Chapter 10: Patent Protection of Software:
Infringement Issues (Continued)


B. Claim Construction Issues




Markman v. Westview Instruments, Inc.
52 F.3d 967 (Fed. Cir. 1995)(en banc), aff'd, 517 U.S. 370 (1996)
United States Court of Appeals for the Federal Circuit

Opinion for the Court filed by Chief Judge Archer, in which Circuit Judges Rich, Nies, Mayer, Michel, Plager, Lourie, Clevenger, Rader, and Schall join. Dissenting opinion filed by Circuit Judge Newman.

Herbert Markman and Positek, Inc. (collectively referred to as Markman) appeal from the judgment of the United States District Court that Westview Instruments, Inc. and Althon Enterprises, Inc. (collectively referred to as Westview) did not infringe claims 1 or 10 of United States Reissue Patent No. 33,054, notwithstanding the jury's verdict to the contrary. We have ordered that this case be reheard in banc. We affirm the judgment of noninfringement.

In doing so, we conclude that the interpretation and construction of patent claims, which define the scope of the patentee's rights under the patent, is a matter of law exclusively for the court. Thus, in this case the district court properly discharged its obligation to delineate the scope of the claim on motion for judgment as a matter of law when the jury had rendered a verdict that was incompatible with a proper claim construction.

Factual Background

A. In the dry–cleaning industry, articles of clothing typically are taken in from customers, recorded in some form, and then sorted according to criteria such as type of clothing and type of cleaning required. During the sorting process, articles of clothing belonging to one customer may be combined together, and also may be combined with similar clothing belonging to other customers, in order to make the cleaning process more efficient and less costly. After the articles of clothing are sorted, they may be cleaned in the same establishment or transported to another establishment for cleaning. During the cleaning process, the articles of clothing move through different locations in the establishment. After cleaning, of course, the articles of clothing must be unsorted and returned to the respective customers.

Markman is the inventor named in and the owner of United States Reissue Patent No. 33,054 (the '054 patent), titled "Inventory Control and Reporting System for Dry–cleaning Stores." Positek is a licensee under the patent in the dry–cleaning business.

The '054 patent is directed to an inventory-control system that assertedly solves inventory-related problems prevalent in the dry-cleaning business. As the patent specification discusses, articles of clothing can be lost in the sorting and cleaning process, and it has been found in the dry-cleaning business that even a small percentage-loss of articles of clothing will generate great consumer dissatisfaction. Also, attendant personnel might send clothing through the cleaning process but pocket the proceeds of the transactions and destroy or fail to do the appropriate paperwork, thereby servicing the customers adequately but stealing from the business. In such circumstances it is difficult for the business owner to locate the loss of profits and to deter such activities.

The invention of the '054 patent is described in detail in the specification which states that the inventory control system is "capable of monitoring and reporting upon the status, location and throughput of inventory in an establishment," and that by using the invention of the '054 patent, "the progress of articles through the laundry and dry-cleaning system can be completely monitored." In this way, the business owner can "reconcile the inventory at any point in the sequence" of sorting, cleaning, and unsorting clothing, and can "detect and localize spurious additions to inventory as well as spurious deletions therefrom."

According to the specification's description of the invention, as customers bring in their articles of clothing for cleaning, the articles are accumulated by an attendant. The attendant enters information on a keyboard identifying at least the particular customer, the type of articles being deposited, and the particular cleaning operations to be performed. Other information may be entered depending upon the complexity of the system.

A data processor stores and processes the data entered by the attendant, associating sequential customers and transactions with a unique indicium such as a number. The processor is connected to a printer that generates a written record of the stored information associated with the particular customers and transactions. No transaction can proceed without generating a written record, thereby ensuring that each transaction is accounted for.

The patent specification specifies that the written record is to have different portions. For example, the written record includes a customer ticket or receipt, a management ticket copy, and a plurality of article tags. The article tags are to be attached to individual articles or groups of articles in inventory. The management ticket and the article tags contain a bar code and a unique indicium such as a number associated with a customer, transaction, and other information. The bar code records are custom printed sequentially, as sequential customer transactions occur. The tags thus not only associate a bar code with transactions, but also with an article or group of articles, persons, physical items in inventory, and other information again depending upon the system's complexity.

Optical detector devices are then used to read the bar code indicia, and they may be located at various points in the cleaning process, including at least at the customer service station. The articles are logged through a particular station by scanning the tags containing the bar codes with the detector. The bar codes are used to call up information associated with the customer or transaction, and used to generate reports containing information such as the location of articles within the system, the number of articles located at a particular point in the system, etc. Obviously, the more optical detectors, the tighter the inventory control. After the articles have been processed, optical detection of the bar codes can be used to reorganize the articles into customer packages. The overall result is that additions to and deletions from inventory can be located—wherever an optical detector appears—and can be associated with particular customers and articles of clothing. In this way the inventory can be fully reconciled.

In claim 1, the only independent claim involved in this appeal, Markman claims his invention to be (emphasis added):

1. The inventory control and reporting system, comprising:

a data input device for manual operation by an attendant, the input device having switch means operable to encode information relating to sequential transactions, each of the transactions having articles associated therewith, said information including transaction identity and descriptions of each of said articles associated with the transactions;

a data processor including memory operable to record said information and means to maintain an inventory total, said data processor having means to associate sequential transactions with unique sequential indicia and to generate at least one report of said total and said transactions, the unique sequential indicia and the descriptions of articles in the sequential transactions being reconcilable against one another;

a dot matrix printer operable under control of the data processor to generate a written record of the indicia associated with sequential transactions, the written record including optically-detectable bar codes having a series of contrasting spaced bands, the bar codes being printed only in coincidence with each said transaction and at least part of the written record bearing a portion to be attached to said articles; and

at least one optical scanner connected to the data processor and operable to detect said bar codes on all articles passing a predetermined station,

whereby said system can detect and localize spurious additions to inventory as well as spurious deletions therefrom.

In dependent claim 10, Markman specifies that in the invention of claim 1, the input device is an alphanumeric keyboard wherein single keys may be used to enter attributes of items being entered.

B. Markman sued Westview and Althon for infringement of claims 1, 10, and 14 of the patent. Westview makes and sells specialty electronic devices, including the system accused of being an infringement of the patent. Althon owns and operates two dry–cleaning sites and uses Westview's device in one of its shops.

The accused Westview device consists of two separate pieces of equipment, which Westview calls the DataMark and the DataScan. The DataMark is a stationary unit comprising a keyboard, electronic display, processor, and printer. When a customer brings articles of clothing in for cleaning, an attendant enters on a keypad information about the customer, articles to be cleaned, and charges for the cleaning. The DataMark then prints a barcoded ticket or invoice listing the information about the customer, the clothes to be cleaned, and the charges for the cleaning. The DataMark retains permanently in memory only the invoice number, date, and cash total. The DataMark is thus used to print barcoded tickets for the articles and to retain an invoice list.

The DataScan is a portable unit comprising a microprocessor and an optical detector for reading barcoded tickets or invoices at any location in the dry–cleaning establishment. To use the DataScan, first the invoice list is transferred from the DataMark to the DataScan. Then, the DataScan is carried about to read the barcodes on tickets or invoices in the establishment. As it does this, it can report any discrepancy between the particular invoice read (or not read) and the invoice list. In this way the DataScan identifies extra or missing invoices.

C. At a jury trial on the issue of infringement, Markman presented the testimony of four witnesses: (1) an expert on barcode technology who testified about the manner in which Westview's device operates, (2) Markman, the inventor, who testified about his patent and its claims, (3) a "patent expert"—that is, a practicing patent lawyer—who testified in his capacity as a patent lawyer about the meaning of the claim language and how the claims allegedly read on the accused system, (4) an accountant who testified as to the number of allegedly infringing systems sold. Also included in evidence were the actual Westview device and its operating manuals, brochures, and computer program. At the conclusion of Markman's case in chief, Westview moved for a directed verdict. The district court deferred ruling on the motion. Westview then presented the testimony of a single witness, its president, who demonstrated the operation of the Westview device and testified about its capabilities. The jury returned answers to general interrogatories finding that Westview infringed independent claim 1 and dependent claim 10 but did not infringe independent claim 14.

The district court then heard argument on and granted Westview's deferred motion for judgment as a matter of law (JMOL). Stating that claim construction was a matter of law for the court, the district court provided its construction of the claims. The court held that "inventory" as used in the claims meant "articles of clothing" and not simply transaction totals or dollars. Under the district court's construction, the claims require that the system be able to track articles of clothing through the dry–cleaning process, detect and localize missing and additional articles of clothing, and generate reports about the status and location of the articles of clothing. It is undisputed that Westview's system is incapable of doing this because it does not retain information regarding the particular articles of clothing, but rather only a listing of the invoices and the cash total of the inventory. Among other things, the court concluded that Westview's device does not have the "means to maintain an inventory total" required by claim 1, and cannot "detect and localize spurious additions to inventory as well as spurious deletions therefrom," and directed a verdict of noninfringement of claims 1 and 10.

Issues

Markman appealed from the district court's grant of JMOL of noninfringement of claims 1 and 10. In this court, Markman's principal argument is that the district court erred in granting the JMOL. Markman contends that the jury was properly given the question of claim construction and that the jury's claim construction and verdict thereon is supported by substantial evidence. The evidence Markman points to in support of the jury verdict is not the language of the patent specification or prosecution history, but rather Markman's own testimony as inventor and the testimony of his patent expert. He also relies on use of the word "inventory" in Westview's product literature and on the testimony of its president. Markman's position essentially is that all the evidence of the meaning of the word "inventory," from the patent, prosecution history, experts, and documents, was properly lumped together and submitted to the jury for it to resolve what in fact is the meaning of "inventory," and that the result of this process is entitled to highly deferential review both by the trial court on motion for JMOL and by this court on appeal from the grant or denial of JMOL.

Markman further argues that the district court misconstrued the term "inventory" to mean "articles of clothing" in addition to "cash" or "invoice totals" in order to find that claim 1 defines a system that "tracks" articles of clothing through the dry–cleaning process. Markman says that based on all the evidence presented at trial the term "inventory" as used in claim 1 means "articles of clothing" or "dollars" or "cash" or "invoices," and is not necessarily limited to a construction that always includes "articles of clothing."

Westview on the other hand focuses almost exclusively on the patent and prosecution history to inform the meaning of "inventory." It argues that the patent and prosecution history are in conflict with the testimony and other evidence relied on by Markman and therefore Markman's evidence should be disregarded by the court in favor of the meaning revealed by the patent. This task of assigning the meaning to "inventory," and the meaning assigned are, in the view of Westview, all legal matters for the court and subject to de novo review.

It is undisputed that when the claim term "inventory" is construed to mean "the physical articles of clothing" or to require "articles of clothing" as part of its meaning, the Westview system lacks "means to maintain an inventory total" and does not and cannot "detect and localize spurious additions to inventory as well as spurious deletions therefrom," as claim 1 would thus require. Markman's appeal therefore turns on:

(1) whether the district court acted properly by construing the term "inventory" as a matter of law notwithstanding a contrary construction given the term by some of Markman's witnesses and by the jury, and

(2) regardless of whether the court or the jury determines the scope of the claims, whether the term "inventory" requires as part of its meaning "articles of clothing."

An infringement analysis entails two steps. The first step is determining the meaning and scope of the patent claims asserted to be infringed. The second step is comparing the properly construed claims to the device accused of infringing. It is the first step, commonly known as claim construction or interpretation, that is at issue in this appeal.

Jury Trial

The opinions of this court have contained some inconsistent statements as to whether and to what extent claim construction is a legal or factual issue, or a mixed issue. At its inception, the Federal Circuit held that claim construction was a matter of law. Nevertheless, a significant line of cases has developed in our precedent stating (although rarely holding) that there may be jury triable fact issues in claim construction. On the other hand, a second line of Federal Circuit opinions has continued to follow the earlier pronouncements that claim construction is strictly a question of law for the court. Notwithstanding the apparent inconsistencies in our opinions, the Supreme Court has repeatedly held that the construction of a patent claim is a matter of law exclusively for the court.

The reason that the courts construe patent claims as a matter of law and should not give such task to the jury as a factual matter is straightforward: It has long been and continues to be a fundamental principle of American law that "the construction of a written evidence is exclusively with the court." The patent is a fully integrated written instrument. There is much wisdom to the rule that the construction of a patent should be a legal matter for a court. A patent is a government grant of rights to the patentee. By this grant, the patentee owns the rights for a limited time to exclude others from making, using, or selling the invention as claimed. Infringement of the patentee's right to exclude carries with it the potential for serious consequences: The infringer may be enjoined and required to pay increased damages, costs and attorney fees. When a court construes the claims of the patent, the court is defining the federal legal rights created by the patent document.

Further, it is only fair (and statutorily required) that competitors be able to ascertain to a reasonable degree the scope of the patentee's right to exclude. They may understand what is the scope of the patent owner's rights by obtaining the patent and prosecution history—"the undisputed public record"—and applying established rules of construction to the language of the patent claim in the context of the patent. Moreover, competitors should be able to rest assured, if infringement litigation occurs, that a judge, trained in the law, will similarly analyze the text of the patent and its associated public record and apply the established rules of construction, and in that way arrive at the true and consistent scope of the patent owner's rights to be given legal effect.

We therefore settle inconsistencies in our precedent and hold that in a case tried to a jury, the court has the power and obligation to construe as a matter of law the meaning of language used in the patent claim. Because claim construction is a matter of law, the construction given the claims is reviewed de novo on appeal. Accordingly, Markman's principal argument that the district court erred in taking the issue of claim construction away from the jury is itself legally erroneous.

Claim Construction

Markman argues that the jury's implied construction of the claims is correct and that the district court's construction of the claims is wrong, thereby necessitating that this court reinstate the jury's verdict. Markman contends that the jury properly considered all the evidence of record on the disputed claim term "inventory" in reaching its implicit conclusion that the term does not require articles of clothing. We find that these arguments are not convincing and we reach a conclusion that is in accord with the district court's construction of the claims.

To ascertain the meaning of claims, we consider three sources: the claims, the specification, and the prosecution history. Expert testimony, including evidence of how those skilled in the art would interpret the claims, may also be used. In construing the claims in this case, all these sources, as well as extrinsic evidence in the form of Westview's sales literature, were included in the record of the trial court proceedings.

Claims must be read in view of the specification, of which they are a part. The specification contains a written description of the invention that must enable one of ordinary skill in the art to make and use the invention. For claim construction purposes, the description may act as a sort of dictionary, which explains the invention and may define terms used in the claims. As we have often stated, a patentee is free to be his own lexicographer. The caveat is that any special definition given to a word must be clearly defined in the specification. The written description part of the specification itself does not delimit the right to exclude. That is the function and purpose of claims.

To construe claim language, the court should also consider the patent's prosecution history, if it is in evidence. This "undisputed public record" of proceedings in the PTO is of primary significance in understanding the claims. The court has broad power to look as a matter of law to the prosecution history of the patent in order to ascertain the true meaning of language used in the patent claims. Although the prosecution history can and should be used to understand the language used in the claims, it too cannot "enlarge, diminish, or vary" the limitations in the claims.

Extrinsic evidence consists of all evidence external to the patent and prosecution history, including expert and inventor testimony, dictionaries, and learned treatises. This evidence may be helpful to explain scientific principles, the meaning of technical terms, and terms of art that appear in the patent and prosecution history. Extrinsic evidence may demonstrate the state of the prior art at the time of the invention. It is useful "to show what was then old, to distinguish what was new, and to aid the court in the construction of the patent."

The court may, in its discretion, receive extrinsic evidence in order "to aid the court in coming to a correct conclusion" as to the "true meaning of the language employed" in the patent. Extrinsic evidence is to be used for the court's understanding of the patent, not for the purpose of varying or contradicting the terms of the claims. When, after considering the extrinsic evidence, the court finally arrives at an understanding of the language as used in the patent and prosecution history, the court must then pronounce as a matter of law the meaning of that language. This ordinarily can be accomplished by the court in framing its charge to the jury, but may also be done in the context of dispositive motions such as those seeking judgment as a matter of law.

Applying this analysis of claim construction, we conclude that (1) the trial court did not abuse its discretion when it admitted the extrinsic evidence offered by Markman—Markman's testimony and the testimony of Markman's "patent expert"—on the issue of claim construction, and that (2) the trial court properly rejected this extrinsic evidence to the extent it contradicted the court's construction of the claims based on the specification and prosecution history. Although in this case the trial court might have granted Westview's motion for directed verdict and should have instructed the jury as to the meaning of the claims (including the disputed term "inventory"), its failure to do so was rendered harmless by the court's subsequent response to Westview's post-trial motion.

We agree with the trial court that the term "inventory" refers, at least in part, to articles of clothing, contrary to Markman's contention that "inventory" may be limited to just cash or inventory receipts. As the district court noted, the claim phrase "detect and localize spurious additions to inventory as well as spurious deletions therefrom" does not make sense using Markman's definition of "inventory." Dollars or invoice totals are not "localized" since dollars do not travel through the cleaning process and the location of invoices is irrelevant. Location is relevant to clothing, since it moves through and sometimes without the establishment, where it can be lost, stolen, or damaged. Also, "spurious" additions and deletions logically relate to clothing because "dollars" would not be spuriously added to a dry–cleaner's inventory. Thus, the language of the claim itself suggests the conclusion that the dry-cleaner's "inventory" includes clothing.

The patent specification confirms this. The specification is pervasive in using the term "inventory" to consist of "articles of clothing." Rather than set forth each instance, we refer the reader to a few examples:

This invention relates to inventory control devices capable of monitoring and reporting upon the status, location and throughput of inventory in an establishment.

The best inventory control and management reporting information systems have the ability to determine and report the current location of any given article in inventory.

Every transaction is recorded, including identification of the articles placed in inventory.

Incoming articles to be placed in inventory are accumulated over a counter.

The prosecution history is also in accord. During prosecution of the original patent application in this case, Markman amended claim 1 in order to overcome an obviousness rejection by adding limitations reciting among other things "whereby said system can detect and localize spurious additions to inventory as well as spurious deletions therefrom." Markman argued in his remarks to the examiner that

unlike the usual system in which apparatus generates non-unique indicia (e.g., Stewart's price indicia) and/or indicia that are not produced concurrently with the commencement of a transaction (e.g., pre-printed tags), applicant's system is operable to keep a running reconcilable inventory total by adding input articles and subtracting output articles, and also protects against the possibility of undocumented or spuriously-documented articles entering the system.

It is evident from Markman's explanation of the claims to the examiner that he used "inventory" in the patent and the examiner understood "inventory" to consist of "articles of clothing." The prosecution history thus confirms the meaning of "inventory" as including "articles of clothing."

Markman argues that the extrinsic evidence of record provides substantial evidence in support of the jury's and his claim construction. Markman testified as an inventor of the patent in suit and as one of ordinary skill in the art (or, perhaps more accurately, one of "extraordinary" skill in the art) that "inventory" did not need to include articles of clothing. Markman's "patent expert" testified likewise, when giving his opinion on the proper construction of the claims. Finally, Markman argues that the testimony of Westview's president and some of its sales literature also support such claim construction. We do not find Markman's arguments persuasive.

First, the testimony of Markman and his patent attorney on the proper construction of the claims is entitled to no deference. For example, they both testified as to how the patent should be construed based on the text of the patent. This testimony about construction, however, amounts to no more than legal opinion—it is precisely the process of construction that the court must undertake. Thus, as to these types of opinions, the court has complete discretion to adopt the expert legal opinion as its own, to find guidance from it, or to ignore it entirely, or even to exclude it. When legal "experts" offer their conflicting views of how the patent should be construed, or where the legal expert's view of how the patent should be construed conflicts with the patent document itself, such conflict does not create a question of fact nor can the expert opinion bind the court or relieve the court of its obligation to construe the claims according to the tenor of the patent. This opinion testimony also does not change or affect the de novo appellate review standard for ascertaining the meaning of the claim language. Thus, to the extent they were testifying about construction itself, we reject Markman's and Markman's patent expert's testimony as having any controlling effect on what the court below and we perceive to be the meaning of "inventory" as used in the patent and prosecution history.

Second, the extrinsic evidence of record cannot be relied on to change the meaning of the claims. In this case, as fully discussed above, the patent and prosecution history make clear that "inventory" in claim 1 includes in its meaning "articles of clothing." The district court exercised its discretion in finding unhelpful Markman's testimony that he meant "inventory," or that one of ordinary skill in the art would understand "inventory," to mean something to the contrary, and furthermore the district court rejected the testimony as conflicting with the meaning derived from the patent and prosecution history. In our construction of the claim term "inventory," we too find unhelpful and reject Markman's testimony. Similarly, even if they in fact used "inventory" to mean other than articles of clothing, Westview's sales literature and the testimony of its president do not dissuade us from our legal construction of the claim, based on the patent and prosecution history, that the claim term "inventory" means articles of clothing.

Seventh Amendment

This decision that claim construction is properly viewed solely as a question of law is consistent with precedent of the Supreme Court and much of this court's precedent. Yet the dissenting and one of the concurring opinions assert that our decision violates the Seventh Amendment. A close analysis of their arguments reveals, however, that they are unsupported by logic and precedent.

The Seventh Amendment provides: "In suits at common law, where the value in controversy shall exceed twenty dollars, the right of trial by jury shall be preserved." Thus, if an action could be tried to a jury in 1791, the right to a jury trial is preserved. The Seventh Amendment has also been judicially interpreted as extending the right to jury trial to statutory causes of action analogous to common law actions.

The dissenting and one of the concurring opinions express in somewhat different ways why they believe our holding deprives plaintiffs of the constitutional right to a jury trial in patent infringement cases. These arguments do not ring true. In this opinion we do not deprive parties of their right to a jury trial in patent infringement cases. Our opinion merely holds that part of the infringement inquiry, construing and determining the scope of the claims in a patent, is strictly a legal question for the court. The patentee's right to a jury trial on the application of the properly construed claim to the accused device is preserved as it was in 1791.

Any constitutional concerns raised by this opinion must be limited to the issue of claim construction. The dissenting and one of the concurring opinions attempt to make the case that construing claims is analogous to construing and interpreting contracts, deeds, and wills. Traditionally courts have treated the construction of these documents as being a legal question for the court, but have stated that under certain circumstances the interpretation of an agreement may raise jury triable questions. Thus, by analogy, the argument is made that although claim construction may indeed be a question of law for the court, it also involves triable issues of fact.

The analogy of a patent to a contract is not useful, however, in the context of a patent infringement suit. Patents are not contracts per se and patent infringement actions have never been viewed as breach of contract actions. Patent infringement has often been described as a tort. In a patent infringement suit, the inventor sues a competitor for infringing upon his right to exclude. The competitor is never a party to the so-called "contract" between the government and the inventor. Nor does the competitor ever breach this contract between the government and the inventor by making, using, or selling the accused devices.

Questions of fact may arise in construing contracts, deeds, or wills in two contexts. First, the document may not reflect the agreement between, or the intent of, the two parties. Thus, unless the document is fully integrated and the parol evidence rule (or its equivalent in the other areas of law) applies, extrinsic evidence may be offered to demonstrate different or additional terms. There is no parol evidence rule in patent law for obvious reasons. It is axiomatic that the invention protected by the patent must be covered by the claims, otherwise it is lost. Parol or other extrinsic evidence cannot add, subtract, or vary the limitations of the claims.

A question of fact may also arise in construing contracts, deeds, or wills when there is an ambiguous term. In this situation, the parol evidence rule does not apply and extrinsic evidence may be offered to demonstrate what the parties intended when they used the term. Thus the factual inquiry for the jury in these cases focuses on the subjective intent of the parties when they entered into the agreement.

No inquiry as to the subjective intent of the applicant or PTO is appropriate or even possible in the context of a patent infringement suit. The subjective intent of the inventor when he used a particular term is of little or no probative weight in determining the scope of a claim (except as documented in the prosecution history). In fact, commonly the claims are drafted by the inventor's patent solicitor and they may even be drafted by the patent examiner in an examiner's amendment (subject to the approval of the inventor's solicitor). While presumably the inventor has approved any changes to the claim scope that have occurred via amendment during the prosecution process, it is not unusual for there to be a significant difference between what an inventor thinks his patented invention is and what the ultimate scope of the claims is after allowance by the PTO. Of course the views of the other party to the "patent contract," the government, are generally not obtainable.

Thus the focus in construing disputed terms in claim language is not the subjective intent of the parties to the patent contract when they used a particular term. Rather the focus is on the objective test of what one of ordinary skill in the art at the time of the invention would have understood the term to mean.

This does not mean there is never a need for extrinsic evidence in a patent infringement suit. A judge is not usually a person conversant in the particular technical art involved and is not the hypothetical person skilled in the art to whom a patent is addressed. Extrinsic evidence, therefore, may be necessary to inform the court about the language in which the patent is written. But this evidence is not for the purpose of clarifying ambiguity in claim terminology. It is not ambiguity in the document that creates the need for extrinsic evidence but rather unfamiliarity of the court with the terminology of the art to which the patent is addressed.

The more appropriate analogy for interpreting patent claims is the statutory interpretation analogy. Statutory interpretation is a matter of law strictly for the court. There can be only one correct interpretation of a statute that applies to all persons. Statutes are written instruments that all persons are presumed to be aware of and are bound to follow. Statutes, like patents, are enforceable against the public, unlike private agreements between contracting parties. When interpreting statutes, a court looks to the language of the statute and construes it according to the traditional tools of statutory construction, including certain well known canons of construction. A court may also find it necessary to review the legislative history of the statute, which is itself a matter of public record, just as the specification and prosecution history of a patent are public records. While a court may seek from the public record to ascertain the collective intent of Congress when it interprets a statute, the subjective intent of any particular person involved in the legislative process is not determinative. Thus the members of Congress, or staffpersons who draft legislation, are not deposed or called on to testify in actions involving statutory interpretation. Similarly, the subjective meaning that a patentee may ascribe to claim language is also not determinative. Thus, it is from the public record that a court should seek in a patent infringement case to find the meaning of claim language.

There are, of course, differences between a statute and a patent. But because both of these public instruments may create liability in third persons who were not participants in the legislative process or the PTO proceedings, as the case may be, we conclude that the statutory interpretation model is a more accurate model than the contractual one for purposes of determining whether constitutional protections are transgressed by assigning claim construction exclusively to judges.

Conclusion

Correctly reasoning that claim construction is a matter of law for the court, the district court properly rejected the jury's verdict and granted JMOL. Upon our de novo review of the court's construction of the claim language, we agree that "inventory" in claim 1 includes within its meaning "articles of clothing." It is undisputed that Westview's device does not and cannot track articles of clothing. Accordingly, there is no substantial evidence to support the jury's finding of infringement of claims 1 and 10 of United States Reissue Patent No. 33,054 when those claims are correctly construed. The district court's grant of judgment of noninfringement as a matter of law is affirmed.



Markman v. Westview Instruments, Inc.
United States Supreme Court
517 U.S. 370 (1996), affirming 52 F.3d 967 (Fed. Cir. 1995)

Justice Souter delivered the opinion of the Court.

The question here is whether the interpretation of a patent claim, the portion of the patent document that defines the scope of the patentee's rights, is a matter of law reserved entirely for the court, or subject to a Seventh Amendment guarantee that a jury will determine the meaning of any disputed term of art about which expert testimony is offered. We hold that the construction of a patent, including terms of art within its claim, is exclusively within the province of the court.

I

It has long been understood that a patent must describe the exact scope of an invention and its manufacture to "secure to [the patentee] all to which he is entitled, [and] to apprise the public of what is still open to them." McClain v. Ortmayer, 141 U.S. 419, 424 (1891). Under the modern American system, these objectives are served by two distinct elements of a patent document. First, it contains a specification describing the invention "in such full, clear, concise, and exact terms as to enable any person skilled in the art ... to make and use the same." Second, a patent includes one or more "claims," which "particularly poin[t] out and distinctly clai[m] the subject matter which the applicant regards as his invention."

Characteristically, patent lawsuits charge what is known as infringement, and rest on allegations that the defendant "without authority ma[de], use[d] or [sold the] patented invention, within the United States during the term of the patent therefor...." 35 U.S.C. § 271(a). Victory in an infringement suit requires a finding that the patent claim "covers the alleged infringer's product or process," which in turn necessitates a determination of "what the words in the claim mean."

Petitioner in this infringement suit, Markman, owns United States Reissue Patent No. 33,054 for his "Inventory Control and Reporting System for Dry–cleaning Stores." The patent describes a system that can monitor and report the status, location, and movement of clothing in a dry–cleaning establishment. The Markman system consists of a keyboard and data processor to generate written records for each transaction, including a bar code readable by optical detectors operated by employees, who log the progress of clothing through the dry–cleaning process. Respondent Westview's product also includes a keyboard and processor, and it lists charges for the dry–cleaning services on barcoded tickets that can be read by portable optical detectors.

Markman brought an infringement suit against Westview and Althon Enterprises, an operator of dry–cleaning establishments using Westview's products. Westview responded that Markman's patent is not infringed by its system because the latter functions merely to record an inventory of receivables by tracking invoices and transaction totals, rather than to record and track an inventory of articles of clothing. Part of the dispute hinged upon the meaning of the word "inventory," a term found in Markman's independent claim 1, which states that Markman's product can "maintain an inventory total" and "detect and localize spurious additions to inventory." The case was tried before a jury, which heard, among others, a witness produced by Markman who testified about the meaning of the claim language.

After the jury compared the patent to Westview's device, it found an infringement of Markman's independent claim 1 and dependent claim 10. The district court nevertheless granted Westview's deferred JMOL motion. The Federal Circuit affirmed, holding the interpretation of claim terms to be the exclusive province of the court and the Seventh Amendment to be consistent with that conclusion. Markman sought our review on each point, and we granted certiorari. We now affirm.
. . .

Where history and precedent provide no clear answers, functional considerations also play their part in the choice between judge and jury to define terms of art. So it turns out here, for judges, not juries, are the better suited to find the acquired meaning of patent terms.

The construction of written instruments is one of those things that judges often do and are likely to do better than jurors unburdened by training in exegesis. Patent construction in particular is a special occupation, requiring, like all others, special training and practice. The judge, from his training and discipline, is more likely to give a proper interpretation to such instruments than a jury; and he is, therefore, more likely to be right, in performing such a duty, than a jury can be expected to be. Such was the understanding nearly a century and a half ago, and there is no reason to weigh the respective strengths of judge and jury differently in relation to the modern claim; quite the contrary, for the claims of patents have become highly technical in many respects as the result of special doctrines relating to the proper form and scope of claims that have been developed by the courts and the Patent Office.

Markman would trump these considerations with his argument that a jury should decide a question of meaning peculiar to a trade or profession simply because the question is a subject of testimony requiring credibility determinations, which are the jury's forte. It is, of course, true that credibility judgments have to be made about the experts who testify in patent cases, and in theory there could be a case in which a simple credibility judgment would suffice to choose between experts whose testimony was equally consistent with a patent's internal logic. But our own experience with document construction leaves us doubtful that trial courts will run into many cases like that. In the main, we expect, any credibility determinations will be subsumed within the necessarily sophisticated analysis of the whole document, required by the standard construction rule that a term can be defined only in a way that comports with the instrument as a whole. Thus, in these cases a jury's capabilities to evaluate demeanor are much less significant than a trained ability to evaluate the testimony in relation to the overall structure of the patent. The decisionmaker vested with the task of construing the patent is in the better position to ascertain whether an expert's proposed definition fully comports with the specification and claims and so will preserve the patent's internal coherence. We accordingly think there is sufficient reason to treat construction of terms of art like many other responsibilities that we cede to a judge in the normal course of trial, notwithstanding its evidentiary underpinnings.

Finally, we see the importance of uniformity in the treatment of a given patent as an independent reason to allocate all issues of construction to the court. As we noted in General Elec. Co. v. Wabash Appliance Corp., 304 U.S. 364, 369 (1938), "[t]he limits of a patent must be known for the protection of the patentee, the encouragement of the inventive genius of others and the assurance that the subject of the patent will be dedicated ultimately to the public." Otherwise, a "zone of uncertainty which enterprise and experimentation may enter only at the risk of infringement claims would discourage invention only a little less than unequivocal foreclosure of the field," United Carbon Co. v. Binney & Smith Co., 317 U.S. 228, 236 (1942), and "[t]he public [would] be deprived of rights supposed to belong to it, without being clearly told what it is that limits these rights." Merrill v. Yeomans, 94 U.S. 568, 573 (1877). It was just for the sake of such desirable uniformity that Congress created the Court of Appeals for the Federal Circuit as an exclusive appellate courts for patent cases, observing that increased uniformity would "strengthen the United States patent system in such a way as to foster technological growth and industrial innovation."

Uniformity would, however, be ill–served by submitting issues of document construction to juries.

Making them jury issues would not, to be sure, necessarily leave evidentiary questions of meaning wide open in every new court in which a patent might be litigated, for principles of issue preclusion would ordinarily foster uniformity. Cf. Blonder-Tongue Laboratories, Inc. v. University of Ill. Foundation, 402 U.S. 313 (1971). But whereas issue preclusion could not be asserted against new and independent infringement defendants even within a given jurisdiction, treating interpretive issues as purely legal will promote (though it will not guarantee) intrajurisdictional certainty through the application of stare decisis on those questions not yet subject to interjurisdictional uniformity under the authority of the single appeals court.

Accordingly, we hold that the interpretation of the word "inventory" in this case is an issue for the judge, not the jury, and affirm the decision of the Court of Appeals for the Federal Circuit.

Markman Notes

1. Markman introduces the issues of how claims should be interpreted and who should do the interpreting. The answer to the second question is now established. Claim construction (or, synonymously, interpretation) is a matter of law for judges, or perhaps at times a mixed issue of fact and law, for judges. In any event, claim construction gets de novo, very non–deferential review on appeal. Cybor Corp. v. FAS Technologies, Inc., 138 F.3d 1448 (Fed. Cir. 1998).

2. Pennwalt and Hilton Davis left most doctrine of equivalents issues to the jury to decide as a matter of fact, and accordingly the appellate review is deferential. Yet, Markman held claim construction a legal issue to be decided by the district court in the first instance, and then reviewed de novo on appeal. Did. these rulings work at cross–purposes? What did Festo do about this?

3. The Markman patent covered a sophisticated data processing system with memory for keeping track of clothing inventory and capable of monitoring and reporting on the location of such inventory. In contrast, as the district court characterized it:

Defendants sell a rudimentary invoice printer, like a cash register that produces a receipt, one copy of which is handed to the customer while the other copy is attached to batches of clothing.

a. In a sense, Markman presents the inverted image of Lockwood, in that Markman's patented system was to Westview's rudimentary device as American Airlines' Sabre reservation system was to Lockwood's automated vending machine. Why do you suppose Markman wanted to sue Westview?

b. The jury was willing to find Westview liable to Markman for selling this "rudimentary" device, but the district judge was not. Do you imagine that this difference in approach is a common phenomenon? Do you suppose that recognition of the prevalence of the phenomenon that juries like inventors was a factor in motivating the majority of the Federal Circuit and a unanimous Supreme Court to rule as they did?

4. Compare the Seventh Amendment analyses of the Federal Circuit and Supreme Court. How do they reach the same result by different routes?

5. The Federal Circuit's Markman opinion does not provide a road map for claim construction, although it sets out many guides. For an elaboration in flowchart detail, see Vitronics Corp. v. Conceptronic, Inc., 90 F.3d 1576 (Fed. Cir. 1996), decided three months after the Supreme Court's Markman opinion. In summary:

(1) Look to the words of the claims, both asserted and nonasserted claims.

(2) Review the specification, which "is always highly relevant." Claim words may be given a special lexicographical twist, but in that case the specification must somewhere clearly state the special meaning.

(3) Prosecution history may be consulted. It is "often of critical significance."

(4) The foregoing intrinsic evidence of public record in most situations "will resolve any ambiguity in a disputed claim term." If so, it is improper to rely on extrinsic evidence, such as expert testimony and inventor testimony. (However, it is usually permitted to look words up in a standard or technical dictionary or to consult a technical treatise, to gain an understanding of what the writer of the specification meant by the terminology used.)

In general, if extrinsic evidence is needed, because the intrinsic evidence is inconclusive, dictionaries and treatises are more worthy of note because they are usually unbiased and reliable. Evidence of the inventor's subjective intent is not to be considered at all. Prior art may also be considered as evidence of how a disputed term was used by those persons skilled in the art. Extrinsic evidence may not be used to contradict the intrinsic evidence.

6. The following excerpts from an October 2002 Federal Circuit opinion, Inverness Med. Switz. GmbH v. Princeton Biomeditech Corp., - F.3d - (Fed. Cir. 2002), provide a view of the current court's greater receptivity to some extrinsic evidence than Vitronics originally signalled:

The sole issue of claim construction here is the proper interpretation of the phrase "mobility of said labelled reagent within said test strip is facilitated by . . . " We begin claim construction analysis with the ordinary meaning of the disputed claim term. Vitronics. It is well settled that dictionaries provide evidence of a claim term's "ordinary meaning." Such dictionaries include dictionaries of the English language, which in most cases will provide the proper definitions and usages, and technical dictionaries, encyclopedias and treatises, which may be used for established specialized meanings in particular fields of art. The parties here do not argue that the term "mobility" has an established specialized meaning in technical dictionaries, encyclopedias, or treatises of the relevant field of art, and we agree that "mobility" has no such specialized meaning. Accordingly, standard dictionaries of the English language are the proper source of ordinary meaning of the phrase.

We may look, therefore, to the dictionary definition of the claim term "mobility" as of the date the patents issued. As with most words, the standard dictionaries offered multiple definitions. "[W]here there are several common meanings for a claim term, the patent disclosure serves to point away from the improper meanings and toward the proper meaning." Here, our examination of the available definitions and the specification suggest that there is only one relevant definition, namely "the quality or state of being mobile: the capacity or facility of movement: MOVABILITY." Webster's at 1450. The pertinent definitions of the word are fully consistent with the second portion of the definition provided for "mobility," namely "the capacity or facility of movement." The claim term "facilitate" means "to make easier or less difficult." Id. at 812. Accordingly, the ordinary meaning of the phrase "mobility . . . is facilitated" is properly interpreted as: the capacity to make movement easier.

However, the general rule that the ordinary meaning of an unambiguous claim term controls is subject to two limitations. First, "a patentee may choose to be his own lexicographer and use terms in a manner other than their ordinary meaning, as long as the special definition of the term is clearly stated in the patent specification . . . ." Vitronics. Second, "[e]ven where the ordinary meaning of the claim is clear, it is well established that '[t]he prosecution history limits the interpretation of claim terms so as to exclude any interpretation that was disclaimed during prosecution.'" Pall Corp. v. PTI Techs. Inc., 259 F.3d 1383, 1392, 59 USPQ2d 1763, 1769 (Fed. Cir. 2001). A broader definition may be disclaimed, for example, where the examiner adopts a narrow definition and the applicant does not object. See Elkay Mfg. Co. v. Ebco Mfg. Co., 192 F.3d 973, 979, 52 USPQ2d 1109, 1113-14 (Fed. Cir. 1999), cert. denied, 529 U.S. 1066 (2000) (holding that failure to respond to an examiner's reason for allowance functioned as a disavowal of a different interpretation of the claim).

7. Markman involved computer-utilizing technology, but the principles it set forth (and their elaboration in Vitronics) do not appear to have any special computer or software significance. However, applying these principles to computer–related inventions may have different results. Do you see any reasons why extrinsic evidence may more often be required in computer cases?



IMS Technology, Inc. v. Haas Automation, Inc.
United States Court of Appeals for the Federal Circuit
206 F.3d 1422 (Fed. Cir. 2000)

Before Mayer, Chief, Judge, Michel, and Plager
Plager, Circuit Judge.

IMS Technology, Inc. ("IMS") appeals from the decision of the United States District Court for the Eastern District of Virginia. The district court granted summary judgment of noninfringement of U.S. Patent No. 4,477,754 ("the '754 patent") against IMS and in favor of Haas Automation, Inc. and Gene Francis Haas (collectively "Haas"). IMS argues on appeal that the district court erred in its claim construction and in its infringement analysis. Haas cross-appeals the district court's construction of certain claim limitations. Because the district court erred in its claim construction and infringement analysis and because, under a proper claim construction, there remain genuine issues of material fact concerning infringement with respect to some of the accused devices, we affirm-in-part, vacate-in-part, and remand.

Background

IMS is the assignee of the '754 patent. The '754 patent, which contains both apparatus and method claims, originally issued on October 16, 1984. After discovering prior art during prosecution of Japanese patent applications corresponding to the '754 patent, Hurco initiated a reexamination proceeding before the United States Patent and Trademark Office ("PTO"). In the reexamination, claim 1, an apparatus claim, and claim 11, a method claim, both at issue in the instant case, were allowed without amendment. One limitation of claim 7, an apparatus claim also at issue in this case, was substantively amended. The PTO issued a reexamination certificate on March 21, 1995.

The '754 patent relates generally to a control for a machine tool, such as a milling machine, which is used to cut or remove material from an object, referred to as a workpiece, through a machining operation. The type of control at issue is a numerical control ("NC"), which runs a program containing a series of numerical instructions and converts the instructions to electrical control signals. These control signals are applied to, for example, servo motors that control the movement of the machine tool along x, y, and z axes. Typically, a table holding the workpiece moves in the x (left and right) and y (fore and aft) directions, and a spindle holding a tool moves in the z (up and down) direction.

Before invention of the control claimed in the '754 patent, a programmer created a control program using a standard part programming language such as EIA Standard RS-274-D, which comprises a series of standard codes commonly referred to as G-codes and M-codes. The programmer, usually not the operator of the machine tool, typically worked in a location remote from the machine tool. The programmer created a program by looking at a blueprint of the object to be machined, determining the series of machine tool operations (e.g., movements and cuts) required to make the object, and consulting a handbook of G- and M-codes corresponding to the operations. The completed code was reproduced on a punched paper tape. The machine tool operator fed the punch tape into the machine tool, which executed the program by converting the G- and M-codes into binary code, which was translated into electrical control signals. The coding process was cumbersome and time-consuming.

The invention claimed in the '754 patent permits interactive programming of the machine tool on the machine shop floor. The machine tool operator himself creates a program by using a keyboard to respond to nested inquiries displayed on a CRT screen. In general, the program contains data blocks, each of which corresponds to one operational step of the machine tool. When the machine tool operator selects an operation, the control system may prompt him for additional parameters to be included in the data block for that operational step. For example, if the operator selects a "mill" operation, the system will prompt him for the selection of dimensional parameters, e.g., the coordinates for the start and end positions of the operation.

While the operator is creating a program, the program is stored in alterable memory (e.g., random access memory ("RAM")). In the embodiment disclosed in the written description of the '754 patent, a program may be stored permanently on a tape cassette by means of a tape cassette transport included in the control. The written description of the '754 patent does not specify that programs are stored in any particular storage format. A program previously stored on a tape cassette can be read into alterable memory. A microprocessor executes the program by using the information in the data blocks to produce control signals for directing the operation of the machine tool.

Haas is a corporation which manufactures and sells machine tools with numerical controls. The accused Haas controls also provide interactive programming capability of machine tools on the machine shop floor. Some Haas controls have a floppy disk drive for storing programs. Others have only an RS-232 data port which can be connected to a storage device, such as a personal computer, for storing programs in ASCII format. Haas controls use programming systems known as Quickcode and Conversational Quickcode that assist the machine tool operator in creating a G- and M-code program. In Quickcode, the operator views a split screen. On the right side of the screen, the operator sees a group window that includes a compressed list of short descriptions of G-code operations. By rotating a jog handle clockwise, the operator navigates through the groups. When the operator finds the desired group, he turns the jog handle counterclockwise to see additional operations, called items. The operator selects an item, and the corresponding G-code appears on the left side of the window. The operator can then edit the G-code to change parameter values.

In Conversational Quickcode, the operator can program questions to solicit values corresponding to G-code. After the answers to such questions are placed in the G-code on the screen, the operator can edit the G-code as described above with respect to Quickcode.

The Haas controls store programs in G- and M-code format. During execution of programs, the Haas controls translate G-code into a binary format, which is converted into electrical signals delivered to the machine tool for directing its operation.

IMS filed suit against Haas alleging that Haas infringes at least apparatus claims 1 and 7 of the '754 patent and induces infringement and contributes to infringement of at least apparatus claims 1 and 7 and method claim 11 of the '754 patent. Those claims read as follows:

1. A programmable microcomputer control apparatus for controlling the relative motion between a tool and a workpiece comprising:

    indicator means for providing at an output digital signals indicative of the relative position between the tool and the workpiece;

    an alterable memory operable to retain a control program and control parameters;

    a microprocessor unit coupled to the output of the indicator means and to the memory and operable to produce control signals dependent upon said indicator means output and said control parameters according to said control program;

    control means for directing said control signals from the microprocessor unit to appropriate motion-providing means;

    interface means for transferring a control program and control parameters from an external medium into said alterable memory and for recording the control parameter contents of said memory onto an external medium;

    data entry means for loading control parameters into said memory through externally accessible data inputs independently of said interface means; and

    display means for displaying control parameters, said control program being operable to display control parameter inquiries on the display means, whereby an operator may load control parameters into said memory through said data entry means in response to the inquiries, said apparatus including means to sequentially display data block inquiries and to display, in response to the loading of certain control parameters into said memory relating to the data block inquiries, separate displays of additional control parameter inquiries relating to information used in the data block which was the subject of the previous inquiry, whereby the sequential display of inquiries and direct loading of control parameters as to an operation can be used to make the use of the device simpler and more responsive to the operator.


7. A programmable microcomputer control apparatus for controlling the relative motion between a tool and a workpiece comprising:

    indicator means for providing at an output digital signals indicative of the relative position between the tool and the workpiece;

    an alterable memory operable to retain a control program and control parameters;

    a processor unit coupled to the output of the indicator means and to the memory and operable to produce control signals dependent upon said indicator means output and said control parameters according to said control program, said control signals including programmed rate signals for controlling the rate of relative motion between the tool and the workpiece;

    control means for directing said control signals from the processor unit to appropriate motion-providing means;

    interface means for transferring a control program and control parameters from an external medium into said alterable memory and for recording the control parameter contents of said memory onto an external medium;

    data entry means for loading control parameters into said memory through externally accessible data inputs independently of said interface means; and

    feed rate adjust means externally and manually settable independent of said control parameters, said feed rate adjust means coupled to said processor unit, said processor unit recalculating said rate signals dependent on said feed rate adjust means to vary the rate of relative motion between the tool and the workpiece.


11. A method for automatically and interactively performing machining operations on a workpiece comprising the steps of:

    entering the mode type and dimensional parameters for a machining operation into a microcomputer memory as a data block;

    repeating said entering step for data blocks for any further operations and dimensions as necessary to complete processing of the workpiece; and

    executing a microcomputer program utilizing said data blocks to direct a machine to perform said operations on a workpiece;

    displaying on screen sequentially for observation and response by the operator, a plurality of inquiries regarding mode and dimensional parameters for individual data blocks; and

    as to at least some of the individual data blocks, utilizing operator response to initiate and implement subsequent display of additional inquiries for observation and response by the operator to further define the parameters of the data block as to an operation.

Upon Haas's motion for claim construction, and after receiving extensive briefing from both parties and conducting a limited hearing on the issue of claim construction, the district court issued a memorandum opinion and order in which it construed many of the terms in the claims of the '754 patent. The district court then held a hearing on Haas's motion for summary judgment of noninfringement. Based on the claim construction, the district court granted Haas's motion for summary judgment of noninfringement.

IMS appeals aspects of the district court's claim construction and its grant of Haas's motion for summary judgment. IMS's appeal focuses on the meaning of two terms: "interface means" and "data block." The district court construed the "interface means" limitation, found in claims 1 and 7, as a means-plus-function limitation in accordance with 35 U.S.C. § 112, ¶ 6 (1994), and determined that the corresponding structure in the written description includes a tape cassette transport. Based on this claim construction, the district court concluded that the Haas controls do not literally infringe claims 1 and 7 as a matter of law because Haas's floppy disk drive and the tape cassette transport disclosed in the '457 patent are not equivalent structures. The district court also found that Haas's floppy disk drive does not as a matter of law satisfy the "interface means" limitation under the doctrine of equivalents.

Regarding the term "data block," found in claims 1 and 11, the district court stated in its original claim construction order that "data block" was limited to the specific variables and sequence of inquiries set forth in the written description of the '457 patent. At the summary judgment hearing, the district court added that the term "data block" does not encompass the use of G- and M-codes. The district court concluded that, because the Haas controls do not use the same variables and sequence of inquiries as those disclosed in the written description and rely on the use of G- and M-codes, Haas does not infringe claim 11 either literally or under the doctrine of equivalents.

IMS also appeals the district court's claim construction limiting the scope of claims 1 and 7 to "a control system for machine tools rather than an entire machine tool apparatus."

In its cross-appeal, Haas argues that, if the district court's grant of summary judgment is vacated, we should correct other errors in the district court's claim construction. Specifically, Haas appeals the district court's conclusion that the "indicator means" limitation in claims 1 and 7 covers systems that measure the location of the workpiece and the tool from a fixed and unalterable point. Haas also appeals the district court's construction of the "feed rate adjust means" limitation in claim 7, arguing that the district court construed the original claim language instead of the language as amended during reexamination.

DISCUSSION

An infringement analysis requires two steps: (1) claim construction to determine the scope and meaning of the asserted claims, and (2) a comparison of the properly construed claims with the allegedly infringing device or method to determine whether the device or method embodies every limitation of the claims. Claim construction is a matter of law over which we exercise independent review. Whether an accused device or method infringes a claim either literally or under the doctrine of equivalents is a question of fact. Thus, on appeal from a grant of summary judgment of noninfringement, we must determine whether, after resolving reasonable factual inferences in favor of the patentee, the district court correctly concluded that no reasonable jury could find infringement.

An infringement analysis of a claim with limitations drafted pursuant to 35 U.S.C. § 112, ¶ 6, involves the same two steps—claim construction and a comparison of the accused device or method with the properly construed claims. Limitations contemplated by § 112, ¶ 6, often referred to as means-plus-function or step-plus-function limitations, recite a specified function to be performed rather than the structure, material, or acts for performing that function. Such limitations are "construed to cover the corresponding structure, material, or acts described in the specification and equivalents thereof." 35 U.S.C. § 112, ¶ 6. Claim construction of a § 112, ¶ 6 limitation includes identifying the claimed function and determining the corresponding structure or act disclosed in the specification, both of which are questions of law that this court reviews independently.

For literal infringement of a § 112, ¶ 6 limitation, the second step of an infringement analysis begins with determining whether the accused device or method performs an identical function to the one recited in the claim. If the identical function is performed, the next step is to determine whether the accused device uses the same structure, materials, or acts found in the specification, or their equivalents. Whether an accused device or method infringes a claim with a § 112, ¶ 6 limitation, i.e., whether it performs the identical function with the same structure, materials, or acts described in the specification or an equivalent thereof, is a question of fact. Thus, in order to uphold a summary judgment of noninfringement, we must conclude that no reasonable jury could have found otherwise.

A. Claim Construction

IMS argues that several aspects of the district court's claim construction are incorrect. We will examine each issue in turn using our standard canons of claim construction.

1. "Interface means" in claims 1 and 7

We agree with the district court's ruling, unchallenged by the parties, that the limitation "interface means for transferring a control program and control parameters from an external medium into said alterable memory and for recording the control parameter contents of said memory onto an external medium" in claims 1 and 7 is subject to § 112, ¶ 6. IMS asserts that the district court erred in its construction of the limitation by identifying the tape cassette transport as the relevant corresponding structure found in the specification. IMS further argues that, even if the tape cassette transport is the corresponding structure, the district court erred by concluding as a matter of law that the floppy disk drive in the accused Haas controls cannot be equivalent to the disclosed tape cassette transport.

The "interface means" limitation recites two functions, i.e., "recording" a control program and control parameters from an alterable memory onto an external medium, and "transferring" a control program and control parameters from the external medium into alterable memory. IMS contends that the corresponding structure in the specification, disclosed in the written description, is a tape cassette peripheral interface adapter ("PIA") because that is the only structure that performs the "transferring" function. In making its argument, however, IMS virtually ignores the "recording" function and misapplies the meaning of "transferring" in the context of the claim.

The claimed interface means records data from the alterable memory to an external medium and transfers data from the external medium to the alterable memory. The external medium disclosed in the written description is a tape cassette, and the alterable memory disclosed is a RAM. Thus, the structure corresponding to the "recording" and "transferring" functions must record data residing in the RAM onto the tape cassette and transfer data from the tape cassette to the RAM. IMS correctly states that the written description associates the PIA with these functions: "PIA 77 provides the inerfacing [sic] with a tape cassette which is utilized to load RAM 36. Also, a subsequently inserted cassette may be utilized to record stored RAM program data through PIA 77." The written description, however, also associates a tape cassette transport with the functions of transferring data from the tape cassette to the RAM and recording data from the RAM onto the tape cassette: "A tape cassette transport apparatus is shown generally at 225 for receiving a magnetic tape cassette operable to read or write data to or from the RAM memory. With mode switch 203 in the tape auto mode, the data block entries may be recorded onto a tape cassette." In view of both of these passages, it is apparent that both the PIA and the tape cassette transport are necessary for transferring data from the tape cassette to the RAM and recording data from the RAM onto the tape cassette.

IMS argues that the "transferring" function is only an "interfacing" function between the RAM and the tape cassette transport. But the claims require the interface means to transfer data to the RAM from an external medium, i.e., a tape cassette, not just from the tape cassette transport. The disclosed PIA performs only part of the "transferring" function, i.e., transferring from the tape cassette transport to the RAM. The tape cassette transport itself transfers data from the tape cassette to the PIA, and therefore both the PIA and the tape cassette transport are part of the disclosed structure corresponding to the "transferring" function of the interface means.

Similarly, the interface means must record data from the RAM onto the tape cassette. The tape cassette transport receives data from the RAM via the PIA and completes the recording function by recording data onto the tape cassette. The PIA and the tape cassette transport together perform this function and thus are both part of the disclosed structure corresponding to the claimed interface means.

IMS also argues that, under the doctrine of claim differentiation, the interface means cannot be limited to a means for "reading" and "writing" because claim 2, which depends from claim 1, places that additional limitation on the interface means: "said interface means includes means for reading from and writing onto a magnetic stored information input." IMS further argues that the "interface means" cannot be limited to a tape cassette transport because claim 3, which depends from claim 2, specifically claims a tape cassette transport as the means for reading and writing.

We reject IMS's argument that the doctrine of claim differentiation requires that the corresponding structure of the interface means of claim 1 be limited to the disclosed PIA. The scope of claim 3 is clearly narrower than that of claim 1 because claim 3 covers only a tape cassette transport, whereas claim 1 covers a tape cassette transport and its equivalents in accordance with § 112, ¶ 6. The scope of claim 2 is also narrower than that of claim 1, at least because it limits the external medium to a magnetic stored information input.

Furthermore, the proper claim construction does not give the same meaning to "recording" in claim 1 and to "writing" in claim 2 as IMS contends. Rather, the "reading" and "writing" functions in claim 2 are the parts of the "transferring" and "recording" functions of the "interface means" that are performed by the disclosed tape cassette transport, rather than the PIA. In any event, it is permissible for claim 1 and claim 2 to have similar scope after each is correctly construed in light of the structures disclosed in the written description, because the judicially-created doctrine of claim differentiation cannot override the statutory mandate of § 112, ¶ 6.

In sum, we conclude that the proper construction of the "interface means" limitation covers the disclosed structure, which includes the PIA and tape cassette transport, and its equivalents in accordance with § 112, ¶ 6. IMS argues alternatively that, even under this claim construction, the district court erred by finding that, as a matter of law, Haas's floppy disk drive could not be an equivalent to the disclosed tape cassette transport. We shall address this issue infra in connection with our infringement analysis.

2. "Data block" in claims 1 and 11

The district court construed the term "data block," which appears in several steps of method claim 11 and in the display means limitation of claim 1, as limited to the specific set of variables disclosed in the written description and the disclosed sequence of inquiries regarding those variables. The district court also held that a "data block," as properly construed, cannot include or refer to any instructions written in a known part programming language, such as G- and M-codes. We agree with IMS that the district court erred in construing the term "data block" so narrowly.

The parties agree that the claim limitations in which the term appears are subject to § 112, ¶ 6. They dispute, however, whether the meaning of the term "data block" itself is affected by § 112, ¶ 6. Haas contends that the district court correctly held that § 112, ¶ 6 applies to limit the meaning of the term "data block" to the variables and sequence disclosed in the written description. We hold that this is an erroneous application of § 112, ¶ 6.

Section 112, ¶ 6 does not limit all terms in a means-plus-function or step-plus-function clause to what is disclosed in the written description and equivalents thereof; § 112, ¶ 6 applies only to interpretation of the means or step that performs a recited function when a claim recites insufficient structure or acts for performing the function. In claim 1, the display means includes a "means to sequentially display data block inquiries." The recited function consists of sequentially displaying data block inquiries, and the claim recites no structure supporting the means for performing that function. Therefore, in accordance with § 112, ¶ 6, the means is construed to cover the disclosed structure, i.e., a CRT, and its equivalents. The "data block" is not the means that causes the sequential display and is therefore not subject to construction under § 112, ¶ 6. See id. (holding the term "passage" within the clause "means for passing the analyte slug through a passage" is not subject to § 112, ¶ 6). Similarly, in claim 11, assuming that the several limitations in which the term "data block" appears are subject to § 112, ¶ 6, the "data block" is not part of the steps that perform the recited functions. We therefore must construe the term "data block" according to our standard claim construction methodology without application of § 112, ¶ 6.

To construe the term "data block," we look first to the claim language, the written description, and the prosecution history. The ordinary and customary meaning of "data block" in the context of programmable machine tools is a computer data structure containing the information needed by a machine tool to perform a single machining operation. Haas contends that the ordinary meaning does not apply because the patentee gave the term "data block" a special meaning by describing the preferred embodiment in the patent as follows: "The sequence of inquiries on the CRT screen for a data block follows the sequence: data block number, machine mode, control mode, X dimension, Y dimension, Z dimension, feed rate, pack rate and tool number." We find nothing in the written description, however, that indicates this is the patentee's specialized definition of "data block." Rather, the written description merely describes the preferred embodiment, and to limit "data block" to the sequence of variables disclosed would be to impermissibly read a particular embodiment into the claim.

Haas also argues that the following statement, made by the applicant during prosecution of the '754 patent, limits the meaning of the term "data block" to the specific variables and display sequence set forth in the written description: "particular attention should be paid to the term 'data block' as used in the specification and claims when considering the scope of these claims." Joint App. at 319. This statement alone cannot narrow the scope of the claims. Haas contends further that a brochure submitted to the Examiner by the applicant limits the term "data block" to the specific variables and display sequence disclosed in the written description. This argument is also without merit, for it is clear from the prosecution history that the brochure was intended only to assist the Examiner in understanding the preferred embodiment. In sum, we hold that nothing in the written description or prosecution history is sufficient to overcome the ordinary meaning and to require that the meaning of "data block" be limited to the specific variables and display sequence disclosed in the written description as the preferred embodiment.

Another issue raised by Haas is whether other statements made during the prosecution and reexamination of the '754 patent limit a "data block" to a format that in no way relies on G- and M-codes. In distinguishing over a prior art reference, the applicant stated that the claims were "intended to focus upon a novel interactive system in which the operator was sequentially asked questions and via the display the operator in response simply answered the question rather than have to worry about how to program the device." The applicant made two more similar statements in responding to later office actions. IMS argues that these statements were intended to convey the interactive nature of creating a parts program using the claimed invention and do not disclaim the use of prior art programming languages such as G- and M-codes so long as a program is created interactively according to the claims.

During reexamination, the patentee distinguished several other prior art references by emphasizing the interactive programming technique of the invention, including the use of nested inquiries to prompt the user to enter additional information based on the user's response to a previous inquiry. No statements regarding the prior art clearly disclaim the use of G- and M-codes as Haas contends. In the last response to the PTO during reexamination, the patentee contrasted the invention with the cumbersome prior art programming process:

The present invention utilizes an interactive display which operates in a question and answer format without resorting to the M and G codes of the machine tool. . . . The interactive processing of the data blocks enables the machine tool operator to perform the tasks of both the programmer and machinist on the shop floor.

We agree with IMS that this statement, taken in context, as well as the other statements made during prosecution and reexamination, do not disclaim the use of G- and M-codes in the claimed invention. The purpose of the statements was to emphasize the interactive nature of the invention as an improvement over the prior art programming method in which a user had to create a program line-by-line using only G- and M-codes. Thus, the claimed invention does not require the creation of a G- and M-code program; at the same time, however, the invention does not preclude the creation of a G- and M-code program so long as it is created using the claimed interactive inquiry process.

Haas further argues, in support of its contention that a data block cannot be stored in G- and M-code format, that the written description never mentions the use of G- and M-codes. While it is true that the embodiment disclosed in the written description does not purport to store data blocks in G- and M-code format, the use of data blocks in the invention as claimed is independent of the storage format. The claimed invention is an apparatus and method for interactively creating a program for controlling the machine tool. That program contains data blocks, each of which, according to the customary meaning of the term, includes the information needed by a machine tool to perform one machining operation. It is irrelevant to the claimed invention whether a data block is stored as a line of G- and M-code, in a binary format, or in any other format.

In sum, we conclude that the proper construction of the term "data block" is a computer data structure containing the information needed by a machine tool to perform a single machining operation. As properly construed, a "data block" is not limited to the specific set of variables and display sequence disclosed in the written description and does not preclude the use of G- and M-codes.

3. "Control apparatus" in claims 1 and 7

IMS contends that the district court erred when, based on the preambles of claims 1 and 7, it limited those claims to a "control system for machine tools rather than an entire machine tool apparatus." To the extent that the district court's claim interpretation precludes a finding of infringement by a machine tool apparatus that includes the claimed control-related limitations, we agree that the district court improperly limited the claims.

"[A] claim preamble has the import that the claim as a whole suggests for it." If the preamble adds no limitations to those in the body of the claim, the preamble is not itself a claim limitation and is irrelevant to proper construction of the claim. That is the case here. The phrase "control apparatus" in the preamble merely gives a descriptive name to the set of limitations in the body of the claim that completely set forth the invention. Its use does not limit the claims, as Haas contends, to a control apparatus that is separate from the machine tool. The claim is infringed by any apparatus encompassing all of the limitations in the body of the claim. Such an infringing apparatus may be a machine tool apparatus that includes the claimed control features or a control apparatus that is separate from and communicates with a machine tool apparatus.

The prosecution history is consistent with this interpretation. In a restriction requirement, the PTO recognized that the claimed invention, a machine tool control, was part of a machine tool. In sum, the applicant's choice to elect claims directed to machine tool control rather than machine control structure does not limit the scope of the claims to a control apparatus that is separate from the machine tool itself.

B. Infringement Analysis

In light of the proper claim construction, the key infringement issue before us is whether the accused Haas systems contain the claimed "interface means." As noted, the district court based its finding of noninfringement of claims 1 and 7 on its conclusion that the Haas floppy disk drive is not equivalent, under either § 112, ¶ 6 or the doctrine of equivalents, to the disclosed tape cassette transport.

To determine whether the Haas systems literally contain the "interface means" of claims 1 and 7, it is necessary to first determine whether the accused devices perform the identical functions recited in the claims—recording data from memory onto an external medium and transferring data from the external medium to memory. There is no dispute that the Haas systems with a floppy disk drive perform these functions. Since the Haas systems do not contain the same structure as the disclosed PIA and tape cassette transport, the only question is whether the Haas systems contain a structure that is an equivalent of the disclosed structure. Assuming that the Haas systems include an interface device equivalent to the PIA, a fact uncontested by Haas, the determinative issue under § 112, ¶ 6 is whether the floppy disk drive in the Haas system is equivalent to the disclosed tape cassette transport.

This court has on several occasions compared statutory equivalence under § 112, ¶ 6 and the judicial doctrine of equivalents. While acknowledging that there are differences between § 112, ¶ 6 and the doctrine of equivalents, this court on several occasions has indicated that the tests for equivalence under § 112, ¶ 6 and the doctrine of equivalents are "closely related," involving "similar analyses of insubstantiality of the differences." Thus, a reduced version of the well-known tripartite test for the doctrine of equivalents has been applied in the § 112, ¶ 6 context to determine if the differences are insubstantial, i.e., after determining that the accused device performs the identical function, as required by statute, whether it performs the function in substantially the same way to achieve substantially the same result. Evidence of known interchangeability between structure in the accused device and the disclosed structure has also been considered an important factor.

In light of the similarity of the tests for equivalence under § 112, ¶ 6 and the doctrine of equivalents, the context of the invention should be considered when performing a § 112, ¶ 6 equivalence analysis just as it is in a doctrine of equivalents determination. As a result, two structures that are equivalent in one environment may not be equivalent in another. More particularly, when in a claimed "means" limitation the disclosed physical structure is of little or no importance to the claimed invention, there may be a broader range of equivalent structures than if the physical characteristics of the structure are critical in performing the claimed function in the context of the claimed invention. Thus, a rigid comparison of physical structures in a vacuum may be inappropriate in a particular case. Indeed, the statute requires two structures to be equivalent, but it does not require them to be "structurally equivalent," i.e., it does not mandate an equivalency comparison that necessarily focuses heavily or exclusively on physical structure.

In some cases, an analysis of insubstantial differences in the context of the invention results in a finding of equivalence under § 112, ¶ 6 even though two structures arguably would not be considered equivalent structures in other contexts, e.g., if performing functions other than the claimed function. In other cases, in which the specific physical features of the structure corresponding to the "means" limitation may have more relevance to the claimed invention, a finding of noninfringement results.

Turning to the case at hand and the issue of whether Haas's floppy disk drive can be a § 112, ¶ 6 equivalent of the disclosed tape cassette transport, we consider the substantiality of their differences in the context of the claimed invention. The invention is directed to an apparatus that permits interactive programming of a machine tool. The transferring and recording functions of the claimed "interface means" merely provide a way of storing programs created using the inventive programming apparatus and process. This does not appear to be a case in which any physical characteristics of the interface means, such as the specific format of recorded data and the mechanism for accessing data, are important to the invention. IMS has provided some evidence of structural similarities between a floppy disk drive and a tape cassette transport, and, while there are admittedly physical differences, there is at least an issue of fact as to whether those differences are substantial in light of the role played by the "interface means" in the claimed invention. One way to address that question is to ask whether the structures perform the same function in substantially the same way to achieve substantially the same result. IMS has also supplied evidence that one of ordinary skill in the art would have recognized the interchangeability of a floppy disk drive and a tape cassette transport for performing the transferring and recording functions in the claimed invention. Such evidence should be considered in a § 112, ¶ 6 equivalence determination.

In light of the evidence presented by IMS regarding the insubstantiality of the differences between a floppy disk drive and a tape cassette transport in the context of the claimed invention, we conclude that there are genuine issues of material fact regarding literal infringement under § 112, ¶ 6 of claims 1 and 7. Furthermore, because of the similarities in analysis of equivalence under § 112, ¶ 6 and the doctrine of equivalents, there also remain genuine factual issues regarding infringement of claims 1 and 7 under the doctrine of equivalents. Accordingly, with respect to the Haas systems containing floppy disk drives, we vacate the grant of summary judgment of noninfringement of claims 1 and 7 and remand for further proceedings consistent with this opinion. On remand, the district court is instructed to apply the correct construction of the terms "data block" in claim 1 and "control apparatus" in claims 1 and 7 as discussed above.

Haas also manufactures and sells systems that include only an RS-232 port for connection to a storage device, but do not include the storage device itself. These systems do not perform the functions of transferring and recording data because there is no external medium. Therefore, the Haas RS-232 systems do not contain the claimed "interface means," and we affirm the district court's grant of summary judgment that these systems do not directly infringe claims 1 and 7, either literally or under the doctrine of equivalents. This holding does not, however, preclude a finding that Haas induces infringement or contributorily infringes if, for example, a Haas customer connects a Haas system to an external storage device. Thus, with respect to the RS-232 systems, we vacate summary judgment regarding Haas's liability for inducement of infringement and contributory infringement of claims 1 and 7 and remand for further proceedings consistent with this opinion.

Finally, the only disputed claim language in claim 11 is the term "data block," which the district court construed incorrectly, as explained above. Because the district court granted summary judgment of noninfringement with respect to claim 11 based on an incorrect construction of the term "data block", we vacate the summary judgment of no literal infringement and noninfringement under the doctrine of equivalents with respect to claim 11.

C. Haas's Cross-Appeal

Because we vacate the district court's grant of summary judgment, we now address Haas's cross-appeal regarding claim construction. Haas contends that the district court erroneously construed the limitation that reads "indicator means for providing at an output digital signals indicative of the relative position between the tool and the workpiece." The district court correctly concluded that this claim limitation is subject to § 112, ¶ 6. The claimed function is providing output signals indicative of the relative position between the tool and the workpiece, and the corresponding structure in the written description is hardware circuitry — an encoder and an up/down counter as shown in Figure 4 — for each axis of movement. The dispute between the parties centers on the meaning of the phrase "indicative of the relative position between the tool and the workpiece." Haas contends that a signal that outputs absolute position, measured with reference to a fixed point, cannot be a signal indicative of relative position within the meaning of the claims. The district court rejected Haas's proposed claim construction and held that an indicator that indirectly measures the distance between the tool and the workpiece by indicating the distance of each to a fixed point does indeed indicate the "relative position."

The written description supports the district court's construction. In the disclosed embodiment, the machine tool operator sets a "table zero" point by moving the table containing the workpiece to a desired location and pushing a button. At this point, the microprocessor software reads the digital outputs of the counters corresponding to the x and y axes and records those outputs as the zero reference point. The counter outputs themselves are arbitrary 8-bit words and are not physically reset to zero. Similarly, the operator can perform a "tool calibration" procedure by lowering the spindle to a desired zero reference point and pushing a button, at which point the microprocessor software saves the digital output of the z axis counter as a zero reference point. As the machine tool performs an operation, the encoders output "clicks" when they detect movement of the workpiece along the x and y axes and the tool along the z axis. The counters count the number of clicks in the positive and negative directions and output a digital signal representing the number of clicks. At specified time intervals, the microprocessor calculates the actual positions of the tool and workpiece by comparing the counter outputs with those saved as the zero reference point.

The digital signal outputs of the counters are "indicative of the relative position between the tool and the workpiece" because they represent the distance and direction the tool and the workpiece have moved from a zero reference point and can therefore be used to determine the relative position between the tool and the workpiece. Thus, in light of the written description, "indicative of the relative position" simply means that the signals can be used to determine the relative position between the tool and the workpiece. Although it may be common for the operator to perform a "table zero" operation when the tool is directly above the workpiece, thus using the workpiece to establish a zero reference point, nothing about the digital signals from the counters directly reflects the position of the tool relative to the workpiece as Haas incorrectly states. Only when compared to the counter values read when the workpiece and tool were at the zero reference point can the counter outputs be used to determine a position, relative or otherwise. Similarly, signals representing the absolute positions of the tool and workpiece with respect to a fixed point, such as in the Haas system, are relevant only as compared to the fixed reference point. Nothing in the claims or written description precludes a signal that directly indicates the distance of the tool and workpiece from a fixed reference position from being a signal "indicative of the relative position between the tool and the workpiece."

We are not persuaded by Haas's argument that IMS surrendered coverage of absolute positioning systems during reexamination of the '754 patent when explaining the pertinency of several prior art references. While the patentee stated that the Eaton reference, U.S. Patent No. 3,821,525, discloses sensors indicating position and a Japanese Kokai reference discloses a position register storing absolute position, the patentee did not distinguish these structures from the structure disclosed in the '754 patent. Indeed, it is not clear in either reference that positions are measured with respect to a fixed point established by the machine tool, as in the Haas systems, rather than a fixed point established by the operator, as in the disclosed embodiment of the '754 patent. Both references distinguish "absolute" positioning from "incremental" or "point-to-point" positioning, but those terms appear to refer to the reference point for entering successive operational commands; "absolute" positions are entered as coordinates from a fixed reference point, whereas "incremental" positions are entered as coordinates with respect to the position after the last operation. In light of the ambiguity of the patentee's statements and the subject matter actually disclosed in the references, we cannot say that the patentee clearly disavowed coverage of absolute positioning systems during reexamination.

Haas also appeals the district court's construction of the "feed rate adjust means" in claim 7. Although in its claim construction order the district court quoted language from claim 7 as originally issued instead of from the claim as amended in reexamination, the district court correctly construed this claim limitation. The claimed function of the "feed rate adjust means" is to allow the operator to adjust manually the feed rate independently of the control parameters in memory. The "recalculating" function is performed by the processor unit, not the "feed rate adjust means," and thus is not subject to construction in accordance with § 112, ¶ 6. Therefore, it is unnecessary to identify structure corresponding to the recalculation function or to discuss the method of recalculation. The term "recalculating" possesses its ordinary meaning.

SUMMARY

We hold that the district court made several errors with respect to claim construction. First, under a proper claim construction, the "interface means" limitation in claims 1 and 7 should be construed to cover the corresponding structure disclosed in the written description, including a PIA and a tape cassette transport, and equivalents thereof in accordance with § 112, ¶ 6. Next, the proper construction of the term "data block" in claims 1 and 11 is a computer data structure containing the information needed by a machine tool to perform a single machining operation. As properly construed, a "data block" is not limited to the specific set of variables and display sequence disclosed in the written description and does not preclude the use of G- and M-codes. Finally, the use of the term "control apparatus" in claims 1 and 7 does not preclude infringement of those claims by a machine tool apparatus that includes a control system. On remand, the district court is instructed to apply the construction of these terms as has been explained above.

In view of the proper claim construction, there are genuine issues of material fact as to whether a floppy disk drive is an equivalent of the disclosed tape cassette transport. Accordingly, we vacate the district court's grant of summary judgment of noninfringement of claims 1 and 7 with respect to the Haas systems containing floppy disk drives and remand for further proceedings consistent with this opinion.

We affirm the grant of summary judgment that the Haas systems that include only an RS-232 port do not directly infringe claims 1 and 7, either literally or under the doctrine of equivalents. Our holding, however, does not foreclose a finding that Haas induces infringement or contributorily infringes. Thus, with respect to the RS-232 systems, we vacate summary judgment regarding Haas's liability for inducement of infringement and contributory infringement of claims 1 and 7 and remand for further proceedings consistent with this opinion.

Because the district court erred in its construction of the term "data block," we vacate the district court's summary judgment of noninfringement of claim 11 and remand for further proceedings consistent with this opinion.

Finally, we affirm the district court regarding the claim construction issues raised in Haas's cross-appeal.

Note

To some extent the en banc Federal Circuit and Supreme Court opinions in Festo may limit the precedential force of parts of this decision concerning the doctrine of equivalents, but the decision remains illustrative of many principles of claim construction applicable to computer-related inventions. Do you think Festo undercuts the proposition that, "when in a claimed 'means' limitation the disclosed physical structure is of little or no importance to the claimed invention, there may be a broader range of equivalent structures than if the physical characteristics of the structure are critical in performing the claimed function in the context of the claimed invention"?



Interactive Gift Express, Inc. (now known
as E-Data, Corp.) v. Compuserve Inc.

United States Court of Appeals for the Federal Circuit
231 F.3d 859 (Fed. Cir. 2000)

Before Plager, Schall, and Linn, Circuit Judges. Linn, Circuit Judge.

Interactive Gift Express, Inc. ("IGE"), now known as E-Data, Corp., seeks review of a judgment of non-infringement of U.S. Patent No. 4,528,643 ("Freeny patent"). Because the district court erred as a matter of law in the construction of each of the five claim terms giving rise to IGE's non-infringement stipulation, we vacate and remand.

Background

A. The Freeny Patent

The Freeny patent is directed to a system for reproducing information in material objects at point of sale locations. Prior to the invention disclosed in the Freeny patent, information disseminated to consumers in material objects, such as tape recordings, books, and records, was recorded onto the material objects at a central manufacturing facility, and the material objects were then shipped to remote retail locations for sale. These systems required centralized manufacturing facilities for reproducing the information in the material objects and extended distribution networks for distributing the material objects, once made, to various point-of-sale locations for sale to consumers. The manufacturing facilities and distribution networks represented substantial costs ultimately borne by consumers.

In such prior art systems, manufacturers had to estimate consumer demand for each new information-specific product and had to manufacture and ship quantities of material objects sufficient to meet the estimated demand at each retail location. Retailers had to make similar estimates to determine how many material objects for each information-specific product to order and keep in inventory. A low estimate of consumer demand resulted in unsatisfied customers and lost sales. On the other hand, high estimates left some material objects unsold, resulting in unrecouped costs.

To overcome these and other related problems, the Freeny patent provides a system for the distributed manufacture and sale of material objects at multiple locations directly serving consumers. The system includes a central control station, referred to in the Freeny patent as an "information control machine" or "ICM," and a plurality of remotely located manufacturing stations referred to as "information manufacturing machines" or "IMMs."

At each IMM, a consumer selects the desired information and initiates a communication from the IMM to the ICM to gain authorization for copying of the selected information onto a desired type of material object. The consumer then waits for the IMM to receive the authorization, after which the selected information is copied by the IMM onto a blank material object. The invention can be used with a wide variety of information and material objects, such as music on cassettes and text on paper. Irrespective of the type of information and material object, the invention requires the purchase of the material object by the consumer, and the material object must contain information that was copied onto it at the point of sale location.

According to the Freeny patent, the information can be copied onto a selected type of material object whenever a consumer requests it. Consumer demand thus can be met without having to rely on manufacturing estimates and without having to bear the costs associated with overproduction, inventory control, shipping, and warehousing. The Freeny system also provides "for reproducing or manufacturing material objects at point-of-sale locations only with the permission of the owner of the information, thereby assuring that the owner of the information will be compensated in connection with such reproduction." The Freeny patent, in the description of the background of the invention, states that the invention overcomes the problem of "how to manufacture and distribute material objects embodying ... information in an economical and efficient manner and in a manner which virtually assures that the owners of [the] information will be compensated in connection with the sale of such material objects."

Claim 1 of the Freeny patent is representative of the method claims at issue and defines the invention as follows:

1. A method for reproducing information in material objects utilizing information manufacturing machines located at point-of-sale locations, comprising the steps of:

(1) providing from a source remotely located with respect to the information manufacturing machine (IMM) the information to be reproduced to the IMM, each information being uniquely identified by a catalog code;

(2) providing a request reproduction code including a catalog code uniquely identifying the information to be reproduced to the IMM requesting to reproduce certain information identified by the catalog code in a material object;

(3) providing an authorization code at the information manufacturing machine authorizing the reproduction of the information identified by the catalog code included in the request reproduction code; and

(4) receiving the request reproduction code and the authorization code at the IMM and reproducing in a material object the information identified by the catalog code included in the request reproduction code in response to the authorization code authorizing such reproduction.

Exemplary of the apparatus claims is claim 37, which reads as follows:

37. An apparatus for reproducing information in material objects at point of sale locations, comprising:

    an information manufacturing machine (IMM) located at a point-of-sale location for reproducing information in material objects,

    each information to be reproduced being uniquely identified by a catalog code and each information being received from a source remotely located with respect to the IMM and each information being stored in the IMM,

    the IMM receiving a request reproduction code including a catalog code uniquely identifying the information to be reproduced and being adapted to provide an authorization code including the catalog code included in the request reproduction code, and

    the IMM being adapted to reproduce the information identified by the catalog code in a material object in response to receiving the authorization code.

B. The Accused Activities

The defendants are computer software and publishing companies and one retail bookstore. Plaintiff contends that the computer software and publishing companies infringe the Freeny patent by selling software or documents "online," that is, over the Internet and the World Wide Web. Plaintiff maintains that the retail bookstore infringes the Freeny patent by selling books that include a CD-ROM containing encrypted computer applications, access to which is not possible until the consumer retrieves a password.

Plaintiff, through the construction it proffered in its Revised Claim Construction Report of November 12, 1996, has effectively conceded that none of the defendants are direct infringers. With the one exception of the retail bookstore defendant, all of the accused systems distribute information directly to consumers' personal computers without using an intermediate retail location, the consumer instead dealing directly with a Website over the Internet. Information is distributed and downloaded onto a consumer's own internal hard disk or other storage device without the purchase of any material object such as a floppy disk or CD-ROM.

In the case of the CD-ROMs sold to consumers by the retail bookstore defendant, if a consumer is interested in one or more of the encrypted programs contained on the CD-ROM, a password must first be requested. The password enables the consumer to decrypt the desired program and copy it for later use. As with the other accused systems, the CD-ROM product avoids the need for a consumer to purchase a material object, such as a floppy disk or a CD-ROM, because the decrypted data is copied directly onto the consumer's own storage device.

C. Proceedings Below

The district court limited discovery to claim construction matters and ordered IGE to file a binding claim construction report. The court received IGE’s report and the parties’ claim construction briefs and rendered an opinion and order construing the claims of the Freeny patent. See Interactive Gift Express, Inc. v. Compuserve Inc., 47 USPQ2d 1797 (S.D.N.Y.1998). The district court did not address invalidity. The district court’s opinion contained a thorough and careful analysis of the Freeny patent and the relevant legal standards for claim construction. The district court devoted most of its lengthy claim construction to the following five disputed claim limitations: (1) the meaning of “point-of-sale location”; (2) the meaning of “material object”; (3) the meaning of “information manufacturing machine”; (4) the meaning of “authorization code”; and (5) whether the information must be provided to and stored at the IMM before the consumer requests it.

After the district court provided its claim construction of the five above-noted claim limitations, the parties entered into a Stipulated Order and Judgment. The district court made no findings of fact regarding infringement. In the Judgment, IGE conceded that none of the defendants had in the past infringed, or was then infringing, any claim of the Freeny patent as construed by the court. The Judgment stated specifically that “no method, system, or apparatus of any defendant includes any” of the five disputed claim limitations.

In appealing the judgment, IGE challenges the district court’s construction of each of the disputed claim limitations. Counsel for IGE acknowledged during the oral hearing before this court that in light of the stipulation entered into by the parties as part of the Judgment, and in view of the fact that the parties have stipulated not to what the accused methods or products are but only to what they are not, IGE must show that the district court was wrong in its construction of all five of the disputed claim limitations to prevail in this appeal.

DISCUSSION

A. Standard of Review

A finding of non-infringement requires a two-step analytical approach. First, the claims of the patent must be construed to determine their scope. Second, a determination must be made as to whether the properly construed claims read on the accused device. In this case, IGE has conceded the second part of the infringement analysis, leaving only the question of the propriety of the district court’s claim construction in issue. Claim construction is a matter of law and is reviewed de novo on appeal.

B. Analysis

In this opinion, we focus on the construction of the five disputed claim limitations as provided in the conclusions of the district court’s claim construction, and upon which IGE’s stipulations in the Judgment are premised. In construing claims, the analytical focus must begin and remain centered on the language of the claims themselves, for it is that language that the patentee chose to use to “particularly point out and distinctly claim the subject matter which the patentee regards as his invention.” 35 U.S.C. § 112, ¶ 2.

“It is well-settled that, in interpreting an asserted claim, the court should look first to the intrinsic evidence of record, i.e., the patent itself, including the claims, the specification and, if in evidence, the prosecution history. Such intrinsic evidence is the most significant source of the legally operative meaning of disputed claim language.” Vitronics Corp. v. Conceptronic, Inc., 90 F.3d 1576 (Fed. Cir. 1996). All intrinsic evidence is not equal however.

First, we look to the claim language. Then we look to the rest of the intrinsic evidence, beginning with the specification and concluding with the prosecution history, if in evidence. If the claim language is clear on its face, then our consideration of the rest of the intrinsic evidence is restricted to determining if a deviation from the clear language of the claims is specified. A deviation may be necessary if “a patentee [has chosen] to be his own lexicographer and use terms in a manner other than their ordinary meaning.” A deviation may also be necessary if a patentee has “relinquished [a] potential claim construction in an amendment to the claim or in an argument to overcome or distinguish a reference.”

If the claim language is not clear on its face, then our consideration of the rest of the intrinsic evidence is directed to resolving, if possible, the lack of clarity. Resort to the specification is particularly important in this case because IGE has conceded that the claim limitations in dispute include technical terms that are defined in the specification. However, in looking to the specification to construe claim terms, care must be taken to avoid reading “limitations appearing in the specification...into [the] claims.” “We recognize that there is sometimes a fine line between reading a claim in light of the specification, and reading a limitation into the claim from the specification.” In locating this “fine line” it is useful to remember that we look “to the specification to ascertain the meaning of the claim term as it is used by the inventor in the context of the entirety of his invention,” and not merely to limit a claim term.

If the meaning of the claim limitations is apparent from the totality of the intrinsic evidence, then the claim has been construed. If however a claim limitation is still not clear, we may look to extrinsic evidence to help resolve the lack of clarity. Relying on extrinsic evidence to construe a claim is “proper only when the claim language remains genuinely ambiguous after consideration of the intrinsic evidence.” “Such instances will rarely, if ever, occur.”

Extrinsic evidence may always be consulted, however, to assist in understanding the underlying technology. “[C]onsultation of extrinsic evidence is particularly appropriate to ensure that [a judge’s] understanding of the technical aspects of the patent is not entirely at variance with the understanding of one skilled in the art.” But extrinsic evidence may never be used “for the purpose of varying or contradicting the terms in the claims.”

Although the district court provided a thorough and accurate description of the patent and of the relevant law, its claim construction impermissibly read limitations from the specification into each of the five disputed claim limitations. We treat each of these disputed claim limitations below.

I. Point-of-sale Location

The district court made several findings with regard to the construction of the expression “point-of-sale location.” We address these findings below, agreeing with some and disagreeing with others.

1. In response to the district court’s request for binding definitions of the disputed terms, described earlier, IGE identified a passage in the specification (col. 5, lines 47-50) as defining a point-of-sale location. That passage states that a point-of-sale location is “a location where a consumer goes to purchase material objects embodying predetermined or preselected information.” The district court held this definition to be correct, and we agree. Clear support is provided for this definition in the Freeny patent specification.

2. The district court further held that, although point-of-sale locations are not restricted to retail locations, a home is not a point-of-sale location. IGE contends that the district court was wrong. IGE urges that a point-of-sale location is simply the location at which the consumer makes or effects a purchase. IGE argues that the concept of a home being a point-of-sale location is not new, citing home shopping networks, pay-per-view cable television, and home Internet shopping. IGE further argues that the specification defines a home as a point-of-sale location and discloses at least two embodiments in which the home is a point-of-sale location. IGE also argues that the prosecution history lists several transmission systems that could be adapted for use in the home. The appellees respond that IGE’s asserted definition before the district court precludes a home from being a point-of-sale location, and that any references in the specification to homes as point-of-sale locations cannot overcome this definition. The appellees further respond that the rest of the intrinsic evidence, as well as the extrinsic evidence of standard dictionaries and references, supports the district court’s construction.

We agree with IGE’s position that a home is not precluded from being a point-of-sale location. Looking first, as we must, to the claim language itself, we find nothing precluding a home from being a point-of-sale location. Except for requiring that an IMM be present, the independent claims are silent regarding the possible venues of a point-of-sale location.

Looking next to the specification, we acknowledge the great likelihood that a point-of-sale location will not be a home, given that: (1) IGE’s asserted definition in the specification, with which we agree, requires that a consumer go to a point of sale location “to purchase material objects”; and (2) the specification requires, and IGE does not dispute, that the IMM be located at the point-of-sale location. However, IGE’s asserted definition, premised on the specification, does not preclude a home from serving as a point-of-sale location, and the specification further describes a vending machine embodiment that could be utilized in a home. This intrinsic evidence unambiguously allows a home to serve as a point-of-sale location. Therefore, it is unnecessary to address IGE’s arguments alleging that the prosecution history additionally supports our conclusion.

Given the lack of ambiguity in the intrinsic evidence, it would be improper to address any of the parties’ arguments relating to extrinsic evidence, such as other examples of point-of-sale locations and standard references.

3. The district court also held that a point-of-sale location “must have...at least two blank material objects.” IGE argues that this limitation is not recited in the claims or required by the specification and has improperly been read into the claims from a particular embodiment. The appellees respond that the specification supports the requirement that there be two or more blank material objects. We agree with IGE that a point-of-sale location need not have two blank material objects.

4. The district court also held that a point-of-sale location must have blank material objects “available for sale to consumers.” IGE argues that this limitation is not recited in the claim or required by the specification and has improperly been read into the claim from a particular embodiment. Notably, the appellees do not argue in defense of this limitation. We agree with IGE that a point-of-sale location need not have any blank material objects separately for sale.

5. Accordingly, we construe a point-of-sale location to be a location where a consumer goes to purchase material objects embodying predetermined or preselected information. This construction permits a home to be a point-of-sale location. A point-of-sale location need not have more than one blank material object and it need not have any material objects separately for sale as blanks.

II. Material Object

As with the term “point-of-sale location,” the district court made several findings with regard to the construction of the term “material object.” We address these findings below, agreeing with some and disagreeing with others.

1. The district court held that a material object is “a tangible medium or device in which information can be embodied, fixed, or stored, other than temporarily, and from which the information embodied therein can be perceived, reproduced, used or otherwise communicated, either directly or with the aid of another machine or device.” Although IGE admits in its brief to this court that a material object is a tangible medium, counsel for IGE argued to this court at the oral hearing that a material object is defined as the information itself and need not be a tangible medium. The appellees respond that the district court’s construction is supported by the specification.

A material object cannot be the information itself, as IGE now argues. Examining first the claim language, claim 1, for example, requires that the information be reproduced in a material object. If the information itself is the material object, as IGE argues, then claim 1 would require the information to be reproduced in itself. Such a construction is illogical and does not accord with the plain import of the claim language. Despite the plain language of the claims, we turn to the specification to discern whether IGE attributed a different meaning to the term material object. Examining the specification, it is clear that even the broadest definition of material object in the specification requires that a material object be a “medium or device in which information can be embodied or fixed.” Thus, IGE’s argument that the reproduced information itself constitutes the material object is not only illogical, but unsupported in the specification as well.

2. The district court further held that a material object must be: (a) separate and distinct from the IMM, (b) removed from the IMM after purchase, and (c) intended for use away from the point-of-sale location. IGE argues that neither the claims nor the specification requires that a material object be separate and distinct from the IMM or intended for use at a location other than the point-of-sale location, and that these limitations were improperly read into the claims from the specification. The appellees respond that the district court’s construction is supported by the specification. We agree with the district court on these three limitations, with one variation regarding point (c) above. On that point, we find that the material object could be intended for use at the point-of-sale location as long as it is on a device separate from the IMM.

Beginning with the claim language, we note that the preamble of claim 1, for example, describes a method in which IMMs are located at point-of-sale locations and in which information is reproduced in material objects utilizing the IMMs. This language could be read to suggest that the material objects, which receive the reproduced information, are not part of the IMM and are intended to be purchased and removed from both the IMM and the point-of-sale location, but that reading is not clear from the claim itself. The claim later describes reproducing the information in a material object, but again there is no clear indication that the material object is or is not a separate and distinct item that is to be removed from the IMM after purchase and used on another device. Thus, we look to the specification for further guidance.

The Freeny patent envisions and discloses only material objects that are separate from the IMM and that can be purchased by the consumer and taken away from the IMM, such as a retail store embodiment and a vending machine embodiment. The emphasis of the specification on distribution and sale consistently reveals that the material objects are intended to be separate from the IMM, removed from the IMM, and used apart from the IMM. These three conditions, namely, that a material object be separate and distinct from the IMM, removed from the IMM after purchase, and used apart from the IMM, are fundamental to the meaning of a material object as clearly and consistently specified in the patent description.

IGE contends that “material object” should be construed so broadly as to include a hard disk that is internal to a personal computer. Although the specification describes numerous material objects, a hard disk, internal or otherwise, is never mentioned as a possibility. In fact, where a hard disk is discussed, it is in relation to the implementation of particular aspects of the IMM or the ICM and not as an example of a material object. Any construction of the expression “material object” which encompasses a hard disk is not only not envisioned anywhere in the specification but is also inconsistent with the definition asserted by IGE before the district court. Specifically, a consumer would not go to a point-of-sale location to purchase an internal hard disk embodying predetermined or preselected information.

3. The district court also held that a material object “[m]ust be offered for sale independently from the information that may be reproduced onto the material object.” The district court applied this same limitation to a point-of-sale location. For the reasons discussed earlier with respect to a point-of-sale location, we again disagree with the district court’s reading of this condition into the claims.

4. Accordingly, we construe a material object to be a tangible medium or device in which information can be embodied, fixed, or stored, other than temporarily, and from which the information embodied therein can be perceived, reproduced, used or otherwise communicated, either directly or with the aid of another machine or device. A material object must be offered for sale, and be purchasable, at point-of-sale locations where at least one IMM is located. Further, a material object must be separate and distinct from the IMM, removed from the IMM after purchase, and intended for use on a device separate from the IMM either at the point of sale location or elsewhere. “Material object” does not encompass the hard disk component of a home personal computer. Finally, a material object need not be offered for sale independently from the information that may be reproduced onto the material object, that is, as a blank.

III. Information Manufacturing Machine

As with the term point-of-sale location, the district court made several findings with regard to the construction of the term “IMM.” For this term, however, we disagree with most of the district court’s findings. We address each below.

1. The district court required that the IMM functionality be divided into at least the following four “separate and distinct components: (a) a Manufacturing Control Unit, (b) a Master File Unit, (c) an Information Manufacturing Unit, and (d) a Reproduction Unit.” IGE maintains that the district court improperly read the limitations of an embodiment into the claims. The appellees respond that these four components are required because Figure 1 of the Freeny patent, which contains these components, and depicts the invention and not merely an embodiment of the invention. We agree with IGE.

Again, we turn first to the claim language itself. The independent claims do not recite any of these four components and do not convey any clear meaning of an IMM to one skilled in the art. The only limitations in the exemplary independent claims pertaining to the IMM relate to its placement at a point-of-sale location and to certain functions that it must perform, namely, storing information to be reproduced, receiving a request reproduction code, receiving an authorization code, and reproducing the requested information in a material object.

The specification describes an embodiment of the IMM containing the four components noted by the district court and performing the functions recited in the claims. The disclosed embodiment of the IMM also performs the functions, not explicitly recited in either claim 1 or claim 37, of transmitting a request reproduction code and receiving and decoding encoded information. Of these, only five functions, namely, storing information to be reproduced, receiving and transmitting a request reproduction code, receiving an authorization code, and reproducing the requested information in a material object, are critical to the operation of the IMM as defined in the specification.

As explained below, the receiving and decoding of encoded information is not essential to the present invention. There is no general description or definition of what constitutes an IMM other than this narrow functional definition presented in the specification. That is the only definition on which the public can rely, and it is therefore reasonable to conclude that an IMM must contain these five functions. To the extent that the district court’s decision, by requiring all four components of the disclosed IMM to be present, requires more than these five critical functions to be performed by the IMM, it is in error.

In its analysis, the district court looked to the specification, and specifically the embodiment depicted in Figure 1, and correctly concluded that the disclosed IMM contained each of the four functional components listed above. However, while the five functions identified above are required in an IMM, there is nothing in the specification that requires that these functions be performed by the particular components of Figure 1 or that such components be separate and distinct. These five functions of the IMM are all of a type that can be performed within a computer, and it is well within the reasonable expectation of a person skilled in the art to move the boundaries between the four identified components to suit a desired application. Such movement would allow, for example, any one piece of the IMM to perform any number of the five required functions.

2. The district court also held that the IMM must “receive a `request reproduction code,’” must “transmit the ‘request reproduction code’ to an ‘information control machine’ (‘ICM’),” and must “receive an ‘authorization code’ from the ICM.” As just explained, we agree that an IMM must receive and transmit these codes. We further agree that the IMM must transmit the request reproduction code to, and receive the authorization code from, a central device, such as an ICM, but the device need not be restricted to an ICM.

We note first that neither claim 1 nor claim 37 recites the details of the ICM of the preferred embodiment. However, it is critical to the operation of the IMM, as defined in the specification, that the IMM send the request reproduction code to the same device that then sends the authorization code to the IMM. See Freeny patent, col. 5, l. 51-col. 6, l. 23. While this device takes the form of an ICM in the preferred embodiment, there is nothing in the specification that would suggest to a person skilled in the art that an IMM would only work with the particular ICM defined in the specification.

Thus, we construe the term IMM to require communication with a remote device, such as but not restricted to an ICM, and hold that the district court’s definition of IMM as requiring communication with an ICM is erroneous.

3. The district court also held that the Master File Unit and the Reproduction Unit components of the IMM must, at a minimum, contain a number of detailed attributes. IGE argues that the language of the claims does not recite any of these limitations. Again, we agree with IGE.

There is no recitation of the specific attributes of the Master File Unit or the Reproduction Unit in the language of the independent claims. There is also no support for these limitations in the text of the specification referenced in IGE’s asserted definition of the IMM before the district court. Further, the invention is primarily concerned with distributed reproduction, and there is nothing to suggest that a person skilled in the art would not readily understand that the invention could be practiced without the received information being encoded, without decoding the received information, or without receiving information “on a unidirectional signal path...in analog form.” We conclude that the district court erred and impermissibly read these limitations into the claims.

4. Accordingly, we hold that an IMM must contain one or more components for performing at least the functions of: (1) storing information to be reproduced; (2) receiving a request reproduction code; (3) transmitting a request reproduction code to a device remotely located from the IMM; (4) receiving an authorization code from the device remotely located from the IMM; and (5) reproducing the requested information in a material object in response to receiving the authorization code. An IMM need not contain the four separate and distinct components of the preferred embodiment.

IV. Authorization Code

The district court made several findings with regard to the construction of the term authorization code. We agree with some of these findings, disagree with others, and address them below.

1. The district court held that an authorization code must “include a code that enables the IMM to decode the information that is to be reproduced in a material object and that was previously stored in encoded form at the IMM.” The district court reasoned that the “seminal component” of the disclosed authorization codes was the encoded catalog decipher program that allowed the IMM to decode information. Without this component, the district court continued, “the IMM would be unable to convert the information from its encoded, unusable format to its decoded, usable format.” Accordingly, the district court held that “the encoded catalog decipher program is the true `authorizing’ mechanism,” and the authorization code needs such a component.

IGE argues that an authorization code need only authorize copying and need not provide decoding information. IGE points to the language of the claims to substantiate its argument. The appellees respond that the portions of the specification noted in IGE’s asserted definition before the district court require that the authorization code perform a decoding function, and that the specification does not disclose an authorization code without such a function. The appellees also maintain that an authorization code must include an IMM code, used to identify the IMM intended to receive the authorization code from the ICM. The appellees further respond that the definition of the term authorization code requires that it be transmitted electronically between the IMM and the ICM.

We agree with IGE that the authorization code need only authorize copying. Our holding is based on the claim language and the language of the specification identified in IGE’s asserted definition before the district court. First, the language of the independent claims does not require that the information be encoded, much less that the authorization code have decoding information. Encoded information is not claimed until claim 5. Further, the claim language itself suggests that the sole function of the authorization code is “authorizing...reproduction.”

Second, in response to the district court’s request for a binding definition of all disputed terms, IGE identified a passage in the Freeny patent as defining the term authorization code. At two points in that passage, the purpose of the authorization code is stated to be providing permission for copying. In the context of the preferred embodiment, it states that “if [the request for reproduction is] approved, [the ICM] provides an authorization code.” Later, it notes that information is reproduced only with permission, “such permission being indicated by the authorization code.” The only reference in this passage to decoding information merely states that such decoding occurs in the IMM of the preferred embodiment “[i]n response to receiving the authorization code.” This simply does not state that the authorization code must include a decoding code. It does indicate a sequence to the events or a causality between reception of the authorization code and the decoding action, but this is expected given that information, which may or may not be encoded, cannot be decoded before permission to reproduce has been received.

The appellees’ arguments that an authorization code must also include an IMM code and that the authorization code must be transmitted electronically are not persuasive. Neither of these proposed limitations is mandated by the claim language itself or the specification. Although the preferred embodiment routes the authorization code with the use of an IMM code and electronic transmission, these features are not recited in the independent claims and we are not at liberty to read them into the claims. “References to a preferred embodiment, such as those often present in a specification, are not claim limitations.”

2. The district court also held that the authorization code is separate and distinct from the request reproduction code. This is clearly correct. These codes are separately recited in claim 1. The specification supports this distinction. In the preferred embodiment, a request reproduction code originates from the user and is passed from the user to the IMM and then to the ICM passed from the ICM to the IMM.

3. As discussed above with respect to the IMM, the district court further held that an ICM must transmit the authorization code to the IMM. This is a limitation associated with the ICM or the IMM and not with the term “authorization code.” Because an authorization code need only authorize copying, it would be improper in this case to construe the term “authorization code” to include limitations regarding its origin or its destination.

4. Accordingly, we hold that: (1) an authorization code must authorize copying but need not provide decoding information; (2) the term “authorization code” is not to be construed to require that it include an IMM code or that it be transmitted electronically; and (3) an authorization code is separate and distinct from a request reproduction code.

V. Real-time Transactions

The district court held that the claimed invention does not “cover real-time transactions where the requested item of information is transmitted to the IMM at the time it is requested by the consumer.” The district court noted that this requirement is equivalent to requiring that step one of the claim be performed prior to step four.

IGE argues that such an order or sequence of steps is not recited, nor required, by the claims. IGE further argues that claim 1 does not exclude real-time delivery of information but that claim 37 does and, therefore, the doctrine of claim differentiation requires a broader construction of claim 1. IGE also claims that real-time delivery is disclosed in the specification and points to embodiments in the specification that it alleges utilize real-time delivery.

The appellees respond that the claim language and the specification limit the claim to methods that do not utilize real-time delivery. With regard to the claim language, the appellees point out that claim 1 recites that the information is reproduced in the material object “in response to” receiving the authorization code. The appellees maintain that this requires the information to be locally stored prior to receipt of the authorization code. With regard to the specification, the appellees maintain that even though the “concept” of real-time delivery is disclosed, it is not claimed and is therefore dedicated to the public.

1. We agree with IGE. As the district court noted, the only way that claim 1 can be limited to embodiments in which the information is predelivered and prestored is if at least the first and fourth steps of the method have to be performed in order. Unless the steps of a method actually recite an order, the steps are not ordinarily construed to require one. “Not every process claim is limited to the performance of its steps in the order written.” However, such a result can ensue when the method steps implicitly require that they be performed in the order written. In this case, nothing in the claim or the specification directly or implicitly requires such a narrow construction.

Looking at the claim language, there is no reason why step one’s “providing” of information to the IMM must occur before step four’s “receiving the request reproduction code.” Logically, information could be sent after a request is made. In the specification, two embodiments are disclosed which operate in real-time and send information after a request is made. In both of these embodiments, the “providing” of information is performed after “receiving the request reproduction code.” Although the specification describes these two non-preferred embodiments as impractical and uneconomical, respectively, it does not characterize them as inoperative nor is there anything in the specification which would nullify the effect of the disclosure in supporting a claim construction that is not limited to the predelivery of information.

The appellees’ argument regarding the “in response to” language of the claims is unpersuasive. Even if the language “in response to” required immediate copying after the authorization code was received, which it does not, such a result could be achieved if the information were transmitted along with the authorization code, as disclosed in the Freeny patent.

2. We now address the district court’s rationale for finding that at least the first and fourth steps of claim 1 must be performed in order. The district court relies on the fact that “step four does not provide for the transmission from the ICM to the IMM of the information sought to be reproduced,” and reasons from this that the information must be predelivered. We find this logic unpersuasive.

As explained above, there is no reason why the claim needs to be construed to require that the steps be performed in the order written. “A claim interpretation that would exclude the inventor’s device is rarely the correct interpretation; such an interpretation requires highly persuasive evidentiary support....”

In the preferred embodiment, the following sequence of events occurs (the parenthetical notations referring to the sequence of steps recited in exemplary claim 1): (1) the user provides a request reproduction code to the IMM (step two) and the IMM receives it (step four); (2) the IMM sends the request reproduction code to the ICM (not claimed); (3) the ICM provides an authorization code to the IMM (step three) and the IMM receives it (step four); and (4) the IMM copies the information onto a material object (step four). As indicated in the parenthetical remarks, the steps of claim 1 are not performed in order by the preferred embodiment. They are not even performed serially in their entirety because part of step four is performed before step three, and part is performed after step three. Thus, if the claim was construed to require that the steps be performed in order, the claim would not read on the preferred embodiment. However, there is no “highly persuasive evidentiary support” for such a result. Indeed, given that the claim itself and the specification both support a construction in which the steps are not performed in order, the appellees have not directed us to any evidentiary support at all.

3. Thus, because the steps of claim 1 need not be performed in order, claim 1 does not require predelivery and/or prestorage of the information. Accordingly, we hold that claim 1 is not limited to embodiments that pre-store or pre-deliver the information to the IMM, but that it covers real-time transactions in which the requested item of information is transmitted to the IMM at or prior to the time it is requested by the consumer.

Conclusion

We hold that the district court erred in at least one aspect of its construction of each of the five claim limitations upon which the judgment of non-infringement was based. Accordingly, we vacate and remand for further proceedings consistent with our claim construction.

Notes

1. The effect of this reversal is to return the case to the trial court for a trial of infringement and prior art issues.

Since the Federal Circuit held that a material object cannot be information per se, no defendant could be liable as a patent infringer for simply streaming video or music, as with Napster. Furthermore, since a material object must be separate and distinct from the IMM and cannot include the hard disk of a personal computer, mere downloading to a hard disk is not covered. These limitations to the scope of the claims would appear to let some defendants out of the case. The defendants indicated also that they intend to proffer evidence of invalidating prior art.

2. The de novo review of the district court’s claim construction, which resulted in a reversal on almost every point, despite the nod here to the district court’s “thorough and careful analysis of the Freeny patent and the relevant legal standards for claim construction,” illustrates a serious problem in trying cases under the current Markman dispensation. The Federal Circuit resolutely opposes piecemeal review, and will almost never grant an interlocutory appeal or accept a certified question as to claim construction. Therefore, a case may well be tried at millions of dollars in expense and the investment of years of delay with attendant business uncertainty—and then have to be re-tried because, as here, the Federal Circuit non-deferentially reverses the claim construction.

In this case, that did not happen because E-Data considered the case hopeless after the district court’s claim construction, and it therefore stipulated non-infringement under that claim construction. This led to entry of judgment in favor of defendants and an appeal of that final judgment to the Federal Circuit. That is the exception, not the rule.

What effect do you suppose this has on the incentive for settlement of well or poorly founded cases? Is case merit the parameter to which settlement incentive is most sensitive?

3. A further problem with the de novo review of district court claim construction is that it makes some district judges resentful or causes them to take a “what’s the use?” attitude. Some judges defer claim construction to the beginning of trial or even the middle or end of trial. When counsel complain that this prevents their preparing their expert testimony, some judges respond that they should simply have the expert testify in the alternative, as in the famous alternative defenses: (1) I didn’t borrow your chain saw; (2) if I did, I returned it in good condition; and (3) anyhow, it was broken before I took it. Some counsel feel that comparable expert testimony in the alternative, to anticipate whatever claim construction the court will later adopt, causes juries to disbelieve the testimony.


Medical Instrumentation & Diagnostics Corp. v. Elekta AB
United States Court of Appeals for the Federal Circuit
344 F.3d 1205 (Fed. Cir. 2003)

Clevenger, Circuit Judge.

Elekta AB appeals the judgment of the United States District Court for the Southern District of California, which denied Elekta’s motion for judgment as a matter of law (“JMOL”) that its products do not infringe two U.S. patents. Because the district court erred in its construction of the “converting means” limitation and noninfringement is conceded under the correct claim construction, we reverse the district court’s denial of JMOL of noninfringement.

I. BACKGROUND

MIDCO is the holder of two patents that relate to a system for planning surgical treatment using a presentation of images from multiple scanning sources. The disclosure of both patents is particularly directed toward stereotactic surgery, which is a type of brain surgery that uses a three dimensional coordinate system to locate the site on which the surgeon is to operate.

Performing surgery on the human brain is extremely complex, and pre-surgical planning is especially important because any surgical exploration of a patient’s brain is very risky. Therefore, it is very advantageous if, prior to surgery, a surgeon can map out exactly where the problem areas are by using techniques to “visualize” the patient’s brain. Stereotactic surgical techniques allow the surgeon to “explore” the brain structures that cannot be seen from the surface by determining their location using “a knowledge of their coordinates in space relative to known anatomical and topographical landmarks.” In order to avoid opening a patient’s skull any more than is necessary, stereotactic surgery is essentially done “blind,” using electrodes attached to certain target areas as landmarks. Although the location of the probes in the brain structures is very critical, it is difficult for the surgeon to conceptualize that location because the probe is out of sight and the position of the probe involves many complex angular variables.

The invention attempts to enhance the surgeon’s ability to conceptualize the structures inside the brain by combining stereotactic surgical techniques with various imaging technologies, including computerized axial tomography (“CT”) and nuclear magnetic resonance (“NMR”) scanning. The specification explains the goal as follows: “The present invention is primarily concerned with the use of computer_graphics techniques and scanning techniques for generating various composite images to better aid the stereotactic surgeon in localizing structures, such as subcortical structures, lesions, or abnormalities.” The use of imaging techniques increases the resolution, which allows for direct rather than inferential identification of brain structures and therefore allows for more accurate performance of stereotactic surgery.

Both patents describe a “method and apparatus for generating a video presentation of images from a variety of separate scanner imaging sources.” The apparatus of the invention comprises a number of different structures that work together to create this presentation of images. The apparatus can acquire image data from different scanner sources, and then convert that image data into a selected digital format. To perform the conversion into the selected format, the apparatus takes the images from the different scanner sources and converts them into a format in which the images have the same number of pixels in the same arrangement (a one_to_one pixel arrangement), which allows them to be readily compared to one another. The apparatus also stores the images and is capable of selectively recalling and displaying at least two of them on a single screen. The images on the screen may be independently manipulated, and preferably also shaped and sized so that they conform to one another, allowing for optimum comparison. Furthermore, the apparatus of the invention can also perform various comparison techniques on the images and use the images to determine stereotactic coordinates.

The preferred use of the apparatus of the invention is in stereotactic surgery, such as tumor biopsies, thalamotomies, and treatment of other neurological disorders. Not only may it be used to assist the surgeon in accurate planning of such surgical procedures beforehand, but the preferred embodiment may also be used by the surgeon during a surgical procedure to view and compare images. An infrared beam touch screen interface allows the surgeon to communicate directly with the system in a sterile manner while the surgeon is performing a procedure.

In 1997, MIDCO filed a patent infringement suit against Elekta, alleging that Elekta’s GammaKnife, GammaPlan, ScopePlan, and SurgiPlan products infringed the patents. Elekta asserted affirmative defenses and counterclaims of noninfringement and invalidity.

Elekta now appeals to this court, arguing that the district court’s claim construction was erroneous as to a number of claim terms, that JMOL of noninfringement should have been granted, and that the district court erred in granting partial summary judgment of noninvalidity.

II. DISCUSSION

Elekta asserts that the district court made a number of errors in claim construction, but we will only focus on the construction of the “means for converting,” as we find it to be dispositive of the infringement issue. There is no dispute that this limitation is written in means plus function form and falls under 35 U.S.C. § 112, ¶ 6, which provides: “An element in a claim for a combination may be expressed as a means or step for performing a specified function without the recital of structure ... in support thereof, and such claim shall be construed to cover the corresponding structure ... described in the specification and equivalents thereof.” The first step in the construction of a means plus function claim element is to identify the particular claimed function. The second step in the analysis is to look to the specification and identify the corresponding structure for that function. Under this second step, “structure disclosed in the specification is ‘corresponding’ structure only if the specification or prosecution history clearly links or associates that structure to the function recited in the claim.” B. Braun Med. Inc. v. Abbott Labs., 124 F.3d 1419, 1424 (Fed. Cir. 1997).

The district court construed the function for the “means for converting” limitation to be converting multiple acquired images into a particular selected digital format and the structures corresponding to this function to be the framegrabber, the CVP, and “[s]oftware routines for converting digital-to-digital known to those of skill in the art.” Elekta asserts that the district court’s inclusion of software for digital-to-digital conversion as corresponding structure was erroneous. According to Elekta, the only disclosed structures that the patents associate with the converting function are the framegrabber and the CVP. Elekta points out that, although some types of software are certainly disclosed in the specification, such software is clearly linked to other functions, such as the “means for manipulating” the images.

MIDCO argues that, in addition to the framegrabber and the CVP, the district court correctly found that software is also disclosed as corresponding structure for the converting function. It points to three places in the specification that it asserts expressly and adequately disclose software as corresponding structure for the conversion function: (1) the “Image Format Conversion” box in the block diagram of Figure 1, (2) the reference to “image format conversion” in the specification, and (3) the reference to “image editing” in the specification.

We conclude that the district court correctly construed the function of the “means for converting” to be converting the acquired images into a particular selected format. The district court also correctly found both the framegrabber and the CVP to be corresponding structures. The specification clearly links these structures with the function of converting the acquired images into a selected format. See: “The VME bus based framegrabber video display board] is capable of converting a standard (RS-170) or nonstandard video signal to a digital format which is stored in its memory”; “At the level of the computer video processor unit, the nonstandard video signal is analyzed and converted by the system’s signal processor and converted to a standard RS-170 video output which then is output to the VME bus based framegrabber display board.” However, the district court erred by identifying software as an additional corresponding structure for this limitation. There is nothing in the specification or prosecution history that clearly links or associates software with the function of converting images into a selected format.

The duty of a patentee to clearly link or associate structure with the claimed function is the quid pro quo for allowing the patentee to express the claim in terms of function under § 112 ¶ 6, which was intended to allow the use of means expressions in patent claims without requiring the patentee to recite in the claims all possible structures that could be used as means in the claimed apparatus. However, the price that must be paid for use of that convenience is limitation of the claim to the means specified in the written description and equivalents thereof. If the specification is not clear as to the structure that the patentee intends to correspond to the claimed function, then the patentee has not paid that price but is rather attempting to claim in functional terms unbounded by any reference to structure in the specification. Such is impermissible under the statute.

The requirement that a particular structure be clearly linked with the claimed function in order to qualify as corresponding structure is also supported by the requirement of § 112, ¶ 2 that an invention must be particularly pointed out and distinctly claimed. “The requirement that the claims ‘particularly point[ ] out and distinctly claim[ ]’ the invention is met when a person experienced in the field of the invention would understand the scope of the subject matter that is patented when the claim is read in conjunction with the rest of the specification.” S3, Inc. v. nVIDIA Corp., 259 F.3d 1364, 1367 (Fed. Cir. 2001). Although indefiniteness of the claims is not an issue in this case because the specification does disclose the framegrabber and CVP as corresponding structures for the function of converting images, a failure to associate software with the converting function is a failure to particularly point out and claim that particular structure as a means of performing the function.

In this case, even the district court acknowledged that the link between software and the converting function was not completely clear. The court stated that “the specification is not very explicit in its disclosures of a means for performing a digital-to-digital conversion.” Nevertheless, the court concluded that because techniques for performing those conversions were known to those of skill in the art at the time the application was filed, a person of skill in the art would understand software to be a corresponding structure for the converting function. It is of course correct that to answer the question of whether the specification adequately describes and links structure that corresponds to the claimed function, we must look at the disclosure from the point of view of one skilled in the relevant art. MIDCO presented some evidence before the district court that a skilled programmer at the time of the application’s filing could have written a program for digital-to-digital conversion of image size, and we have no reason to doubt that assertion. In discussing software programs in the medical imaging field, MIDCO’s expert explained that “a software programmer having ordinary skill in the art ... would be aware of the sources of routines, modules and even small programs ... that could be incorporated into the larger program being developed. These programs were widely available from well_known sources or available from other software developers....” MIDCO then provided examples of programs for digital-to-digital image conversion (none of which are cited in the patents) that would have been available at the time the patent was filed.

However, that is not the correct inquiry. The correct inquiry is to look at the disclosure of the patent and determine if one of skill in the art would have understood that disclosure to encompass software for digital-to-digital conversion and been able to implement such a program, not simply whether one of skill in the art would have been able to write such a software program. It is important to determine whether one of skill in the art would understand the specification itself to disclose the structure, not simply whether that person would be capable of implementing that structure. Fulfillment of the § 112, ¶ 6 trade-off cannot be satisfied when there is a total omission of structure. There must be structure in the specification. Indeed, the requirement of looking to the disclosure to find the corresponding structure comes from § 112 ¶ 6 itself. It is not proper to look to the knowledge of one skilled in the art apart from and unconnected to the disclosure of the patent. Here, MIDCO’s expert never pointed to any disclosure of structure for digital-to-digital conversion in the specification. Instead, when asked about digital-to-digital conversion in the patents, he explained as follows: “The actual aspects of changing the digital format from one, for instance, number of pixels to another number of pixels, is not disclosed or discussed in the document, presumably ... because it was well known in the art and required no explanation.” We turn now to the three portions of the specification that MIDCO alleges to disclose software for digital-to-digital conversion as corresponding structure for the means for converting and MIDCO’s other arguments as to where we may find the link between software and conversion. We conclude that there is nothing in the specification or prosecution history sufficient to disclose software that is clearly linked to the converting function.

A

The “Image Format Conversion” box in Figure 1 of both patents is not a depiction of structure. This figure is described as illustrating the steps of the preferred method of the invention, not the structure of the apparatus that is the subject of the asserted claims. Because the figure does not describe structure at all, and there is no indication that one skilled in the art would understand it to do anything other than list the steps of the method, it cannot serve to clearly link software as a corresponding structure for the function of converting the images into a selected format.

This is not like the situation in Overhead Door Corp. v. Chamberlain Group, Inc., 194 F.3d 1261 (Fed. Cir. 1999), where we held that the district court erred in finding that the corresponding structure for the “memory selection second switch means” included only the mechanical switch embodiment shown in one of the figures of the patent and did not include the software embodiment illustrated by a flow diagram in a different figure. This court held that the software embodiment should also be included as an alternative corresponding structure. The software embodiment was clearly linked to the claimed function of the means limitation. First, expert testimony indicated that one of skill in the art would understand the relevant portions of the flow diagram to describe software operations for performing the claimed function. Second, the prosecution history contained an explicit statement that the “switch means includes electronic as well as manual switches.” Therefore, the flow diagram figure of the patent at issue in Overhead Door would have been understood by one of skill in the art to clearly link a software embodiment to the recited function. In contrast, the “Image Format Conversion” box in Figure 1 of the patents in suit refers to the method claims rather than the apparatus claims at issue, and there is no evidence that it would be understood by one skilled in the art to refer to structure at all, let alone to software for digital-to-digital conversion.

That Figure 1 is not a depiction of structure at all is made even clearer by the fact that the patents include two figures actually depicting structure. Figure 2 of the patents in suit is a block diagram for depicting the preferred hardware of the invention. One of the blocks in Figure 2 is labeled “Computer Video Signal Processor,” and the specification explains that in this component, the “scanning data, which is in various, typically non_standard formats, is convertible to a standard format in accordance with the invention.” The figure also has a block labeled “Central Processing Unit,” and the specification explains that the “central processing unit (CPU) ... preferably compris[es] hard disc storage, floppy disc storage, streamer tape storage, and a high resolution frame grabber with a high speed graphics and video image processor.” Figure 3 is a depiction of the preferred apparatus, and none of the numbered components of the figure refer to software. Therefore, the two structures clearly linked by the specification to the converting function are depicted in the figures of the patent, while software for digital-to-digital conversion is not. As noted above, the disclosed structures perform analog_to_digital conversion, but do not perform digital-to-digital conversion.

If the box in Figure 1 labeled “Image Format Conversion” actually referred to some structure instead of simply referring to a step in the claimed method, then the situation may well be different. In past cases, we have been generous in finding something to be a corresponding structure when the specification contained a generic reference to structure that would be known to those in the art and that structure was clearly associated with performance of the claimed function. For example, in Intel Corp. v. VIA Technologies, Inc., 319 F.3d 1357, 1366 (Fed.Cir.2003), we found that the “core logic” modified to perform a particular program was adequate corresponding structure for a claimed function although the specification did not disclose internal circuitry of the core logic to show exactly how it must be modified. The core logic was described as structure in the specification, and the specification explained that it was the adapted core logic that was capable of performing the functions recited in the claim. There was no need for a disclosure of specific circuitry in that case, just as here there would be no need for a disclosure of the specific program code if software were linked to the converting function and one skilled in the art would know the kind of program to use. However, in this case, the “Image Format Conversion” box does not refer to a type of structure, so it does not serve to link software to the converting function. It would be more like the situation in Intel if the box in Figure 1 were labeled as “Image Conversion Software” or if it at least appeared in a figure illustrating the components of the apparatus.

Similarly, in S3, Inc. v. nVIDIA Corp., 259 F.3d 1364, 1370_71 (Fed.Cir.2001), we concluded that a “selector” was adequately disclosed as corresponding structure for the “means ... for selectively receiving,” although the electronic structure of the sensor and the details of its operation were not described. The selector referred to in the disclosure and drawings of the patent was clearly a type of structure, unlike the reference to “Image Format Conversion” in the patents. There was testimony that the selector was a standard component well known in the art and that such standard components were usually represented in the same way that they were in the patent. There was also testimony that one skilled in the art would “recognize that the selector as shown in the specification [was] an electronic device such as a simple multiplexer, whose structure [was] well known.” Unlike the evidence in the case before us, which fails to connect what is disclosed in the specification with the knowledge of one skilled in the art, the testimony in S3, Inc. showed that one of skill in the art would recognize that the specification clearly linked a particular structure to the claimed function. There is no indication in this case that one skilled in the art would understand the “Image Format Conversion” box to refer to software for the conversion function.

Unlike the situations in our previous cases where we have found some link between a generic structural reference and a claimed function, there is nothing in this case to link the “Image Format Conversion” box of Figure 1 of the patents in suit to the function of converting images into a selected digital format.

B

The second portion of the specification that MIDCO asserts discloses software for digital-to-digital conversion as corresponding structure for the means for converting is another reference to “image format conversion.” The specification explains as follows:

The method of the invention is illustrated in FIG. 1. The method of the invention comprises scanning 10 the patient’s head or other body part(s); image acquisition 12 of the scans obtained; image format conversion 14 for all images so that they are converted into the same format; image storage 16; multiple image recall and display 18 of the images; and image manipulation and comparison 20.

Again, this is simply a description of Figure 1, which, as discussed above, illustrates the method of the invention rather than the apparatus. There is no evidence that one skilled in the art would understand the phrase to refer to software for digital-to-digital conversion. Therefore, this reference to “image format conversion” also does not serve to clearly link software as a corresponding structure for the function of converting the images into a selected format.

C

The third and final place in the specification that MIDCO points to as disclosing software as a corresponding structure for the means for converting is a reference to “image editing.” The full passage of the specification reads as follows:

The division for image acquisition, enhancement, and manipulation includes modular software subroutines for: 1) image capture, storage, and archiving; 2) pixel analysis for an entire image or user-defined areas of interest; 3) zoom and pan functions; 4) contrasting and filtering images with functions for smoothing, sharpening, and pseudocoloring; 5) image comparisons; 6) image editing; and 7) various edge detection routines....

Unlike the reference to “Image Format Conversion” in Figure 1 and the related discussion of “image format conversion” in the specification, this quoted portion of the specification describes software. However, there is no evidence that one of skill in the art would understand the use of the phrase “image editing” as a reference to the function of converting images into a selected digital format. The quoted passage is prefaced by the statement that “[s]oftware, provided in the CPU 34, is preferably structured on a multi-modular bi-divisional foundation, which comprises a division for image acquisition, enhancement and manipulation and a division for graphics and user specific functions.”

If the patentee had wanted to link “image editing” to the function of converting images, all that would have been necessary was to add “conversion” to the list of divisions that the software contains. As it is actually written, there is nothing to indicate that conversion is one of the functions performed by the described software or that one skilled in the art would understand that the software described in the specification performs digital-to-digital image conversion. The reference to “image editing” in this discussion of software is insufficient to clearly link software to the converting function.

This portion of the specification clearly links software to the claimed functions of acquiring and manipulating the images and may therefore appropriately be considered a corresponding structure for those functions. However, MIDCO would have us hold that software is also a corresponding structure for the converting function, even though the reference to software is not clearly linked to the claimed converting function.

In the past, we have rejected similar attempts to include as additional corresponding structure for a particular function a structure that is disclosed in the specification but is not associated with the particular claimed function. The specification here clearly links the framegrabber and CVP to the converting function, but does not link software to that function, though software is disclosed in the specification. There is no evidence that one of skill in the art would perceive a clear link between software and the function of converting images into a selected digital format.

D

In addition to the three specific places in the specification that MIDCO asserts link software to the function of digital-to-digital conversion, MIDCO also raises an additional argument to support the district court’s judgment. MIDCO argues that its expert testimony that software programs for digital-to-digital conversion were known in the art, combined with the statement in the specification that “[o]ther programs used in practicing the invention, such as image manipulation programs, are either commercially available or within the skill of practitioners in the programming arts,” is sufficient for one skilled in the art to understand how the function of converting is performed and therefore enough to make software a corresponding structure. We disagree.

MIDCO relies on our decision in Atmel, where we found that, based on the knowledge of one skilled in the art, sufficient structure was disclosed for a high voltage generating means when “the specification plainly state[d] that ‘known circuit techniques are used to implement high voltage circuit 34 [citing a paper in IEEE Journal of Solid State Circuits].’” This case is different in at least two significant respects. First, the “known techniques” referred to in Atmel are quite clearly linked to the high voltage generating means. In the patents in suit, here, the references to commercially available software or software known in the art are not discussed in connection with the means for converting. Second, Atmel’s expert had actually testified that the title of the article was enough to indicate to a person skilled in the art the precise corresponding structure contemplated by the specification. There is no comparable evidence in this case to indicate that a person skilled in the art would actually understand from the specification that software for digital-to-digital conversion was structure that corresponded to the means for converting. This may be a different case if the specification contained a statement suggesting that digital-to-digital conversion can be performed by software programs known to those of skill in the art. A statement in the specification referring to the knowledge of those skilled in the art specific to the claimed function would put it closer to the lines we have drawn in other cases such as Atmel.

Another example of this type of situation is In re Dossel, which involved a claim for a “means for reconstructing.” The Patent and Trademark Office found the claim to be invalid for failing to adequately disclose any corresponding structure for the reconstructing function. This court concluded that the specification sufficiently disclosed a computer as corresponding structure. Although the specification did not use the term “computer,” it described a structure that “receive[d] digital data, perform[ed] complex mathematical computations and output[ ] the results to a display,” and we concluded that one of skill in the art of medical imaging would understand that a computer must be the structure to perform these functions. Further, although no code that the computer would use to perform the functions was disclosed, the specification did explain that “known algorithms” could be used in the reconstruction process.

In contrast to Dossel, the specifications of these patents do not clearly link known software to the converting function. Although the specification refers to the use of software programs that “are either commercially available or within the skill of practitioners in the programming arts,” this statement in no way links software to the function of converting images into a selected format. There is no indication that it is referring to commercially available programs for conversion. Even if one skilled in the art would know that software is capable of performing the function of converting images into a selected format, there is nothing in the patents to suggest that it must be the structure that would perform the function in this invention. There must be something in the disclosure to indicate to the public that the patentee intends for a particular structure to correspond to a claimed function. It is not enough simply to list a certain structure in the specification; that structure must also be clearly linked to a claimed function in order to be a corresponding structure for that function. Furthermore, in this case, the specifications clearly describe the framegrabber and the CVP as performing the converting function, so, unlike Dossel, it is not necessary to find software to be corresponding structure to save the claim from being found invalid.

The circumstances of this case are quite similar to those in Texas Digital Systems, Inc. v. Telegenix, Inc., 308 F.3d 1193 (Fed. Cir. 2002). In Texas Digital, we held that the district court erred in its construction of “converter means” because “the court’s description of the corresponding structure as ‘including firmware, software, and/or hardware’ has no basis in the specification.” The specification had disclosed an inverter that was linked to the converting function, but Texas Digital Systems had argued that it presented expert testimony “that one of skill in the art would have appreciated that the converter means could be implemented in hardware, software, and/or firmware.” We concluded that the district court failed to properly perform the step of identifying the corresponding structure because, rather than looking to the specification, which is the proper place to look to determine what structure is disclosed that corresponds to the claimed function, it “identified a broad array of possible structures not mentioned anywhere in the specification.” In the case currently before us, software is mentioned in the specification, but it is mentioned nowhere in connection with the converting function. However, as in Texas Digital, there is other structure in the specification that is clearly linked to the converting function. Also, similar to the patentee in Texas Digital, MIDCO presented some evidence suggesting that a software program for digital-to-digital conversion would have been within the knowledge of one skilled in the art, but nothing to connect that testimony to what one of skill in the art would understand the specification to actually disclose.

Finally, none of the other references to software in the specification that MIDCO has not specifically called to our attention serve to clearly link software to the claimed function of converting images into a selected digital format. The specification states that “[s]oftware usable with the apparatus hardware to practice and to carry out the desiderata of the invention is disclosed herewith.” Obviously, the specification itself does not disclose any software routine for digital-to-digital conversion, as MIDCO’s expert even admitted. Additionally, the software routines that are appended to the patents do not deal with conversion. The specification explains what types of programs are included in the microfiche appendix, and none of the programs deal with conversion. The reference to “image manipulation programs” that are commercially available similarly does not link software to the converting function, but only to the manipulating function. Furthermore, the statement that “[t]he CPU controls all data inflow and outflow through its special software programs” does not serve as a clear link between software and the converting function. There is nothing to indicate that this statement would be understood to refer to digital-to-digital conversion of images, especially since the statement appears right before the listing of appended software programs, which does not include a program for image conversion.

E

In addition to there being nothing in the specification to clearly link or associate software with the function of converting images, there is also nothing in the prosecution history to provide this link. During prosecution of the patent, the applicant prepared a chart to distinguish the claims over the Umemura reference. One of the points of comparison in the chart was whether the system was “Solely an A/D [analog-to-digital] Conversion System.” In the column labeled “Present Invention” the applicant marked “no,” while in the column for Umemura the applicant marked “yes.” This may indicate that the applicant intended for the invention to cover digital-to-digital conversion, although the framegrabber and the CVP only perform analog-to-digital conversion. However, it is not sufficient to provide a clear link of software for digital-to-digital conversion to the claimed function of converting images into a selected digital format. There is no reference to software in that portion of the prosecution history, and there is nothing to suggest that one of skill in the art would know from that table that software must be the structure to perform the conversion.


F

We therefore conclude that the district court erred in identifying software as a corresponding structure for the means for converting because the specification and prosecution history fail to clearly link or associate software with performance of the converting function. The requirement that structure must be clearly linked or associated with the claimed function is the quid pro quo for the convenience of claiming in functional terms. MIDCO is attempting to avoid its part of the section 112, paragraph 6 bargain by asserting as corresponding structure for the converting function a structure that is not linked to that function in the specification or prosecution history. In order for the claims to serve their proper function of providing the public clear notice of the scope of the patentee’s property rights, we cannot allow a patentee to claim in functional terms essentially unbounded by any reference to what one of skill in the art would understand from the public record. The scope of a claim under section 112, paragraph 6 therefore must be limited to structures clearly linked or associated with the claimed function in the specification or prosecution history and equivalents of those structures. Here, the only two structures that are clearly linked to the converting function are the framegrabber and the CVP. Because MIDCO has conceded that the accused devices do not contain these structures or their equivalents, we reverse the judgment of infringement, and remand for entry of judgment in favor of Elekta on the issue of infringement.

To be sure, the patentee clearly and emphatically selected the framegrabber and the CVP as structure that corresponds to the claimed converting function. And equally to be sure, one of ordinary skill in the art could have written the software program to achieve digital-to-digital conversion. So, it may be tempting to say that this patentee should not be required to turn square corners when it comes to disclosing structure in the specification that is clearly linked to the claimed conversion function. Why not simply require the patentee to disclose some structure for conversion, such as the framegrabber or CVP, and then permit the patentee to claim infringement by some other structure, such as software, so long as one of ordinary skill in the art could have written the software program to perform the claimed function? The reason, of course, is because the statute itself requires disclosure of corresponding structure in the specification, and that disclosure must clearly link the disclosed structure to the claimed function with which it is associated. The public should not be required to guess as to the structure for which the patentee enjoys the right to exclude. The public instead is entitled to know precisely what kind of structure the patentee has selected for the claimed functions, when claims are written according to section 112, paragraph 6. This is precisely the point we emphasized in Atmel, where we stated:

All one needs to do in order to obtain the benefit of [§ 112, ¶ 6] is to recite some structure corresponding to the means in the specification.... The requirement of specific structure in § 112, ¶ 6 thus does not raise the specter of an unending disclosure of what everyone in the field knows that such a requirement in § 112, ¶ 1 would entail. If our interpretation of the statute results in a slight amount of additional written description compared with total omission of structure, that is the trade-off necessitated by an applicant’s use of the statute’s permissive generic means term.

The established rules in our case law on section 112, paragraph 6 that structure corresponding to the claimed function must be disclosed in the specification with clear linkage between the structure and the claimed function serve worthy goals. Such rules are intended to produce certainty in result. Precision in claiming is not an unreasonable price to pay to gain the benefits of claiming in functional terms under section 112, paragraph 6.

Because software is not clearly linked in the specification or prosecution history to the claimed function of converting images into a selected format, the district court’s identification of software as a corresponding structure for the “means for converting” was erroneous. The only corresponding structures for that means are the framegrabber and the CVP, and the accused devices concededly do not contain these structures or equivalents thereof. We therefore reverse the judgment that Elekta’s products infringe the patents, and hold that Elekta is entitled to JMOL of noninfringement.

Prefatory Note for Motorola v. Hitachi

The issue in the next case is unusual. It requires determination of the meaning of the term “instruction set.” Motorola licensed Hitachi to make microcontroller chips that did not use the same instruction set as those of Motorola’s chips. That is a license in a limited field of use. See generally General Talking Pictures Corp. v. Western Elec. Co., 304 U.S. 175 (1938), 305 U.S. 124 (1938).

Manufacture of products not covered by a license is patent infringement. Hence, the issue of whether Hitachi exceeded the scope of its license was determinative of whether Hitachi infringed Motorola’s patents. Viewed from another vantage point, license is a good affirmative defense to a claim of patent infringement. But there is no license for conduct outside the scope of the license instrument.

Why do you suppose Motorola wanted to keep Hitachi from using the same instruction set as Motorola used in its chips? For a mirror–image controversy, see NEC Corp. v. Intel Corp., 10 U.S.P.Q.2d 1177 (N.D. Cal. 1989) (involving Intel’s license to NEC to make microprocessor chips using the instruction set of Intel’s 8088/8086 chips; NEC made V–series microprocessor chips executing a superset of the instructions and Intel sued for infringement).

A very recent similar controversy arose between Sun Microsystems and Microsoft when Microsoft, operating under its JAVA license from Sun, began to distribute a proprietary, superset version of JAVA and influenced software developers to use Microsoft’s version. The result was that these developers began to create software that was not compatible with the regular JAVA, since regular JAVA did not support Microsoft’s extensions. See Sun Microsystems Inc. v. Microsoft Corp., 999 F. Supp. 1301 (N.D. Cal. 1998). Sun prevailed and the case was settled in January 2001. The settlement is available at the course Website. Other court papers in that case are available at http://java.sun.com/lawsuit/filings.html.

What competitive issues are raised when a licensee–competitor of the licensor markets a superset product? What happens if the licensee-competitor has not agreed to a “grantback” of any kind, and decides to keep its superset product proprietary?

Motorola, Inc.. v. Hitachi, Ltd.
United States District Court
750 F. Supp. 1319 (W.D. Tex.), vacated by stip., 923 F.2d 868 (Fed. Cir. 1990)

Bunton, Chief Judge.

The plaintiff, Motorola, Inc. (“Motorola”), is a Delaware corporation headquartered in Schaumburg, Illinois. Defendant Hitachi, Ltd. (“Hitachi”) is a Japanese corporation headquartered in Tokyo, Japan. Both Motorola and Hitachi manufacture and sell microprocessors and microcontrollers, among other products. Since 1975, Motorola and Hitachi have entered into a series of agreements concerning their microprocessors and microcontrollers, including agreements to cross-license their respective patents, to share technological advances with each other, and to manufacture each other’s devices. Such a union is also known as a second-source relationship and is typically initiated at the request of large customers of either corporation.

The dispute before the Court focuses on one of those agreements, the 1986 Patent License Agreement (the “PLA”). Under the PLA, Motorola and Hitachi each agreed to license certain of their patents to each other for use in the manufacture and sale of new or improved electronic devices, subject to restrictions specified in the PLA. In this suit, each party alleges the other used its patents to manufacture and sell a device not licensed under the PLA.

The Language of the PLA

Initially, Motorola claims the Hitachi H8/532 microcontroller infringes four Motorola patents, namely the ‘650, the ‘785, the ‘559 and the ’945 patents and the H8/532 is not licensed under the PLA. Hitachi countered this claim by arguing the H8/532 was licensed. In the alternative, Hitachi seeks a declaratory judgment of the invalidity of the ’650, ’785, ’559 and '945 patents negating Motorola’s infringement claim.

The relevant language of the PLA, found in § 1.20.5 thereof, states:

1.20 MICROPROCESSOR FAMILY PRODUCTS means...

1.20.5 Any MICROPROCESSOR capable of executing substantially the same instruction set as a MICROPROCESSOR in any of the [Motorola 6800/68000 microprocessor families].

It is the meaning of the phrase “instruction set” that is hotly disputed by the parties hereto and is necessarily a springboard for the remainder of the claims and counterclaims regarding the H8/532. In essence, Motorola claims the phrase refers to the “source code” or “assembly code” used by customers of the product to encode particular instructions into a microprocessor and thereby make it perform the function desired by the customer. Hitachi argues it refers to the binary code, object code or machine language understandable by the microcontroller.

Object code, binary code and machine language refer to a series of electrical impulses comprehendible by the microprocessor and symbolized by zeroes and ones (010101) or as letters (ABABA) or as electrical impulses (high-low, high-low).

At trial, the evidence revealed “instruction set” is a phrase standard in the microprocessor industry meaning the source code used by the customer to program the microprocessor to his liking. “Instruction set” is defined in the Institute of Electrical and Electronics Engineers (“IEEE”) Standard Dictionary of Electrical and Electronics Terms (the “IEEE Dictionary”) as “the set of instructions of a computer, of a programming language, of the programming languages in a programming system.” “Programming language” is defined as:

(1) A language used to prepare computer programs.... (2) An artificial language designed to generate or express programs.

Digging deeper, “artificial language” refers the reader to “formal language” which is defined as:

A language whose rules are explicitly established prior to its use. Examples include programming language, such as Fortran and Ada, and mathematical language such as predicate calculus.

Another relevant source of definition, submitted by both parties as a trial exhibit, is Paul Horowitz and Winfield Hill, The Art of Electronics (2d ed. 1989):

Programming directly in machine language is extremely tedious, since you wind up dealing with columns of binary numbers, each bit of which has to be bit-perfect, so to speak. For this reason you invariably use a program called an assembler; it allows you to write programs using easily remembered mnemonics for the instructions, and symbolic names of your own choosing for memory locations and variables.

This assembly-language program, really nothing more than a number of cryptic-looking lines of letters and numbers, is massaged by a program called an assembler to produce as its output a finished program in machine-language object code that the computer can execute. Each line of assembly code gets turned into a few machine-language bytes (1 to 6 bytes, for the 8086). The computer cannot execute assembly language instructions directly.

Another authority filed as a trial exhibit by both parties is Daniel P. Siewiorek, C. Gordon Bell, and Allen Newell, Computer Structures: Principles and Examples (1982):

The components of the program level are a set of memories and a set of operations. The memories hold data structures, which represent things both inside and outside the memory, e.g., numbers, payrolls, molecules, and other data structures. The operations take various data structures as inputs and produce new data structures, which again reside in memories.

Thus the behavior of the system is the time pattern of data structures held in its memories. The unique feature of the program level is the representation it provides for combining components, that is, for specifying what operations are to be executed on what data structures. This is the program, which consists of a sequence of instructions. Each instruction specifies that a given operation (or operations) be executed on specified data structures.

Superimposed on this is a control structure that specifies which instruction is to be interpreted next. Normally this is done in the order in which the instructions are given, with jumps out of sequence specified by branch instructions....

Two things separate the logic level from the program level. First, computer systems at the logic level are parallel devices, with all components active at the same time. At the program level, computers are represented essentially as serial devices, executing one instruction after another. Second, the program level is essentially linguistic in nature; the logic level is not. At the program level things can be named, abbreviations used, decisions made, instructions interpreted-all concepts that are absent from physical systems. Of course, they are not really absent, since a full description of the operation of a program is possible at the logic level. This is done by applying the set of physical behaviors that makes computers show the appropriate linguistic behavior at the program level. Thus, instead of the instruction “go to ALPHA if register zero is negative,” there is a logic circuit that transfers the contents of the address field of the instruction register to the program counter, ANDing that transfer with the sign of register zero so that it takes place only if the register is negative. This example reveals the distinct system boundary between the register-transfer level and the program level. The gap between these levels is also revealed in the ability of programmers to become expert without knowing anything about representations below the programming level.

The program level constitutes an entire technology in its own right, carrying within it most of the characteristics of computer systems. The ISP (instruction-set processor) sublevel specifies the machine’s instruction interpretation cycle: instruction fetch, instruction decode, program counter update, operand address calculation, operand fetch, and instruction execution.

The ISP description system is meant to provide a uniform way of describing instruction sets, i.e., of giving the information contained in a programming manual. It must provide the instruction format, the registers referenced by the instructions, the rules of interpretation of the instructions, and the semantics of each instruction in the processor’s repertoire. It must be able to do this for any existing computer and for any anticipated future computer.

One final authority, at the risk of verbosity, is Adam Osborn, An Introduction to Microcomputers (2d ed. 1980), defining a “program”:

Instruction codes are input to the CPU as a means of identifying the next operation you want the CPU to perform. A sequence of instruction codes, stored in memory, constitutes a program.

These authorities, in addition to the testimony at trial, persuade the Court the phrase “instruction set” is an accepted industry standard referring to the mnemonics used by the programmer, as opposed to the binary code understood by the microprocessor.

The fact that the PLA uses the word “executing,” which Hitachi argues denotes binary code, does not, in this Court’s opinion, render the PLA ambiguous. Although the computer translates the mnemonic instruction set to binary before it can carry out the user’s commands, it is, nevertheless, executing the user’s intentions. All computers break down the programming language into the digestible binary code, but this process does not change the fact that an instruction set is a set of mnemonics, nor that the computer executes the instruction set, only by way of binary. Thus, it is the finding of this Court the “instruction set” is the set of mnemonics used by Motorola in its 6800 and 68000 microprocessor families.

The H8/532 and License Under the PLA

The next question this Court must address is whether the H8/532 is licensed under the PLA. By law, the owner of a patent may license others to “perform acts which if performed without his consent would constitute contributory infringement of the patent.” 35 U.S.C. § 271(d)(2). Plaintiff seeks a declaratory judgment that Hitachi’s H8 and H16 are not licensed under the PLA.

Testimony of Dr. Federico Faggin revealed his comparison of the H8/532 with Motorola’s 6800 and 6801 microprocessors. (Dr. Faggin was one of the designers of the first microprocessor (the Intel 4004), the designer of the first 8-bit microprocessor (the Intel 8008), and a designer of the first high performance microprocessor (the Intel 8080).)

Dr. Faggin testified that only four instructions of the 200 included in the 6800 were not substantially the same or equivalent to instructions in the H8/532. Of the 35 additional instructions of the 6801 over the 6800, all are outside the instructions included in the H8/532. Additionally, the Hitachi 6301 contains some 9 instructions in excess of those found in the 6801, all of which are outside the scope of the H8/532.

(The 6301 was designed by Hitachi in the early 1980s. Motorola disputed the licensing of the 6301, believing the 6301 to be a derivative of the Motorola 6801, but found its arguments academic in light of the fact that many customers had already designed the 6301 into their software. Motorola therefore “allowed” the 6301 to be marketed without dispute, although it disagreed the 6301 was an independent product.)

In general, however, the H8/532 is capable of executing more than 75% of the instruction sets of the 6800, 6801 and 6301. Each of the Motorola chips are upward source code compatible with one another, meaning the customer who originally purchased the 6800 can move up to the more complex 6801 or 6301 without having to repurchase or change software. The 6801 computer can read the software originally designed for the 6800 as well as any newly designed 6801 software, and the customer can take advantage of innovation without major cost to overhaul its software. Likewise, the 6301 is upward source code compatible with the 6800 and 6801. (Thus, the phrase “family of products.”)

It was the intention of Motorola and Hitachi, in executing the PLA, to preserve the typical customer loyalty which develops when customers of a line of products make large investments in software and need only update such software upon the announcement of innovations. Competing products which are upward source code compatible allow customers to buy into a competitor’s products without having to replace their existing software. Because the H8/532 is upward source code compatible with the Motorola 6800 family, Hitachi ostensibly reaped a tremendous marketing benefit with those customers owning the 6800 family software as opposed to introducing a microprocessor which was not upward source code compatible with the 6800.

For reasons stated hereinabove, the Court finds the Hitachi H8/532 does in fact execute substantially the same instruction set as the Motorola 6800 family and is not licensed under the PLA.

H8/532 Infringement Claim

Motorola argues that Hitachi infringed four Motorola patents: the ’650 patent, the ’785 patent, the ’559 patent and the ‘’945 patent. Each will be discussed in turn.

A. The H8/532 v. the ’650 Patent

Motorola’s ’650 Patent relates to a microprocessor peripheral interface adaptor (“PIA”) which allows a microprocessor–based system to efficiently connect to any number of external peripheral devices, such as CRTs, printers, keyboards, etc. Hitachi counters Motorola’s ’650 infringement claim with the argument the ’650 patent was preempted by prior art in the form of Digital Equipment Corporation’s (“DEC’s”) PDP-11 computer, TC-11 interface for the PDP-11, and the Cohen Patent assigned to DEC.

The evidence at trial reflected Motorola’s argument that the TC-11 was designed for a minicomputer, a device much larger than the microcomputer for which the ’650 patent was designed. The description and claims of the ’650 patent do not, however, reflect the patent was specifically designed for microprocessors or for “chips.” Instead the ’650 refers to data processing systems. Further, the ’650 patent does not describe how the technology therein can be put on a chip or specifically designed to microprocessor size. Testimony from one of the inventors of the ’650 patent, Mr. Wiles, revealed the PDP-11 handbook, among other minicomputer handbooks, was used as a reference in the design of the Motorola 6820 microcomputer, which subsumes the ’650 technology, including the “Branch Never” instruction found in the ’650. As the 6820 project developed more details, however, the PDP-11 PIA technology was eventually left behind. After the 6820 microcontroller project was complete, Motorola patent attorneys prepared and submitted the documentation behind what eventually became the ’650 patent. Although those attorneys knew the PDP-11 and other minicomputer handbooks had been utilized in the groundwork for the patent, no reference was made thereto in the ’650 patent.

At trial, counsel for Hitachi presented an edition of EDN, an electronics designer’s magazine. Counsel directed the Court’s attention to an article about the Motorola 6820 microcomputer, which shows the following quote:

But the 6800 goes further than the 8080 towards simplicity, because it also doesn’t need external latches to hold status information. This is due to the way that the 6800 follows PDP-11 architecture, treating all externals as memory.

Under patent law, the claims found within a patent are presumed valid. Invalidity must be shown by clear and convincing evidence. Production of prior art not considered by the PTO in granting the patent eliminates, or, at least reduces, the deference typically due as to evidence considered by the PTO.

The Court finds the PDP-11 and the TC-11 interface clear and convincing evidence of prior art. The PDP-11 was used in the original formation of the Motorola 6820 microcomputer, and contains the same technology found in the ’650 patent. The fact that the ’650 was designed around the microcomputer as opposed to the minicomputer does not persuade the Court otherwise as microcomputer specifications are not included in the ’650 patent and because the computer industry is forever striving toward making the current technology smaller. Further, the TC-11 (DECtape) was on sale in the United States before one year preceding the filing date of the ’650 patent.

Hitachi also tendered the Cohen patent as prior art tending to invalidate the ’650 patent. The Cohen patent was issued over one year before Motorola filed the ’650 patent. Further, the Cohen patent was not considered by the PTO in awarding the ’650 patent. This Court finds the Cohen patent anticipated the ’650 patent because it contained the key elements found in the ’650, namely a processing system for executing multiple instructions in response to the execution of the first of the set of instructions, a bidirectional bus, a memory means coupled to the processor by way of the bidirectional bus, a peripheral data bus, an adaptor means coupled between the peripheral bus and the bidirectional bus to transmit information between the peripheral bus and the digital data processing system, a control register, an interface means, etc. For these reasons, the Court is of the opinion the ’650 Patent is invalid due to prior art.

In the alternative, the Court is of the opinion even if the ’650 patent is valid, the H8/532 does not infringe the patent. As Dr. Strader testified, the H8/532 is based on CMOS circuitry whereas the ’650 patent teaches NMOS circuitry. Further, the claims in the ’650 require a processor for executing instructions but the H8 uses microprogramming to execute instructions. Thus, this Court finds in the alternative the ’650 patent is not infringed by Hitachi’s H8/532 microprocessor.

B. The H8/532 v. the ’785 Patent

The ’785 patent embodies technology directed to a microprocessor which “fetches” and “executes” consecutive instructions in an overlapping manner, as opposed to one command, then another, and so on. As such, the ’785 patent allows for more rapid and efficient execution of the string of commands which comprise a computer program.

Hitachi’s invalidity defense to the ’785 infringement claim was again prior art. This Court is of the opinion defendant did not carry its burden of producing clear and convincing evidence of prior art.

Turning then to the question of infringement, this Court is of the opinion the Hitachi H8/532 did indeed infringe the Motorola ’785 patent. The fact that the H8/532 uses the more efficient combination of regular logic and random logic (microprogramming) does not distract from the underlying fact that the H8/532 uses the instruction overlap taught in the ’785 patent. Although the Court is of the opinion the H8/532 improves upon the concepts taught in the ’785 patent, the Court finds the ’785 patent is infringed in that its teachings are utilized without license by the H8/532.

C. The H8/532 v. the ’559 and ’945 Patents

Motorola refers to its ’559 and ’945 patents as the “power-down” patents, devices which shut off the power to a battery operated machine automatically, thereby producing a substantial saving of energy. Another way of expressing the concept is the “watchdog timer,” whereby the circuitry is “put to sleep” when not in use, and, upon the appropriate watchdog signal, awakened and warmed up to efficiently carry out the incoming command. Both the ’559 and the ’945 patents are titled “Apparatus for Reducing Power Consumed by a Static Microprocessor.”

Again, Hitachi’s initial defense against Motorola’s infringement claim is the ’559 and ’945 patents are anticipated by prior art. The Court is of the opinion defendants did not meet their burden with respect to showing prior art.

Turning, to Motorola’s claim of infringement, Hitachi again demonstrated for the Court how it improved on the watchdog timer by allowing the user of the H8/532 to program the timer to suit his fancy, and by the use of the more efficient microprogramming. As earlier set forth in this Court’s discussion of the ’785 patent, the Court finds that the use of the timer in the H8/532 patent was unlicensed and thereby infringing, regardless of any improvements made thereto by Hitachi.

The ZTAT Agreement

In November of 1987 the ZTAT Agreement was executed by the parties because Motorola believed the microprocessor introduced into the market by Hitachi which included the “Zero Turn Around Time” (“ZTAT”) feature was an unlicensed derivative of the Motorola 6800 family microprocessors. In exchange for Hitachi’s withdrawal of the “ZTAT Microprocessor” from the market and a license to Motorola for the device, Motorola agreed to offer a limited license to Hitachi during the withdrawal period. § 2.7 of the ZTAT Agreement states:

2.7. HITACHI agrees not to manufacture, use lease, sell or otherwise dispose of any microprocessor based device which is designed using any previously transferred TECHNICAL INFORMATION OF MOTOROLA or which falls under the definition of MICROPROCESSOR FAMILY PRODUCTS as stipulated in paragraph 1.20 of the Patent License Agreement dated May 6, 1986 between the parties and which infringes a MOTOROLA PATENT and which is not licensed under this or any other agreement between the parties without first giving notice to MOTOROLA of such intended manufacture, lease, sale, or other disposition and without receiving formal approval in writing from MOTOROLA for such action.

Hitachi’s Patent Misuse/Unfair Competition Claims

Hitachi’s Count 5 states:

Motorola’s acts and its interpretation of the 1986 PLA would prevent Hitachi from designing and developing any new products or improvements which perform substantially the same or similar functions as or that compete with Motorola products. These acts constitute an unlawful extension of Motorola’s patent grants to include rights within the public domain, resulting in the suppression of legitimate competition. The foregoing acts also constitute patent misuse and unfair competition and render all patents licensed by Motorola under the 1986 PLA unenforceable.

In view of this Court’s previous finding the H8 is not licensed under the PLA, this Court is of the opinion Hitachi’s unfair competition claims based upon the PLA are untenable and the Court shall not grant relief to Hitachi on that basis.

Hitachi’s 68030 Infringement Claim

Hitachi alleges patent infringement of Hitachi’s U.S. Patent No. 4,646,271 (the ‘’271 patent) by Motorola’s 68000 (or MC68000) family of microprocessors, specifically, the MC68030 microprocessor. The ’271 patent teaches a special purpose memory device which has a content addressable memory (“CAM”) array, a random access memory (“RAM”) array, and interconnecting logic between those two memory arrays. The interconnecting logic of the ’271 includes a means responsive to a control signal for selecting between two ways of connecting the CAM and RAM arrays to each other, and thus switches between two modes of operation.

Motorola challenges the validity of the ’271 with the Sperry Rand patent. The Court finds the Sperry Rand patent does not anticipate Hitachi’s ’271 patent.

As for the issue of Motorola’s infringement of the ’271, the Court is of the opinion the MC68030 and specifically the Translation Lookaside Module portion thereof does in fact include the CAM array/RAM array with an interconnecting logic means for selecting and connecting, including the ability to load the CAM array without inputting a key. Accordingly, it is the finding of this Court Motorola infringed the Hitachi ‘’271 patent with the MC68030.

Damages

For reasons stated above, the Court is constrained to find damages both for infringements by Hitachi and by Motorola. It is both in making the initial infringement determination and in fashioning the remedy that this Court is made acutely aware of the travesty of justice cases such as this pose upon courts. The subject matter of this suit is extremely complex and delicate; not the sort of thing the lay person should be put in a position of judging. The intricacies of the patents and devices involved is clear only to the engineer. The far-reaching effects of infringement is known only to the business persons and marketing specialists involved with Motorola and Hitachi.

What is more perplexing to this Court is these two parties have dealt personally with each other for years. They have negotiated their differences with the skill and expertise only they can possess. Yet suddenly they left behind their prior relationship and expected this Court to ferret out the wrongdoings of which each is accused. Even worse, they hired lawyers to compound and exponentially increase their disputes and damages. This Court has seen more than 90 motions filed in this case, replete with bickering and petty insults. The parties would have saved time, money, feelings, and relations had they curbed their emotions and sat down to settle their difference out of court.

In short, this suit is not the sort of thing Federal Courts should spend time and energy upon. The parties present this Court not with legal questions, but with questions related to engineering and electronic technology more suitably determined by those intimately familiar with the art.

With that, the Court shall begin its bewildering foray into the issue of damages. By statute, this Court, in its equitable discretion, may enjoin the use of the infringing device. 35 U.S.C. § 283. Indeed, injunctive relief against an infringer is the norm. KSM Fastening Systems, Inc., v. H.A. Jones Co., 776 F.2d 1522 (Fed. Cir. 1985). Further, this Court must award at least reasonable royalty damages to the patentee. 35 U.S.C. § 284.

This Court finds herein Hitachi infringed Motorola patents ’785, ’559 and ’945 with its H8 microcontroller. In terms of injunctive relief, this Court must rely on the ancient principles of equity in molding its decision. The historic injunctive process was designed to deter, not punish. Yet any sort of injunctive relief will necessarily punish the wrongdoer as the technology and markets involved herein are so far-reaching that the future harm to the enjoined party shall not and perhaps cannot be measured. At any rate, the Court feels compelled to enjoin the further marketing by Hitachi of the H8 for the duration of the ’785, ’559 and ’945 patents, for the reason certain circuitry of the H8 infringes the teaching of those patents and because the H8 is not licensed under the PLA. Likewise, the Court shall order an injunction of further marketing of the Motorola 68030 device for the duration of the ’271 patent.

This Court’s duty in determining compensatory damages, is to put the patentee in the position it would have held had infringement not occurred. Reasonable royalty is the floor below which damages shall not fall.

Motorola is clearly not entitled to Hitachi’s H8 profits under the prevailing law, although such profits may be used as a yardstick for making the assessment of Motorola’s damages. Had the H8, and products utilizing the H8, not been marketed in the United States, Hitachi would not have made some $6,691,000.00 in profits. As this Court is not in a position to conclude Motorola products would have been bought instead of the H8 in each of the purchases underscored by the profits, the Court is of the opinion the entire amount should not be awarded. Instead, the evidence suggests Motorola currently holds approximately 6% of the total market share in the total semiconductor industry. Multiplying Hitachi’s profits by Motorola’s market share in the industry is, in this Court’s opinion, a more accurate measure of damages Motorola suffered by introduction of the H8 into the United States’ market. This amount totals $401,460, a nominal amount in terms of the net worth of both Motorola and Hitachi. The Court is certain this figure does not come close to the reasonable royalty chargeable to Hitachi for the use of the ’785, ’559 and ’945 patents.

As Motorola tendered no evidence of a reasonable royalty figure or analysis, this Court shall look to the evidence presented by Hitachi with regard to reasonable royalties. Hitachi’s expert, Willis, looked at three areas in determining a reasonable royalty, licensing characteristics in the semiconductor industry, licensing characteristics of Motorola, and costs associated with available, acceptable non-infringing technology. The Court finds the second factor most relevant and significant to a determination of what these parties might have agreed to had the issue been negotiated.

According to Hitachi, Motorola entered into at least 62 agreements with Hitachi and other semiconductor manufacturers covering semiconductor technology. Thirteen of those agreements were between Motorola and Hitachi. Forty-six of the agreements include a lump sum royalty payment, twelve of which were for $500,000 or less. Motorola did not produce cross-evidence refuting these numbers. In light of this evidence, the Court is of the opinion a reasonable royalty for each infringed patent is a lump sum of $500,000. As Hitachi infringed three of Motorola’s patents, the Court is of the opinion a baseline reasonable royalty calculation for all three patents is $1,500,000.

The Court shall not stop at this figure, however, because the Court agrees with the prevailing thought that mere recovery of reasonable royalty is analogous to the imposition of a compulsory license upon every patent owner and does not serve to deter such conduct in the future. Thus, in addition to reasonable royalty, the Court shall include lost profits to the sum, making the total recovery for Motorola equal to $1,901,460 on its infringement claims.

Turning then to the Hitachi ’271, the Court is likewise of the opinion Hitachi should recover $500,000 as a lump sum reasonable royalty for the infringement of its patent. Unfortunately, the ’271 has never been put to market in a microprocessor or otherwise; therefore lost profits, in terms of Motorola’s 68030, is not relevant to the issue of damages. Further, Hitachi argued reasonable royalty was a proper measure of damages for infringement of the ’271. Therefore, the Court shall not assess additional damages against Motorola for infringement of the ’271. Thus, the Court assigns a total damage figure to Hitachi of $500,000 for Motorola’s infringement of the Hitachi ’271 patent.

In light of the foregoing, IT IS ORDERED:

The H8 is hereby declared not licensed under the parties 1986 PLA.

Hitachi is enjoined from marketing or selling the H8/532 microprocessor for the duration of the ’785, ’559 and ’945 patents. Motorola shall recover from Hitachi $1,901,460 for Hitachi’s infringement of the Motorola ’785, ’559 and ’945 patents.

Motorola is enjoined from the marketing or sale of the 68030 mi- croprocessor for the duration of the ’271 patent. Hitachi shall recover from Motorola $500,000 for Motorola’s infringement of Hitachi’s ’271 Patent.

Notes

1. The court’s order, perhaps deliberately (see introductory paragraphs of Damages section of opinion), forced the parties into a standoff. The court enjoined Motorola from making and selling its premier microprocessor chip, and it enjoined Hitachi from U.S. marketing of its latest microcontroller chip. As the court observed with satisfaction, it had no choice since “injunctive relief against an infringer is the norm.” This appears to have left each party in a much worse position than it was in before the suit.

A few months after the district court’s order, the parties agreed to settlement of the case and dismissal of their cross-appeals. In an unpublished opinion (referenced in a table at 923 F.2d 868), the Federal Circuit ordered that, upon consideration of the parties’ joint motion to vacate and remand these appeals because of settlement, the motion is granted, the judgment of the district court is vacated, and the case is remanded to the district court with instructions to dismiss the complaint with prejudice.

2. The key words of the contract (PLA) were “capable of executing substantially the same instruction set as” a 6800/68000 microprocessor chip. (The 6800 series of chips were an earlier version of the 68000 series of chips.) The court’s explanation of the PLA is not a model of clarity. Motorola licensed Hitachi to make chips other than those that were capable of executing the 6800/68000 instruction set.

The H8 implemented, in different machine language (1s and 0s), a slight variation on the Motorola instruction set (as to mnemonics or assembly language terms). A mnemonic might be, for example, STO (meaning “send to output”) or JNZ (meaning “jump [branch] on not–zero”). The 6800 might use 1001 0101 as the machine language code for the STO instruction, while the H8 used 1100 1010 for its corresponding mnemonic instruction. Hitachi might use a different mnemonic term for an instruction, perhaps terming JNZ (“jump on not–zero”) NZJ (“non–zero jump”), which might be like using jour instead of day, but there would be similar functionality.

The Motorola 6800 had about 200 possible instructions. Only 4 of them lacked a counterpart in the Hitachi H8 instruction set. An additional 35 instructions were added to the Motorola 6801, and the H8 omitted all of them. The Hitachi 6301 (later licensed to Motorola) added 9 more instructions that were lacking in the 6800 and H8.

If a customer wrote a program for use on the 6800, the customer could use the program on the H8 after reassembling the assembly code (converting the mnemonics to machine language). It was not a major task to reassemble microprocessor code, although it entailed some effort.

Hitachi argued that the H8 did not “execute” (and was not capable of executing) the same instruction set as the 6800, because the H8’s decoder (the combinatorial logic circuit in the microprocessor core of the microcontroller that caused the microprocessor to perform operations upon receipt of an instruction in machine language) could not “understand” (and thus could not execute or operate on) a signal using the 6800’s patterns of 1s and 0s. Thus, if I tell your robot, Passez–moi du lait, it will not respond properly (by passing me some milk) if you have programmed its voice–recognition circuitry (or software) in terms of English instructions. Indeed, in the case of a faux ami, untoward consequences may occur.

The court did not agree with Hitachi that the purpose of the PLA was to limit Hitachi only as to 1s and 0s. What are the different business consequences of accepting Hitachi’s or Motorola’s respective interpretations of the PLA?

Is there any public interest implication of this restriction or limitation? Consider the court’s oblique statement about “the typical customer loyalty which develops when customers of a line of products make large investments in software and need only update such software upon the announcement of innovations.” Does this sound like anything in the background of Lotus Development Corp. v. Borland Int’l, Inc., 49 F.3d 807 (1st Cir. 1995), aff’d by an equally divided Court, 116 S. Ct. 804 (1996)?

3. The court accepted Hitachi’s argument that putting the architecture of a PDP–11 minicomputer onto a chip is not patentable. Did the court invalidate the patent under § 103 or § 102(b)? On appeal, would the Federal Circuit have upheld this ruling?

4. The court does not believe in quoting claims and matching elements of the claims against specific disclosures in the prior art. However, in holding the Cohen patent anticipatory of the ’650 patent, the court stated that the “key elements found in the ’650” were:

a processing system for executing multiple instructions in response to the execution of the first of the set of instructions, a bidirectional bus, a memory means coupled to the processor by way of the bidirectional bus, a peripheral data bus, an adaptor means coupled between the peripheral bus and the bidirectional bus to transmit information between the peripheral bus and the digital data processing system, a control register, an interface means, etc.

Then, in addressing infringement in the next paragraph, the court finds the H8 noninfringing because it “is based on CMOS circuitry whereas the ’650 patent teaches NMOS circuitry.” Also, the H8 uses microprogramming (i.e., microcode) to execute instructions. Explain how the key elements of the ’650 relate to CMOS vs. NMOS. Explain also how using microcode avoids inclusion of the key elements.

5. In addressing the claims of misuse and unfair competition the court opines that the claims are untenable because, under its interpretation of the PLA, the PLA did not license the H8. How does the fact (if such) that the license does not cover the H8 keep the license from being an act of misuse or unfair competition?

What do you suppose is Hitachi’s legal theory? See Lasercomb Amer., Inc. v. Reynolds, 911 F.2d 970 (4th Cir. 1990); Compton v. Metal Prods., Inc.., 453 F.2d 38, 45 (4th Cir. 1971), cert. denied, 406 U.S. 968 (1972).


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