Chicago Board Options Exchange, Inc. v. International Securities Exchange, LLC


Docket No. 2011-1267, -1298

RADER, WALLACH (Circuit Judge), FOGEL (District Judge)
May 7, 2012

Brief summary: The corresponding structures of means-plus-function limitations are ascertained from the specification.

Summary: ISE appealed from final judgment of USDC ND IL that its ‘707 patent directed to an automated exchange for trading options contracts was not infringed by CBOE. The opinion concluded that the DC erred in construing certain terms and did not abuse its discretion in denying CBOE’s motions to amend its Complaint. The claimed automated systems were described by the specification as being designed to replace the traditional “open outcry” system. CBOE argued that its “Hybrid” system “blends the elements of open-outcry and electronic execution”. The disputed claim terms were “system memory means,” “matching,” and “automated exchange” which were construed in view of the specification and precedent (e.g., Honeywell, FC 2006 (“[w]here the specification makes clear that the invention does not include a particular feature, that feature is deemed to be outside the reach of the claims of the patent, even though the language of the claims, read without reference to the specification, might be considered broad enough to encompass the feature in question”); e.g., “The ’707 Patent thus disavows the traditional open-outcry or floor-based trading systems.”) It was ultimately concluded that the DC erred in certain of these interpretations and the decision was therefore reversed-in-part and vacated-in-part. The opinion affirmed the DC decision not to allow CBOE to amend its complaint to include inequitable conduct charges because it failed to show good cause or any explanation for why it waited until a later date to make their request.

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