High Reversal Rate of Markman Decisions Weakens their Intended Value

Summary of Recent Federal Circuit Decisions

Once a court of last resort for patent issues, the Federal Circuit has effectively become a court of original jurisdiction for claim construction disputes by virtue of its de novo review of district court decisions. Cybor Corp. v. FAS Tech. Inc., 138 F.3d 1448 (Fed. Cir. 1998). In the following Federal Circuit cases, the district courts' grant of summary judgment was reversed based on improper claim construction.

Omega Eng'g, Inc. v. Raytek Corp., 334 F.3d 1314 (Fed. Cir. 2003): The District of Connecticut granted summary judgment of invalidity to the defendant by placing a negative limitation on the disputed claim term “periphery.” The Federal Circuit reversed and remanded, construing the disputed term in accordance with its ordinary meaning derived from dictionary evidence.

Brookhill-Wilk 1, LLC v. Intuitive Surgical, Inc., 334 F.3d 1294 (Fed. Cir. 2003): The patent owner appealed the Southern District of New York's grant of summary judgment of noninfringement. The Federal Circuit was faced with the interpretation of the disputed phrase “remote location” in a method for performing robotic surgery. To correctly interpret this term, the Federal Circuit considered the words themselves, the surrounding text in the patent and the prosecution history. The decision was reversed and remanded based on the lower court's improper interpretation of the disputed phrase.

Prima Tek II, L.L.C. et al. v. Polypap, S.A.R.L, 318 F.3d 1143 (Fed. Cir. 2003): On appeal from the Southern District of Illinois' grant of summary judgment of noninfringement, the Federal Circuit vacated and remanded the case as a result of the district court's erroneous construction of the term “floral holding material” in a decorative assembly for flowers. The lower court impermissibly read a limitation into the claims from the written description, thereby improperly limiting the scope of the claim. The Federal Circuit also found error because the district court based part of its interpretation on the patent drawings, and stated that “[t]he mere fact that the patent drawings depict a particular embodiment of the patent does not operate to limit the claims to that specific configuration.” Prima Tek, 318 F.3d at 1149. Ultimately, the Federal Circuit construed the claim by resorting to the term's ordinary meaning.

Middleton, Inc. v. Minnesota Mining and Mfg. Co., 311 F.3d 1384 (Fed. Cir. 2002): The Middleton case required two trips to the Federal Circuit on the issue of claim construction. The appellate court first stated that the phrase “uniform flexible film” does not convey any special technical meaning. The court then considered Webster's definition of “uniform” as having always the same form. The Federal Circuit later examined the prosecution history and determined that Middleton's continuation application is not limited by the language of the specification which pertains to bowling alley surfaces. The appellate court ultimately held that the term “uniform” is entitled to its full scope, and must not be limited to thickness uniformity, as the district court erroneously construed the term to mean.

Inverness Medical Switzerland GmbH v. Warner Lambert Co., 309 F.3d 1373 (Fed. Cir. 2002): In reviewing the District of New Jersey's grant of summary judgment of noninfringement, the Federal Circuit began with the ordinary meaning of the disputed phrase “mobility of said test strip is facilitated by … a material comprising a sugar.” According to the court, a word with an ordinary meaning comprised of two relevant alternatives may be construed as comprising both alternatives, unless the specification or prosecution history clearly demonstrates that only one meaning is intended. Thus, in conjunction with the ambiguity in the prosecution history itself, the Federal Circuit held that the ordinary and customary meaning of the disputed terms, ascertained from the dictionary, was controlling. Summary judgment of noninfringement was vacated and the case was remanded.

PIN/NIP, Inc. v. Platte Chemical Co., 304 F.3d (Fed. Cir. 2002): After the District of Idaho granted partial summary judgment, the Federal Circuit vacated and remanded, holding that the lower court improperly construed the word “composition.” According to the Federal Circuit, a “composition” refers to a mixture of substances. The district court erroneously interpreted the term to include two ingredients that were not physically combined, but worked together in a spaced relationship.

Anchor Wall Systems, Inc. v. Rockwood Retaining Walls, Inc., 340 F.3d 1298 (Fed. Cir. 2003): The Federal Circuit reversed a summary judgment of noninfringement by the District of Minnesota. The patents at issue concerned interlocking features of masonry blocks that are stacked to form retaining walls. The lower court's erroneous claim construction involved the terms “back surface,” “protrusion,” “mate,” “generally parallel” and “substantially horizontal.” The lower court narrowly interpreted the terms based on preferred embodiments without considering the ordinary dictionary definitions of the words.

Inefficiency of Markman Hearings

Many litigants and district court judges may view early Markman hearings as advantageous in saving cost and time. Arguably, this reasoning could apply to many pretrial Markman hearings in which claim construction is decided quickly without the benefit of a full airing of prior art validity and infringement issues. See Thompson Consumer Elecs., Inc. v. Innovatron, S.A., 43 F.Supp.2d 26, 28-29 (D.D.C. 1999) (explaining danger of claim construction in a vacuum).

While Markman was intended to result in a uniform system of claim construction, it seems that this result has not been realized. In fact, Markman frequently has been used by lawyers to engage in litigation tactics that increase uncertainty and cost while delaying finality in patent litigation. Due to the district courts' wide latitude in developing their own mode of claim construction, uncertainty prevails. Instead of creating a system of uniformity, flipping a coin provides clients with a reasonable prediction of whether their claim construction will be reversed on appeal. A study of claim construction decisions by the Federal Circuit reveals that about 50% of district court claim interpretations were reversed or modified. See, e.g., Christian A. Chu, Empirical Analysis of the Federal Circuit's Claim Construction Trends, in HOW TO PREPARE & CONDUCT MARKMAN HEARINGS 711, 738 (PLI Patents, Copyrights, Trademarks & Literary Property Course Handbook Series, No. G0-00TZ, 2001).

Based on the high reversal rate, it is safe to argue that litigants and the district courts spend too much time and money on a preliminary procedure that will not reach a final determination until after an appeal and a second district court proceeding. Additionally, because a Markman hearing typically involves a separate hearing or trial, followed by another hearing or trial after a first appeal, a second appeal often results. Thus, the Federal Circuit's docket is impacted as well.

In some instances, district courts that construe claims early in the discovery period run the risk that the claims in dispute may change throughout the course of discovery. This results in the needless expenditure of conducting a Markman hearing on claim language that may not be at issue later on.

Possible Alternatives to Pretrial Markman Hearings

One alternative to pretrial Markman hearings is to go back to a procedure in which claim construction is incorporated into the trial itself. Markman mandates that claim construction is the “exclusive province of the court.” It does not, however, dictate that claim construction should or must occur before trial at a separate potentially appealable hearing when coupled with summary judgment motions. The current penchant for granting summary judgment based on district courts' Markman decisions has resulted in piecemeal litigation and high reversal rates. This could be explained by the district courts having to interpret patent language in a partial vacuum. See generally IPPV Enters., L.L.C. v. Echostar Comms. Corp., 191 F. Supp. 2d 530, 532 (D. Del. 2002) (explaining the inherent 'semantic exercise' claim construction entails and the natural consequence of continual development of new disputes throughout the course of trial).

Most district courts currently conduct the Markman hearing after discovery and before trial. However, there is nothing to prevent claim construction from being decided during trial along with all other substantive issues. Arguably, it should be performed at trial. The district court judge should be better able to understand a claim's scope, the technology involved and the allegedly infringing product or process when interpreting claim language with reference to all of the evidence introduced at trial. Also, conducting claim construction at trial may avoid the tendency of the parties to over-lawyer the claim interpretation issues. When all is said and done, the fundamental dispute over claim interpretation is resolved by science, engineering and technology as well as linguistics. Allowing scientific experts to testify in the course of a full trial would provide a means of focusing the issues for a more precise resolution of the specific claim language at issue.

Another possible approach is for the patent world to take a cue from the bankruptcy world. Bankruptcy judges become experienced and well equipped to adjudicate specific bankruptcy issues. Similarly, patent law involves specialized jargon, technical and scientific issues, and procedural intricacies and nuances which could be assessed by judges who become more experienced in that area of the law, perhaps even with some scientific or technical expertise. Establishing the Court of Appeals for the Federal Circuit was a step in setting up a specialized court. On the district court level, there are cogent arguments both for and against a specialized patent trial court, and that debate is beyond the scope of this article. Suffice it to say that the notion of a specialized trial court system for patents, trademarks, and copyrights is worthy of further exploration.

Conclusion

In view of the Markman decision, district courts have been wrestling with many difficult procedural and substantive aspects of claim construction. Unfortunately, only about half of the district courts reach a claim construction determination that withstands appellate review. Perhaps, the best procedure is to hold the Markman hearing immediately prior to, or integrated as part of, a full trial on all issues. A court's claim construction decision could be incorporated into the trial as part of the judge's instructions to the jury at the close of all of the evidence. Finally, district courts could exercise greater restraint by denying summary judgment motions based solely or largely on their decision following the Markman hearing.

In Markman v. Westview Instruments, Inc., 517 U.S. 370 (1996), the Supreme Court held that patent claim construction is an issue of law to be decided exclusively by the court rather than the jury. As a result, district court judges now routinely conduct what is referred to as pretrial Markman hearings in order to resolve disputes about the meaning of words or phrases in patent claims. Prior to Markman, claim construction took place at trial and was decided by the judge or the jury with appropriate instructions from the court.

In theory, placing claim construction solely in the province of the court was intended to simplify the trial and provide uniformity, predictability and reliability. In practice, Markman has provided a vehicle for the district court to avoid a lengthy trial by facilitating the grant of summary judgment of invalidity, noninfringement or infringement following a relatively short pretrial claim construction hearing. However, the practice frequently backfires because the Court of Appeals for the Federal Circuit reverses and remands a high percentage of these cases because of erroneous claim constructions. Thus, instead of cutting back on the amount of time and money expended on patent litigation, the Markman decision often has the opposite effect.

Has the Markman decision provided an all-too-easy escape route for district court judges who do not wish to endure lengthy and complex patent infringement trials? This article summarizes several recent cases in which the Federal Circuit reversed and remanded summary judgment decisions because of an erroneous claim construction at the district court level. Possible alternatives to this often inefficient procedure are suggested.

Summary of Recent Federal Circuit Decisions

Once a court of last resort for patent issues, the Federal Circuit has effectively become a court of original jurisdiction for claim construction disputes by virtue of its de novo review of district court decisions. Cybor Corp. v. FAS Tech. Inc., 138 F.3d 1448 (Fed. Cir. 1998). In the following Federal Circuit cases, the district courts' grant of summary judgment was reversed based on improper claim construction.

Omega Eng'g, Inc. v. Raytek Corp., 334 F.3d 1314 (Fed. Cir. 2003): The District of Connecticut granted summary judgment of invalidity to the defendant by placing a negative limitation on the disputed claim term “periphery.” The Federal Circuit reversed and remanded, construing the disputed term in accordance with its ordinary meaning derived from dictionary evidence.

Brookhill-Wilk 1, LLC v. Intuitive Surgical, Inc., 334 F.3d 1294 (Fed. Cir. 2003): The patent owner appealed the Southern District of New York's grant of summary judgment of noninfringement. The Federal Circuit was faced with the interpretation of the disputed phrase “remote location” in a method for performing robotic surgery. To correctly interpret this term, the Federal Circuit considered the words themselves, the surrounding text in the patent and the prosecution history. The decision was reversed and remanded based on the lower court's improper interpretation of the disputed phrase.

Prima Tek II, L.L.C. et al. v. Polypap, S.A.R.L, 318 F.3d 1143 (Fed. Cir. 2003): On appeal from the Southern District of Illinois' grant of summary judgment of noninfringement, the Federal Circuit vacated and remanded the case as a result of the district court's erroneous construction of the term “floral holding material” in a decorative assembly for flowers. The lower court impermissibly read a limitation into the claims from the written description, thereby improperly limiting the scope of the claim. The Federal Circuit also found error because the district court based part of its interpretation on the patent drawings, and stated that “[t]he mere fact that the patent drawings depict a particular embodiment of the patent does not operate to limit the claims to that specific configuration.” Prima Tek, 318 F.3d at 1149. Ultimately, the Federal Circuit construed the claim by resorting to the term's ordinary meaning.

Middleton, Inc. v. Minnesota Mining and Mfg. Co., 311 F.3d 1384 (Fed. Cir. 2002): The Middleton case required two trips to the Federal Circuit on the issue of claim construction. The appellate court first stated that the phrase “uniform flexible film” does not convey any special technical meaning. The court then considered Webster's definition of “uniform” as having always the same form. The Federal Circuit later examined the prosecution history and determined that Middleton's continuation application is not limited by the language of the specification which pertains to bowling alley surfaces. The appellate court ultimately held that the term “uniform” is entitled to its full scope, and must not be limited to thickness uniformity, as the district court erroneously construed the term to mean.

Inverness Medical Switzerland GmbH v. Warner Lambert Co., 309 F.3d 1373 (Fed. Cir. 2002): In reviewing the District of New Jersey's grant of summary judgment of noninfringement, the Federal Circuit began with the ordinary meaning of the disputed phrase “mobility of said test strip is facilitated by … a material comprising a sugar.” According to the court, a word with an ordinary meaning comprised of two relevant alternatives may be construed as comprising both alternatives, unless the specification or prosecution history clearly demonstrates that only one meaning is intended. Thus, in conjunction with the ambiguity in the prosecution history itself, the Federal Circuit held that the ordinary and customary meaning of the disputed terms, ascertained from the dictionary, was controlling. Summary judgment of noninfringement was vacated and the case was remanded.

PIN/NIP, Inc. v. Platte Chemical Co., 304 F.3d (Fed. Cir. 2002): After the District of Idaho granted partial summary judgment, the Federal Circuit vacated and remanded, holding that the lower court improperly construed the word “composition.” According to the Federal Circuit, a “composition” refers to a mixture of substances. The district court erroneously interpreted the term to include two ingredients that were not physically combined, but worked together in a spaced relationship.

Anchor Wall Systems, Inc. v. Rockwood Retaining Walls, Inc., 340 F.3d 1298 (Fed. Cir. 2003): The Federal Circuit reversed a summary judgment of noninfringement by the District of Minnesota. The patents at issue concerned interlocking features of masonry blocks that are stacked to form retaining walls. The lower court's erroneous claim construction involved the terms “back surface,” “protrusion,” “mate,” “generally parallel” and “substantially horizontal.” The lower court narrowly interpreted the terms based on preferred embodiments without considering the ordinary dictionary definitions of the words.

Inefficiency of Markman Hearings

Many litigants and district court judges may view early Markman hearings as advantageous in saving cost and time. Arguably, this reasoning could apply to many pretrial Markman hearings in which claim construction is decided quickly without the benefit of a full airing of prior art validity and infringement issues. See Thompson Consumer Elecs., Inc. v. Innovatron, S.A., 43 F.Supp.2d 26, 28-29 (D.D.C. 1999) (explaining danger of claim construction in a vacuum).

While Markman was intended to result in a uniform system of claim construction, it seems that this result has not been realized. In fact, Markman frequently has been used by lawyers to engage in litigation tactics that increase uncertainty and cost while delaying finality in patent litigation. Due to the district courts' wide latitude in developing their own mode of claim construction, uncertainty prevails. Instead of creating a system of uniformity, flipping a coin provides clients with a reasonable prediction of whether their claim construction will be reversed on appeal. A study of claim construction decisions by the Federal Circuit reveals that about 50% of district court claim interpretations were reversed or modified. See, e.g., Christian A. Chu, Empirical Analysis of the Federal Circuit's Claim Construction Trends, in HOW TO PREPARE & CONDUCT MARKMAN HEARINGS 711, 738 (PLI Patents, Copyrights, Trademarks & Literary Property Course Handbook Series, No. G0-00TZ, 2001).

Based on the high reversal rate, it is safe to argue that litigants and the district courts spend too much time and money on a preliminary procedure that will not reach a final determination until after an appeal and a second district court proceeding. Additionally, because a Markman hearing typically involves a separate hearing or trial, followed by another hearing or trial after a first appeal, a second appeal often results. Thus, the Federal Circuit's docket is impacted as well.

In some instances, district courts that construe claims early in the discovery period run the risk that the claims in dispute may change throughout the course of discovery. This results in the needless expenditure of conducting a Markman hearing on claim language that may not be at issue later on.

Possible Alternatives to Pretrial Markman Hearings

One alternative to pretrial Markman hearings is to go back to a procedure in which claim construction is incorporated into the trial itself. Markman mandates that claim construction is the “exclusive province of the court.” It does not, however, dictate that claim construction should or must occur before trial at a separate potentially appealable hearing when coupled with summary judgment motions. The current penchant for granting summary judgment based on district courts' Markman decisions has resulted in piecemeal litigation and high reversal rates. This could be explained by the district courts having to interpret patent language in a partial vacuum. See generally IPPV Enters., L.L.C. v. Echostar Comms. Corp., 191 F. Supp. 2d 530, 532 (D. Del. 2002) (explaining the inherent 'semantic exercise' claim construction entails and the natural consequence of continual development of new disputes throughout the course of trial).

Most district courts currently conduct the Markman hearing after discovery and before trial. However, there is nothing to prevent claim construction from being decided during trial along with all other substantive issues. Arguably, it should be performed at trial. The district court judge should be better able to understand a claim's scope, the technology involved and the allegedly infringing product or process when interpreting claim language with reference to all of the evidence introduced at trial. Also, conducting claim construction at trial may avoid the tendency of the parties to over-lawyer the claim interpretation issues. When all is said and done, the fundamental dispute over claim interpretation is resolved by science, engineering and technology as well as linguistics. Allowing scientific experts to testify in the course of a full trial would provide a means of focusing the issues for a more precise resolution of the specific claim language at issue.

Another possible approach is for the patent world to take a cue from the bankruptcy world. Bankruptcy judges become experienced and well equipped to adjudicate specific bankruptcy issues. Similarly, patent law involves specialized jargon, technical and scientific issues, and procedural intricacies and nuances which could be assessed by judges who become more experienced in that area of the law, perhaps even with some scientific or technical expertise. Establishing the Court of Appeals for the Federal Circuit was a step in setting up a specialized court. On the district court level, there are cogent arguments both for and against a specialized patent trial court, and that debate is beyond the scope of this article. Suffice it to say that the notion of a specialized trial court system for patents, trademarks, and copyrights is worthy of further exploration.

Conclusion

In view of the Markman decision, district courts have been wrestling with many difficult procedural and substantive aspects of claim construction. Unfortunately, only about half of the district courts reach a claim construction determination that withstands appellate review. Perhaps, the best procedure is to hold the Markman hearing immediately prior to, or integrated as part of, a full trial on all issues. A court's claim construction decision could be incorporated into the trial as part of the judge's instructions to the jury at the close of all of the evidence. Finally, district courts could exercise greater restraint by denying summary judgment motions based solely or largely on their decision following the Markman hearing.