing.
On damages, the Court found that the jury’s reasonable royalty award was supported by Vectura’s expert’s testimony utilizing the rate and base from an expired licensing agreement between the parties that covered the accused products and included a non-assert clause for the application that became the patent in suit. The Court also found that excessive remarks by Ventura’s counsel concerning GSK’s total sales of the accused products, while improper, were not so prejudicial as to warrant a new trial where some reference to those sales was required for the jury to determine a royalty base.
Whitewater West Industries, Ltd. v. Alleshouse, Appeal Nos. 2019-1852, -2323 (Fed. Cir. Nov. 19, 2020)
In this appeal from the District Court for the Southern District of California, the Court reversed the district court’s holding that Alleshouse’s employment agreement with Whitewater required Alleshouse to assign the patents at issue to Whitewater, and that, because of the assignment, Yeh was improperly named as an inventor on the patents. At issue was whether Alleshouse’s employment agreement with Whitewater, which purported to assign Alleshouse’s post-employment inventions to the Whitewater, regardless of whether Whitewater’s confidential information was used to conceive the invention, was valid and enforceable. The Court held that the terms of the employment agreement violated California law so the relevant provisions were invalid and unenforceable. Since Whitewater had no rights in the patents at issue, the Court held that Whitewater had no standing to challenge Yeh’s inventorship of the same. Accordingly, the Court reversed the district court’s holdings.