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October 3, 2010

Ordinary & Extreme

The childishness of corporations is no better illustrated than in patent litigation, where, instead of coming to cross-license, the little boys fight it out in court. For their fat fees, lawyers egg this sort of thing on. So it was with Extreme Networks and Enterasys. Then again, what would you expect of a company whose imagination runs so vacant as to name itself "extreme." In this battle, Enterasys held the short straw at district court: asserted 5,195,181 & 5,430,727 were found not infringed in summary judgment. Enterasys's expert excluded from testifying was salt in the wound. Appeal was but slight relief from the grief.

Extreme Networks and Enterasys (CAFC 2009-1325, -1346) non-precedential

'727 claims a "brouter," an amalgam of bridge and router. '181 claims partitioning workload for better packet throughput.

Extreme started the fight. Enterasys counter claimed with three patents, one of which it dropped.

'727 went out based upon claim construction of "acting as a bridge" and "bridge circuitry." '181 died on "digest."

For its laborious efforts, Extreme's patent payday was $201,213, chump change in the patent world. The district court denied attorneys fees to Extreme. The only ones making out on this case were the lawyers.

Jurisdiction: Timely Filing of the Notice of Appeal

As a gating issue, Extreme frivolously argued that Enterasys's notice of appeal was untimely.

The district court entered judgment on November 5, 2008. The parties then filed post-trial motions, including motions to calculate pre-judgment interest, post-judgment interest, and supplemental damages. The district court entered an order disposing of all such motions on March 16, 2009. The court clerk entered an amended judgment on March 19, 2009. Enterasys filed its notice of appeal on April 17, 2009.

A final judgment "ends the litigation on the merits and leaves nothing for the [district] court to do but execute the judgment." Crown Packaging Tech., Inc. v. Rexam Beverage Can Co., 559 F.3d 1308, 1311 (Fed. Cir. 2009) (citation omitted). Where substantive issues remain unresolved, a "judgment standing alone as issued by the district court [is] insufficient to establish dismissal of the entire action and . . . could not be the basis for providing [the Federal Circuit] with subject matter jurisdiction." SafeTCare Mfg., Inc. v. Tele-Made, Inc., 497 F.3d 1262, 1267 (Fed. Cir. 2007).

"Prejudgment interest is an element of complete compensation." West Virginia v. United States, 479 U.S. 305, 310 (1987). "Prejudgment interest serves to compensate for the loss of use of money due as damages from the time the claim accrues until judgment is entered, thereby achieving full compensation for the injury those damages are intended to redress." Id. at 310 n.2. Therefore, courts should calculate prejudgment interest before determining the amount of damages that would fully compensate the patentee for the infringer's use of the patented invention.

The November 5, 2008 judgment did not constitute a final judgment because it left unresolved prejudgment interest, even though the parties had previously notified the district court of their unresolved dispute over its calculation. The district court did not calculate prejudgment interest until the March 16, 2009 order. Because the March 19, 2009 amended judgment resolved all pending issues, under the facts of this case, it is the only final judgment. Because Enterasys filed its notice of appeal within thirty days thereafter, this court has jurisdiction.

Claim Construction

A sample of the quality of lawyering for Enterasys ('727 claim construction):

Enterasys argues it is entitled to pursue additional discovery on Extreme's devices because the district court changed its claim construction of "bridge circuitry" over time. The district court did not change its construction of "bridge circuitry." Also, this court finds that Enterasys could have conducted its discovery in anticipation of the final claim construction.

Summary judgment of '727 affirmed.

On '181, the district court made a claim construction mistake that was only possible because of illiteracy.

Claims 1, 6, and 7 of the '181 patent recite: "the message receiving processor . . . to generate a digest of information relating to the [received] message, the digest containing network protocol processing information for message transmit processing." '181 patent col.12 ll.50-68, col.14 ll.18-43. The district court explained in its summary judgment order that because the digest "contain[s]" network protocol processing information, "the digest is a structure and not the contents of the structure." Extreme Networks, 558 F. Supp. 2d at 920. The district court granted summary judgment of non-infringement based on Enterasys's alleged concession that Extreme's devices do not have such a structure.

The parties agree that the term "digest" does not have specific definition in the relevant art. The term "digest" ordinarily means a collection of information. See Merriam-Webster's Collegiate Dictionary (10th ed. 1993) (defining "digest" as "a summation or condensation of a body of information"); Random House Webster's College Dictionary (1991) (defining "digest" as "a collection or compendium, as of literary or scientific matter, esp[ecially] when classified or condensed"). A "digest," which is a condensation of a body of information relating to the received message, would logically be a set of data rather than a structure containing that data. The district court erred by focusing on the claim term "containing" and concluding that something "containing" information cannot also be information. To the contrary, the term "containing" does not indicate whether the "digest" is a structure or the contents of a structure.

The specification also "clarifies that a "digest" is a collection of information."

And so non-infringement of '727 was vacated.

Expert Witness

Enterasys's expert Barbara Frederiksen was disqualified by the district court.

Enterasys has the burden of establishing that Frederiksen's expert testimony is admissible based on her "knowledge, skill, experience, training, or education" in the relevant technology. Fed. R. Evid. 702. Courts must determine whether expert testimony is reliable by assessing whether the expert is qualified in the relevant field. Smith v. Ford Motor Co., 215 F.3d 713, 718 (7th Cir. 2000). A district court's decision to preclude expert testimony is an evidentiary issue, which this court reviews under the law of the regional circuit. Research Corp. Techs. V. Microsoft Corp., 536 F.3d 1247, 1255 (Fed. Cir. 2008). The U.S. Court of Appeals for the Seventh Circuit reviews evidentiary rulings for an abuse of discretion. Von Der Ruhr v. Immtech Int'l, Inc., 570 F.3d 858, 862 (7th Cir. 2009).

Frederiksen wasn't technically qualified. "Frederiksen would not qualify as a person of ordinary skill in the relevant art even under her own proposed definition." There's a word for lawyers putting up an expert unqualified by her own definition of necessary qualification: malpractice.

Expert out affirmed.

This case well illustrates the generally crappy quality of patent litigators and district court judges: lawyers that clog the court with junk argument (but for which they get rich), and district court judges where literacy and thinking straight are extreme challenges. Time and again, the CAFC has to straighten it out.

Remanded.

Posted by Patent Hawk at October 3, 2010 12:50 PM | Claim Construction

Comments

Hawk: I may not always agree with your opinions, but your pull-no-punches style makes for an entertaining read. Keep it up.

Posted by: anon at October 6, 2010 6:05 AM

What anon said.

Posted by: Steve at October 7, 2010 12:53 PM