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April 12, 2010


Global Locate took SiRF and others to the ITC to stop the defendants from importing products infringing six of its GPS patents, which claim methods for improving signal reception. Global Locate prevailed. The defendants appealed. At issue were standing, infringement, and whether GPS-based methods were patentable subject matter under the Bilski standard.

SiRF et al v. ITC and Broadcom and Global Locate (CAFC 2009-1262) precedential

The patents in suit: 6,417,801; 6,606,346; 6,651,000; 6,704,651; 6,937,187; 7,158,080.


Standing was at issue.

The '346 patent is directed to signal correlation and the named inventors are Charles Abraham and Donald L. Fuchs. The patent names Global Locate as the assignee. At issue is whether Magellan Corporation ("Magellan") is a co-owner of the '346 patent. If Magellan is a co-owner, Global Locate lacks standing to assert the '346 patent absent joinder of Magellan. The question of whether Magellan is co-owner of the patent depends on whether one of the inventors (Abraham) assigned his interest in the patent to Magellan.

Abraham was an employee of a Ashtech, and signed an employment agreement with obliged automatic assignment of his inventions to Ashtech. Ashtech merged with Magellan in 1997.

Abraham testified that at the time of conception of the invention, he was still subject to the original Ashtech agreement. Abraham separated from Magellan in February 2000 and then joined Global Locate. In May of 2001, he and his co-inventor applied for the '346 patent, which was eventually assigned to Global Locate.

Initially, we conclude that the Abraham/Ashtech agreement provided for automatic assignment. The question of whether or not an agreement provides for automatic assignment is a matter of federal law. DDB Techs., 517 F.3d at 1290. "If the contract expressly grants rights in future inventions, 'no further act [is] required once an invention [comes] into being,' and 'the transfer of title [occurs] by operation of law.'" Id. (quoting FilmTec Corp. v. Allied-Signal Inc., 939 F.2d 1568, 1573 (Fed. Cir. 1991)). Here, the agreement provides that "[t]he Employee assigns all of his or her right, interest, or title in any Invention to the Employer to the extent allowed by law." Final Determination, slip op. at 6. By using the language "Employee assigns," the employee-assignment agreement expressly grants rights with no further action needed on the part of the employee. Therefore the provision is one of automatic assignment. See DDB Techs., 517 F.3d at 1290 & n.3 (finding automatic assignment where the agreement used "the present, automatic" language "agrees to and does hereby grant and assign").

Ambiguous language in the contract pried open the question of assignment.

The question remains whether the invention is "related to or useful in the business of the Employer" within the meaning of the agreement. That question is a matter of state law--here, California law. See id. at 1290. Neither the agreement nor the California Labor Code specifies what it means for an invention to be "related to or useful in the business of the Employer." The terms "related to" and "useful in" are inherently ambiguous. Under California law, when a contract is ambiguous, "[e]xtrinsic evidence is admissible to prove a meaning to which the contract is reasonably susceptible." Founding Members of the Newport Beach Country Club v. Newport Beach Country Club, Inc., 109 Cal. App. 4th 944, 955 (Ct. App. 2003). Such extrinsic evidence may include evidence of the nature of the employer's business and the nature of the employee's work for the employer, as well as evidence of the conduct of the parties, i.e., evidence probative of whether or not they regarded the invention as falling within the agreement. See DDB Techs., 517 F.3d at 1292; see also 11 Samuel Williston & Richard A. Lord, A Treatise on the Law of Contracts § 32:14 (4th ed. 1999) ("[T]he parties' own practical interpretation of the contract--how they actually acted, thereby giving meaning to their contract during the course of performing it--can be an important aid to the court."). Here, as in DDB Technologies, "resort to extrinsic evidence . . . is necessary to determine whether the [contract] provision applies." DDB Techs., 517 F.3d at 1292.

The claimed invention was deemed not to relate to Magellan's business.

The Commission, in concluding that Global Locate has standing to assert the '346 patent, found that there was "no evidence that the invention of the '346 patent was 'related to or useful in' its business." Final Determination, slip op. at 8-9. In reaching this conclusion, the Commission pointed out that "none of the evidence to which [appellants] have cited relates the specific invention of the '346 patent to any particular aspects of Magellan's business." Id. at 7. The Commission also relied on the fact that "[i]n light of Magellan's awareness of the invention of the '346 patent and its failure to assert ownership of the invention at any time, . . . Magellan itself did not consider the invention of the '346 patent 'related to or useful in' its business within the meaning of . . . the employee inventions agreement." Id. at 8.

Global Locate met its burden.

All parties agree that Global Locate had the burden to establish standing. Global Locate attempted to satisfy this burden by showing that Abraham and Fuchs, the inventors, had assigned the patent to Global Locate, and that Global Locate is shown as the assignee of the patent as issued.5 The question is whether Global Locate also had the burden of establishing that an interest in the patent had not been previously assigned by Abraham to Magellan. We think that that the Commission properly found that that burden rests with the appellants. The recording of an assignment with the PTO is not a determination as to the validity of the assignment. See 37 C.F.R. § 3.54. However, we think that it creates a presumption of validity as to the assignment and places the burden to rebut such a showing on one challenging the assignment. Such an understanding is consistent with and supported by the provisions of 35 U.S.C. § 261. That section provides that the recordation of an assignment with the PTO can be the basis for a bona fide purchaser defense ("An assignment, grant or conveyance shall be void as against any subsequent purchaser or mortgagee for a valuable consideration, without notice, unless it is recorded in the Patent and Trademark Office within three months from its date or prior to the date of such subsequent purchase or mortgage.").

5 "The inventor is presumed to be the owner of a patent application, and any patent that may issue therefrom, unless there is an assignment." 37 C.F.R. § 3.73(a); see also Isr. Bio-Eng'g Project v. Amgen, Inc., 475 F.3d 1256, 1263 (Fed. Cir. 2007); Arachnid, Inc. v. Merit Indus., Inc., 939 F.2d 1574, 1578 n.2 (Fed. Cir. 1991); 8 Donald S. Chisum, Chisum on Patents § 22.01 (2006) ("The presumptive owner[s] of the property right in a patentable invention [are] . . . the several human inventors, in the case of a joint invention."). The statute provides that "[p]atents may be granted to the assignee of the inventor of record in the Patent and Trademark Office, upon the application made and the specification sworn to by the inventor." 35 U.S.C. § 152.

Given that the burden of proof on this issue rested with appellants, we think that the Commission's determination that appellants have not sustained their burden is supported by substantial evidence.


SiRF argued it did not directly infringe. The ITC had found joint infringement, but the CAFC put infringement directly on SiRF's doorstep.

Appellants argue that the claims are only infringed when actions are taken by SiRF's customers and by the end users of the GPS devices; that SiRF accordingly can infringe the patents only when it is a joint infringer together with the customers and the end users; and that the requirements for joint infringement are not satisfied because SiRF does not control or direct the customers or end users. See Muniauction, Inc. v. Thomson Corp., 532 F.3d 1318, 1329 (Fed. Cir. 2008). The Commission found joint infringement. We do not reach the question of joint infringement because we do not read the relevant claims as requiring that any of the specified actions be taken by SiRF's customers or by the end users of the GPS devices. This is not a situation where a method claim specifies performance of a step by a third party, or in which a third party actually performs some of the designated steps, and thus control or direction of the performance of that step by the accused infringer is required. Rather, the method claims at issue here are drawn to actions which can be performed and are performed by a single party. As they do not require that any of the steps be performed here by the customers or the end users, and the disputed steps are not in fact performed by third parties, we conclude that SiRF directly infringes.

Patentable Subject Matter

SiRF argued that the claims of two patents were not patentable subject matter. As if a GPS device was not sufficiently particular.

After the Initial Determination, but before review by the Commission, this court decided In re Bilski. In Bilski, we held that "[a] claimed process is surely patent-eligible under § 101 if: (1) it is tied to a particular machine or apparatus, or (2) it transforms a particular article into a different state or thing." 545 F.3d at 954. We also held that the machine-or-transformation test has a further aspect: "the use of a specific machine or transformation of an article must impose meaningful limits on the claim's scope to impart patent-eligibility." Id. at 961 (see also Prometheus Labs., Inc. v. Mayo Collaborative Servs., 581 F.3d 1336, 1342-43 (Fed. Cir. 2009). We agree with the Commission that the claims in question satisfy this test.

We have defined a "machine" as "a concrete thing, consisting of parts, or of certain devices and combination of devices. This includes every mechanical device or combination of mechanical powers and devices to perform some function and produce a certain effect or result." In re Ferguson, 558 F.3d 1359, 1364 (Fed. Cir. 2009) (quoting In re Nuijten, 500 F.3d 1346, 1355 (Fed. Cir. 2007)) (internal quotation marks omitted).

A GPS receiver is a machine and is integral to each of the claims at issue.

We also think that the presence of the GPS receiver in the claims places a meaningful limit on the scope of the claims. In order for the addition of a machine to impose a meaningful limit on the scope of a claim, it must play a significant part in permitting the claimed method to be performed, rather than function solely as an obvious mechanism for permitting a solution to be achieved more quickly, i.e., through the utilization of a computer for performing calculations. We are not dealing with a situation in which there is a method that can be performed without a machine. Contrary to appellants' contention, there is no evidence here that the calculations here can be performed entirely in the human mind. Here, as described, the use of a GPS receiver is essential to the operation of the claimed methods.


Posted by Patent Hawk at April 12, 2010 10:10 PM | Standing