Finisar v. DirecTV (CAFC 2007-1023, -1024)

'505 claims TV program downloads, without request, by popularity, on a scheduled basis, using tiered database software, where the tiers are based on popularity. "Then the system broadcasts each tier of data at a particular repetition rate."

DirecTV's appeal challenges the district court's construction of two claim terms ("information database" and "downloading into a memory storage device") and the jury's findings of literal infringement, validity (novelty and non-obviousness), and willfulness. Finisar cross-appeals the district court's denial of Finisar's motion for a permanent injunction, imposition of a compulsory license at a rate of $1.60 per set-top box, and grant of summary judgment of invalidity on claims 1, 2, 7, 9, 10, 11, and 37 as indefinite.

Claim Construction

Generally this court gives claim terms their ordinary and customary meanings, according to the customary understanding of an artisan of ordinary skill at the time of the invention. See Phillips v. AWH Corp., 415 F.3d 1303, 1312-13 (Fed. Cir. 2005) (en banc). And "the person of ordinary skill in the art is deemed to read the claim term not only in the context of the particular claim in which the disputed term appears, but in the context of the entire patent, including the specification." Id. at 1313. When construing claims, the claims and the rest of the patent, along with the patent's prosecution history (together, the intrinsic evidence of the meaning of the claims) are the primary resources; while helpful, extrinsic sources like dictionaries and expert testimony cannot overcome more persuasive intrinsic evidence. See id. at 1318.

Finistar had sued Comcast in the Northern California. The appeals court extensively relied upon the California construction, which had referenced the Texas constructions.

Given "the importance of uniformity in the treatment of a given patent," Markman v. Westview Instruments, Inc., 517 U.S. 370, 390 (1996), this court would be remiss to overlook another district court's construction of the same claim terms in the same patent as part of this separate appeal. In the interest of uniformity and correctness, this court consults the claim analysis of different district courts on the identical terms in the context of the same patent. Here, the Northern District of California's efforts in the Comcast case are particularly helpful because that court repeatedly referred back to the Eastern District of Texas's constructions--the subjects of this appeal. See, e.g., Comcast Markman Order, 2007 U.S. Dist. LEXIS 28994, at *6, 7, 10, 18, 27, 30, 36.

The Texas court construed "information database" too broadly, the CAFC found, finding support for the narrow construction in the specification.

In isolation, the term "information database" suggests a very broad coverage. In context, however, this claim term repeatedly appears within a framework that requires referencing, embedding, assigning, and transmitting portions of the database. These database functions and capabilities, in turn, presuppose searchability and retrievability.

Another rather silly spat was over the construction of "downloading into a memory storage device."

This court perceives that "downloading into a memory storage device" requires more than the mere transfer of data, but retention of data as well. Thus the claims require a downloading that preserves the data for later use or retrieval of the transferred data. Once again, the language of the claims, in context, specifies that the data downloads "into a memory storage device." Thus, the claim itself associates "downloading" with memory, retention, and preservation. Indeed the Northern District of California construed the term to require capacity for later access.

The CAFC found support in the spec too, as well in claim differentiation. A "buffer" had been specified in a dependent claim. A buffer is not final memory storage.

This court observes that fleeting or transient retention does not qualify as the kind of downloading defined by these claims. As such, this court adopts the Northern District of California's construction of "downloading into a memory storage device" as "transferring the desired data into a device capable of saving it for later access."

The revision of "information database" made no difference, but the "downloading" term might. On that, the CAFC vacated the jury infringement verdict and remanded.

Anticipation

Anticipation is a question of fact, reviewed for substantial evidence when tried to a jury. z4 Techs., Inc. v. Microsoft Corp., 507 F.3d 1340, 1347 (Fed. Cir. 2007). If the claimed invention was "described in a printed publication" either before the date of invention, 35 U.S.C. § 102(a), or more than one year before the U.S. patent application was filed, 35 U.S.C. § 102(b), then that prior art anticipates the patent. Although § 102 refers to "the invention" generally, the anticipation inquiry proceeds on a claim-by-claim basis. See Hakim v. Cannon Avent Group, PLC, 479 F.3d 1313, 1319 (Fed. Cir. 2007). To anticipate a claim, a single prior art reference must expressly or inherently disclose each claim limitation. Celeritas Techs., Ltd. v. Rockwell Int'l Corp., 150 F.3d 1354, 1361 (Fed. Cir. 1998). But disclosure of each element is not quite enough--this court has long held that "anticipation requires the presence in a single prior art disclosure of all elements of a claimed invention arranged as in the claim." Connell v. Sears, Roebuck & Co., 722 F.2d 1542, 1548 (Fed. Cir. 1983) (citing Soundscriber Corp. v. United States, 360 F.2d 954, 960 (Ct. Cl. 1966) (emphasis added)).

A 1983 textbook by Jan Gecsei, The Architecture of Videotex Systems (Videotex Architecture), was the scripture the defense brought forth for invalidation. The heathen district court didn't convert.

A non-enunciated nuance received grammatical scrutiny from the CAFC from the viewpoint of "a person of ordinary skill in the field of the invention," who, post-KSR, is extraordinary. A gratuitous stem-winder of investigation readily resolves.

To check for anticipation, this court examines the Videotex Architecture reference in some detail. In a section entitled "Transmission Sequence" in Chapter 10, "Databases for Videotex," the reference explains:

On-line and off-line reception can be mixed by controlling the repetition rate of transmitted pages. A few hundred pages of general interest can be repeated in a short cycle, whereas less important or less frequently updated pages are inserted in hourly or even daily intervals into specific slots in the cycle, or according to a predetermined schedule. This . . . permits for the dissemination of very large amounts of data.

Videotex Architecture at 175 (emphasis added). This passage discloses two tiers with two corresponding repetition rates. Still the very specific requirements of anticipation demand a further inquiry. Particularly, this court must consider whether the jury could have reasonably concluded that this passage does not disclose assignment of scheduled transmission times to the pages in both tiers. Because "or according to a predetermined schedule" appears at the end of the sentence and after a comma, this court must ask whether the jury could have reasonably construed this phrase as an alternative only for the "less important or less frequently updated pages," rather than both tiers of pages mentioned in the preceding clauses. Id. at 39-40.

Although this reading of the reference seems a stretch even at first blush, this court discussed an analogous situation in Anhydrides & Chemicals, Inc. v. United States, 130 F.3d 1481, 1483 (Fed. Cir. 1997). In that case, this court used general principles of English grammar for the proposition that "[r]eferential and qualifying words and phrases, where no contrary intention appears, refer solely to the last antecedent, which consists of 'the last word, phrase, or clause that can be made an antecedent without impairing the meaning of the sentence'" for purposes of statutory construction. Id. (quoting 2A C. Dallas Sands, Sutherland Statutory Construction § 47.33 (4th ed. 1984)) (emphasis added). Thus, this court has addressed this grammatical guideline referred to as the doctrine of the last antecedent. In Anhydrides, a case without a contrary intention in the passage at issue, this court construed the qualifying phrase to apply only to the immediately preceding antecedent. 130 F.3d at 1483.

In contrast, "[w]hen a modifier is set off from a series of antecedents by a comma, the modifier should be read to apply to each of those antecedents." Kahn Lucas Lancaster, Inc. v. Lark Int'l Ltd., 186 F.3d 210, 215 (2d Cir. 1999), abrogated on other grounds as recognized by Sarhank Group v. Oracle Corp., 404 F.3d 657 (2d Cir. 2005). But while "the meaning of a statute will typically heed the commands of its punctuation," U.S. Nat'l Bank v. Indep. Ins. Agents of Am., Inc., 508 U.S. 439, 454 (1993), the doctrine of the last antecedent and its corollary, the rule of punctuation, see Bingham, Ltd. v. United States, 724 F.2d 921, 926 n.3 (11th Cir. 1984), are more guidelines than absolute rules. See Kahn, 186 F.3d at 215 ("and in applying them we are mindful of the Supreme Court's admonition that 'a purported plain-meaning analysis based only on punctuation is necessarily incomplete and runs the risk of distorting a statute's true meaning'") (quoting U.S. Nat'l Bank, 508 U.S. at 454 (1993)).

Of course, Anhydrides and the other cases discussed above apply the rules of English grammar to statutory construction, whereas the present dispute involves the meaning of a prior art reference. These exercises are not entirely coterminous because the meaning of a prior art reference requires analysis of the understanding of an artisan of ordinary skill. See Scripps Clinic & Res. Found. v. Genentech, Inc., 927 F.2d 1565, 1576 (Fed. Cir. 1991) (to anticipate, "[t]here must be no difference between the claimed invention and the reference disclosure, as viewed by a person of ordinary skill in the field of the invention"); cf. In re Omeprazole Patent Litig., 483 F.3d 1364, 1379 (Fed. Cir. 2007) (a prior art reference must enable one of ordinary skill in the art to make the invention without undue experimentation to anticipate). In contrast, statutory construction does not include a skilled artisan component but considers instead the "object and policy" of the law. Nat'l Bank, 508 U.S. at 455 (internal citations omitted). Still words, in context, receive their meaning according to their placement in grammatical structure.

Therefore, to avoid slipping into a realm of ambiguity that could render jury verdicts wholly unreviewable, this court imputes an understanding of English grammar and usage to the jury. Moreover this court consults the overall context of the passage. The passage discusses and explains the entire hierarchy of data, not isolated portions of the database. Thus, one of skill would interpret the passage broadly to present many varied options for each of the tiers under consideration. Therefore, this court perceives that the comma before "or according to a predetermined schedule" (Videotex Architecture at 175) refers to the general interest pages and the less frequently updated pages. Thus, the passage means that either tier of data repeats at particular intervals or according to a predetermined schedule.

This court finds more support than just the passage on page 175 to support anticipation of the dividing limitation. The very next page provides additional and unequivocal support.

Taken together, pages 175 and 176 clearly and convincingly teach both division of portions of the database into tiers and assignment of scheduled transmission times to portions of the database within those tiers. In other words, those passages disclose the interrelated requirements of claim 16's "scheduling," "transmitting," and "dividing" steps. On this basis, and because Finisar does not dispute that Videotex Architecture discloses the other limitations of claim 16, Videotex Architecture anticipates claim 16. No reasonable jury could have concluded otherwise. This court reverses the district court's denial of DirecTV's JMOL motion for invalidity on the basis of anticipation of claim 16.

Tired from their exertion over whacking claim 16, the other dependent claims that DirecTV had damned with the Videotex book were left for the jury to reconsider on remand. The CAFC added the obviousness wildcard for reconsideration.

Willfulness

In In re Seagate Technology, LLC, 497 F.3d 1360, 1371 (Fed. Cir. 2007) (en banc), this court held that "proof of willful infringement permitting enhanced damages requires at least a showing of objective recklessness." Moreover this court imposes "no affirmative obligation to obtain opinion of counsel." Id.

The anti-Nietzsche appeals court finds patent infringers akin to spineless worms, unable to willfully infringe unless documented plundering forth with reckless abandon. Not in this case, where Finisar fudged dates. Exaggeration has a way of impressing the court.

DirecTV obtained an opinion of counsel, which concluded that DirecTV did not infringe the '505 patent, but took no position on validity. Based on that opinion, DirecTV proceeded to practice its system. The district court faulted DirecTV in part for not obtaining an opinion on validity, weighing its failure to do so in Finisar's favor on the question of willfulness. But the '505 patent would only have been a problem for DirecTV if DirecTV infringed it and it was valid. See Graco, Inc. v. Binks Mfg. Co., 60 F.3d 785, 793 (Fed. Cir. 1995) ("There is no requirement that an opinion must address validity to negate a finding of willful infringement.") (citation omitted) (emphasis in original). Thus a competent opinion of counsel concluding either that DirecTV did not infringe the '505 patent or that it was invalid would provide a sufficient basis for DirecTV to proceed without engaging in objectively reckless behavior with respect to the '505 patent.

Finisar also asserts, as evidence of willfulness, that DirecTV knew of the '505 patent as early as 1997 due to a letter sent to DirecTV's parent company. Finisar contends that DirecTV willfully "stonewalled" in response for many years. In fact, Finisar also argues that DirecTV did not even obtain its attorney opinion letter until over a year after Finisar sent a notice letter in January 2004. The record, however, shows that Finisar responded successfully to DirecTV's laches defense by acknowledging "no evidence that Finisar reasonably should have known of its claim against DirecTV until December 2003." Under the doctrine of judicial estoppel, see Biomedical Patent Mgmt. Corp. v. Cal. Dep't of Health Servs., 505 F.3d 1328, 1341 (Fed. Cir. 2007), Finisar cannot suggest that DirecTV started "stonewalling" in 1997 when even Finisar did not perceive a problem until nearly 2004. Thus, Finisar has not shown that DirecTV willfully infringed the '505 patent.

Indefiniteness

35 U.S.C. § 112, ¶ 2 requires that claims "particularly point[] out and distinctly claim[] the subject matter which the applicant regards as his invention." For means-plus-function elements, which are statutorily limited to the "corresponding structure, material, or acts described in the specification and equivalents thereof," 35 U.S.C. § 112, ¶ 6, section 112, ¶ 2 requires that the specification must permit one of ordinary skill in the art to "know and understand what structure corresponds to the means limitation." Biomedino, LLC v. Waters Techs. Corp., 490 F.3d 946, 949-50 (Fed. Cir. 2007) (internal citation omitted).

'505 had numerous means-plus-function claims about a claimed database with a specification "that discloses very little about the purported structure corresponding to this claim term."

For computer-implemented means-plus-function claims where the disclosed structure is a computer programmed to implement an algorithm, "the disclosed structure is not the general purpose computer, but rather the special purpose computer programmed to perform the disclosed algorithm." WMS Gaming, Inc. v. Int'l Game Tech., 184 F.3d 1339, 1349 (Fed. Cir. 1999). Thus the patent must disclose, at least to the satisfaction of one of ordinary skill in the art, enough of an algorithm to provide the necessary structure under § 112, ¶ 6. This court permits a patentee to express that algorithm in any understandable terms including as a mathematical formula, in prose, see In re Freeman, 573 F.2d 1237, 1245-46 (CCPA 1978), or as a flow chart, or in any other manner that provides sufficient structure.

The district court correctly determined that the structure recited in the '505 specification does not even meet the minimal disclosure necessary to make the claims definite. Simply reciting "software" without providing some detail about the means to accomplish the function is not enough. See Aristocrat Techs. Austl. Pty v. Int'l Game Tech., __ F.3d __, 2008 U.S. App. LEXIS 6472, at *10 (Fed. Cir. Mar. 28, 2008) ("For a patentee to claim a means for performing a particular function and then to disclose only a general purpose computer as the structure designed to perform that function amounts to pure functional claiming. Because general purpose computers can be programmed to perform very different tasks in very different ways, simply disclosing a computer as the structure designated to perform a particular function does not limit the scope of the claim to 'the corresponding structure, material, or acts' that perform the function, as required by section 112 paragraph 6."). This court does not impose a lofty standard in its indefiniteness cases. See, e.g., Med. Instrumentation & Diagnostics Corp. v. Elekta AB, 344 F.3d 1205, 1214 (Fed. Cir. 2003). But in this case, the claims are already quite vague. Without any corresponding structure, one of skill simply cannot perceive the bounds of the invention.

The claims remain invalid.