Center for Advanced Study & Research on Innovation Policy


CASRIP Newsletter - Spring/Summer 1998, Volume 5, Issue 2

Recent Federal Circuit Cases on Claim Interpretation and the Doctrine of Equivalents

The Federal Circuit has issued many decisions in the last three months, which may change the case law direction on claim interpretation and the doctrine of equivalents in both the substantive and procedural aspects of U.S. patent law. I was fortunate to be able to work in Judge Rader's chambers in such an exciting transitional period and to participate in discussions among judges and law clerks in clarifying key concepts and theories regarding the scope of U.S. patents. Although many important cases have come out, I think that the following will most likely trigger debates among patent professionals:

Prior Art-Related Amendment/Argument during Patent Prosecution May Leave Some Range of Equivalents

Litton Systems, Inc. v. Honeywell, Inc. (Litton II)1

On April 7, 1998, the Federal Circuit issued three important decisions, clarifying the Supreme Court's holding in Warner-Jenkinson,2 with respect to the doctrines limiting the application of the doctrine of equivalents. Among these three, the most significant is Litton Systems, Inc. (Litton II) because the Federal Circuit provided clear guidance to overcome the presumption of estoppel introduced by the Supreme Court in Warner-Jenkinson. The Federal Circuit's earlier judgement on the same case, Litton Systems, Inc. v. Honeywell Inc., (Litton I)3 is one of the three judgements that the Supreme Court had vacated for a further examination of any infringement by equivalents in view of the doctrines limiting the application of the doctrine of equivalents. With extensive discussions on the prosecution history estoppel (discussed below), the Litton II court remanded the case to the district court for examining the range of equivalents with respect to all three doctrines limiting the doctrine of equivalents, i.e., (1) the prosecution history estoppel, (2) the prior art limitation, and (3) the "all elements" rule. The court reaffirmed the findings of the remaining federal patent claim issues in Litton I but vacated the state law claim issues which depended on the result of infringement analysis under the doctrine of equivalents.

Litton's reissue patent was directed to a method of coating a substrate with multiple layers to provide an almost perfect reflective mirror. Such a mirror is used in navigational devices for aircraft and is essential to calculate precisely the speed, direction and attitude of an aircraft. In Litton I, the Federal Circuit reversed the district court's JMOL that overturned the jury's verdict of infringement under the doctrine of equivalents. An important fact of this case is that during the reissue prosecution, the patentee explained the disputed claim term, "Kaufman-type source," to refer only to the Kaufman gun discussed in the specification. This interpretation was further supported by Litton's amendment to replace a more general limitation term "ion-beam source" with a precise term "Kaufman-type source," although the patentee clearly noted in the record that the amendment was made to overcome Section 112 Paragraph 2 rejection.

Honeywell did not use Kaufman gun but used a hollow cathode or a RF ion-beam source. Nevertheless, the Litton I court relied on expert testimony with respect to the similarity of function/way/result and the known interchangeability, and thus found sufficient evidence to support the jury's verdict of infringement under the doctrine of equivalents. In his dissenting opinion, Judge Bryson argued that Litton should be estopped from asserting infringement for any ion beams other than Kaufman-type source under the doctrine of equivalents.

With respect to the newly introduced presumption for applying the prosecution history estoppel, the Supreme Court remanded Litton I to determine whether the patentee can overcome the presumption and still claim infringement under the doctrine of equivalents. The most important issue is whether Warner-Jenkinson should be read to change the Federal Circuit's patent-friendly case law on the scope of application of the prosecution history estoppel. The Federal Circuit denied the Honeywell's all-or-nothing view, which depended on an amendment or argument during the prosecution, by stating that "Warner-Jenkinson did not effect a change in the scope of subject matter precluded by an estoppel but only in the circumstances that may trigger an estoppel." The court clarified that the "patentability related" reason for giving rise to an estoppel was generally limited to prior art-related amendments, but suggested a possibility that an amendment made for a patentability-unrelated reason and an argument without amendment might give rise to an estoppel if an applicant clearly or unmistakably surrendered a scope irrelevant to whether or not these events occurred to overcome the prior art.

Applying this standard to the circumstances of Litton, the Federal Circuit rejected Litton's argument that an estoppel did not apply because the amendment to limit to "Kaufman-type source" was made to overcome Section 112 rejection. The court determined that an estoppel should apply because "although amendments made in response to indefiniteness and enablement rejections are generally not made 'in response to the prior art,' the amendment in response to the section 112 rejection at issue here, a 'regard as his invention' rejection, was related to patentability."

The court nevertheless inquired if the accused process might still infringe the claim under the doctrine of equivalents because the patentee might still have a range of equivalents that encompasses Honeywell's ion-beam sources even when an estoppel applied. To ascertain the scope of equivalents left to the patentee for claiming equivalents, the Federal Circuit identified three categories of subject matter estopped from recapturing by the patentee. These categories include (1) subject matter that was deemed unpatentable over the prior art by the applicant and excluded through an amendment;4 (2) subject matter having features that the patentee has amended to overcome the prior art and their trivial variations;5 and (3) subject matter that was clearly and unmistakably surrendered during the prosecution.6

In determining whether Honeywell's process fell within one of the three categories, the Federal Circuit looked into the records of prosecution history. Because Litton had never amended a claim that specifically recited Honeywell's hollow cathode or RF ion beam, category 1 was not applicable under the circumstances of this case. Further, because the examiner did not cite either Honeywell's hollow cathode or RF ion beam during the prosecution, Honeywell's sources did not fall within the second category. The court, however, inquired whether Honeywell's sources fell within the third category and found that they might because Litton relied on unexpected results obtained by the Kaufman-type source to show nonobviousness over the cited processes using sources other than those in Honeywell's process. The records included Litton's unmistakable statement that the phrase "ion-beam source" referred only to a Kaufman-type ion-beam source.

Unique to the facts of this case is that Litton emphasized the narrow interpretation to distinguish sources disclosed in the references filed by Litton itself. Whether the examiner relied on these references to reject Litton's claims is unclear because the examiner referred to all references in general but did not emphasize those disclosing a hollow cathode and RF ion-beam source potentially similar to sources used in Honeywell's process. The majority believed that the examiner relied on the references because "these references were central to the course of the prosecution." To confirm the narrow interpretation, Litton amended the claim language to limit to the Kaufman-type source. Based on these so-called telling circumstances, the Litton II court decided that the statement might now bind Litton and estop it from asserting all ion beams before the examiner as equivalents. However, the district court had never examined whether Honeywell's ion beams were the same or trivial variations of those before the examiner. Thus, the Litton II court remanded the case to the district court to determine the relationship between ion beams in the references and those in Honeywell's process.

Contrary to the recent trend after Warner-Jenkinson that limits the application of the doctrine of equivalents, the Federal Circuit in Litton II has maintained its patent-friendly case law on the prosecution history estoppel by leaving a possibility to claim a range of equivalents even when an amendment or argument gives rise to an estoppel. Judge Rader, who wrote a lengthy dictum to prevent the patentee from using the doctrine of equivalents to eliminate a claimed element in Sage Product,7 expressed a patent-friendly view in Litton II. He rejected Honeywell's argument that Litton surrendered any of potential scope covering Honeywell's process using a RF ion-beam source, because one skilled in the art knew that a RF source could have been substituted with the source in the Litton's process but amended its claim not covering any RF source. Had the same philosophy that Judge Rader discussed in Sage Product been followed, Honeywell's argument would have been upheld because a skilled patent drafter would have foreseen the limiting potential of the "Kaufman-type source" limitation, although one may argue that subsequent change in the state of the art has affected the significance of the limitation since the time when the limitation was included during the reissue prosecution.

A significant point of this case is the court's effort to clarify a method to define the scope of estoppel and to identify the categories of subject matter estopped because of the applicant's behavior during the prosecution. Although the Federal Circuit has previously stated that patentees still have some range of equivalents even if the prosecution history estoppel applies, it has not explained how to define the scope that is given up and thus estopped from recapturing by equivalents. Before Litton II, although the Supreme Court in Warner-Jenkinson instructed with respect to circumstances giving rise to an estoppel by introducing a presumption, patentees were lost about how to overcome the presumption and to show the remaining scope of equivalents encompassing the accused product because neither the Court nor the Federal Circuit gave guidance on how to define the scope of estoppel. Being given a list of subject matter excluded by the prosecution history estoppel, patentees can now overcome the presumption and may still claim equivalents by showing that the accused product or process does not fall within any of the three categories. Although some uncertainty remains with respect to the scope of "trivial variations," because the Litton II court did not give the definition, the Federal Circuit will, hopefully, clarify the scope through the regular course of case-to-case determination in the near future.

Litton II also significantly contributes to the harmonization of the U.S. doctrine of equivalents with its Japanese counterpart by generally limiting the effect of the prosecution history estoppel to prior art-related amendments and arguments. If the Ball Spline Supreme Court decision8 is interpreted in line with the holding of the Genentech Osaka Court decision,9 prior art unrelated amendments, in response to indefiniteness and enablement rejections, do not give rise to estoppel. U.S. courts' prosecution history estoppel doctrine closely parallels the Japanese Supreme Court's fifth element to establish infringement under the doctrine of equivalents, i.e., the doctrine of intentional removal, because both doctrines focus on the subjective element, the intent of applicant indicated by his or her behavior during the prosecution, to limit the doctrine of equivalents. In contrast, Japanese Supreme Court's fourth element, the doctrine of the free state of the art, parallels U.S. courts' prior art limitation doctrine announced in Wilson Sporting Goods,10 because both doctrines focus on the objective element, a patentable range from the state of the art or the prior art. Although Japanese lower courts and legal scholars need to clarify what constitutes subject matter intentionally removed during the prosecution, they may adopt the three categories defined by the Litton court because U.S. case law has a significant influence on Japanese case law development.11

At the same time, the court has introduced uncertainty in the practice of prosecuting U.S. patents by allowing the statement and amendment made with respect to the document that the examiner particularly cites for a rejection to give rise to an estoppel. Although the majority appeared to find sufficient evidence to support the examiner's reliance, Judge Newman disagreed. If this case is interpreted in such a way that insufficient evidence of the examiner's reliance may still give rise to an estoppel, such practice will further remove the prosecution history estoppel away from the traditional estoppel doctrine,12 and from the practice of Japanese and German courts where the duty of competitors includes only investigating the patent claims, specification and drawings for avoiding infringement. As Judge Newman correctly pointed out in her dissenting opinion, such an extensive application of the prosecution history estoppel, adopted by the majority, works only to discourage applicants from submitting information on the invention and may cause a result that conflicts with the policy underlying the duty of disclosure.

Relaxed "All Elements" Rule for Later-Developed Equivalents

Hughes Aircraft Co. v. United States13

Another case remanded by the Supreme Court for reconsidering the finding of infringement under the doctrine of equivalents in light of the Court's decision in Warner-Jenkinson is Hughes Aircraft Co. v. United States (Hughes XV). This case has an extraordinarily long and complex procedural history. The parties have already spent 25 years since the suit began in 1973 and have disputed liability and damages issues separately through bifurcated proceedings.

The only issues the Supreme Court instructed to reconsider in Hughes XV were the range of equivalents granted by the Federal Circuit in its earlier decision on the liability issues (Hughes VII)14 in view of the effect of the two requirements for limiting the doctrine of equivalents enunciated in Warner-Jenkinson: (1) the "all elements" rule and (2) the prosecution history estoppel. A newly introduced standard for applying the "all elements" rule is whether a subsequent change in the state of the art obfuscated the significance of the limitation at the time of its incorporation into the claim. When positively answered, courts may apply a relaxed "all elements" rule to enable later-developed equivalents falling within the scope of equivalents. This case meets the standard and finds all elements in the accused device. After determining that the amendment during the prosecution did not affect the Hughes VII court's early finding of infringement by equivalents, the court found its early analysis met both requirements and affirmed the decision.

Whether the Federal Circuit satisfied the first requirement in Hughes VII was questioned because the court clearly stated that "the failure to apply the doctrine of equivalents to the claimed invention as a whole . . . was error," which suggests that the court had applied the doctrine of equivalents to "invention as a whole," instead of "element-by-element" as requested by the Supreme Court. Nevertheless, the Federal Circuit found it actually followed the "all elements" rule and affirmed its finding of infringement under the doctrine of equivalents.

Hughes' patent related to an apparatus for control over the orientation, or attitude, of a spacecraft using commands from a ground control station. The patent claims required the apparatus to provide the ground crew with data necessary to calculate the instantaneous spin angle (ISA) position. The ISA position was the angle between two specific planes and was used to correct the attitude of the spacecraft.15 In Hughes' apparatus, the ground crew calculated the spacecraft's existing and desired orientation by determining the ISA position and sent signals to adjust the spacecraft to the desired position. In the accused spacecraft, the "store and execute (S/E) craft," the ISA position was calculated on board. Thus, the ground crew did not receive data sufficient to calculate the ISA position but received the spin rate and information sufficient to calculate the sun angle in the S/E craft. After receiving the data, the crew performed the necessary calculations to adjust the attitude of the spacecraft. The accused spacecraft received the result of calculation but did not change its position right away. Instead, it stored the result until it received an executed command from the ground crew.

In applying the doctrine of equivalents, the Hughes VII court found that the transmission to the ground of the spin rate and sun angle calculation information was "the modern day equivalent to providing an indication of the ISA to the ground" as required by the claim paragraph (e), noting that the transmission of this information and the ISA position information performed substantially the same function to achieve the same result, i.e., to enable the ground crew to control the position of the spacecraft. One may argue that the government's spacecraft functions in a different way because it does not use the ISA position to control the spacecraft, but the Federal Circuit did not require the strict identity of the "way" prong test because of the circumstances surrounding the patented invention and the accused product. The court rationalized the application of a relaxed "all elements" rule by noting that "this is a case in which a subsequent change in the state of [the] art, such as later-developed technology, obfuscated the significance of [the] limitation at the time of its incorporation into the claim."

Regarding the "synchronism" limitations in paragraphs (f) and (g) of the claim that require adjusting the position of the spacecraft upon the receipt of a signal from the ground crew, the court again noted the effect of an advance in technology and explained that "the synchronism in the accused device is coordinated by the computer instead of by real-time execution of the command from the ground." Such a difference in coordination did not avoid equivalency because "the difference between operation by retention and operation by sending is achieved by relocating the function, making no change in the function performed, or in the basic manner of operation, or in the result obtained." Therefore, the court concluded that the Hughes VII court correctly found all identical or equivalent claimed elements in the accused device.

In examining the effect of the amendment relating to disputed limitations in paragraphs (e), (f) and (g) of the claim, like the Litton II court, the Federal Circuit rejected the government's all-or-nothing view in applying the prosecution history estoppel. In Hughes, the amendment was made for a patentability-related reason because it was made to overcome an obviousness rejection in light of the McLean Patent. The court's analysis, however, does not stop there because, as Litton II indicates, the court must examine the scope of estoppel even when an estoppel applies. Here, no Litton II first category is involved because Hughes has never canceled or amended a claim reciting the government's S/E spacecraft. The Hughes XV court did not find any incident to give rise to an unmistakable surrender. With respect to the second category, the court concluded that Hughes did not surrender subject matter covering the government's spacecraft because the government's spacecraft significantly differed from the craft disclosed in the McLean patent. Thus, the amendment did not prevent Hughes from claiming the government's spacecraft as an equivalent.

Reading Limitations into Claims or Interpreting Claims in Light of Specification?

Vehicular Technologies Corp. v. Titan Wheel Inc.16

The last case issued on April 7 also relates to the range of equivalents but the court's attitude is not as patent-friendly as the first two cases. In Vehicular, the parties disputed infringement issues with respect to the patentee's right to a preliminary injunction. To establish the right, a patentee must show: (1) a reasonable likelihood of success on the merits; (2) an irreparable harm if preliminary relief is not granted; (3) the balance of hardships tipping in its favor; and (4) the impact of the injunction on the public sector.17 With respect to the first factor, the patentee had to establish that (a) it will likely prove infringement of its patent by the accused product and (b) its infringement claim will likely withstand the accused infringer's validity and enforceability challenges. The district court found that the patentee had established its right and granted its motion of preliminary injunction. The accused infringer appealed, and the Federal Circuit stayed the preliminary injunction while reviewing its appropriateness.

The patent at issue was directed to an automatic locking differential for use in automotive vehicles. One of the improvements resulting from the patented locking differential was to facilitate do-it-yourself backyard mechanics installing small parts of after-market add-ons by providing two concentric springs. Thus, all claims required the claim limitation: "a spring assembly consisting of two concentric springs bearing against one end of said pin." In contrast, the accused infringer replaced the concentric springs with a spring and a plug. Hence, the patentee admitted that the limitation was not literally met but asserted that it was met under the doctrine of equivalents, arguing that the plug and spring were respectively equivalent to the inner and outer springs recited in the claims. Particularly, because the outer spring existed in conventional differentials, the court's analysis centered around the replacement between the plug and the inner spring.

Quoting the Supreme Court's statement in Warner-Jenkinson, the Vehicular court emphasized that "if a claim limitation must play a role in the context of the specific claim language, then an accused device which cannot play that role or which plays a substantially different role, cannot infringe under the doctrine of equivalents." To find out the role of the inner spring, the court looked into the intrinsic evidence. The role was identified as an ability to serve as a back-up when the outer spring broke, because the patentee repeatedly emphasized the ability throughout the description in the specification. The court examined other roles for the inner spring, discussed in the specification and emphasized by the patentee, but found that the accused plug played these roles in different ways.

In response to the dissenting judge's criticism that the majority introduced an unclaimed limitation from the specification, the majority emphasized the presence of the spring mechanism limitation in the claims and identified its function in applying the doctrine of equivalents by looking at the specification to find out if the accused plug was substantially different from the inner spring limitation. In contrast, Judge Newman (dissenting) found the back-up capacity nonessential and believed that the majority improperly limited the scope of equivalents by relying on an unclaimed limitation, an advantage of a preferred embodiment.

Vehicular clearly demonstrates a recent trend of limiting the application of the doctrine of equivalents. How extensively a court may rely on the statement in the specification often causes a problem in interpreting a claim with respect to an analysis of claim construction. The Federal Circuit has repeatedly emphasized that the proper practice of taking account of the specification to interpret claims must be distinguished from the improper practice of reading limitations into claims from the specification.18 However, the distinction is not clear in applying the circumstances of a particular case. The distinction is even more difficult in applying the doctrine of equivalents, because the doctrine requires identifying the function of claimed limitations; however, such functions are often found only in the specification, not in the claim. The majority of Vehicular clearly authorized courts to look for the function in the specification and the prosecution history records.

The practice adopted by the Vehicular court closely parallels the approach taken by German and Japanese courts in focusing on the object and result of the patented invention. German and Japanese courts' analysis of the patented invention begins with the determination of the principle underlying the claimed invention by looking at the object and result of the invention. To infringe either literally or by equivalents, courts require the accused device to accomplish the same object(s) and produce the same result as the patented invention.19 Following this tradition, the Supreme Court of Japan listed the identical object and result requirement as the second element to establish infringement under the doctrine of equivalents.20

However, as experienced by European and Japanese patent practitioners who are familiar with the problem-solution approach in examining the inventive step, the problem of this approach lies in objectively determining the object. The object may change as the problem of the prior art varies. When an object can be narrowly, as well as broadly, defined with respect to the problem of the prior art, it can result in a difference in scope meeting the requirement. The risks that Judge Newman noted often occur when Japanese courts define the object very narrowly by requiring all objects listed in the specification. The result is a protection scope covering only embodiments with no scope of equivalents.

Are Section 112, Paragraph 6 Equivalents Different from the Judicially Created Doctrine of Equivalents?

Dawn Equipment Co. v. Kentucky Farms, Inc.21

Although Warner-Jenkinson contributed to the legal certainty in affirming the judicially created doctrine of equivalents under the current patent statute and endorsing the related case law developed by the Federal Circuit, it also left many questions unanswered and even poses new questions. One of such questions relates to the relationship between Section 112, Paragraph 6 equivalents and the judicially created doctrine of equivalents. In Dawn Equipment, the jury found no literal infringement but upheld infringement under the doctrine of equivalents with respect to a means-plus-function limitation. This triggered a debate whether a court should apply two different kinds of equivalents in analyzing infringement on a claim with means-plus-function limitations.

Interestingly, in Down Equipment, the opinion for the court written by Judge Plager is relatively simple by reversing the district court's denial of motion for judgment as a matter of law. The Federal Circuit found that the accused product could not solve the problem the patented mechanism tried to solve. The specification stressed that the structure corresponding to the disputed means-plus-function limitations served to solve the problems with conventional mechanisms, but it was time-consuming to adjust the mechanism and easy to make mistakes in adjustment. Additionally, the loose pins of the mechanism were easy to lose. Because the accused mechanism, which the patentee claimed to be equivalent, did not solve these problems, the court concluded that no reasonable jury would have found the structure and the accused mechanism equivalent.

In contrast to the relatively short discussions to dispose of infringement issues in this case, three judges separately wrote opinions to express their views on the two types of equivalents. Judge Plager believed that the tests for the two equivalents were quite similar and argued for eliminating the application of the judicially created doctrine of equivalents from infringement analysis of mean-plus-function limitations, in order to avoid a confusion to triers of fact. Judge Newman disagreed with Judge Plager because the distinction between the two types of equivalents had long been understood by patent practitioners. She argued that one could avoid the possible confusion to triers of fact by presenting more explicit verdicts. In turn, Judge Michel questioned whether means-plus-function limitations would deserve an additional protection by the judicially created doctrine of equivalents if one considered the Supreme Court's emphasis on notice function in Warner-Jenkinson. His opinion can be read to invite the patent community to present a case to challenge whether the judicially created doctrine of equivalents is applied with respect to means-plus-function limitations.

Comparatively, although both the EPO22 and JPO23 allow their applicants to use means-plus-function limitations, neither the European Patent Convention nor the Japanese Patent law includes a provision parallel to Section 112, Paragraph 6. In examining patentability, both the EPO and JPO do not discriminate means-plus-function limitations from structural limitations. In enforcement proceedings, some Japanese courts punished Japanese patentees for adopting ambiguous functional limitations by limiting the scope to cover only disclosed embodiments,24 while the Japanese Patent Office in principle did not allow applicants to adopt functional limitations.25 German courts usually interpret limitations by making reference to the corresponding structure in the specification to cover the structure (direct invention) and obvious equivalents; they follow the approach defined in Section 112, Paragraph 6, regardless of the claim format. The same approach has also been adopted by many Japanese courts in finding literal infringement through the substantial identity test. If Section 112, Paragraph 6 is interpreted to be consistent with the practice of other major countries, the statute simply affirms the applicability of the claim interpretation approach universal to other claim interpretation formats.

However, U.S. courts have been interpreting Section 112, Paragraph 6 as an exception to the claim interpretation approach applicable to other claim formats. Because of the difficulty in distinguishing the two types of equivalents, Judge Plager attempted to extend the exception by eliminating the application of the judicially created doctrine of equivalents only to means-plus-function claims. The difficulty the Federal Circuit encounters is reminiscent of the debates among German patent professionals and scholars with respect to the tests for obvious and nonobvious equivalents (glatte und nichtglatte Aquivalentz).26 In theory, German scholars may distinguish obvious equivalents (the ones examined by the Patent Office during the patent prosecution) from nonobvious equivalents (the ones examined by the court in infringement proceedings). However, German scholars in practice have not come up with an effective test to distinguish the two types of equivalents and have not yet agreed on how these equivalents are affected by the 1981 revision of the German Patent Law, which resulted from the change that was necessary to accommodate the provisions of EPC Article 69 and its protocol.27 The Federal Circuit may be able to learn from the number of proposals on tests for the two equivalents made by German scholars during the period of three-part theories.

Reinforcement of Judge's Power on Claim Interpretation

Cybor Corp. v. FAS Technologies28

Cybor relates to another important issue in determining the protection scope of U.S. patent claim construction. This issue was also recently reviewed by the Federal Circuit en banc (Markman I)29 and examined by the Supreme Court (Markman II).30 In Markman I, the Federal Circuit majority held that claim construction should be decided by the judge as a matter of law and therefore be reviewed de novo on appeal.31 However, three judges did not agree with the majority that claim construction was purely a question of law and was thus devoid of any factual questions.32 The Supreme Court in Markman II clarified the district court's power, but did not explicitly address the appellate court's power of review. These judges interpreted Markman II to endorse their views and applied a clearly erroneous standard with respect to district courts' findings of issues that are considered to be factual in nature. In contrast, judges supporting the majority opinion applied a de novo review, which resulted in a clear split. The Federal Circuit in Cybor held again en banc that the claim construction should be subject to a de novo review and thus resolved the conflict among its own panels.

In Cybor, FAS, the patentee, owned a patent to a device and method for accurately dispensing small volumes of industrial liquid onto semiconductor wafers. The patented invention was defined in claims using the means-plus-function format. Section 112, Paragraph 6 requires courts to interpret means-plus-function claims to include the structures disclosed in the patent and their equivalents that produce the same function as the structures. In defining the equivalents, courts must look at what was surrendered during the prosecution. Cybor, the accused infringer, manufactured a similar liquid dispenser and filed an action, requesting a declaratory judgment of no infringement. Cybor's device differed from the device disclosed in the specification in that it had a separate external reservoir for accumulating and dispensing fluid to the second pump. In contrast, the disclosed device did not have a separate reservoir, but the second pump alone accumulated and conveyed the fluid. Cybor relied on the patentee's statement during the prosecution to emphasize the separateness of a container in the prior art reference cited by the examiner and argued that the patentee was estopped from claiming any pump with an external reservoir as being equivalent under Section 112, Paragraph 6 as well as under the doctrine of equivalents. Cybor also read the claim term that required the fluid to flow from the first pump directly to the second pump without passing through any additional component to be similar to that of Cybor's external reservoir.

The district court simply instructed the jury to find whether the accused device was exactly the same as the device disclosed in the specification or its equivalent that functioned to produce the same result as the disclosed structure. The jury found for the patentee. The district court denied both Cybor's JMOL motion of non-infringement and FAS' motion for attorneys' fees. Before the final judgment was entered, the Federal Circuit decided its Markman I case. Cybor filed with the district court a motion for reconsideration of its denial of JMOL motion in light of Markman I. The district court again denied the motion and entered its final judgment.

On Cybor's appeal from the court's refusal to enter a JMOL, the Federal Circuit affirmed the district court's judgment. The court's discussion begins with the clarification of the Supreme Court's holding in Markman II with respect to its power to review claim construction. The majority supported the de novo standard adopted in Markman I and interpreted Markman II to endorse its own earlier decision that claim construction issues were purely legal. The standard also promoted the Federal Circuit's function, which was emphasized by the Supreme Court, in providing national uniformity to the patent claim construction.

The three judges who wrote concurring or dissenting opinions for Markman I believed that claim construction might include underpinning factual issues and thus the Federal Circuit should give deference to the district court's findings of such issues. They read Markman II differently to endorse their views, instead of the majority view. Using Fromson33 as an example, Chief Judge Mayer argued that the Federal Circuit should not disturb the district court's finding of factual issues, such as what claim term meant to one skilled in the art unless such findings were clearly erroneous.

Writing a separate concurring opinion, Judge Rader emphasized that Markman I resulted in a number of procedural deviations from the normal litigation, particularly in the use of expert testimony. According to Judge Rader, the majority's distinction, that the use of expert might be utilized to understand the meaning of a claim but not to interpret the claim, did not make sense. Because the risk of using experts to influence lay jurors was removed by letting the judge decide the meaning of a claim term, we should respect trial judges' expertise on factual findings in determining what claim term was meant to one skilled in the art. Judge Rader criticized that no deference to the district court's findings would convert claim interpretation to what was meant by lawyers or judges, instead of one skilled in the art. Judge Rader also pointed out that a high reversal rate resulting from the de novo standard would frustrate the majority's goal of early settlement by clarifying the meaning of the claim in an early stage of patent litigation. If losing parties had a good chance of reversal on appeal, they are reluctant to settle until the point when the Federal Circuit adopted its own claim interpretation. Finally, Judge Rader concluded that, if the same functional approach adopted by the Supreme Court in Markman II with respect to the roles of judges and jury applied to the roles of trial and appellate judges, the Federal Circuit should give proper deference to the trial courts where "the trial judges enjoy a potentially superior position to engage in claim interpretation," such as a case involving complex technology issues which required background tutorials from leading scientists and technical experts.

In another opinion, Judge Newman expressed her additional view that Markman I could not achieve its goal of enhancing consistency in infringement results as expected. She blamed the Federal Circuit's implementation of the de novo standard of the claim interpretation for such poor results, listing these three problem areas: (1) the Federal Circuit's reluctance to hear appeals on certified questions; (2) creative de novo claim interpretation adopted by the Federal Circuit; and (3) the Federal Circuit's refusal to be bound by even its prior interpretation. She also emphasized the value of extrinsic evidence and the trial judges' expertise to weight such evidence. She strongly objected to the majority view that limited judicial access to such evidence and findings based thereon.

The dilemma Federal Circuit judges encounter results from the different roles of courts between the above mentioned first and second instances. In civil law countries, both district and appellate courts have power to resolve legal and factual questions, functions provided uniquely to U.S. district courts. Thus, appellate courts in civil law countries are in a better position than the U.S. district courts to decide the issue in question. For example, under Japanese civil procedure, both district and high courts have the same tools to acquire and evaluate evidence. Both the Tokyo District and High Courts retain technical experts, Chosakan, for giving judges tutorials on technology in complex intellectual property disputes. District and appellate judges both develop expertise in weighing conflicting expert testimony introduced by the parties. As a result, there is no clear distinction between legal and factual issues, and there are no different standards associated with different types of issues. Appellate courts review all issues de novo.

In comparative law perspective, because no other countries uses the jury trial for resolving patent issues, Markman has contributed to the goal of harmonization by removing jury trials from claim interpretation. Cybor has also contributed to the same goal by clarifying that appellate courts should review claim interpretation by applying the de novo standard as done by other countries.

Federal Circuit Cannot Completely Avoid Adjudicating Antitrust Issues

Nobelpharma AB v. Implant Innovation34

This case is a very unusual one because on a motion for reconsideration the Federal Circuit withdrew its opinion published last November and substituted with its prior opinion, which indicated an exactly opposite view from its previous opinion. This case did not attract U.S. patent experts' interests as much as the above cases involving claim interpretation and the doctrine of equivalents. However, the practical significance of this case for non-U.S. patent attorneys is greater than the aforementioned cases, because poor handling of a U.S. patent application by a foreign patent agent will not only forfeit the enforceability of patent but also result in an antitrust liability.

In Nobelpharma, the patent at issue was directed to "an element used for dental implants" and granted on a patent application, claiming the priority based on a Swedish application. The claim and specification described the elements to be made preferably of titanium with particularly sized and spaced "micropits." Well before the filing date of the Swedish application, one of two inventors of the patent, Dr. Branemark, published a book, disclosing a particular measurement of the micropits that fell within the range claimed in the disputed patent. In preparing to file a Swedish application, the other inventor provided their patent agent with a draft referring to the disclosure. The Swedish as well as U.S. patent applications prepared by the agent, however, did not refer to the disclosure. During the prosecution of an U.S. application, Dr. Branemark granted an exclusive license to the plaintiff who sued the defendant for patent infringement. The defendant argued that the patent was invalid for violating the best mode requirement and was unenforceable for the intentional omission of the early disclosure. Further, it brought an antitrust counterclaim, alleging that the plaintiff tried to enforce a patent that it knew was invalid and unenforceable.

The district court found that the patent was invalid for violating the best mode but declined to determine its enforceability. After granting the defendant's motion for JMOL of invalidity and non-infringement, the court allowed the defendant to present the counterclaim to the jury. The jury made the plaintiff liable for the counterclaim, finding that (1) the patent was obtained through fraud; (2) the plaintiff knew that the patent was obtained through fraud when this action was filed; and (3) knowing that the patent was either invalid or unenforceable, the plaintiff brought this action with the intent of interfering with the defendant's ability to compete in the relevant market. The court denied both motions filed by the plaintiff for JMOL and a new trial on the antitrust counterclaim. As a result, the court entered a final judgement, awarding $3.3 million damages to compensate the defendant.

The patent infringement plaintiff/antitrust counterclaim defendant appealed, challenging the district courts' grant of JMOL on the validity and infringement issue and its denial of the post-verdict JMOL on the antitrust counterclaim issue. The Federal Circuit, however, affirmed the district court's judgment with respect to both issues. In reviewing the antitrust counterclaim issue, the court first made clear that its own law applied in deciding whether conduct in the prosecution of a patent was sufficient to strip a patentee of its immunity from antitrust liability and repealed some of its own precedents in which the law of the appropriate regional circuit applied to this issue. The Federal Circuit then identified two separate lines of doctrines under which a patentee's bringing an infringement suit would give rise to antitrust liability: (1) enforcing a patent that was obtained through fraud (Walker Process enforcement)35 and (2) enforcing a patent that was a mere sham to cover an attempt to interfere with the business relationships of a competitor (Sham enforcement).36 These doctrines give alternative grounds to subject patentees to antitrust liability.

The Federal Circuit also distinguished the fraud involved in "inequitable conduct" from that of Walker Process enforcement, stating that the former was a lesser offense than the latter. However, it clarified that a conduct giving rise to fraud in the inequitable conduct sense could constitute a fraud within the meaning of Walker Process enforcement if the evidence was sufficient to show the patentee's clear intent to deceive the PTO and the PTO's reliance on such misrepresentation to grant an invalid patent. The evidence of this case was sufficient to establish the elements to subject the patentee to antitrust liability resulting from the Walker Process enforcement: (1) an intentional fraud to the PTO based on the inventor's failure to disclose the early disclosure; (2) the materiality of the omitted information, which led to the fact that the PTO would not have issued the patent but for the omission; and (3) the patentee's knowledge of the patent being obtained through fraud based on the testimony from the patentee's then officers. Thus, the Federal Circuit found no error in the district court's denial of the patentee's motion for JMOL. The patentee's challenge on the denial of its motion for a new trial was also unsuccessful because the Federal Circuit found that the jury instruction was not legally improper.

In sum, if a foreign agent or patentee innocently removed some information material to the patentability of the invention, without knowing the requirements and practice under U.S. patent law, this will not cause either inequitable conduct or antitrust liability.37 However, if a foreign agent or patentee is familiar with the U.S. patent law and practice and failed to disclose material information, courts may infer a deceptive intent from the omission and find the patent unenforceable for inequitable conduct.38 This leads to an ironic result that well-educated foreign patent owners are subjected to more risk of inequitable conduct than less sophisticated patent owners. Although less sophisticated foreign patent owners may escape the charge of inequitable conduct, if the material information was not part of the prosecution, their patents are vulnerable to validity challenges.

In the withdrawn opinion, the Federal Circuit distinguished omissions from affirmative misrepresentation and held that omissions could not give rise to Walker Process antitrust liability. In contrast, the new opinion indicates that the omission may give rise to a fraud in "Walker Process enforcement" antitrust liability if evidence is sufficient to clearly show two elements: (1) the patentee's intent to deceive the PTO and (2) the PTO's reliance on the patentee's act, including an omission and affirmative misrepresentation to issue an invalid patent. Although establishing these elements would be difficult, upholding an antitrust violation by an omission may work negatively for foreign patent owners. Like patent owners of this case, foreign patent owners may prepare a foreign patent application without paying attention to U.S. patent law requirements and prepare a U.S. application by simply translating the foreign application. Because the PTO does not examine the best mode requirements or inequitable conduct, the patent owner may obtain a patent without any office action. When they do not take the charge of inequitable conduct seriously and try to enforce it anyway, they cannot explain why they did not prepare a U.S. application to meet the U.S. patent law requirements. Because the jury who tends to disfavor foreign parties decides on the deceptive intent and reliance elements, they may discount or interpret the testimony from nervous foreign witnesses unfavorably. The result of antitrust liability is disastrous because Section 4 of the Clayton Act mandates courts to treble damages found by the jury. Thus, smart patent owners should learn from Nobelpharma that before engaging in patent litigation, they should prepare its original foreign patent application to meet the U.S. patent requirements from the beginning if they also plan to file a U.S. application. They should also retain a competent U.S. counsel and carefully investigate not only infringement but also the validity of their patents to avoid any possible ground for antitrust counterclaims.


1. 140 F.3d 1449; 46 U.S.P.Q.2d (Fed. Cir. 1998).
2. Warner-Jenkinson Co. v. Hilton Davis Chem. Co., 137 L.Ed.2d 146, 117 S.Ct. 1040, 41 U.S.P.Q.2d 1865 (U.S. 1997).
3. Litton Systems, Inc. v. Honeywell, Inc., 87 F.3d 1559, 39 U.S.P.Q.2d 1321 (Fed. Cir. 1996).
4. Pall Corp. v. Micron Separations, Inc., 66 F.3d 1121, 1219, 36 U.S.P.Q.2d 1225 (Fed. Cir. 1995).
5. Southwall Techs., Inc. v. Cardinal IG Co., 54 F.3d 1570, 1580, 34 U.S.P.Q.2d 1673, 1680 (Fed. Cir. 1995).
6. Texas Instruments, Inc. v. United States Int'l Trade Comm'm, 988 F.2d 1165, 1174-75, 26 U.S.P.Q.2d 1018, 1035 (Fed. Cir. 1993).
7. Sage Products, Inc. v. Devon Industries, Inc., 126 F.3d 1420, 44 U.S.P.Q.2d 1103 (Fed. Cir. 1997).
8. Judgment of Supreme Court of Japan, February 24, 1998. An English translation of this case is published in "Current Developments: Japan," CASRIP Newsletter, Winter 1998 (CASRIP, University of Washington School of Law, Seattle), and a translation of the judgment of the second instance, Tokyo High Court, is reported in 26 IIC 683 (1995).
9. Genentech, Inc. v. Sumitomo Seiyaku K.K., Judgment of Osaka High Court, March 29, 1996, Hanrei Jiho No. 1586, 117 (1996). An English translation with comments of the case is reported in Toshiko Takenaka, "New Policy in Interpre ting Japanese Patents," CASRIP Newsletter, Spring/Summer 1996 (CASRIP, University of Washington School of Law, Seattle).
10. Wilson Sporting Goods Co. v. David Geoffrey & Associates, 904 F.2d 677, 14 U.S.P.Q.2d 1942 (Fed. Cir. 1990), cert. denied, 111 S. Ct. 537 (1990).
11. Toshiko Takenaka, "Harmonizing the Japanese Patent System with its U.S. Counterpart through Judge-Made Law: Interaction between Japanese and U.S. Case Law Developments," University of Washington, Pacific Rim Law and Policy Jour nal (forthcoming 1998 Fall).
12. For a general discussion on the nature of the prosecution history estoppel, distinguished from the concept of "estoppel" as used in other legal contexts, see Donald S. Chisum, Chisum on Patents, ยง18.05[1] (1978 & Supp. 1998).
13. 140 3d 1470, 46 U.S.P.Q.2d 1285 (Fed. Cir. 1998).
14. Hughes Aircraft Co. v. United States, 717 F.2d, 1351, 1366, 219 U.S.P.Q. 473, 484 (Fed. Cir. 1983).
15. The relevant limitation of claim 1 of the Hughes' patent reads:
(e) means disposed on said body for providing an indication to a location external to said body of the instantaneous spin angle position of said body about said axis and the orientation of said axis with reference to a fixed external coordinate system;(f) and means disposed on said body for receiving from said location control signals synchronized with said indication; (g) said valve being coupled to said last-named means and responsive to said control signals for applying fluid to said fluid expulsion means in synchronism therewith for processing said body to orient said axis into a predetermined desired relationship with said fixed external coordinate system (emphasis added by the court).
16. 141 F.3d 1084, 46 U.S.P.Q.2d 1257 (Fed. Cir. 1998).
17. Reebock Int'l Ltd. v. J. Baker, Inc., 32 F.3d 1552, 1555, 31 U.S.P.Q.2d 1781, 1783 (Fed. Cir. 1994).
18. Minnesota Mining & Manufacturing Co. v. Johnson & Johnson Orthopaedics, Inc., 976 F.2d 1559, 24 U.S.P.Q.2d 1321 (Fed. Cir. 1992).
19. Toshiko Takenaka, Interpreting Patent Claims: The United States, Germany and Japan, 169 (Germany), 202 (Japan), 17 IIC Studies (1995).
20. Judgment of Supreme Court of Japan, February 24, 1998. For a translation with comments of the judgement, see Toshiko Takenaka, "Current Developments: Japan," CASRIP Newsletter, Winter 1998 (CASRIP, University of Washington Scho ol of Law, Seattle).
21. 140 F.3d 1009, 46 U.S.P.Q.2d 1109 (Fed. Cir. 1998).
22. Singer, The European Patent Convention, 362 (1995); T 68/85, OJ EPO 1987, 228.
23. Japanese Patent Office's Examination Standard Office, Kaisetsu: Heisei 6 nen Kaisei Tokkyoho no Unnyou (Practices in Examination and Appeals under 1994-Revised Patent Law in Japan) 132 (1995).
24. Katsura Yoshimine, Tokkyo Jitsuyo Shin-an Shinsa Kijun no Kaisetsu (Patent and Utility Model, Explanations of the Examination Standard) 18 (1986).
25. Tokyo Seimitsu K.K. v. N.T. Toyo Bearing K.K., 381 Hanrei Taimuzu 165, Kaneko Someno Kogyo Shoyuken Ho 2535-5-495-368 (Tokyo Dist. Ct. July 22, 1977). For a general discussion of this case, see supra note 16, Takenaka, Interpreting Patent Claims, 223 (1995).
26. Georg Benkard, Patentgesetz, 516-518 (8 ed. 1988).
27. Kurt von Falck, "Die Aequivalentzlehre im neuen Patentrecht" ("The Doctrine of Equivalents under the New Patent Law"), 1988 GRUR 1(1988); Karl Bruchhausen, Ulrich Krieger, and Albert Preu, "Diskussionsbeitraege zum Vortrag: Die Aequivalenzlehre im neuen Patentrechts von Rechtsanwalt Dr. von Falck" ("Discussion Exercise: The Doctrine of Equivalents under the New Patent Law by Lawyer Dr. von Falck), 1988 GRUR 8 (1988).
28. 138 F.3d 1448 46 U.S.P.Q.2d 1169 (Fed. Cir. 1998).
29. Markman v. Westview Instruments, 52 F.3d 967, 34 U.S.P.Q.2d (BNA) 1321 (Fed. Cir. 1995).
30. Markman v. Westview Instruments, 116 S.Ct. 1384 (1996).
31. Markman v. Westview Instruments, 52 F.3d at 979.
32. Markman , 52 F.3d 967, 991(Mayer, J., Concurring).
33. Fromson v. Anitec Printing Plates, 132 F.3d 1437, 45 U.S.P.Q.2d 1269, 4 (Fed. Cir. 1997).
34. 141 F.3d 1059 46 U.S.P.Q.2d 1097 (Fed. Cir. 1998).
35. Walker Process Equipment, Inc. v. Food Machinery & Chemical Corp., 382 U.S. 172, 15 L.Ed.2d 247, 86 S.Ct. 347, 147 U.S.P.Q. 404 (1965).
36. Professional Real Estate Investors v. Columbia Pictures Indus., 508 U.S. 49, 123 L.Ed.2d 611, 113 S.Ct. 1920, 26 U.S.P.Q.2d 1641 (1993).
37. In re Harita, 847 F.2d 801, 6 U.S.P.Q.2d 1930 (Fed. Cir. 1988).
38.Molins PLC v. Textron, 48 F.3d 1172, 33 U.S.P.Q.2d (BNA) 1823 (Fed. Cir. 1995).

Toshiko Takenaka

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