Rembrandt Wireless Technologies L.P. v. Samsung Electronics Co., Ltd. et al.

Docket No. 2016-1729

April 17, 2017

Brief Summary: DC claim construction based on prosecution history estoppel affirmed (“patentee’s use of ‘i.e.,’ in the intrinsic record…is often definitional”). DC non-obviousness conclusion affirmed. Royalty calculation affirmed. FC found “disclaimer cannot serve to retroactively dissolve the § 287(a) marking requirement for a patentee to collect pre-notice damages” and remanded the “novel legal issue” of whether § 287 “should attach on a claim-by-claim, rather than on a patent-by-patent, basis”.

Summary: Samsung appealed DC denial of its request for JMOL after it was found to infringe Rembrandt’s wireless device-related patents (US 8,023,580 and 8,457,228, which share the same specification), which were also found not to be invalid for obviousness (pre-AIA), and award of $15.7 million in damages. This opinion also addresses the DC’s claim construction and its denial of Samsung’s motion based on the marking statute. The claims require at least two “different type[s]” of “modulation methods” which the DC construed to mean “different families of modulation techniques, such as FSK family of modulation methods and the QAM family of modulation methods.” The DC relied on Rembrandt’s insertion of the “different types” limitation into the “claims after the examiner had already issued a notice of allowance…to ‘more precisely claim the subject matter’” and defining the term “[f]or example” essentially as it was construed by the DC. Samsung argued that “the plain claim language requires only that the different types of modulation methods be ‘incompatible’ with one another” but the FC panel disagreed since “the clearest statement in the intrinsic record” is the above-described post-allowance statement (“While the specification is the principal source of the meaning of a disputed term, the prosecution history may also be relevant.” Vitronics, FC 1996). Samsung’s argument was based in part on the use of “i.e.” in the statement which it argued was not definining, but the FC panel concluded “[t]he context here strongly supports the conclusion that Rembrandt used ‘i.e.’ to define the ‘different types’ limitation” (“A patentee’s use of ‘i.e.,’ in the intrinsic record…is often definitional”, Edwards Lifesciences, FC 2009 (“[U]se of ‘i.e.,’ signals an intent to define the word to which it refers.”); Abbott Labs., FC 2003 (“explicitly defined’ a term by using ‘i.e.,’”); compared to Pfizer (FC 2005) (“internally inconsistent”) or Dealertrack (FC 2012) (“would read out preferred embodiments”); Braintree, FC 2014 (“clear and unmistakable disavowel”)). The FC panel also disagreed there was a claim differentiation issue (ERBE, FC 2010), “that the specification is at odds with the prosecution history definition”, or that the broader construction adopted during IPR was binding on it (Cuozzo, US 2016).

Regarding obviousness, the FC panel agreed with the DC that “any dispute regarding whether particular modulation techniques are in different familes is a factual one” which is reviewed for substantial evidence (present here). The FC panel also noted that some “ambiguity” in claim construction is allowed (Eon Corp., FC 2016) and concluded that the jury’s determination of no motivation to combine was proper (“the absence of a formal teaching away in one reference does not automatically establish a motivation to combine it with another reference in the same field” (Apple, FC 2016 (teaching away is “doctrinally distinct from whether there is no motivation to combine”)).

Rembrandt alleged, and the jury agreed, that “Samsung devices incorporating the Bluetooth enhanced data rate (‘EDR’) standard infringed its patents” and Samsung challenged the damages award. But the FC panel found the expert witness’s “royalty calculations were properly ‘based on the incremental value that the patented invention adds to the end product” (Ericsson, FC 2014) and its consideration of another agreement in the calculation to be allowable (Summit 6, FC 2015).

Samsung also alleged that the DC improperly refused “to bar Rembrandt’s recovery of pre-notice damages based on Rembrandt’s failure to mark products covered by a claim Rembrandt later disclaimer” (35 USC § 287). Samsung alleged Zhone Technologies, Inc. sold unmarked products embodying claim 40 of the ‘580 patent and, therefore, Samsung argued damages should be limited to after it received notice (i.e., Rembrandt’s complaint). After filing suit, Rembrandt withdrew claim 40 from its infringement allegations and filed a statutory disclaimer to that claim (35 USC § 253(a)). The DC denied Samsung’s motion to bar pre-notice damages, concluding that under FC precedent “a disclaimed patent claim is treated as if it never existed” (Genetics Inst., FC 2011). The FC panel explained that while marking under § 287 is “permissive, not mandatory”, the failure to mark (including by a licensee, as here (Amsted Indus., FC 1994)) means no damages can be recovered “except on proof the infringer was notified…and continued to infringe thereafter, in which even damages may be recovered only for infringement occurring after such notice” (Bonito Boats, US 1989). And “[a]llowing Rembrandt to use disclaimer to avoid the consequence of its failure to mark undermines the marking statute’s public notice function.” Thus, “disclaimer cannot serve to retroactively dissolve the § 287(a) marking requirement for a patentee to collect pre-notice damages.” Rembrandt also argued § 287 “should attach on a claim-by-claim, rather than on a patent-by-patent, basis” and the FC panel remanded this “novel legal issue” to the DC “to address in the first instance”.

This entry was posted in Claim Construction, Damages, Inter Parties Review (IPR), Obviousness, Patent Marking, Royalties. Bookmark the permalink.

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