United States Court of Appeals for the Federal Circuit
2009-1086, -1098
VERIZON SERVICES CORP., VERIZON COMMUNICATIONS, INC.,
MCI COMMUNICATIONS CORP., and VERIZON BUSINESS GLOBAL LLC,
Plaintiffs-Appellants,
v.
COX FIBERNET VIRGINIA, INC., COX VIRGINIA TELECOM, INC.,
COX COMMUNICATIONS HAMPTON ROADS, LLC,
COXCOM, INC., and COX COMMUNICATIONS, INC.,
Defendants-Cross Appellants.
Richard G. Taranto, Farr & Taranto, of Washington, DC, argued for plaintiffs-
appellants. Of counsel on the brief were Michael K. Kellogg, John C. Rozendaal and
Michael E. Joffre, Kellogg, Huber, Hansen, Todd, Evans & Figel, PLLC, of Washington,
DC; John Thorne and Robert H. Griffen, Verizon Communication Inc., of Arlington,
Virginia, and Leonard C. Suchyta, of Basking Ridge, New Jersey.
Mitchell G. Stockwell, Kilpatrick Stockton LLP, of Atlanta, Georgia, argued for
defendants-cross appellants. With him on the brief were William H. Boice and Audra A.
Dial.
Appealed from: United States District Court for the Eastern District of Virginia
Senior Judge Claude M. Hilton
United States Court of Appeals for the Federal Circuit
2009-1086, -1098
VERIZON SERVICES CORP., VERIZON COMMUNICATIONS, INC., MCI
COMMUNICATIONS CORP., and VERIZON BUSINESS GLOBAL LLC,
Plaintiffs-Appellants,
v.
COX FIBERNET VIRGINIA, INC., COX VIRGINIA TELECOM, INC., COX
COMMUNICATIONS HAMPTON ROADS, LLC, COXCOM, INC., and COX
COMMUNICATIONS, INC.,
Defendants-Cross Appellants.
Appeals from the United States District Court for the Eastern District of Virginia in case
no. 1:08-CV-157, Senior Judge Claude M. Hilton.
__________________________
DECIDED: April 16, 2010
__________________________
Before MAYER, LINN, and PROST, Circuit Judges.
LINN, Circuit Judge.
Verizon Services Corp., Verizon Communications, Inc., MCI Communications,
Inc., and Verizon Business Global LLC (collectively “Verizon”) appeal from a final
judgment of the United States District Court for the Eastern District of Virginia entered
after a jury found: (1) claims 5 and 6 of U.S. Patent No. 6,282,574 (“the ’574 patent”)
and claims 1, 3, and 11 of U.S. Patent No. 6,104,711 (“the ’711 patent”) invalid; and (2)
claim 1 of U.S. Patent No. 6,430,275 (“the ’275 patent”); claims 1, 19, 27, and 35 of U.S.
Patent No. 6,292,481 (“the ’481 patent”); claim 1 of U.S. Patent No. 6,137,869 (“the ’869
patent”); and claims 12, 13, and 20 of U.S. Patent No. 6,636,597 (“the ’597 patent”) not
infringed by Cox Fibernet Virginia, Inc., Cox Virginia Telecom, Inc., Cox
Communications Hampton Roads, LLC, Coxcom, Inc., and Cox Communications, Inc.
(collectively “Cox”). See Verizon Servs. Corp. v. Cox Fibernet Va., Inc., No. 08-CV-
0157 (E.D. Va. Oct. 6, 2008) (judgment); Verizon Servs. v. Cox Fibernet Va., Inc., 08-
CV-0157 (E.D. Va. Nov. 7, 2008) (order denying cross-motions for judgment as a matter
of law and new trial); Verizon Servs. Corp. v. Cox Fibernet Va., Inc., No. 08-CV-0157
(E.D. Va. Nov. 11, 2008) (agreed order amending and clarifying the judgment). On
appeal, both parties challenge the district court’s denial of their respective motions for
judgment as a matter of law and motions for new trial. Because the evidence
introduced at trial supports the jury’s verdict, and because the district court did not err in
instructing the jury on the scope of the claims, we affirm.
I. BACKGROUND
A. The Patents at Issue
The six patents at issue in this appeal are owned by Verizon and relate generally
to packet-switched telephony─technology for providing telephone calls by breaking up
voice signals and sending the resulting data in packets, not all of which need traverse
the same path, through a network. Packet-switched telephony increases the efficiency
of the underlying network over traditional circuit switching, which relies on a dedicated
path between endpoints of a call.
To explain the technology involved in the six asserted patents, the parties divide
them into three groups: the ’711 and ’574 patents (the “Feature Patents”), the ’275,
’869, and ’481 patents (the “Network Patents”), and the ’597 patent (the “Quality of
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Service Patent”). None of the claims in any of the patents at issue in this appeal refer
explicitly to the Internet or to a “public packet data network,” which this court has
previously equated to the Internet. Verizon Servs. Corp. v. Vonage Holdings Corp., 503
F.3d 1295, 1305 (Fed. Cir. 2007). Instead, the asserted claims refer to “packet
switched networks,” “circuit switched networks,” and a “system of interlinked packet
data networks.”
1. The Feature Patents (’711 and ’574)
The Feature Patents share a specification and involve methods for providing
features such as call-forwarding over packet-switched networks. These features are
made possible by an enhanced name translation server. The specification describes
the existing Domain Name System (“DNS”), which uses computers associated with the
Internet, known as domain name servers, to convert textual domain names into numeric
Internet Protocol (“IP”) addresses. The specification also describes software developed
for use on personal computers to permit the two-way transfer of real-time voice
information via an Internet data link between two personal computers (“VOIP”). The
inventions relate to a server with an expanded variety of translation services over a
traditional domain name server, allowing for a wider range of routing options over
packet-switched networks. This additional functionality allows providers of VOIP to offer
enhanced features, such as call-forwarding and voicemail, to which users of traditional
telephone service have become accustomed. Although the inventions are “particularly
advantageous for processing of voice telephone communications through the packet
data network,” they are not limited to voice services or the Internet. ’711 patent col.6
ll.48-50.
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2. The Network Patents (’275, ’869, and ’481)
The Network Patents relate to an architecture for providing per-call support
functionality for voice service over a packet-switched network. The inventions in this
group provide for bundling the traditionally separate databases of usage recording,
pricing, and authorization into a single logical database in order to ensure scalability of
the system, reduce the potential for fraud, and allow mechanisms for network support
infrastructure, pricing, call flow, and billing. The patents do not require this single logical
database, referred to as a “unitary logical object” or “ULO,” to be implemented as a
single physical system.
3. The Quality of Service Patent (’597)
The Quality of Service Patent covers a method for providing services over a
packet-switched network by dynamically allocating resources to vary the quality of
service on a call-by-call basis. The invention includes an enhanced routing technique,
which is more flexible than the traditional routing tables used by the public switched
telephone network and allows the invention to quickly respond to changes in network
configuration and network traffic.
B. The Parties and the Litigation
In 1996, Cox began to offer telephone service. This service initially was based
on traditional, circuit-switched telephony, operated over Cox’s private cable network. In
2003, Cox began to provide telephone service over its private cable network using a
packet-switched technology called PacketCable.
In January 2008, Verizon sued Cox for willfully infringing its patents by deploying
Cox’s packet-switched telephone service. Four of the six patents at issue, the Feature
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Patents (the ’711 and ’574 patents) and two of the three Network Patents (the ’275 and
’869 patents), had been previously litigated in Verizon Servs. Corp. v. Vonage Holdings
Corp., No. 06-CV-1782 (E.D. Va. 2007) (“Vonage”). Although different claims were
asserted in Vonage, the claims at issue in that case were closely related to the asserted
claims in this case and used many of the same terms. The issues relating to the
Feature Patents were reviewed by this court on appeal, and the claim constructions
made in connection therewith were affirmed. Verizon Servs. Corp. v. Vonage Holdings
Corp., 503 F.3d 1295 (Fed. Cir. 2007). The district court adopted the relevant claim
constructions from the Vonage litigation and, in addition, construed several terms that
had not been at issue in the Vonage case. Verizon Servs. v. Cox Fibernet Va., Inc., No.
08-CV-0157 (E.D. Va. Sept. 3, 2008) (“Claim Construction Order”). A jury found that
Cox did not infringe any of the asserted claims of the six patents and that the asserted
claims of the Feature Patents were invalid. Verizon Servs. v. Cox Fibernet Va., Inc.,
No. 08-CV-0157 (E.D. Va. Oct. 6, 2008) (jury verdict).
After the jury verdict, Verizon renewed its Rule 50(a) motion for judgment as a
matter of law (“JMOL”) under Rule 50(b) of the Federal Rules of Civil Procedure and,
alternatively, moved for a new trial under Rule 59(a). Cox filed its own motions for
JMOL under Rules 50(a) and (b) arguing that the asserted claims of the Network
Patents and the Quality of Service Patent are invalid. In the alternative, Cox requested
a new trial on invalidity in the event the district court were to grant Verizon a new trial on
infringement. The district court denied all of these motions and both parties appeal.
We discuss the parties’ arguments in the following order. First, we discuss
Verizon’s argument that a new trial is necessary for both validity and infringement of all
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the asserted claims in all six patents because Cox improperly made arguments to the
jury about claim scope. Second, we discuss the challenges to the jury’s verdicts on
validity of the asserted claims of the Feature Patents. This includes Verizon’s request
for JMOL that the Feature Patents are not invalid and, in the alternative, its request for a
new trial on validity of the Feature Patents because of an allegedly improper argument
by Cox. This section also includes Cox’s cross-appeal of the denial of its motion for
JMOL that the Network Patents and the Quality of Service Patent are invalid and its
alternative motion for new trial. Third, we discuss the challenges to the jury’s verdicts
finding no infringement, including Verizon’s request for JMOL of infringement of claim 1
of the ’481 patent and its request for a new trial on infringement of the asserted claims
of the Quality of Service Patent based on its allegation that the district court
misconstrued a claim term.
We have jurisdiction under 28 U.S.C. § 1295(a)(1) (2006).
DISCUSSION
I. Standard of Review
JMOL is appropriate when “there is no legally sufficient evidentiary basis for a
reasonable jury to find for that party on that issue.” Fed. R. Civ. P. 50(a)(1). We review
the denial of a motion for judgment as a matter of law or for a new trial under the law of
the regional circuit. Riverwood Int’l Corp. v. R.A. Jones & Co., 324 F.3d 1346, 1352
(Fed. Cir. 2003). The Fourth Circuit reviews rulings on motions for judgment as a
matter of law de novo. Johnson v. MBNA Am. Bank, NA, 357 F.3d 426, 431 (4th Cir.
2004). “The question is whether a jury, viewing the evidence in the light most favorable
to [the nonmovant], could have properly reached the conclusion reached by this jury.
2009-1086, -1098 6
We must reverse [the denial of a motion for JMOL] if a reasonable jury could only rule in
favor of [the movant]; if reasonable minds could differ, we must affirm.” Id. (internal
quotations and citation omitted). The Fourth Circuit reviews rulings on motions for a
new trial for abuse of discretion. United States v. Perry, 335 F.3d 316, 320 (4th Cir.
2003). “In reviewing a grant or denial of a new trial, the crucial inquiry is whether an
error occurred in the conduct of the trial that was so grievous as to have rendered the
trial unfair.” Bristol Steel & Iron Works, Inc. v. Bethlehem Steel Corp., 41 F.3d 182, 186
(4th Cir. 1994) (internal quotations omitted).
We also review a district court’s evidentiary rulings under the law of the regional
circuit. MicroStrategy Inc. v. Bus. Objects, S.A., 429 F.3d 1344, 1349 (Fed. Cir. 2005).
Under the law of the Fourth Circuit, this court reviews the district court’s exclusion of
evidence for abuse of discretion. United States v. Wilkerson, 84 F.3d 692, 696 (4th Cir.
1996).
II. Jury Arguments About Claim Scope
Verizon argues that we should vacate the district court’s judgment that the
asserted claims of the Feature Patents are invalid and that Cox did not infringe any of
the asserted claims of all six patents because Cox improperly made arguments to the
jury about claim scope that subverted the jury’s ability to fairly decide the issues before
it.
The scope of the claims was considered at several times leading up to trial. At
the claim construction phase of the proceedings, both parties agreed that the term
“packet data network” in the asserted claims included both public networks, like the
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Internet, and private networks, like that used by Cox. The construction adopted by the
district court was that the term “packet data network” means:
a packet-switched data network, where the network transports packets of
data over a non-dedicated circuit to a destination, and each packet
includes source and destination addresses.
Claim Construction Order 4-5. Neither party asserts on appeal that this construction is
incorrect.
Prior to the jury charging conference, Verizon submitted a proposed jury
instruction stating “[t]he 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. 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 Patent
and Trademark Office.” Verizon Servs. v. Cox Fibernet Va., Inc., No. 08-CV-0157 (E.D.
Va. Sept. 24, 2008) (Verizon’s proposed jury instruction No. 31). The district court did
not give this proposed instruction and rejected Verizon’s renewed request made prior to
the initiation of jury deliberations.
At the trial, the district court gave comprehensive instructions to the jury defining
its role in claim construction. The instructions included the following: “the scope of the
patent claims is a question of law for me to decide”; “you must give the claims the scope
my interpretations give them”; “all of the terms which I have not given you in an express
interpretation are to be given by you their ordinary and customary meaning to a person
of ordinary skill in the art to which the patent pertains”; and “[t]he scope of the patent is
not limited to particular embodiments . . . but is limited only by what is fairly within the
scope of the claims.” Trial Tr. vol. 8, 1694, 1704, Sept. 29, 2008. The district court also
2009-1086, -1098 8
instructed the jury that “[f]rom time to time in their arguments, the lawyers may have
stated what law was applicable to this case. And if they made a reference . . . that is
contrary to what I state the law to be, you must disregard what the lawyers said and
abide by what the Court states the law to be.” Trial Tr. vol. 8, 1717, Sept. 29, 2008.
Neither party argues that any of the jury instructions were incorrect.
The dispute in this case is not over the district court’s claim construction or jury
instructions, but instead about arguments that Cox made to the jury about claim scope.
More specifically, Verizon alleges that Cox and its experts repeatedly argued that the
scope of the asserted claims was limited by the intent of the inventors. In support of this
allegation, Verizon cites to several places where Cox’s counsel and its experts referred
to statements of the inventors and then distinguished Cox’s system from the asserted
claims based on those statements. Verizon also points to the following statement made
by Cox’s counsel while he questioned an expert, “[Verizon] accuse[s] a small part of the
Cox system which has nothing to do with the purpose of the patent.” Verizon’s Principal
Br. 13. In addition, Verizon asserts that although witness testimony about the Internet’s
role in the patents was “unobjectionable as background,” during closing arguments Cox
improperly made statements inviting the jury to use this testimony to interpret the
claims. Verizon’s Reply Br. at 6-7. The particular portion of Cox’s closing argument
that Verizon finds objectionable is the following:
You will notice that the Court has construed some terms, but not all the
terms. And at the bottom of each page there is a footnote that I want you
to look at and read. And what it says is, “all of the terms that the Court did
not give an express interpretation, are to be given their customary and
ordinary meaning to a person of ordinary skill in the art to which the
patents pertain.”
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In other words, all this language that is not construed, you have got to
apply as it would be understood by a person of ordinary skill in the art.
Well, I certainly am not, and I assume that at least some of you are not
persons of ordinary skill in this art. So, how are you to do that? To apply
these patent terms or these claims, you have got to understand what they
cover, what the context is. And that’s why we put on the evidence that we
have.
Trial Tr. vol. 8, 1650, Sept. 29, 2008. According to Verizon, this “unmistakably created
a dispute over claim scope by inviting the jury to limit the claims to the Internet.” To
remedy this perceived problem, Verizon requested an instruction after the district court
charged the jury that “none of the claims in this case is limited to the Internet.” Trial Tr.
vol. 8, 1722, Sept. 29, 2008. The district court denied this request.
Verizon frames its challenge on appeal as a claim construction issue governed
by O2 Micro International Ltd. v. Beyond Innovation Technology Co., Ltd., 521 F.3d
1351 (Fed. Cir. 2007). In O2 Micro, the parties disputed the specific meaning of the
claim term “only if” at the Markman hearing. Id. at 1357. In its Markman order, while
acknowledging the parties’ dispute, the court ruled that the term had a well-understood
definition and therefore needed no construction. Id. At trial, the “only if” limitation “was
a key issue disputed by the parties” and both parties presented explicit arguments to the
jury regarding the term’s meaning. Id. at 1358. In O2 Micro, we held that the district
court’s conclusion that the term “only if” need not be construed was wrong because it
left the parties’ dispute over the scope of the claim term unresolved and was a question
of law that should have been determined by the court and not left to the jury. Id. at
1361. Thus, we remanded the case to the district court for proper construction of the
claim term “only if.” Id. at 1362-63.
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Several subsequent cases have clarified when a remand for additional claim
construction is appropriate. For example, in Kinetic Concepts, Inc. v. Blue Sky Medical
Group, Inc., we noted that “[w]hile [O2 Micro] permits a remand for further claim
construction, it does not require one,” particularly when the parties do not use the
allegedly disputed construction in front of the jury. 554 F.3d 1010, 1019 n.4 (Fed. Cir.
2009). Further, in Broadcom Corp. v. Qualcomm Inc., we refused to remand a case for
further construction of a claim term when the purported dispute over claim construction
was raised for the first time after the jury verdict. 543 F.3d 683, 694 (Fed. Cir. 2008)
(“Unlike in O2 Micro, where the parties disputed the proper construction of a term at a
pre-trial Markman hearing, 521 F.3d at 1362, Qualcomm here has failed to offer its
proposed construction of ‘networks’ at or prior to trial, and we reject such arguments
raised for the first time after the jury verdict.”)
Verizon characterizes Cox’s closing argument as creating “an actual dispute
regarding whether the patent claims were limited to communications over the Internet
and/or the particular problems the inventors were trying to solve” and requires reversal
under O2 Micro. Verizon’s Principal Br. 23. Verizon’s reliance on O2 Micro is
misplaced. Unlike O2 Micro, where the scope of a specific claim term was in dispute
beginning at the Markman hearing and continuing throughout the trial, Verizon never
identified at any time during the proceedings before the district court any specific claim
term that was misconstrued or that needed further construction. Moreover, the
allegedly improper arguments it complains that Cox made do not relate to any particular
misconstrued term. Cox did not invite the jury to choose between alternative meanings
of technical terms or words of art or to decide the meaning of a particular claim term, as
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was the case in O2 Micro. To the contrary, Cox asserts that not only did it not argue
that the claim generally should be limited to the Internet, it acknowledged through its
expert that the asserted claims are not limited to the Internet. Specifically, Cox’s expert,
Dr. Evans, testified at the trial that:
Q. In your conclusion that the Cox system does not have a system of
interlinked packet data networks but instead is one network, are you
relying in any way on a distinction between the public or private
interlink packet data networks?
A. No, sir, I’m not.
Trial Tr. vol. 4, 839, Sept. 23, 2008.
Cox contends that the arguments now objected to by Verizon were not intended
to limit claim scope but more broadly to distinguish its accused system, which it
contended lacked any sort of “system of interlinked packet data networks,” from the
claimed system of the Feature Patents. Cox also argues that because it believed at the
time it implemented its PacketCable system that Verizon’s patents solved problems
related to the Internet, it was proper to contend at the trial─as a matter unrelated to
claim scope─that its actions should not be found to have been willful.
While Verizon attempts to characterize the issue as one of claim construction, its
argument is more accurately about whether Cox’s arguments to the jury about the
distinction between how its system works and the Internet were improper in offering the
jury “appealingly simplifying ways to determine invalidity and infringement” thus
“invit[ing] the jury to shirk its key factfinding function.” Verizon’s Principal Br. 28-29.
On that issue, we turn, once again, to the law of the Fourth Circuit. See Juicy
Whip, Inc. v. Orange Bang, Inc., 382 F.3d 1367, 1370-71 (Fed. Cir. 2004). The Fourth
Circuit reviews the refusal to set aside a verdict based on improper arguments by
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considering the totality of the circumstances, including “the nature of the comments,
their frequency, their possible relevancy to the real issues before the jury, the manner in
which the parties and the court treated the comments, the strength of the case (e.g.,
whether it is a close case), and the verdict itself.” Arnold v. E. Air Lines, Inc., 681 F.2d
186, 197 (4th Cir. 1982) (quoting City of Cleveland v. Peter Kiewit Sons’ Co., 624 F.2d
749 (6th Cir. 1980)). Only when there is a “reasonable probability,” that improper
arguments effectively subverted “the jury’s reason or [] its commitment to decide the
issues on the evidence received and the law as given it by the trial court” can an abuse
of discretion in declining to set aside that verdict be found. Id.
On this record, we are not persuaded that the district court abused its discretion
by refusing to order a new trial on the basis of Cox’s arguments to the jury. Validity and
infringement were vigorously litigated, with extensive testimony, physical exhibits, and
argument from both sides. Each side presented multiple expert witnesses. From
thousands of pages of trial testimony, Verizon singles out snippets of testimony by
Cox’s witnesses and of argument by counsel as improper. And Verizon admits that
each of the cited statements “were not necessarily objectionable on their own,” but that
somehow taken together, these statements made “prejudice to the jury deliberations
inescapable.” Verizon’s Principal Br. 28; Verizon’s Reply Br. 6-7. We disagree. We
cannot say that the singular or cumulative effect of these statements effectively
subverted the jury’s reason or commitment to decide the issues on the evidence
received and the law as given by the court.
The district court specifically instructed the jury that counsel’s arguments and
statements were not evidence. During closing, along with the allegedly improper
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arguments, Cox properly described the specific claim limitations that were missing from
the accused system. In addition, Verizon did not, during the trial, request a limiting
instruction based on Cox’s allegedly improper claim scope arguments. Nor did Verizon
object to any arguments made during Cox’s closing. Finally, Verizon had the
opportunity, in its own closing, to rebut any improper or misleading statements it
perceived in Cox’s closing arguments but instead said nothing. Looking at the entire
record, including the extensive evidence and testimony along with the district court’s
comprehensive jury instructions, we see no reason to conclude that the district court
abused its discretion in finding that the jury had not been deprived of its ability to decide
this case. We thus conclude that the district court properly denied Verizon’s request for
a new trial.
III. Validity
A. JMOL
Both parties argue that the jury verdicts on validity should be overturned because
the jury could not reasonably have made its decision based on the evidence advanced
at trial. Verizon argues that Cox presented insufficient evidence to support the jury’s
finding that the asserted claims of the Feature Patents were invalid. Cox, on the other
hand, argues that the Network Patents and the Quality of Service Patent are invalid as a
matter of law. At trial, Cox argued that all the asserted claims of Verizon’s six patents
were invalid because of anticipation and obviousness.
1. Anticipation
To show invalidity of the asserted claims of the Feature Patents, Cox presented
an expert at trial, Dr. Mark J. Handley. Dr. Handley testified that two papers he had co-
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authored on protocols for using the Internet for telephony, a February 1996 draft of the
Session Initiation Protocol (“SIP Article”) and a November 1995 paper on Session
Description Protocol (“SDP Article”), along with another document entitled RFC 1183,
were relevant prior art. Dr. Handley testified that the Feature Patents were anticipated,
as the SIP Article disclosed all the elements of the claims in the ’711 patent and RFC
1183 disclosed all elements of the ’574 patent. For example, after extensive
explanation of how the SIP Article disclosed each element of asserted claims 1, 3, and
11 of the ’711 patent, Dr. Handley testified:
Q. Dr. Handley, I believe we were getting ready to get to a dependent
Claim 3 of the ’711 patent. Did you reach an opinion as to whether
that claim is embodied in your 1996 SIP article?
A. Yes, I believe it is.
...
Q. Do you have anything else to add to your conclusion that Claims 1 and
11 are invalid in view of the SIP article?
A. No, I believe that that’s the key points, that all of these elements are
present in the February 1996 document.
Trial Tr. vol. 4, 909, 914, Sept. 23, 2008. Dr. Handley also provided testimony that RFC
1183 disclosed each element of the asserted claims of the ’574 patent─independent
claim 5 and dependent claim 6, which adds to claim 5 the limitation “wherein the reply
also contains an address conforming to the first protocol”:
Q. Okay. So, let’s look at your slides here. If you could look at Exhibit
25, Defendant’s Exhibit 4225 [“Claim 5 of the ’574 Patent v. 1990 RFC
1183” J.A. 15721]. Does that help illustrate your point that Claim 5 of
the ’574 patent is embodied in this 1990 RFC?
A. Yes. This is basically what you have already seen several times.
...
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Q. What about, we don’t have a slide for this, but what about Claim 6’s
point about adding another IP address. Was that disclosed in the
RFC?
A. It is disclosed in the RFC sort of implicitly.
Trial Tr. vol. 4, 927, 930, Sept. 23, 2008. In addition, Dr. Handley testified that the SIP
Article and SDP Article, read together, anticipated the asserted claims of both of the
Feature Patents.
Cox also called Dr. Williams and Dr. Helgert as expert witnesses to testify that
the asserted claims of the Network Patents and the Quality of Service Patent were
anticipated. Dr. Williams testified that U.S. Patent 5,233,604 (“the ’604 patent”)
disclosed every element of the asserted claims of the Quality of Service Patent. Dr.
Helgert testified that U.S. Patent 6,310,873 (“the ’873 patent”) disclosed each element
of the asserted claims of the Network Patents. Verizon, in turn, presented an expert
witness at trial, Pieter Zatko, who testified that the ’604 patent did not disclose several
limitations of the asserted claims of the Quality of Service Patent and therefore did not
anticipate those claims. Verizon also called an expert, Dr. Houh, who testified that the
’873 patent did not disclose several elements of the asserted claims of the Network
Patents.
For a prior art reference to anticipate a patent, it must disclose each and every
limitation of the claimed invention. Schering Corp. v. Geneva Pharms., Inc., 339 F.3d
1373, 1377 (Fed. Cir. 2003). “[A] prior art reference may anticipate without disclosing a
feature of the claimed invention if that missing characteristic is necessarily present, or
inherent, in the single anticipating reference.” Id. However, a patent claim “cannot be
anticipated by a prior art reference if the allegedly anticipatory disclosures cited as prior
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art are not enabled.” Amgen, Inc. v. Hoechst Marion Roussel, Inc., 314 F.3d 1313,
1354 (Fed. Cir. 2003). “The standard for what constitutes proper enablement of a prior
art reference for purposes of anticipation under section 102, however, differs from the
enablement standard under section 112.” Rasmusson v. SmithKline Beecham Corp.,
413 F.3d 1318, 1325 (Fed. Cir. 2005). It is well-settled that utility or efficacy need not
be demonstrated for a reference to serve as anticipatory prior art under section 102.
See Bristol-Myers Squibb Co. v. Ben Venue Labs., Ind., 246 F.3d 1368 (Fed. Cir. 2001);
In re Schoenwald, 964 F.2d 1122, 1124 (Fed. Cir. 1992).
Verizon argues that since the SIP paper refers to the SDP paper only as a
“companion draft,” it does not properly identify the specific material it incorporates as
required to treat two documents as one for anticipation purposes. Kyocera Wireless
Corp. v. Int’l Trade Comm’n, 545 F.3d 1340, 1352 (Fed. Cir. 2008). Verizon also argues
that since incorporation by reference is a matter of law, it was improperly left for the jury
to decide without any instruction. Verizon is correct that if incorporation by reference
comes into play in an anticipation determination, it is the court’s role to determine what
material in addition to the host document constitutes the single reference. Advanced
Display Sys., Inc. v. Kent State Univ., 212 F.3d 1272, 1283 (Fed. Cir. 2000). However,
we find that Dr. Handley’s testimony, noted above, provided substantial evidence for the
jury to determine that the SIP paper, by itself, anticipated the claims of the ’711 patent,
and the RFC 1183 paper anticipated the claims of the ’574 patent. Therefore, the lack
of instruction on incorporation by reference was harmless. See Z4 Techs., Inc. v.
Microsoft Corp., 507 F.3d 1340, 1354 (Fed. Cir. 2007) (holding that district court’s
2009-1086, -1098 17
erroneous jury instruction was harmless because the instruction would not have
affected the outcome of the case).
Verizon also argues that the SIP and SDP articles are not enabling because they
do not disclose or enable the “basic claim requirement” of being able to make ordinary
two-way telephone calls. However, none of the claims in the Feature Patents actually
recite performing two-way telephone calls. The patents relate to telephony, but do not
specifically recite the steps of making an actual call. Furthermore, Cox’s expert, Dr.
Handley, provided testimony that a person of ordinary skill in the art would have had no
problems implementing the functionality disclosed in the SIP Article. The record thus
reveals that the jury had substantial evidence to find that the SIP Article was enabling in
the sense of 35 U.S.C. § 102 and that the Feature Patents were invalid based on
anticipation.
2. Obviousness
Dr. Handley testified that, in addition to being anticipated, the asserted claims of
the Feature Patents would have been obvious to one of skill in the art based on both the
SIP Article and the SDP Article. “In reviewing the jury verdict of obviousness, we review
whether the jury was correctly instructed on the law, and whether there was substantial
evidence whereby a reasonable jury could have reached its verdict upon application of
the correct law to the facts, recognizing that invalidity must be proved by clear and
convincing evidence.” U.S. Surgical Corp. v. Ethicon, Inc., 103 F.3d 1554, 1563 (Fed.
Cir. 1997) (internal citations omitted). A determination of obviousness in this case
requires an inquiry into the scope and content of the prior art, the level of ordinary skill
2009-1086, -1098 18
in the art, and the differences between the claimed inventions and the prior art. Graham
v. John Deere Co., 383 U.S. 1, 17 (1966).
Verizon argues that the jury could not have found that the Feature Patents would
have been obvious because “Cox offered no evidence of what an ordinary skilled
artisan in the relevant art would be taught by the prior art or find obvious in light of the
proper art.” Verizon’s Principal Br. 42. Verizon asserts that Cox’s expert, Dr. Handley,
testified regarding obviousness using the wrong field of art─“Internet and network
protocols”─instead of the art correctly defined by the district court in the jury instructions
“telephony and wireless communications.”
While it is true that the Feature Patents pertain to telephony and wireless
communications, the language of the patents themselves, which make frequent
reference to the Internet, makes clear that the patents also relate to the field of Internet
and network protocols. In fact, Dr. Handley explained that he was describing the
background of a person of ordinary skill working in the area of the “Internet telephony
industry,” which is clearly a subset of telephone and wireless communications. “In
determining the relevant art for purposes of addressing issues of patent validity, the
court must look to the nature of the problem confronting the inventor.” Bancorp Servs.,
L.L.C. v. Hartford Life Ins. Co., 359 F.3d 1367, 1375 (Fed. Cir. 2004). The problem
facing the inventors of the Network Patents was related to providing communication
services, including voice telephone service, over packet-based networks, including the
Internet. Therefore, the relevant art in this case plainly includes the use of network
protocols and the Internet. Thus, it was not improper for the jury to rely on Dr.
Handley’s testimony to find that the Feature Patents were obvious.
2009-1086, -1098 19
* * *
Both parties assert numerous additional arguments about the reliability of the
other party’s experts and the sufficiency of the other party’s evidence relating to
invalidity. We do not find these arguments persuasive. The jury was presented with
opposing experts expressing conflicting views about the validity of the six patents-in-
suit. The jury was entitled to resolve the conflicting evidence in favor of Cox for the
Feature patents and for Verizon on the Network and Quality of Service patents. Bio-
Tech. Gen. Corp. v. Genentech, Inc., 267 F.3d 1325, 1330-31 (Fed. Cir. 2001); see also
U.S. Surgical, 103 F.3d at 1559 (affirming a jury verdict of invalidity because
“[c]onflicting evidence and argument must be viewed as resolved favorably to the party
in whose favor the jury found. The reviewing court must give appropriate deference to
the jury’s choices in weighing the evidence, in deciding between opposing positions,
and in drawing factual inferences.”). Looking at the record as a whole, we find that the
jury had substantial evidence upon which to conclude that Cox met its burden of
showing invalidity by clear and convincing evidence for the Feature patents, but that it
did not meet its burden of showing invalidity of the Network and Quality of Service
patents. Therefore, we find the district court correctly determined that a reasonable jury
could find that the Feature Patents were invalid for anticipation or obviousness and that
the Network Patents and Quality of Service Patent were not. We affirm the district
court’s denial of Verizon’s motion for JMOL on validity and Cox’s motion for JMOL on
invalidity.
2009-1086, -1098 20
B. New Trial
Verizon argues that a new trial is required on validity of the Feature Patents
because the district court failed to correct another improper argument by Cox relating
solely to validity. Verizon alleges that Cox improperly argued that the jury could find the
Feature Patents invalid simply because they were identical, in all material respects, to
what was taught in the prior art SIP and SDP articles. Verizon points to testimony by
Dr. Handley explaining the evolution of the 1996 SIP and SDP articles to the current SIP
protocol used by the accused system as improper. In addition, Verizon again points to
statements in Cox’s closing argument:
Now, what is the mistake they made? They made a mistake of accusing
that protocol [SIP] of infringing their patent. So, what they are doing is
they are saying, by using this protocol, you infringe. But the protocol
predates the patent.
So, they have accused the prior art. That invalidates their patent.
Trial Tr. vol. 8, 1673, Sept. 29, 2008.
It is true that in Zenith Electronics Corp. v. PDI Communication Systems, Inc.,
522 F.3d 1348, 1363 (Fed. Cir. 2008), this court held that “anticipation cannot be proved
by merely establishing that one ‘practices the prior art.’” Instead, “[a]nticipation requires
a showing that each element of the claim at issue, properly construed, is found in a
single prior art reference. ‘It is the presence of the prior art and its relationship to the
claim language that matters for invalidity.’” Id. (quoting Tate Access Floors, Inc. v.
Interface Architectural Res., Inc., 279 F.3d 1357 (Fed. Cir. 2002)). In Zenith, we
remanded a finding of anticipation because the accused infringer provided no evidence
whatsoever that the accused product satisfied two limitations of the asserted claim. Id.
This is not the case here. As described above, Cox’s expert, Dr. Handley, detailed how
2009-1086, -1098 21
the prior art disclosed each of the claim elements. Thus, a reasonable jury could
conclude, based on evidence in the record and separate and apart from any alleged
“practicing the prior art” argument, that the Feature Patents were invalid.
On cross-appeal Cox asserts that it is entitled to a new trial on validity of the
Network and Quality of Service patents because the district court abused its discretion
in excluding the factual testimony of Eric Voit and Kelvin Porter, named inventors of
Verizon’s patents. Cox argues that the district court erred in adopting Verizon’s
argument that assignor estoppel precluded inventor testimony about prior art. We need
not and do not address the issue of assignor estoppel because the district court
properly allowed testimony from the witnesses about the patents they invented based
on their personal knowledge, and properly excluded these same witnesses from
providing expert testimony on invalidity for which they had not previously provided
expert reports or been qualified as an expert. The district court did not abuse its
discretion in limiting inventor testimony to factual testimony that did not require expert
opinion. See Kumho Tire, Ltd. v. Carmichael, 526 U.S. 137, 152 (1999) (“[W]e conclude
that the trial judge must have considerable leeway in deciding in a particular case how
to go about determining whether particular expert testimony is reliable.”); Voice Techs.
Group, Inc. v. VMC Sys., Inc., 164 F.3d 605, 615-16 (Fed. Cir. 1999) (stating that the
inventor may provide testimony explaining the claimed invention and its development,
but that “the inventor can not by later testimony change the invention and the claims
from their meaning at the time the patent was drafted and granted”).
2009-1086, -1098 22
IV. Infringement
A. JMOL
Verizon asserts that it is entitled to JMOL of infringement of claim 1 of the ’481
Network Patent because it “demonstrated that Cox’s system practices every step of that
claim and Cox never disputed Verizon’s expert testimony regarding how calls were
actually made on Cox’s system.” Verizon’s Principal Br. 33-34. A determination of
infringement is a question of fact, reviewed for substantial evidence when tried to a jury.
Lucent Techs., Inc. v. Gateway, Inc., 580 F.3d 1301, 1309 (Fed. Cir. 2009).
Claim 1 of the ’481 patent recites:
1. A method of establishing a communication path between terminals
through a packet switched network, a circuit switched network, and at
least one interface that interconnects the packet switched network and the
circuit switched network, comprising the steps of:
a) requesting from one of said terminals the establishment of said
communication path through said interface;
b) searching a first database for the address of a second database
containing a table of terminal data which includes identification of said
requesting terminal;
c) searching said second database to obtain data regarding said
requesting terminal;
d) responsive to data regarding said requesting terminal obtained from
said search authorizing the establishment of said communication path;
and
e) responsive to said authorization establishing said communication path
between terminals through said interface.
’481 patent col.34 l.52-col.35 l.3.
Both parties provided expert testimony on infringement. Cox provided expert
testimony that its accused system does not practice several of claim 1’s limitations.
First, Cox’s expert, Dr. Evans explained that Cox’s system does not practice the
requirement of “searching a first database” because it simply uses the domain name
server to translate the textual domain name of a known Call Management Server
2009-1086, -1098 23
(“CMS”) into its numeric IP Address and this translation is a lookup, not a search. Trial
Tr. vol. 4, 783, Sept. 23, 2008. Verizon countered with expert testimony that this
translation amounts to “searching” as required by claim 1. Trial Tr. vol. 1, 197-99, Sept.
17, 2008. Therefore, there was a factual dispute between the experts over whether a
simple database lookup for translation is equivalent to “searching a first database.”
Second, Dr. Evans testified that a CMS is not a database and therefore does not
qualify as the “second database” in the limitation “searching a first database for the
address of a second database.” Trial Tr. vol. 4, 783, Sept. 23, 2008. In addition,
another Cox witness explained that any database residing internally on a CMS was not
addressable by IP address and therefore could not be returned by the domain name
server lookup. Trial Tr. vol. 3, 609-10, Sept. 22, 2008. Verizon’s expert, Dr. Houh,
testified that the CMS is equivalent to “the second database” because the CMS is a
server that includes a database containing a table of terminal data. Trial Tr. vol. 1, 197-
99, Sept. 17, 2008. Again, this amounted to a factual dispute between the experts over
whether Cox’s system was fairly within the scope of the claims.
Both of these factual disputes were properly for the jury to decide. The jury was
entitled to credit Cox’s experts over Verizon’s experts and thus it was not unreasonable
for the jury to find that claim 1 of the ’481 patent was not infringed. See Kinetic
Concepts, Inc. v. Blue Sky Med. Group, Inc., 554 F.3d 1010, 1024 (Fed. Cir. 2009)
(finding that a jury is at liberty to accept or reject expert testimony); accord Aldridge v.
Balt. & Ohio R.R. Co., 789 F.2d 1061, 1065 (4th Cir. 1986), aff’d en banc, 814 F.2d 157
(4th Cir. 1987). There is no basis on which to overturn the district court’s denial of
Verizon’s request for JMOL on this ground.
2009-1086, -1098 24
Verizon also argues that Cox improperly argued that steps (a) and (b) in claim 1
had to be performed in sequence. Verizon points to the following testimony from Cox’s
expert, Dr. Evans:
Q. You say [step] (b) occurs before (a) you mean in Verizon’s
contentions?
A. Yes. In the patent, (a) comes before (b), but in time, if you look at what
happens on the way Cox’s system works, (b) would have to occur
before (a).
Trial Tr. vol. 4, 781, Sept. 23, 2008. The district court found that Dr. Evans’s testimony
on sequence was simply an explanation, not a part of his opinion as to why there was
no infringement. Trial Tr. vol. 4, 837-38, Sept. 23, 2008. In fact, Verizon itself later
clarified this with Dr. Evans:
Q. Just to clarify the last point, Dr. Evans, you were not claiming, I
understand, that the various steps of the patent, and in particular, step
(b), has to be done in a particular order in order for the patent claim to
be satisfied; is that correct?
A. That would be a legal conclusion, so that is correct.
The district court subsequently instructed the jury “[t]here is no requirement that steps
(a), (b) or (c) occur in any order.” Trial Tr. vol. 8, 1702-03, Sept. 29, 2008. Because the
jury had substantial evidence to find that claim 1 of the ’481 patent was not infringed
based on the district court’s undisputed construction of that claim, we find the district
court did not err in denying Verizon’s motion for JMOL on this issue.
B. New Trial
Verizon contends that a new trial on infringement of the ’597 Quality of Service
Patent is required because the district court misconstrued the term “evaluating said set
of candidate resources to find a best candidate resource.” Verizon asserted that Cox
2009-1086, -1098 25
infringed claims 12, 13, and 20 of the Quality of Service Patent. Independent claim 12
represents the asserted claims:
12. A method of providing services in a communications network, which
comprises the steps of:
receiving a request for service;
determining criteria for a resource necessary to provide the requested
service;
searching a resource data structure for a set of candidate resources
meeting said criteria wherein each resource of said resource data
structure comprises a resource identifier, a set of static attributes, and a
set of dynamic attributes;
evaluating said set of candidate resources to find a best candidate
resource; and
allocating said best candidate resource to meet said request for service.
’597 patent col.9 ll.1-15 (emphasis added). Claims 13 and 20 are dependent from claim
12.
We need not resolve this issue because the jury had substantial evidence to find
that the ’597 patent was not infringed regardless of whether the district court was
correct in its construction of “evaluating said set of candidate resources to find a best
candidate resource.” We may affirm the jury’s findings on infringement “if substantial
evidence appears in the record supporting the jury’s verdict and if correction of the
errors in a jury instruction on claim construction would not have changed the result,
given the evidence presented.” Teleflex Inc. v. Ficosa N. Am. Corp., 299 F.3d 1313,
1328 (Fed. Cir. 2002). The record shows that Cox’s expert testified that many of the
limitations of the ’597 patent were not performed by Cox’s system, including the
“determining a criteria,” “searching a resource data structure,” and “evaluating said set
of candidate resources” limitations. For example, one of Cox’s experts testified as
follows:
2009-1086, -1098 26
Q. [C]an you just summarize what you found was missing in terms of how
Cox’s, how Cox operates?
A. Well, in the Cox system, the very first element, which is a network
based selection of a service, is not present. Cox does not do its
network path selection on a network basis.
Element (b), there is no determination of a criteria. All of Cox’s
systems have the same criteria for a voice call. So, there is no
differentiation between the types of calls.
Element (c), there is no resource data structure within the Cox system.
There is no resource data structure that contains the type of
information we are talking about here.
Q. Then what about the last step, this evaluation step in finding the best
candidate resource?
A. So, the evaluation step, there is no evaluation of candidate resources
because there are no candidate resources created. And also there is
no allocation of a best resource because all of the resources that are
being accused by Verizon are equivalent resources.
Trial Tr. vol. 5, 1115, Sept. 24, 2008. Because the evidence that Cox’s system does not
practice several of these limitations does not depend on the disputed claim construction,
the jury had substantial evidence to find that the ’597 patent was not infringed
independently of the disputed limitation. Moreover, because we hold that Verizon is not
entitled to a new trial on infringement, we need not and do not reach Cox’s arguments
that a remand on infringement would entitle it to a new trial on validity based on an
allegedly erroneous construction of the claim term “authenticating . . . from a unitary
logical object.”
CONCLUSION
For the foregoing reasons, we affirm the district court’s denial of Verizon’s motion
for a new trial on all issues based on Cox’s allegedly improper arguments regarding
claim scope. We also affirm the district court’s denial of both parties’ motions for JMOL
2009-1086, -1098 27
of validity or invalidity and Verizon’s alternative request for a new trial on validity of the
Feature Patents. Finally, we affirm the district court’s denial of Verizon’s request for
JMOL on infringement of claim 1 of the ’481 patent and its request for a new trial on
infringement of the asserted claims of the Quality of Service Patent.
AFFIRMED
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