Federal Circuit Holds That Art Teaches Away From Its Own Disclosure
In Chemours Company Fc, LLC v. Daikin Industries, Ltd., Appeal No. 20-1289, the Federal Circuit held that a reference may teach away from modifying a particular embodiment to include features disclosed elsewhere in the same reference.
Daikin requested inter partes review of two of Chemours’ patents directed to insulating communication cables by pulling wires through melted polymers flowing at a flow rate. The PTAB found the challenged claims invalid as obvious, holding that it would have been obvious to modify an embodiment found in a prior art reference to use the claimed flow rate because the claimed flow rate was disclosed elsewhere in the same reference.
On appeal, the Federal Circuit reversed, finding that the prior art reference taught away from using the claimed flow rate in the relevant embodiment. The Federal Circuit also held that the Board legally erred by requiring evidence of market share to prove commercial success of the patented invention. Instead, the Federal Circuit found that evidence of sales alone could be enough.
Judge Dyk dissented in part, stating that the prior art did not sufficiently teach away from the claimed flow rate.
Don’t Be Late – Interlocutory Appeals of Liability Issues Shouldn’t Wait for Resolution of Damages Issues
In Mondis Technology Ltd. v. Lg Electronics Inc., Appeal No. 20-1812, the Federal Circuit held that Mondis Technology Ltd., Hitachi Maxell Ltd., and Maxell, Ltd. (collectively, “Mondis”) sued LG Electronics Inc. and LG Electronics U.S.A., Inc. (collectively, “LG”) for infringement of a patent covering a video display configured to receive video signals from an external source. The jury found that the asserted claims were valid, LG’s televisions infringed, and LG’s infringement was willful. The jury awarded Mondis $45 million in damages. LG filed motions for judgment as a matter of law or a new trial on the issues of invalidity, non-infringement, damages and willfulness. In a first order, the trial court denied LG’s post-trial motions on invalidity, non-infringement and willfulness. In a second order, issued seven months after the first order, the trial court granted LG’s motion for a new trial on damages. Two weeks after the date of the second order, LG filed an interlocutory appeal challenging, inter alia, the validity, infringement, and willfulness rulings.
The Federal Circuit dismissed LG’s appeal for lack of jurisdiction because it was untimely. Under 28 U.S.C. § 1292(c)(2), the Federal Circuit has jurisdiction to hear interlocutory appeals on “judgment[s] . . . which would otherwise be appealable to the [Federal Circuit] and [are] final except for an accounting.” 28 U.S.C. § 2107(a) sets a 30 day time limit to file such appeals. The Federal Circuit held that under § 1292(c)(2) a judgment is “final except for an accounting” when “all liability issues have been resolved, and only a determination of damages remains.” The first order resolved all liability issues. The first order, not the second order, started the 30 day time limit for the appeal. Thus, LG’s appeal, filed approximately seven-and-a-half months after the first order, was untimely. The Federal Circuit found this construction of § 1292(c)(2) was consistent with Supreme Court precedent and Fed. R. App. P. 4(a)(4).
It’s No Secret That a Related Company’s Physical Presence in a Jurisdiction May Not Be Enough For Proper Venue
In Andra Group, LP v. Victoria’s Secret Stores, LLC, Appeal No. 20-2009, The Federal Circuit held that an entity’s physical presence in a jurisdiction does not automatically confer jurisdiction over related corporate entities.
Andra Group, LP (“Andra”) sued Victoria’s Secret Stores, L.L.C., Victoria’s Secret Stores Brand Management, Inc., Victoria’s Secret Direct Brand Management, LLC, and L Brands, Inc. (collectively, “Victoria’s Secret”) for patent infringement in the District Court for the Eastern District of Texas. The Eastern District of Texas granted Victoria’s Secret Stores Brand Management, Inc., Victoria’s Secret Direct Brand Management, LLC, and L Brands, Inc. (collectively, the “Non-Store Defendants”) motion to dismiss for improper venue on the grounds that they lacked a regular and established place of business in the district. Andra appealed.
On appeal, Andra argued that the Non-Store Defendants had a regular and established place of business in the district by: (1) having an agency relationship with the Victoria’s Secret Stores’ employees in its retail locations in the district, and (2) ratifying Victoria’s Secret’ Stores’ locations as their own places of business. Upon review of the facts, the Court determined that the Non-Store Defendants did not have the right to direct or control the Victoria’s Secret Stores’ employees, and thus, an agency relationship was not established. Further, the Court determined that Andra could not prove that the Non-Store Defendants had “actually engage[d] in business from [the retail locations],” and thus, the Court found that the Non-Store Defendants did not ratify the Victoria’s Secret Stores’ locations as their own.
Accordingly, the Court did not find either of Andra’s arguments persuasive and affirmed the lower court’s ruling.