United States Court of Appeals
for the Federal Circuit
__________________________
CENTILLION DATA SYSTEMS, LLC,
Plaintiff-Appellant,
v.
QWEST COMMUNICATIONS INTERNATIONAL,
INC., QWEST CORPORATION, AND QWEST
COMMUNICATIONS CORPORATION,
Defendants-Cross Appellants.
__________________________
2010-1110, -1131
__________________________
Appeals from the United States District Court for the
Southern District of Indiana in consolidated case Nos. 04-
CV-0073 and 04-CV-2076, Chief Judge Larry J. McKin-
ney.
___________________________
Decided: January 20, 2011
___________________________
VICTOR M. WIGMAN, Blank Rome LLP, of Washington,
DC, argued for plaintiff-appellant. With him on the brief
were PAUL M. HONIGBERG; and KENNETH L. BRESSLER, of
New York, New York.
VINCENT J. BELUSKO, Morrison & Foerster LLP, of Los
Angeles, California, argued for defendants-cross appel-
lants. With him on the brief was HECTOR G. GALLEGOS.
CENTILLION DATA v. QWEST COMM 2
__________________________
Before LOURIE, LINN, and MOORE, Circuit Judges.
MOORE, Circuit Judge.
Appellant Centillion Data Systems, LLC (Centillion)
appeals the district court’s grant of summary judgment
that Qwest Communications International, Inc., Qwest
Corporation, and Qwest Communications Corporation
(Qwest, collectively) do not infringe the claims of U.S.
patent no. 5,287,270 (’270 patent). Qwest cross-appeals
the district court’s grant of summary judgment that the
asserted claims are not anticipated. Because the district
court erred in granting summary judgment of nonin-
fringement, we vacate and remand. Because there are
genuine issues of material fact regarding anticipation, we
reverse and remand.
BACKGROUND
The ’270 patent discloses a system for collecting, proc-
essing, and delivering information from a service pro-
vider, such as a telephone company, to a customer. ’270
patent col.1 ll.15-20. Prior to the ’270 patent, according to
the inventors, telephone companies did not have a system
to process and deliver billing data to clients in an elec-
tronic format other than tapes used on a mainframe. Id.
col.2 ll.29-39. The inventors developed a system for
processing call data and delivering it to customers in a
format appropriate for a personal computer. Id. col.2
l.66–col.3 l.6. The personal computers are adapted to
perform analysis on the data using a specialized software
package. Id. col.3 ll.34-48.
Claims 1, 8, 10, and 46 are relevant to this appeal.
Claim 1 is illustrative and, at a high level, requires “a
system for presenting information . . . to a user . . . com-
3 CENTILLION DATA v. QWEST COMM
prising:” 1) storage means for storing transaction records,
2) data processing means for generating summary reports
as specified by a user from the transaction records, 3)
transferring means for transferring the transaction
records and summary reports to a user, and 4) personal
computer data processing means adapted to perform
additional processing on the transaction records. Centil-
lion concedes that the claim includes both a “back-end”
system maintained by the service provider (claim ele-
ments 1, 2, and 3) and a “front-end” system maintained by
an end user (claim element 4).
Centillion accused a number of Qwest’s billing sys-
tems including Logic, eBill Companion, and Insite (ac-
cused products) of infringing claims of the ’270 patent.
For the purposes of this appeal, we need not differentiate
between these products. The accused products include
two parts: Qwest’s back office systems and front-end
client applications that a user may install on a personal
computer. Customers who sign up for the accused prod-
ucts “have made available to them electronic billing
information on a monthly basis.” Appellee’s Br. 9. Qwest
also provides, as part of the accused products, software
applications that a user can choose to install on a per-
sonal computer. A customer may take advantage of the
electronic billing information without installing the
software, but the software allows for additional function-
ality. Customers access data by download.
In most uses, the processing of information on the
back-end is passive. Once a user subscribes, the back-end
will perform its monthly processing regardless of whether
the user chooses to download the data. However, the
system allows for “on-demand” reports when a user, at a
personal computer, requests different date ranges. These
“on-demand” requests cause the back-end system to
process data and deliver it to the user via download.
CENTILLION DATA v. QWEST COMM 4
The parties filed cross motions for summary judgment
regarding infringement. Qwest also filed a motion for
summary judgment of invalidity and Centillion filed a
motion for summary judgment of no anticipation. The
district court granted Qwest’s motion for summary judg-
ment of noninfringement. Centillion Data Sys., L.L.C. v.
Qwest Commc’ns Int’l, Inc., No. 1:04cv73 (S.D. Ind. Oct.
29, 2009) (Opinion). The district court did not perform an
element by element comparison. Rather, it considered
whether, under our case law, Qwest could be liable for
infringement of a system claim that requires both a back
office portion as well as a personal computer operated by
a user. All claims on appeal are system claims. The
district court only considered infringement by “use” under
35 U.S.C. § 271(a). The district court held that NTP, Inc.
v. Research in Motion, Ltd., 418 F.3d 1282 (Fed. Cir.
2005) defined use as “put[ting] the system into service,
i.e., . . . exercis[ing] control over, and benefit[ting] from,
the system’s application.” It held that under BMC Re-
sources Inc. v. Paymentech, L.P., 498 F.3d 1373 (Fed. Cir.
2007) and Cross Medical Products v. Medtronic Sofamor
Danek, Inc., 424 F.3d 1293 (Fed. Cir. 2005), an accused
infringer must either practice every element or control or
direct the actions of another that practices the element in
question.
Applying this law to the facts, the district court de-
termined that no single party practices all of the limita-
tions of the asserted claims. Regarding Qwest, the
district court determined that Qwest does not “use” the
system under § 271(a) by providing the back-end portions
of the accused systems and the software for a user to load
on its “personal computer processing means.” Opinion at
32. It held that, under its definition of “use,” Centillion
could not show that Qwest “practiced each and every
element of the system claim.” Id. Specifically, it held
5 CENTILLION DATA v. QWEST COMM
that Qwest does not control the “personal computer
processing means” of the asserted claims. Id. It held
that, although Qwest provides the software, it does not
require customers to load the software or perform the
additional processing required by the asserted claims. Id.
at 32-33. It further held that Centillion could not estab-
lish any direction or control of the customers by Qwest
such that Qwest should be vicariously liable for the ac-
tions of its customers as in Cross Medical.
The district court further held that Qwest’s customers
did not “use” the patented system under § 271(a). Opin-
ion at 34. It held that “Centillion has not demon-
strated . . . that Qwest’s customers directed or controlled
the ‘[data] processing means’ of the accused systems’
‘back-end.’” Id.
The district court also granted Centillion’s motion for
summary judgment of no anticipation holding that the
prior art COBRA system did not generate “summary
reports as specified by the user” as required by the claims.
Both parties appeal. We have jurisdiction under 28
U.S.C. § 1295(a)(1).
DISCUSSION
We review a district court’s grant of summary judg-
ment de novo. ICU Med., Inc. v. Alaris Med. Sys. Inc., 558
F.3d 1368, 1374 (Fed. Cir. 2009). Summary judgment is
appropriate when, drawing all justifiable inferences in the
nonmovant’s favor, there exists no genuine issue of mate-
rial fact and the movant is entitled to judgment as a
matter of law. Fed. R. Civ. P. 56(c); Anderson v. Liberty
Lobby, Inc., 477 U.S. 242, 255 (1986).
I. Infringement
To analyze infringement in this case, we must first
address the district court’s definition of “use” under
CENTILLION DATA v. QWEST COMM 6
§ 271(a) and its application of the rules of vicarious liabil-
ity. Then, we apply the rule for “use” to the potential
direct infringers in this case.
A. “Use” of a System Claim Under Section 271(a)
This case turns on what constitutes “use” of a system
or apparatus claim under § 271(a). Centillion argues that
the district court adopted an overly narrow interpretation
and that “use” simply means “the right to put into service
any given invention.” Appellant’s Br. 22. It argues that
use does not require that a party “practice” every element,
only that it use the system as a collective. In other words,
Centillion argues that operation of one component of an
invention may “put into service” the invention even if the
accused infringer does not directly interact with other
components. It argues that we explicitly defined “use”
under § 271(a) in NTP. It further argues that by intro-
ducing a requirement that an individual party practice
every claim element, the district court introduced con-
cepts of infringement that apply only to method claims.
Finally, it argues that the district court did not need to
apply the rules of vicarious liability when Centillion is
arguing that there is a single “user” of the system.
Qwest responds that the district court was correct,
that to “use” a system under § 271(a), an accused in-
fringer must exert control over or “practice” each claimed
element. It further argues that we should reject the
application of vicarious liability to “use.” It argues that,
although we have endorsed the notion of vicarious liabil-
ity in the context of method claims, we should not extend
this analysis to system or apparatus claims. It argues
that we should require “use” of the entire system, practic-
ing each element, by a single entity and should never look
to the conduct of more than one party to determine “use.”
7 CENTILLION DATA v. QWEST COMM
Qwest further argues that public policy disfavors Cen-
tillion’s proposed definition of “use” under § 271(a). It
argues that to allow direct infringement of a claim that
includes both a front-end personal computer and a back-
end controlled by a service provider would subvert the
statutory scheme for indirect infringement. It argues that
if an end user can “put a system into service” even though
it does not control back-end components, then there would
be no need for the indirect infringement analysis. It also
argues that the claims in this case are poorly drafted to
require action by two distinct parties. It argues that we
should not “remedy Centillion’s ill-conceived claims” by
defining “use” to cover the accused products. Appellee’s
Br. 52.
We have never directly addressed the issue of in-
fringement for “use” of a system claim that includes
elements in the possession of more than one actor. How-
ever, we defined the term in a very similar scenario in
NTP. In NTP, the issue was whether infringement oc-
curred within the United States. Id. at 1313. The claims
and the accused product involved a handheld device
operated by a customer as well as a number of relays
operated by a service provider. One of these relays was
located outside the United States. We had to determine
whether a “use” by a customer of the entire system
amounted to a “use” within the United States. We stated
that “courts have interpreted the term ‘use’ broadly.” Id.
at 1316. Citing Bauer & Cie v. O’Donnell, 229 U.S. 1
(1913), we stated that the term use means “the right to
put into service any invention.” NTP, 418 F.3d at 1316-
17. We went further to distinguish use of a claimed
method from that of a claimed system and to hold that
“[t]he use of a claimed system under section 271(a) is the
place at which the system as a whole is put into service,
i.e., the place where control of the system is exercised and
CENTILLION DATA v. QWEST COMM 8
beneficial use of the system obtained.” Id. at 1317.
Applying this rule to the facts of the case in NTP, we held
that customers located in the United States who sent
messages via the accused product used the overall system
and the location of the use was in the United States.
Turning to the instant action, although NTP dealt
with the situs of infringement rather than the nature of
the infringing act, it interpreted the definition of “use”
under § 271(a). We hold that to “use” a system for pur-
poses of infringement, a party must put the invention into
service, i.e., control the system as a whole and obtain
benefit from it. NTP, 418 F.3d at 1317. The district court
correctly determined that this definition from NTP was
the proper one to apply. Opinion at 22.
The district court erred, however by holding that in
order to “use” a system under § 271(a), a party must
exercise physical or direct control over each individual
element of the system. The “control” contemplated in
NTP is the ability to place the system as a whole into
service. In other words, the customer in NTP remotely
“controlled” the system by simply transmitting a message.
418 F.3d at 1317. That customer clearly did not have
possession of each of the relays in the system, nor did it
exert the level of direct, physical “control” that the district
court requires. To accept the district court’s interpreta-
tion of “use” would effectively overturn NTP because the
predicate “use” in that case would no longer fall under the
definition of “use.”
We agree that direct infringement by “use” of a sys-
tem claim “requires a party . . . to use each and every . . .
element of a claimed [system].” In order to “put the
system into service,” the end user must be using all
portions of the claimed invention. For example, in NTP,
the end user was “using” every element of the system by
9 CENTILLION DATA v. QWEST COMM
transmitting a message. It did not matter that the user
did not have physical control over the relays, the user
made them work for their patented purpose, and thus
“used” every element of the system by putting every
element collectively into service.
1. “Use” by Qwest’s Customers
Centillion argues that, under the correct definition of
“use” from NTP, Qwest’s customers put the claimed
system into service. It argues that a system is put into
service “when it is engaged to accomplish the purposes for
which it is intended.” Appellant’s Reply Br. 32. It argues
that Qwest’s customers use the system by subscribing,
thus causing the back-end portions of the system to act
and then downloading the reports. It argues that this is
sufficient to put the entire system into service.
Qwest argues that its customers do not “use” the sys-
tem because they do not control the back-end processing.
It argues that Qwest performs the back-end processing
and provides the result—not the processing itself—to the
customer. It argues that the customer then chooses
autonomously whether to download this information and
whether to install and use the Qwest software. It argues
that under Cross Medical, a customer could only be liable
for use of the system if Qwest actually provided the back-
end processing hardware and software to the customer so
that the customer could control it.
There are two different manners of operation of the
Qwest system relevant to this appeal. First, there is an
on-demand function where a customer “seeks particular
and specified information” by creating a query that the
Qwest back-end system processes and provides a result
for download (on-demand operation). Appellee’s Br. 44.
Second, during the normal functioning of the system after
a user subscribes, Qwest’s back-end systems create peri-
CENTILLION DATA v. QWEST COMM 10
odic summary reports (standard operation) which are
available for the user to download.
We hold that the on-demand operation is a “use” of
the system as a matter of law. 1 The customer puts the
system as a whole into service, i.e., controls the system
and obtains benefit from it. The customer controls the
system by creating a query and transmitting it to Qwest’s
back-end. The customer controls the system on a one
request/one response basis. This query causes the back-
end processing to act for its intended purpose to run a
query and return a result. The user may then download
the result and perform additional processing as required
by the claim. If the user did not make the request, then
the back-end processing would not be put into service. By
causing the system as a whole to perform this processing
and obtaining the benefit of the result, the customer has
“used” the system under § 271(a). It makes no difference
that the back-end processing is physically possessed by
Qwest. The customer is a single “user” of the system and
because there is a single user, there is no need for the
vicarious liability analysis from BMC or Cross Medical.
We also hold that the standard operation is a “use” as
a matter of law. The standard operation allows users to
subscribe to receive electronic billing information on a
monthly basis. Once a user subscribes, Qwest’s back-end
system generates monthly reports and makes them avail-
able to the customer by download or other means. Qwest
also makes available to customers software to load on
their PCs to further exploit these monthly reports.
Unlike the on-demand operation, this is not a one re-
quest/one response scenario. By subscribing a single
1 As we discuss below, this does not dispose of the
issue of infringement because the district court did not
compare the accused system to the asserted claims.
11 CENTILLION DATA v. QWEST COMM
time, the user causes the back-end processing to perform
its function on a monthly basis. Like the on-demand
operation, the back-end processing in normal operation is
performed in response to a customer demand. The differ-
ence though is that a single customer demand (the act of
subscribing to the service) causes the back-end processing
monthly. But in both modes of operation, it is the cus-
tomer initiated demand for the service which causes the
back-end system to generate the requisite reports. This is
“use” because, but for the customer’s actions, the entire
system would never have been put into service. This is
sufficient control over the system under NTP, and the
customer clearly benefits from this function.
Because the district court concluded as a matter of
law that no single party could be liable for “use” of the
patented invention, it did not compare the accused system
to the claim limitations. We note that, although the
customers “use” the system as a matter of law, this does
not settle the issue of infringement. We will not decide,
as Qwest requests, whether the accused products satisfy
the “as specified by the user” limitations for the first time
on appeal. Likewise, we decline to determine for the first
time on appeal whether any individual customer has
actually installed the Qwest software, 2 downloaded
records, and analyzed them as required by the claims. 3
Because the issue has not been raised on appeal here, we
2 Centillion concedes that in order to infringe, the
customer must install Qwest’s client software. Appel-
lant’s Br. 31.
3 For purposes of its indirect infringement case,
Qwest also asks us to determine that the accused prod-
ucts have substantial noninfringing uses. The district
court did not address this issue in its opinion and we
decline to perform this factual inquiry for the first time on
appeal.
CENTILLION DATA v. QWEST COMM 12
make no comment on whether Qwest may have induced
infringement by a customer.
2. “Use” by Qwest
Centillion argues that there is a genuine issue of ma-
terial fact regarding whether Qwest, by operating the
back-end processing, “uses” the system under § 271(a). It
argues that Qwest operates the back-end processing and
provides the software to adapt the user’s personal com-
puter. It argues that this effectively puts the system into
service and should qualify as use under § 271(a). It
argues that under our precedent, actual performance of
claim limitations is not required to establish infringement
of a system or apparatus claims, citing Fantasy Sports
Properties, Inc. v. Sportsline.com, Inc., 287 F.3d 1108
(Fed. Cir. 2002). Centillion also argues that, in some
instances, Qwest customer service representatives can log
into the system on behalf of an end user and operate all
parts of the claimed system.
Qwest argues that, as a matter of law, it cannot “use”
the system under § 271(a) because it does not control the
claimed personal computer. Qwest argues that this case
is analogous to Cross Medical where a third party assem-
bled the complete system. Qwest asserts that, because it
does not control the actions of its customers, it cannot
meet the test of Cross Medical for vicarious liability. It
further argues that the district court found that there was
no evidence of Qwest customer service using the system
as a whole on behalf of end users.
We agree with Qwest that, as a matter of law, it does
not “use” the patented invention under the appropriate
test from NTP. To “use” the system, Qwest must put the
claimed invention into service, i.e., control the system and
obtain benefit from it. NTP, 418 F.3d at 1317. While
Qwest may make the back-end processing elements, it
13 CENTILLION DATA v. QWEST COMM
never “uses” the entire claimed system because it never
puts into service the personal computer data processing
means. Supplying the software for the customer to use is
not the same as using the system.
The only way that Centillion can establish “use” by
Qwest is if Qwest is vicariously liable for the actions of its
customers such that “use” by the customers may be at-
tributed to Qwest. Our precedents on vicarious liability,
BMC, Muniauction, Inc. v. Thomson Corp., 532 F.3d 1318,
1328-29 (Fed. Cir. 2008), Akamai Technologies, Inc. v.
Limelight Networks, Inc., 2009-1372, 2009-1380, 2009-
1416, 2009-1417, 2010 WL 5151337 (Fed. Cir. Dec. 20,
2010), and Cross Medical, analyze the circumstances in
which the actions of one party ought to be attributed to a
second party for purposes of direct infringement – vicari-
ous liability. In BMC, we noted that “[f]or process patent
or method patent claims, infringement occurs when a
party performs all of the steps of the process.” 498 F.3d at
1378-79. However, we noted that in some instances, one
party could be liable for infringement of a method claim
even if it did not perform all of the steps. This vicarious
liability arises when one party controls or directs the
actions of another to perform one or more steps of the
method. Id. at 1379. We confirmed this approach for
method claims in Muniauction, 532 F.3d at 1328-29 and
recently explained in Akamai Technologies that for in-
fringement to be found when more than one party per-
forms the steps of a method claim, an agency relationship
or other contractual obligation to perform the steps must
exist. See Akamai Techs., 2010 WL 5151337, at *6. In
Cross Medical, we considered the issue of vicarious liabil-
ity for making a claimed apparatus or system under
§ 271(a). The claim related to a medical device and, as
properly construed, required contact between the device
and human bone. 424 F.3d at 1310-11. In the particular
CENTILLION DATA v. QWEST COMM 14
facts of that case, the accused manufacturer created the
accused product, but did not perform surgeries to bring
the device into contact with bone. We held that the
manufacturer did not “make” the claimed apparatus. We
held that if anyone made the claimed apparatus, it was
the surgeon who implanted the accused device, possibly
bringing it into contact with bone. Id. at 1311. We noted
that the manufacturer would not be liable for the sur-
geon’s direct infringement unless the surgeon acted as an
agent of the manufacturer. Id.
Following our vicarious liability precedents, we con-
clude, as a matter of law, that Qwest is not vicariously
liable for the actions of its customers. Qwest in no way
directs its customers to perform nor do its customers act
as its agents. While Qwest provides software and techni-
cal assistance, it is entirely the decision of the customer
whether to install and operate this software on its per-
sonal computer data processing means.
Centillion’s reliance on Fantasy Sports is misplaced
because the issue in that case was whether the district
court erred by only considering indirect infringement.
287 F.3d at 1117-19. In Fantasy Sports, we held that the
district court should have considered whether the defen-
dant directly infringed the claims because it housed all of
the necessary software on its servers. 287 F.3d at 1119.
This does not equate to a holding that in order to prove
“use” of a patented invention, a patent owner must only
show that the accused infringer makes software available.
As discussed above, the entire system is not used until a
customer loads software on its personal computer and
processes data. Qwest clearly does not fulfill this claim
requirement.
15 CENTILLION DATA v. QWEST COMM
B. Liability for “Making” under § 271(a)
Centillion argues that there is a genuine issue of ma-
terial fact as to whether Qwest “makes” the claimed
invention under § 271(a) and that it was therefore im-
proper for the district court to grant summary judgment
of noninfringement. It argues that Qwest builds all of the
parts of the system including the client-side software.
Although Centillion concedes that the independent claim
requires a “personal computer processing means,” it
argues that Qwest acts as the “mastermind” of the system
by directing and controlling its customers’ action to install
the software. Appellant’s Br. 37 (citing Muniauction, 532
F.3d at 1329).
Qwest responds that Centillion waived this argument
by not bringing it below. If the argument is not waived,
Qwest argues that it asserts virtually no control over its
customers to complete the system. It argues that its
customers are free to choose whether to install the soft-
ware. With or without the software, they can still
download and view their reports.
The district court did not address this issue in its
opinion, likely because Qwest’s motion for summary
judgment of noninfringement and Centillion’s response
focused on “use.” Centillion argues that the issue is not
waived because, in its response to Qwest’s motion, it
incorporated by reference its own motion for partial
summary judgment of infringement that mentioned
Qwest’s liability for “manufacture” of the accused sys-
tems. J.A. 6323. We need not reach the issue of whether
a single statement in an incorporated brief is sufficient to
preserve an issue, because Qwest does not “make” the
patented invention under § 271(a) as a matter of law.
Qwest manufactures only part of the claimed system. In
order to “make” the system under § 271(a), Qwest would
CENTILLION DATA v. QWEST COMM 16
need to combine all of the claim elements—this it does not
do. The customer, not Qwest, completes the system by
providing the “personal computer data processing means”
and installing the client software.
Further, Qwest is not vicariously liable for the actions
of its customers; as discussed above, Qwest’s customers do
not act as Qwest’s agents as a matter of law nor are they
contractually obligated by Qwest to act. See Akamai
Techs., 2010 WL 5151337, at *6; Cross Medical, 424 F.3d
at 1311. 4
II. Invalidity
In response to Qwest’s motion for summary judgment
of invalidity, Centillion filed a motion for summary judg-
ment of no anticipation. These motions addressed antici-
pation for prior sale under § 102(b) based on a system
called COBRA that had a similar function to the claimed
invention. The district court denied Qwest’s motion and
granted Centillion’s motion holding that the COBRA
system did not anticipate the asserted claims as a matter
of law.
In the 1980s, the phone company New York/New Eng-
land Exchange (NYNEX) created the COBRA system to
solve the same problem addressed by the ’270 patent. It
sought to replace paper statements and computer tapes
with a more user-friendly format. COBRA created disk-
ettes for customers with billing information for use on
personal computers. There were four different types of
records, TOLL and three other records that arguably did
not directly involve the cost of toll phone calls. For exam-
4 Centillion also argues that Qwest employees can
remotely log into customer computers to install the soft-
ware. Centillion cites no evidence to support this state-
ment and Qwest argues that its personnel have access to
customer accounts, not computers.
17 CENTILLION DATA v. QWEST COMM
ple, one of the other record types involved charges for
rented equipment. A customer could choose to receive
reports on one or more of these record types. Like the
asserted claims of the ’270 patent, COBRA comprised a
back-end system as well as a software package for cus-
tomers to install on their personal computers. The system
became available for subscription in 1987 and was re-
named TRACE.
The district court granted summary judgment of no
anticipation holding that COBRA did not generate “sum-
mary reports as specified by the user” as required by the
claims. The court’s claim constructions are undisputed.
It construed “summary reports” to mean “a collection of
analyzed and/or reorganized data.” It construed “as
specified by the user” to mean “customer selects, or makes
specific, the character of.” This means that, to anticipate,
the COBRA system must generate “a collection of ana-
lyzed and/or reorganized data that a customer selects, or
makes specific, the character of.”
The district court held that the COBRA system did
not meet this limitation. It relied on the fact that COBRA
was simply an extension of the prior art mainframe
system that allowed users to select a record type (e.g.,
TOLL) and receive monthly reports on tape. It held that
the ’270 patent contemplated more than simply collecting
the same call data previously provided on a paper bill or
tape. It stated that the “summary reports” of the ’270
patent involved more processing of the data and placing
the data into a different format. It held that the ’270
patent contemplated greater customer input than simply
selecting a record type. Accordingly, the district court
held that there was no genuine issue of material fact that
COBRA did not meet the “as specified by user” limitation
of the independent claims.
CENTILLION DATA v. QWEST COMM 18
Qwest argues that there are genuine issues of mate-
rial fact as to whether COBRA discloses “summary re-
ports as specified by the user.” It first argues that the
district court was incorrect to find that COBRA was
merely an extension of the prior art system that provided
the same data on magnetic tape. It argues that COBRA
had to reformat all files for use on a personal computer.
Further, it argues that the district court improperly
applied its own construction. It argues that COBRA users
could select which type of report they wanted (e.g., TOLL)
and the resulting reports meet the construction “a collec-
tion of analyzed and/or reorganized data that a customer
selects, or makes specific, the character of.” In other
words, if a customer received only its TOLL records, this
would be a collection of reorganized data that the cus-
tomer selected.
Centillion argues that the COBRA system only al-
lowed users to access one type of record that included
“rated” calls, the TOLL file. It argues that the court
should only consider rated calls, because they are the only
types of calls relevant to billing. Further, it argues that
Qwest cannot rely on the COBRA system because NYNEX
concealed all of the back-end processing. It argues that
NYNEX only provided the public with the software for
personal computers and concealed all of the processing
that is relevant to the claims. It asks us to consider this
issue for the first time on appeal. Cross-Appellee’s Resp.
Br. 48, n.25. It argues that even commercial sale will not
result in a § 102 bar if the seller does not fully disclose the
claimed invention, citing Woodland Trust v. Flowertree
Nursery, Inc., 148 F.3d 1368, 1370-71 (Fed. Cir. 1998).
The district court erred by holding there was no genu-
ine issue of material fact that COBRA meets the “sum-
mary reports as specified by the user” limitation. There is
a factual dispute as to whether the records that COBRA
19 CENTILLION DATA v. QWEST COMM
provided are “summary reports” as construed by the
district court. The different reports, such as the TOLL
report, are arguably “a collection of analyzed and/or
reorganized data” because they present records in a
format that was previously unavailable. Further, there is
a factual dispute as to whether these summary reports
are created “as specified by the user.” This claim term
has a broad construction of “customer selects, or makes
specific, the character of.” The COBRA customer could
define which record type it wanted in the reports provided
by the system. This is arguably “select[ing] or mak[ing]
specific, the character of” a report. Because there are
genuine issues of material fact regarding whether COBRA
satisfies the “summary reports as specified by the user”
claim limitation, we hold that summary judgment was
improper.
Regarding the failure to publicly disclose, we will not
decide this for the first time on appeal. Qwest disputes
almost every fact presented by Centillion. It does not
appear that this issue is amenable to summary judgment,
and if it is, the district court should consider it in the first
instance.
Because genuine issues of material fact remain, we
reverse the district court’s grant of summary judgment of
no anticipation. We remand the case for further proceed-
ings.
VACATED-IN-PART, REVERSED-IN-PART, and
REMANDED