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April 7, 2008

Only If, Take 2

O2 enforced its DC-to-AC converter patents against Beyond Innovation and others. Construction of the claim term "only if" sparked a slight disagreement among defendants, but was only "two simple plain English words" to O2. The district court judge agreed with O2: no construction needed. The appeals court did not.

O2 Micro International, Ltd v. Beyond Innovation Technology, Co, Ltd (CAFC 2007-1302, -1303. -1304)

O2 enforced its DC to AC converter patents against Beyond Innovation and other defendants in the Eastern District of Texas. The representative patent claim covers, in relevant part:

a feedback control loop circuit receiving a feedback signal indicative of power being supplied to said load, and adapted to generate a second signal pulse signal for controlling the conduction state of said second plurality of switches only if said feedback signal is above a predetermined threshold;

The co-defendants had slight disagreement regarding the meaning of the italicized words "only if," while plaintiff O2 maintained that the phrase consisted of "two simple plain English words" and therefore needed no construction. Judge T. John Ward agreed:

"Only if" has a well-understood definition, capable of application by both the jury and this court in considering the evidence submitted in support of an infringement or invalidity case.

The CAFC, through Judge Prost, found Judge Ward to be in error, holding that Markman mandated that the district court provide a construction:

We find this decision to be in error because, while Elekta Instruments may not require the court to construe this claim term, we find that Markman does.

The parties presented a dispute to the district court regarding the scope of the asserted claims--What do the patents mean when they say that the feedback signal controls power "only if said feedback signal is above a predetermined threshold"? O2 Micro contends that this "only if" limitation only applies during "steady state operation," while Defendants-Appellants contend that the "only if" limitation applies at all times without exception. This dispute over the scope of the asserted claims is a question of law. In deciding that "'only if' needs no construction" because the term has a "well-understood definition," the district court failed to resolve the parties' dispute because the parties disputed not the meaning of the words themselves, but the scope that should be encompassed by this claim language.

First, the CAFC quickly dealt with O2's argument that the Defendants waived their appeal with respect to the claim construction by failing to object to the jury instructions:

A claim construction order always dictates how the court will instruct the jury regarding a claim's scope. Because these issues were fully litigated and decided at the Markman stage of the litigation, Defendants-Appellants assert that no objection to the jury instruction was required to preserve error. We agree.

The district court in this case, as in Cardiac Pacemakers, rendered a claim construction order following a Markman hearing during which the parties' positions were fully litigated. Because Defendants-Appellants' position was previously made clear to the district court and the district court did not clearly indicate that it was open to changing its claim construction, Defendants-Appellants need not have renewed their objections by reasserting them when jury instructions were given.

Turning to the merits of the appeal, the nature of the dispute between the parties served to force the district court to provide a construction:

A determination that a claim term "needs no construction" or has the "plain and ordinary meaning" may be inadequate when a term has more than one "ordinary" meaning or when reliance on a term's "ordinary" meaning does not resolve the parties' dispute. In this case, for example, the parties agreed that "only if" has a common meaning, but then proceeded to dispute the scope of that claim term, each party providing an argument identifying the alleged circumstances when the requirement specified by the claim term must be satisfied (e.g., at all times or during steady state operation). In this case, the "ordinary" meaning of a term does not resolve the parties' dispute, and claim construction requires the court to determine what claim scope is appropriate in the context of the patents-in-suit. This court has construed other "ordinary" words for these and other related reasons.

Apparently, the district court's action improperly handed off claim construction to the jury, a no-no in this CAFC's post-Markman jurisprudence:

When the district court failed to adjudicate the parties' dispute regarding the proper scope of "only if," the parties presented their arguments to the jury. By failing to construe this term, the district court left the jury free to consider these arguments.

For the reasons stated, the parties' arguments regarding the meaning and legal significance of the "only if" limitation were improperly submitted to the jury.

While the CAFC stopped short of requiring judges to provide a construction for all claim terms, the opinion provides ammunition for a party to unilaterally demand a construction of its desired terms:

When the parties present a fundamental dispute regarding the scope of a claim term, it is the court's duty to resolve it. Because we determine that the district court is in the best position to determine the proper construction of this claim term in the first instance, we remand for further proceedings consistent with this opinion.

Judgment was vacated and remanded for further consideration, including a proper construction of the phrase "only if."

Posted by Patrick Anderson at April 7, 2008 7:45 PM | Claim Construction