Commil USA, LLC v. Cisco Systems, Inc.

Docket No. 2012-1042

June 25, 2013

Brief summary: Inducement to infringe does not turn on “mere negligence” and “evidence of an accused inducer’s good-faith belief of invalidity may negate the requisite intent for induced infringement”.

Summary: Cisco appealed final decision based on two jury verdicts that Cisco directly and indirectly infringed Commil’s claims relating to wireless systems, that certain claims were not indefinite, lack of enablement or lacking adequate description and that Cisco was liable for about $64 million in damages. Commil alleged that Cisco’s access points and controllers infringed its claims. Regarding infringement, Cisco alleged that the jury instruction to find inducement (35 USC 271(b)) on the showing of “mere negligence” was erroneous in view of Global-Tech (US 2011 (induced infringement “requires knowledge that the induced acts constitute patent infringement” and may be satisfied by “willful blindness” (“deliberate actions to avoid confirming a high probability of wrongdoing and who can almost be said to have actually known the critical facts”)). The panel agreed with Cisco (citing DSU Medical, FC 2006 (“alleged infringer must be shown…to have knowingly induced infringement, not merely knowingly induced the acts that constitute direct infringement”)). It also found the DC prevented Cisco from presenting evidence of its good faith belief of invalidity (citing DSU Medical, Ecolab (FC 2009), Kinetic Concepts (FC 2009), and Betcher (FC 2011)) (“evidence of an accused inducer’s good-faith belief of invalidity may negate the requisite intent for induced infringement”). It also found the instruction to be prejudicial to Cisco. There were two trials leading to this appeal. Commil was granted a new trial after Cisco’s attorney’s were found to have prejudiced the jury with negative remarks related to religion (Commil is based in Israel and the inventors are from Israel); the FC found the grant of a new trial was not erroneous (for this reason and under the Seventh Amendment (“infringement and invalidity are separate and distinct issues”)). Cisco also challenged the DC claim construction but the panel found this to be “without merit” (citing Phillips, FC 2005 (cautioning against importing limitations from the specification into the claims). Cisco’s arguments regarding indefiniteness, non-enablement and lack of written description were also found to have no merit (without further analysis). However, the case was remanded for a new trial due to the erroneous jury instructions. Judge Newman agreed with the result but not the holding that a good faither belief of invalidity rebuts liability for induced infringement (e.g., it is only a defense to willfulness). Judge O’Malley concurred with the decision but disagreed on “whether Commil did or ever could prove the third-party direct infringement” and with the partial new trial issues.

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