APPLE INC. V. WI-LAN INC.

Before Moore, Chief Judge, Bryson, and Prost. Appeal from the United States District Court for the Southern District of California.

Summary: Construing a broad claim term to be re-defined as a disclosed species on a theory that the terms are interchangeable requires that the intrinsic record clearly manifest a departure from the term’s plain and ordinary meaning.

Apple, Inc. sued Wi-LAN, Inc. seeking a declaratory judgment of non-infringement and invalidity for all claims of the ‘145 and ‘757 patents. During claim construction, the parties disputed the construction of “subscriber unit.” Apple argued that the written description defined “subscriber unit” as a “fixed or portable customer premises equipment” (CPE), pointing to (1) the patents’ interchangeable use of CPE and subscriber unit, (2) the patents’ use of CPE as the sole embodiment of the “subscriber unit,” (3) the patentee’s preliminary amendment that replaced claims reciting CPE with claims reciting “subscriber unit,” and (4) the patentee’s interchangeable use of subscriber unit with other similar terms in related patents. The district court rejected Apple’s construction of a subscriber unit as being a CPE, granted summary judgment of non-infringement concerning certain products in view of a license, and denied JMOL of non-infringement for other products. However, two rounds of trial on damages occurred, with Wi-Lan ultimately securing damages based on a reasonable royalty rate that relied on a “key patent” theory of apportionment. Apple appealed the district court’s construction of subscriber unit, denial of JMOL, and damages. Wi-Lan cross-appealed the summary judgment decision regarding non-infringement and damages.

The Federal Circuit affirmed the district court’s construction. The Federal Circuit held that the intrinsic record did not support Apple’s claim that the written description re-defined a subscriber unit as CPE. Applying the standard for lexicography, The Court held that the written description did not clearly show that the two terms were used interchangeably to describe the same facet of a device or embodiment. Rather, the written description revealed that a CPE is a type of subscriber unit, which failed to demonstrate that the terms were interchangeable. Further, the written description failed to demonstrate that the invention was limited to a CPE as there were no “words or expressions of manifest exclusion or restriction.” Lastly, the Court noted the replacing of one claim term with another during prosecution does not alone indicate that the terms are equivalents or interchangeable. The Federal Circuit upheld the district court’s claim construction determination as there was no indication of deviation from the term’s plain and ordinary meaning.

Additionally, the Federal Circuit affirmed the denial of JMOL regarding non-infringement, reversed the grant of summary judgment of non-infringement after concluding that the license had expired, and remanded for a third trial on damages after holding that the “key patents” apportionment methodology was flawed.

Editor: Paul Stewart

Written by: Jose A. Martin del Campo and Andrew Morrell, Ph.D.