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Bosch asserted the patent against Snap-On, who argued that the claim terms “program loading device” and “program recognition device” are means-plus-function terms under 35 U.S.C. '112, '6, and lacked the requisite description of structures in the specification. Specifically, claim 1 contains the limitation “wherein a program version contained in a connected control unit is queried and recognized by means of the program recognition device ',” triggering a presumption that the “program recognition device” was a means-plus-function limitation. At trial, the district agreed that “program recognition device” was presumptively a means-plus-function limitation, and that Bosch failed to overcome that presumption. Regarding “program recognition device,” the court found that the limitation was presumptively not a means-plus-function claim, based on the lack of the word “means” associated with the limitation. Nonetheless, the district court found “program recognition device” to be a means-plus-function claim. The court found that both claims lacked support in the specification and were thus indefinite. The parties stipulated to a final judgment of invalidity, and Bosch appealed.

On appeal, the Federal Circuit applied a two-step analysis to determine if the limitations were indeed means-plus-function. The first step is to determine whether the claim limitation is drafted in the means-plus-function format. Use of the term “means” triggers a rebuttable presumption that '112, '6 governs. This presumption can be overcome if “the claim term fails to recite sufficiently definite structure or else recites function without reciting sufficient structure for performing that function.” Slip op. at 5 (quoting EnOcean GmbH v. Face Int'l Corp., 742 F.3d 955, 958 (Fed. Cir. 2014)). If the limitation is found to invoke '112, '6, then the second step is to attempt to construe the claim term by identifying “corresponding structure, materials or acts described in the specification to which the claim term will be limited. If [the court] is unable to identify any corresponding structure, materials, or acts described in the specification, the claim term is indefinite.” Id . (internal quotations and citations omitted).

Turning to the instant limitations, the panel first found that the phrase “by means of” was insufficient to trigger the presumption of a means-plus-function claim. Id. at 6'7. Nevertheless, the panel found that the presumption against invoking '112, '6, was overcome for both claim terms. While the panel acknowledged that the specification disclosed that “program loading device” and “program recognition device” referred to physical structures with physical connection to other components, no particular structure for either device was defined in the claims or specification. Specifically, the specification contained only functions that are to be performed by each device, but defined no particular structure for either. Id. at 7'10. Turning to validity, the panel relied on the same analysis to determine that the claims lacked any corresponding structure to define the claimed functions, and were thus indefinite. Id. at 12.

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Doctrine of Claim Differentiation Insufficient to Overcome Plain Meaning of Claim Term

On Oct. 17, 2014, a unanimous Federal Circuit panel consisting of Chief Judge Prost, and Judges Taranto and Hughes, issued an opinion authored by Judge Hughes in CardSoft, LLC v. VeriFone, Inc., Case No. 2014-1135. In it, the panel overturned the lower court's claim construction, and because CardSoft had waived any argument that Verifone infringed under the Federal Circuit's construction, entered a judgment of noninfringement.

CardSoft asserted two related patents against VeriFone. The patents describe software for controlling payment terminals ' small specialized computers, along with peripheral units such as a card reader, a printer, or communications interface, and a software operating system to control the hardware components. The software was intended to solve the problem caused by the variety of unique architectures employed in different terminals, which required software to be written specifically for the terminal intended to run it. The specification of each of the asserted patents describes the use of a “virtual machine” to act as an interpreter between an application program and the payment terminal's underlying hardware and operating system, which allow applications to be written for the virtual machine, and then run on any payment terminal running the virtual machine. The specification acknowledges that the concept of a virtual machine was prior art, but the patents claim an improved virtual machine optimized for use on payment terminals.

At trial, the district court adopted CardSoft's proposed construction of “virtual machine” to mean “a computer programmed to emulate a hypothetical computer for applications relating to transport of data.” CardSoft, Inc. v. VeriFone Holdings, Inc., No. 2:08-cv-98, 2011 WL 4454940, at 8 (E.D. Tex. 2011). The district court rejected VeriFone's argument that a virtual machine must “process[] instructions expressed in a hardware/operating system-independent language.” Id. at 7. Applying the district court's construction, a jury found that VeriFone infringed. VeriFone appealed.

On appeal, the Federal Circuit reviewed the lower court's construction of “virtual machine.” The panel found that that construction was correct, but incomplete, because it failed to include that a virtual machine “must process instructions expressed in a hardware/operating system-independent language.” Slip op. at 6 (internal quotations and citations omitted). This was in error, according to the panel, because it conflated the virtual machine itself with operations written to run on the virtual machine. Id. CardSoft argued that the district court's construction was supported by the doctrine of claim differentiation. Specifically, the term “virtual machine” appeared in independent claims, as well as dependent claims, which stated that instructions do not require translation to the native software code of the microprocessor. The panel dismissed this argument, stating that the doctrine of claim differentiation is “a rule of thumb that does not trump the clear import of the specification” which required the virtual machine to process instructions expressed in a language not native to the hardware/operating system. Id. at 9 (quoting Eon-Net LP v. Flagstar Bancorp, 653 F.3d 1314 , 1323 (Fed. Cir. 2011).

Finally, the Federal Circuit found that CardSoft failed to argue that VeriFone's product would infringe even under VeriFone's construction of “virtual machine,” and thus waived any infringement argument. Thus the panel granted VeriFone's request for judgment of no infringement as a matter of law.

Patentee's Failure to Connect the Dots Insufficient, But Not Sanction-Worthy

On Oct. 20, 2014, a Federal Circuit panel consisting of Judges Newman, Reyna, and Taranto, issued a unanimous opinion, authored by Judge Newman, in AntiCancer, Inc., v. Pfizer, Inc., Case No. 2013-1056. In it, the panel vacated the district court's summary judgment ruling and remanded for further proceedings.

AntiCancer is the owner of patents on technology related to imaging gene expression using green fluorescent protein. AntiCancer sued Pfizer in the Southern District of California in January 2011 for breach of its license agreement. AntiCancer subsequently learned of publications authored by scientists at Pfizer and Crown Bioscience, Inc. AntiCancer stated that the publications showed the use of AntiCancer's technology and infringement of its patents, and amended its complaint in Nov. to add counts of infringement and add Crown Bioscience as a defendant.

Prior to AntiCancer amending its complaint, the district court had ordered that AntiCancer serve its Disclosure of Asserted Claims and Preliminary Infringement Contentions on Nov. 14, 2011, in accordance with the Patent Local Rules. AntiCancer did so, and Pfizer subsequently moved for summary judgment on the patent infringement counts, stating that AntiCancer's Preliminary Infringement Contentions did not properly allege infringement on a limitation by limitation basis. The district court agreed, finding that the claim chart was deficient as to three elements found in each of the claims, and authorized AntiCancer to supplement its contentions but required that AntiCancer also pay the defendants' attorney fees and costs related to the summary judgment motion. AntiCancer refused, and the court entered summary judgment of noninfringement. AntiCancer appealed.

On appeal, the Federal Circuit examined whether the fee-shifting condition and its consequence were a sanction, and if so, if it was an abuse of discretion. As an initial matter, the panel determined that the question of whether fee-shifting is an appropriate condition for supplementation of infringement contentions is primarily a matter of discipline under the court's inherent authority, not substantive patent law, and is thus governed by the laws of the regional circuit. Slip op. at 7'8. Under the Ninth Circuit precedent, a court must make an explicit finding of bad faith on the part of the sanctioned party before awarding sanctions. See, id. at 8 (quoting Primus Auto. Fin. Servs., Inc. v. Batarse, 115 F.3d 644, 648 (9th Cir. 1997)).

The panel turned next to AntiCancer's preliminary infringement contentions. The district court found them “woefully insufficient” and “vague,” for failing to “connect the dots” between the asserted claims and Pfizer's research. Id. at 19, 22. The panel found that, while it was within the lower court's discretion to require supplementation, the contentions were not so deficient as to show bad faith. The panel noted that the contentions were due five days after AntiCancer amended its claims to plead infringement. Id. at 17. The panel also noted that in its briefing in opposition to Pfizer's motion for summary judgment, AntiCancer clarified and explained its infringement contentions more fully, and this weighed against a finding of bad faith. Id. at 22. For these reasons, the panel found that the district court erred in sanctioning AntiCancer, reversed the entry of summary judgment, and remanded the case for further proceedings.

Jeff Ginsberg is a Partner in the New York office of Kenyon & Kenyon LLP. Wyatt Delfino is an Associate with the firm.

Federal Circuit Defines “By Means Of”

On Oct.14, 2014, a Federal Circuit panel made up of Judges Taranto and Hughes, and Chief Judge Prost, issued a unanimous opinion, authored by Chief Judge Prost, in Robert Bosch, LLC v. Snap-On Inc., Case No. 2014-1040. The panel upheld the district court's finding that all claims asserted by Bosch were invalid as indefinite, because they contained two means-plus-function limitations, but the specification failed to describe structures that would accomplish the same.

Bosch's patent at issue is directed to a diagnostic tester that determines whether the computerized control unit on a vehicle needs to be reprogrammed. The diagnostic tester contains a “program recognition device,” which recognizes a version of the diagnostic software loaded on the vehicle's control unit, and a “program loading device,” which loads the current version of the diagnostic software if it detects an out of date version.

Bosch asserted the patent against Snap-On, who argued that the claim terms “program loading device” and “program recognition device” are means-plus-function terms under 35 U.S.C. '112, '6, and lacked the requisite description of structures in the specification. Specifically, claim 1 contains the limitation “wherein a program version contained in a connected control unit is queried and recognized by means of the program recognition device ',” triggering a presumption that the “program recognition device” was a means-plus-function limitation. At trial, the district agreed that “program recognition device” was presumptively a means-plus-function limitation, and that Bosch failed to overcome that presumption. Regarding “program recognition device,” the court found that the limitation was presumptively not a means-plus-function claim, based on the lack of the word “means” associated with the limitation. Nonetheless, the district court found “program recognition device” to be a means-plus-function claim. The court found that both claims lacked support in the specification and were thus indefinite. The parties stipulated to a final judgment of invalidity, and Bosch appealed.

On appeal, the Federal Circuit applied a two-step analysis to determine if the limitations were indeed means-plus-function. The first step is to determine whether the claim limitation is drafted in the means-plus-function format. Use of the term “means” triggers a rebuttable presumption that '112, '6 governs. This presumption can be overcome if “the claim term fails to recite sufficiently definite structure or else recites function without reciting sufficient structure for performing that function.” Slip op. at 5 (quoting EnOcean GmbH v. Face Int'l Corp., 742 F.3d 955, 958 (Fed. Cir. 2014)). If the limitation is found to invoke '112, '6, then the second step is to attempt to construe the claim term by identifying “corresponding structure, materials or acts described in the specification to which the claim term will be limited. If [the court] is unable to identify any corresponding structure, materials, or acts described in the specification, the claim term is indefinite.” Id . (internal quotations and citations omitted).

Turning to the instant limitations, the panel first found that the phrase “by means of” was insufficient to trigger the presumption of a means-plus-function claim. Id. at 6'7. Nevertheless, the panel found that the presumption against invoking '112, '6, was overcome for both claim terms. While the panel acknowledged that the specification disclosed that “program loading device” and “program recognition device” referred to physical structures with physical connection to other components, no particular structure for either device was defined in the claims or specification. Specifically, the specification contained only functions that are to be performed by each device, but defined no particular structure for either. Id. at 7'10. Turning to validity, the panel relied on the same analysis to determine that the claims lacked any corresponding structure to define the claimed functions, and were thus indefinite. Id. at 12.

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Doctrine of Claim Differentiation Insufficient to Overcome Plain Meaning of Claim Term

On Oct. 17, 2014, a unanimous Federal Circuit panel consisting of Chief Judge Prost, and Judges Taranto and Hughes, issued an opinion authored by Judge Hughes in CardSoft, LLC v. VeriFone, Inc., Case No. 2014-1135. In it, the panel overturned the lower court's claim construction, and because CardSoft had waived any argument that Verifone infringed under the Federal Circuit's construction, entered a judgment of noninfringement.

CardSoft asserted two related patents against VeriFone. The patents describe software for controlling payment terminals ' small specialized computers, along with peripheral units such as a card reader, a printer, or communications interface, and a software operating system to control the hardware components. The software was intended to solve the problem caused by the variety of unique architectures employed in different terminals, which required software to be written specifically for the terminal intended to run it. The specification of each of the asserted patents describes the use of a “virtual machine” to act as an interpreter between an application program and the payment terminal's underlying hardware and operating system, which allow applications to be written for the virtual machine, and then run on any payment terminal running the virtual machine. The specification acknowledges that the concept of a virtual machine was prior art, but the patents claim an improved virtual machine optimized for use on payment terminals.

At trial, the district court adopted CardSoft's proposed construction of “virtual machine” to mean “a computer programmed to emulate a hypothetical computer for applications relating to transport of data.” CardSoft, Inc. v. VeriFone Holdings, Inc., No. 2:08-cv-98, 2011 WL 4454940, at 8 (E.D. Tex. 2011). The district court rejected VeriFone's argument that a virtual machine must “process[] instructions expressed in a hardware/operating system-independent language.” Id. at 7. Applying the district court's construction, a jury found that VeriFone infringed. VeriFone appealed.

On appeal, the Federal Circuit reviewed the lower court's construction of “virtual machine.” The panel found that that construction was correct, but incomplete, because it failed to include that a virtual machine “must process instructions expressed in a hardware/operating system-independent language.” Slip op. at 6 (internal quotations and citations omitted). This was in error, according to the panel, because it conflated the virtual machine itself with operations written to run on the virtual machine. Id. CardSoft argued that the district court's construction was supported by the doctrine of claim differentiation. Specifically, the term “virtual machine” appeared in independent claims, as well as dependent claims, which stated that instructions do not require translation to the native software code of the microprocessor. The panel dismissed this argument, stating that the doctrine of claim differentiation is “a rule of thumb that does not trump the clear import of the specification” which required the virtual machine to process instructions expressed in a language not native to the hardware/operating system. Id. at 9 (quoting Eon-Net LP v. Flagstar Bancorp, 653 F.3d 1314 , 1323 (Fed. Cir. 2011).

Finally, the Federal Circuit found that CardSoft failed to argue that VeriFone's product would infringe even under VeriFone's construction of “virtual machine,” and thus waived any infringement argument. Thus the panel granted VeriFone's request for judgment of no infringement as a matter of law.

Patentee's Failure to Connect the Dots Insufficient, But Not Sanction-Worthy

On Oct. 20, 2014, a Federal Circuit panel consisting of Judges Newman, Reyna, and Taranto, issued a unanimous opinion, authored by Judge Newman, in AntiCancer, Inc., v. Pfizer, Inc., Case No. 2013-1056. In it, the panel vacated the district court's summary judgment ruling and remanded for further proceedings.

AntiCancer is the owner of patents on technology related to imaging gene expression using green fluorescent protein. AntiCancer sued Pfizer in the Southern District of California in January 2011 for breach of its license agreement. AntiCancer subsequently learned of publications authored by scientists at Pfizer and Crown Bioscience, Inc. AntiCancer stated that the publications showed the use of AntiCancer's technology and infringement of its patents, and amended its complaint in Nov. to add counts of infringement and add Crown Bioscience as a defendant.

Prior to AntiCancer amending its complaint, the district court had ordered that AntiCancer serve its Disclosure of Asserted Claims and Preliminary Infringement Contentions on Nov. 14, 2011, in accordance with the Patent Local Rules. AntiCancer did so, and Pfizer subsequently moved for summary judgment on the patent infringement counts, stating that AntiCancer's Preliminary Infringement Contentions did not properly allege infringement on a limitation by limitation basis. The district court agreed, finding that the claim chart was deficient as to three elements found in each of the claims, and authorized AntiCancer to supplement its contentions but required that AntiCancer also pay the defendants' attorney fees and costs related to the summary judgment motion. AntiCancer refused, and the court entered summary judgment of noninfringement. AntiCancer appealed.

On appeal, the Federal Circuit examined whether the fee-shifting condition and its consequence were a sanction, and if so, if it was an abuse of discretion. As an initial matter, the panel determined that the question of whether fee-shifting is an appropriate condition for supplementation of infringement contentions is primarily a matter of discipline under the court's inherent authority, not substantive patent law, and is thus governed by the laws of the regional circuit. Slip op. at 7'8. Under the Ninth Circuit precedent, a court must make an explicit finding of bad faith on the part of the sanctioned party before awarding sanctions. See, id. at 8 (quoting Primus Auto. Fin. Servs., Inc. v. Batarse, 115 F.3d 644, 648 (9th Cir. 1997)).

The panel turned next to AntiCancer's preliminary infringement contentions. The district court found them “woefully insufficient” and “vague,” for failing to “connect the dots” between the asserted claims and Pfizer's research. Id. at 19, 22. The panel found that, while it was within the lower court's discretion to require supplementation, the contentions were not so deficient as to show bad faith. The panel noted that the contentions were due five days after AntiCancer amended its claims to plead infringement. Id. at 17. The panel also noted that in its briefing in opposition to Pfizer's motion for summary judgment, AntiCancer clarified and explained its infringement contentions more fully, and this weighed against a finding of bad faith. Id. at 22. For these reasons, the panel found that the district court erred in sanctioning AntiCancer, reversed the entry of summary judgment, and remanded the case for further proceedings.

Jeff Ginsberg is a Partner in the New York office of Kenyon & Kenyon LLP. Wyatt Delfino is an Associate with the firm.