Hearing Components v. Shure (CAFC 2009-1364, -1365) precedential

'920 "readily" Indefiniteness

The preamble claim term "readily" in '920 worried the district court judge mightily.

During claim construction, the court found the limitation in the '920 patent stating "said wax guard being readily installed and replaced by a user" indefinite. Id., slip op. at 11-13. The court reasoned that the word "readily" was not sufficiently explained in the specification. Id. at 12-13. According to the court, the specification first notes that some prior art products required a tool or solvent to remove wax buildup, but it then disparages prior art products for having filters that were difficult to remove or replace by the elderly and those "unable to see clearly enough or to perform fine physical actions well enough." Id. at 12. The court found that the specification's standard for the word "readily" was so subjective that the court could not determine what the claim term meant in the context of the patent. Id. The court stated that "[i]t would be extremely difficult, if not impossible, for someone attempting to design around claim 1 to determine what test group of users would be used to measure ease of replacement and which degree of difficulty would be sufficient to avoid infringement. The court therefore finds this claim term indefinite." Id. at 13.

The CAFC found "readily" a claim limitation, even though it lurked in the preamble. What it didn't find was that "readily" was indefinite.

On "readily" as a preamble limitation -

As an initial matter, the "readily installed" phrase is a claim limitation, as Shure argues. A preamble to a claim may or may not be limiting, depending on the circumstances. "In considering whether a preamble limits a claim, the preamble is analyzed to ascertain whether it states a necessary and defining aspect of the invention, or is simply an introduction to the general field of the claim." Computer Docking Station Corp. v. Dell, Inc., 519 F.3d 1366, 1375 (Fed. Cir. 2008) (quotation marks omitted). A term is often limiting when the patentee has relied on it during prosecution to distinguish prior art, as such reliance demonstrates that the feature disclosed in the preamble is necessary to the patentability of the claim. See id.; Jansen v. Rexall Sundown, Inc., 342 F.3d 1329, 1333 (Fed. Cir. 2003). In this case, Hearing Components clearly relied on the "readily installed" phrase during prosecution to distinguish prior art. See J.A. 5768 ("The Moser et al device clearly lacks (1) a 'disposable wax guard' that is (2) 'readily installed and replaced by a user' . . . as expressly called for in applicant's claim 1."); J.A. 5769 (The membrane in the Siemens device "is not 'readily installed and replaced'; indeed, it apparently remains in place, where it is cleaned ultrasonically."); J.A. 5770 (In the Oliveira device, "the sleeve is certainly not intended to be 'readily installed and replaced,' . . . as specifically called for by applicant's claim 1."). We do not consider the "readily installed" phrase to be duplicative of other language in the claim. Although the claim recites a membrane "that permits a user to position [a] guard over [an] outlet port," the "readily installed" phrase refers to the entire wax guard and therefore is more limiting. We thus conclude that the "readily installed" phrase is a claim limitation.

On the definiteness of "readily," where the "specification clearly 'supplies some standard for measuring the scope of the phrase.'"

However, Hearing Components correctly asserts that the limitation is not indefinite. Under 35 U.S.C. § 112, second paragraph, the "specification shall conclude with one or more claims particularly pointing out and distinctly claiming the subject matter which the applicant regards as his invention," which is known as the definiteness requirement. "Claims are considered indefinite when they are not amenable to construction or are insolubly ambiguous. Thus, the definiteness of claim terms depends on whether those terms can be given any reasonable meaning. Indefiniteness requires a determination whether those skilled in the art would understand what is claimed." Young, 492 F.3d at 1346 (internal citations and quotations marks omitted). The purpose of the definiteness requirement is to ensure that "the claims, as interpreted in view of the written description, adequately perform their function of notifying the public of the scope of the patentee's right to exclude." Honeywell Int'l, Inc. v. Int'l Trade Comm'n, 341 F.3d 1332, 1339 (Fed. Cir. 2003) (quotation marks omitted).

Here, the district court noted that the patentee has used a word of degree, "readily." "[A] patentee need not define his invention with mathematical precision in order to comply with the definiteness requirement." Invitrogen Corp. v. Biocrest Mfg., L.P., 424 F.3d 1374, 1384 (Fed. Cir. 2005) (quotation marks omitted). Not all terms of degree are indefinite. However, the specification must "provide[ ] some standard for measuring that degree." Datamize, LLC v. Plumtree Software, Inc., 417 F.3d 1342, 1351 (Fed. Cir. 2005) (quotation marks omitted). Although "readily" does not refer to a mathematical measure of degree, in Datamize, we addressed the "purely subjective" claim term "aesthetically pleasing" and stated that, as with terms of degree, "a court must determine whether the patent's specification supplies some standard for measuring the scope of the phrase. Thus, we next consult the written description." Id.

As the district court correctly noted, the written description of the '920 patent states that one of the advantages of the wax guard is that it "requires no tools for installation or removal." '920 patent col.2 ll.6-9. Indeed, that statement appears in the context of the following two sentences: "It is simple to install, easy to remove, and convenient to replace, even for older persons. The guard is inexpensive and requires no tools for installation or removal." Id. Assuming the patentee intended the second sentence to elaborate on the first sentence, a wax guard that is "inexpensive and requires no tools for installation or removal" will be "simple to install, easy to remove, and convenient to replace, even for older persons." Id. That assumption is supported by the repetition of variations on the words "install" and "remove" in both sentences. Furthermore, given that the words "readily," "simpl[y]," "eas[ily]," and "convenient[ly]" are all synonyms, the language of those two sentences in the specification closely tracks the language of the disputed claim term, "readily installed and replaced by a user." Thus, the written description gives a clear example of a wax guard that is "readily installed and replaced by a user": one that "is inexpensive and requires no tools for installation or removal."

The district court was also correct in noting that the specification discusses the phrase "readily installed and replaced by a user" in the context of prior art. The specification disparages prior art guards that were not "readily installed and replaced."... By negative implication, the patent thus explains that a filter that must be mounted beyond the sound delivery tube opening is not "readily installed and replaced."

The specification states that a guard that "is inexpensive and requires no tools for installation or removal," id. at col.2 ll.6-9, is "readily installed and replaced," and that a filter that must be mounted beyond the sound delivery tube opening, id. at col.1 ll.62-68, is not "readily installed and replaced." Thus, the court was incorrect in its conclusion that "the specification provides no boundaries as to what 'readily installed and replaced by a user' can be." Claim Construction Opinion, slip op. at 13. The specification clearly "supplies some standard for measuring the scope of the phrase." Datamize, 417 F.3d at 1351.

The court can use its own discretion as to whether further construction of the "readily installed" phrase is required, but the distinction in the specification between the ability of a layperson user to install the wax guard without tools, on the one hand, and the necessity of a professional using tools, on the other hand, requires reversal of the indefiniteness holding.

'076 & '151 Infringement

Hearing Components contends that the district court erred in granting JMOL of noninfringement of the '076 and '151 patents by Shure's straight-nozzled earphones, and Shure contends that the court erred in denying JMOL of noninfringement by Shure's barbed-nozzled earphones.

The doctrine of equivalents was in play for § 112, ¶ 6 claims. Claim construction itself was not disputed.

A determination of infringement requires a two-step analysis. "First, the court determines the scope and meaning of the patent claims asserted . . . . [Second,] the properly construed claims are compared to the allegedly infringing device." Cybor Corp. v. FAS Techs., Inc., 138 F.3d 1448, 1454 (Fed. Cir. 1998) (en banc) (citations omitted).

Step two, determining "[w]hether an accused device infringes a § 112, ¶ 6 claim as an equivalent[,] is a question of fact." Odetics, 185 F.3d at 1268... The assertedly equivalent structure must "perform[ ] the claimed function in substantially the same way to achieve substantially the same result as the corresponding structure described in the specification." Id. at 1268.

We have stated that "[e]vidence of known interchangeability between structure in the accused device and the disclosed structure has . . . been considered an important factor" in determining equivalence. IMS Tech., Inc. v. Haas Automation, Inc., 206 F.3d 1422, 1435 (Fed. Cir. 2000).

We agree with Hearing Components that substantial evidence supported the jury's verdict that both Shure's straight- and barbed-nozzled products infringed the asserted claims... We reverse the district court's grant of JMOL that Shure's straight-nozzled products do not infringe, and we affirm the court's denial of JMOL that Shure's barbed-nozzled products infringe.

'076 & '151 Validity

The patents were found valid by the jury, a determination the district court judge declined to overturn.

Shure also contends that the district court erred by requiring a motivation to combine prior art references, contrary to KSR Int'l Co. v. Teleflex Inc., 550 U.S. 398 (2007). According to Shure, it would have been obvious and predictable to make the above modifications to the prior art... Finally, Shure argues that secondary considerations of nonobviousness suggest that the patents would have been obvious. According to Shure, there is no nexus between commercial success and the patented products. Indeed, Shure argues, the inventors admitted that their product was commercially unappealing. Shure also asserts that there is no evidence of unexpected results.

We agree with Hearing Components that the district court correctly denied JMOL, upholding the jury's verdict that the '076 and '151 patents were not obvious. We agree with the district court that the jury heard substantial evidence to support a finding of nonobviousness. As the court emphasized, in order for a party to meet its burden of proving obviousness by "clear and convincing" evidence, the specific evidence must have been presented to the jury. Validity Opinion, 2009 U.S. Dist. Lexis 17168 at *10-14.

The jury heard conflicting expert witness testimony.

Finally, we agree with the district court that Hearing Components provided substantial evidence in the form of secondary considerations of nonobviousness. Hearing Components relied on the commercial success of its licensing program. As Shure argues, Hearing Components must show a "nexus between the merits of the claimed invention and evidence of secondary considerations . . . in order for the evidence to be given substantial weight in an obviousness decision." Muniauction, Inc. v. Thomson Corp., 532 F.3d 1318, 1327 (Fed. Cir. 2008) (quotation marks omitted). However, Hearing Components showed such a nexus in that the licensing fee for a covered product was more than cut in half immediately upon the expiration of the '151 patent, supporting its contention that the success of the device was related to the patent. J.A. 3620 ll.1-23.

We therefore agree with Hearing Components that the district court correctly denied JMOL and upheld the jury's verdict of nonobviousness as legally permissible and supported by substantial evidence.

Laches

Shure argued laches, which was denied by the district court.

"The application of the defense of laches is committed to the sound discretion of the district court." A.C. Aukerman Co. v. R.L. Chaides Constr. Co., 960 F.2d 1020, 1032 (Fed. Cir. 1992) (en banc). To prevail on a defense of laches, Shure must prove two elements: (1) Hearing Components delayed filing suit for an unreasonable and inexcusable length of time from the time it knew or reasonably should have known of its claim against Shure, and (2) the delay operated to the prejudice or injury of Shure. Id. Hearing Components' delay is measured from the time it knew or reasonably should have known of Shure's alleged infringing activities to the date of suit. Id. A delay of more than six years raises a presumption of prejudice. Wanlass v. Gen. Elec., 148 F.3d 1334, 1338 (Fed. Cir. 1998) (citing A.C. Aukerman, 960 F.2d at 1035-36). That presumption shifts to Hearing Components the burden of producing evidence that would show either that Hearing Components' delay was reasonable under the circumstances or that Shure suffered neither economic nor evidentiary prejudice. Id.

In this case, the district court correctly found that a presumption of prejudice did not apply, and that even if the presumption had applied, it had been rebutted, as there was neither economic nor evidentiary prejudice to Shure. Indeed, Shure had proven a delay of six years minus a day, which technically does not invoke the presumption of prejudice. However, even giving Shure the presumption of prejudice because "maybe as a matter of equity it should have" applied, the court permissibly found that Hearing Components had proven that Shure had suffered neither economic nor evidentiary prejudice. J.A. 4943 ll.16-24.

Regarding evidentiary prejudice, Shure asserts that because of the delay in suit, evidence of further delay to prove the laches defense itself was lost. Id. at 4941 l.25-4942 l.23. But evidentiary prejudice must consist of some separate disadvantage resulting from the delay, such as loss of records, unavailability of evidence, etc., that prevents a party from proving a separate claim or defense. If the only missing evidence is evidence of further delay, that does not amount to a showing of evidentiary prejudice. In this case, any loss of evidence that would have shown further delay is irrelevant because the court applied the presumption of prejudice as if such a delay had been proven. Thus, Shure would have gained no benefit from having evidence that would have shown an even longer delay.

We also agree with Hearing Components that the district court permissibly found no economic prejudice, having shifted the burden of production to Hearing Components. Even though, as Shure argues, capital investment is not required to show economic prejudice, our cases have required at least increased expenditures by the defendant in reliance on the delay. See ABB Robotics, Inc. v. GMFanuc Robotics Corp., 52 F.3d 1062, 1065 (Fed. Cir. 1995) (agreeing that "increasing sales without additional evidence of capital investments may constitute economic prejudice" but that alleged infringers had "to prove that their increased expenditures, i.e., on marketing and development, were in [some] way related to actions taken by the patentee."). "The proper inquiry is whether there has been a 'change in the economic position of the alleged infringer during the period of delay.'" Id. (quoting A.C. Aukerman, 960 F.2d at 1033).

Shure knew about the patents in suit long before suit was filed, and the court permissibly found that Shure had relied on noninfringement opinions of counsel, such that it would not have acted differently if it had been sued earlier. Indeed, the court discussed Shure's position that its products' value did not arise from the use of the claimed invention. The court also analyzed Shure's actions over the course of the nearly six-year delay, which lacked significantly increased expenditures based on the use of the claimed invention. J.A. 4944 l.13-4948 l.17. Shure did incur increased damages because of the delay in its being found to have infringed Hearing Components' patent, but it did not prove that it was unable to respond in damages to compensate for that infringement. It is not economic prejudice to pay damages from infringing sales of products generating a profit over a longer period of time resulting from delay. See A.C. Aukerman, 960 F.2d at 1033 ("[Economic] damages or monetary losses are not merely those attributable to a finding of liability for infringement. Economic prejudice would then arise in every suit." (citation omitted)). Shure did not prove its inability to respond in greater damages resulting from the delay. Thus, the court permissibly found that Hearing Components had proven no change in Shure's economic position based on the delay in filing suit. We therefore affirm the court's finding of no laches.

Only the finding of non-infringement was reversed and remanded. A total victory for Hearing Components, and surely a loss for surly Shure.