Contec's suppliers sued by Phillips included Compo Micro Tech (CMT), Seoby Electronics, and Hango Remote Solution. Contec and Seoby settled, and Hango opted for a separate trial, leaving only CMT in the dock.

Universal remote controls (URCs) let consumers operate various home entertainment equipment, such as TVs and DVDs and stereo, from a single remote control. The two asserted patents were 4,703,359 and 5,872,562.

The ’359 patent discloses a “scan” method (and apparatus) whereby the URC is preprogrammed with the infrared signal patterns corresponding to many different appliances and learns the correct infrared signal pattern for controlling a particular appliance by sequentially attempting each format until that appliance responds appropriately. The ’562 patent, on the other hand, discloses a “code entry” method (and apparatus) that requires the user to manually enter a code corresponding to the correct infrared signal pattern for each appliance to be used with the URC.

A technology tutorial, Markman hearing and cross-motions for summary judgment were all heard by Judge Kent A. Jordan on November 25, 2003. During the hearing, both sides agreed that, with respect to the ’359 patent, if the court adopted the claim construction proffered by the other side, summary judgment of infringement would be appropriate.

On March 29, 2004, the district court issued a Markman order, construing (1) ”signal structure identification data” to mean “information (data) that identifies a signal structure;” (2) ”entry initiate signal” to mean “the keyboard output signal generated by the entry initiate key;” and (3) ”an entry initiate key” to mean “one entry initiate key.” On April 5, 2004, the district court issued an order granting Philips’ motion for summary judgment of infringement (and denying CMT’s cross-motion for summary judgment of non-infringement) on Claims 1, 3 and 4 of the ’359 patent. It emphasized that “signal structure identification data” had been the only disputed term in the ’359 patent. Because Philips’ proposed construction was adopted and CMT had conceded at oral argument that, under that construction, the accused products literally infringed, summary judgment was appropriate. In the same order, the district court also granted CMT’s motion for summary judgment of non-infringement of the ’562 patent. It noted that in the accused URCs, a user must press two keys, (i.e., both a category key and some other, non-category key), simultaneously in order to initiate the programming sequence. Because “an entry initiate key” had been construed to mean only one entry initiate key, the ’562 patent was not literally infringed. The district court further held that Philips was precluded from asserting the doctrine of equivalents due to prosecution history estoppel, as Claim 1 had been amended from “user activation of respective ones of said keys” to “one of said keys.”

With regard to '359, Phillips had argued for the plain meaning of "identification data", while CMT wanted a narrower construction based upon the preferred embodiment in the specification, and adding the phrase "identification data" to an asserted claim.

We agree with the district court that the phrase “signal structure identification data” is entitled to its plain and ordinary meaning. The district court correctly rejected CMT’s invitation to read into the phrase a limitation from the preferred embodiment. See Electro Med. Sys., S.A. v. Cooper Life Sciences, 34 F.3d 1048, 1054 (Fed. Cir. 1994). It also accepted, as do we, Philips’ explanation that the claim amendment was only made to maintain consistency, as the final phrase of Claim 1 refers to “said stored signal structure identification data,” which otherwise does not appear earlier in the claim.

The claim construction for '562 centered on the quantity implied by "an".

As for the phrases “an entry initiate key” and “entry initiate signal,” the district court acknowledged that an indefinite article normally means “one or more” in open-ended claims, but found sufficient evidence in the specification of the ’562 patent and the prosecution history to limit “an” to the singular. We agree that “a” or “an” normally carries the meaning of “one or more” in claims containing the transitional phrase “comprising.” KJC Corp. v. Kinetic Concepts, Inc., 223 F.3d 1351, 1356 (Fed. Cir. 2000). Here, however, the patentee clearly intended the use of only one entry initiate key.

Because it is undisputed that the accused device required a user to press two keys simultaneously to initiate the code entry programming sequence, a routine that was expressly disclaimed by the ’562 patent, we must affirm the summary judgment of non-infringement.

So, after summary judgment, Phillips prevailed with '359, but CMT skirted infringement of '562 based upon the district court's claim construction.

CMT angled to invalidate the patents with a summary judgment motion, but couldn't get that accomplished, as the facts got in the way, necessitating a trial.

In a separate order, also issued on April 5, 2004, the district court denied CMT’s motion for summary judgment of invalidity. With respect to the ’359 patent, the motion was denied because there remained “genuine issues of material fact, due to competing expert opinions,” as to whether Claims 1, 3 and 4 were anticipated by a particular Japanese reference. Summary judgment on obviousness was also inappropriate because CMT had not “undertaken the analysis, required by Graham, to support its argument that claims 3 and 4 are obvious in light of the cited prior art references.” As for the ’562 patent, there remained issues of material fact as to (1) whether a remote control device called “CORE” and its accompanying reference manual constituted invalidating prior art; (2) whether the two other remote controls (the UR1 and UR2) were adequately disclosed to the PTO; and (3) whether the examiner considered the ’359 patent during prosecution of the ’562 patent.

The appeals court declined to disturb the jury's verdict of patent validity, a verdict which seemed reasonable to the CAFC; the jury buying the testimony of Phillips expert witness.

In other words, the jury’s verdict can only be overturned if the “factual findings were not supported by substantial evidence or . . . the facts were not sufficient to support the conclusions necessarily drawn by the jury on the way to its verdict.” Tec Air, Inc. v. Denso Mfg. Mich. Inc., 192 F.3d 1353, 1357-58 (Fed. Cir. 1999).

From the jury trial verdict: 1) '359 withstood the invalidity challenge; 2) $1 per unit royalty on units sold; 3) CMT's infringement had not been willful. CMT was ordered to pay royalty and interest approaching $6 million.

CMT had argued to lower the damages estimate, but again, the CAFC wasn't going to disturb the jury verdict.

To the extent that CMT is also challenging the district court’s refusal to give its proposed jury instruction limiting damages to the number of products actually used in an infringing manner by consumers, we find no reversible error. CMT argues that damages for indirect infringement must be tied to identified instances of direct infringement, citing Dynacore v. U.S. Philips Corp., 363 F.3d 1263, 1274 (Fed. Cir. 2004). CMT misreads this opinion. It is true that “[p]laintiffs who identify individual acts of direct infringement must restrict their theories of vicarious liability – and tie their claims for damages or injunctive relief – to the identified act.” Id. Yet, the very next sentence recognizes that plaintiffs, like Philips, “who identify an entire category of infringers (e.g., the defendant's customers) may cast their theories of vicarious liability more broadly, and may consequently seek damages or injunctions across the entire category.” Id.

Here, Philips argued that the reasonable royalty reached in a hypothetical negotiation between the parties would have been based on the agreed upon number of total sales rather than usage by individual customers, since the latter would have been difficult to predict. There was substantial evidence in the record, including expert testimony and Philips’ license agreement with Sony Corporation, to support the jury’s calculation of damages in this way. In any event, it could be inferred that the jurors did account for CMT’s contention that not all the units sold were used in an infringing manner, since they considered $1 per unit to be a reasonable royalty despite the testimony of Philips’ expert that the reasonable royalty would have been much higher – i.e., $2 per unit to license both patents-in-suit or $1.50 per unit to license only one of the patents. Although it is true that no survey evidence or expert testimony was presented as to the percentage of units sold that were actually used in an infringing manner, the jurors could have relied on their own personal experiences with URCs and common sense in discounting the royalty rate.

This was, by the way, a non-precedential ruling. What a strange way to run a judicial system.