A weekly summary of the precedential patent-related opinions issued by the Court of Appeals for the Federal Circuit and the opinions designated precedential or informative by the Patent Trial and Appeal Board.
SRI International, Inc. v. Cisco Systems, Inc., Nos. 2020-1685, -1704 (Fed. Cir. (D. Del.) Sept. 28, 2021). Opinion by Stoll, joined by Lourie and O'Malley.
SRI sued Cisco for patent infringement in district court, and a jury found willful infringement and awarded damages. The district court then awarded enhanced damages and attorneys' fees. In a first appeal, the Federal Circuit vacated each of those determinations because the jury's willfulness finding had included a period of time when Cisco did not know of SRI's patents. On remand, the district court concluded that substantial evidence did not support the jury's willfulness finding. But the district court maintained its attorneys' fee award. SRI appealed, and Cisco cross-appealed.
At the outset, the Federal Circuit analyzed the district court's ruling on remand that the evidence did not support the jury's willfulness finding. The Federal Circuit explained that "the district court reasonably read [the Federal Circuit's earlier] opinion to require a more stringent standard for willful infringement than [the Federal Circuit's] other cases suggest." The court clarified "that it was not our intent to create a heightened requirement for willful infringement," explaining that, "under Halo, the concept of 'willfulness' requires a jury to find no more than deliberate or intentional infringement." Applying the proper test for willfulness, the Federal Circuit concluded that substantial evidence supports the jury's willfulness finding. Therefore, the Federal Circuit reinstated the jury's willfulness verdict.
After reinstating the willfulness verdict, the Federal Circuit also restored the district court's award of enhanced damages. The district court had appropriately considered the factors for enhancement.
Lastly, the Federal Circuit addressed Cisco's cross-appeal challenging the award of attorneys' fees to SRI. The Federal Circuit saw "no error in the district court's determination that this was an exceptional case" warranting attorneys' fees.
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In re: Vivint, Inc., No. 2020-1992 (Fed. Cir. (PTAB) Sept. 29, 2021). Opinion by Moore, joined by Schall and O'Malley.
In this appeal, the Federal Circuit considered the question of "when one pathway [for challenging patent validity], ex parte reexamination, is available to a requester who has repeatedly tried to use another pathway, IPR, to forward the same arguments."
Vivint sued Alarm.com for infringement of four patents, prompting Alarm.com to institute a litany of post-issuance proceedings. As to one of the patents, Alarm.com filed three IPR petitions, but the Patent Trial and Appeal Board declined institution. The Board denied the first two petitions on the merits, and denied the third in its discretion because the petition was an example of "undesirable, incremental petitioning."
After the IPR petitions were rejected, Alarm.com filed a request for ex parte reexamination. The request "repackaged" the arguments raised in the third IPR petition, with "vast swaths" of the request "copied, almost word for word, from the [third] petition." The Patent Office ordered the reexamination, concluding that Alarm.com had raised a substantial new question of patentability under 35 U.S.C. § 303(a).
Vivint then petitioned the Patent Office for dismissal of the ex parte reexamination, but the Patent Office declined and ultimately issued a final rejection for all claims. Vivint appealed to the Board, which affirmed, and then appealed to the Federal Circuit.
In the Federal Circuit, Vivint argued that the ex parte reexamination did not present a substantial new question of patentability. The Federal Circuit disagreed. While § 303(a) does not define the word "new," the court ruled that the "broader statutory context . clarifies that a question of patentability is new until it has been considered and decided on the merits." Thus, Alarm.com's request raised "new" questions of patentability.
Next, Vivint argued that the Patent Office abused its discretion and acted arbitrarily and capriciously by ordering reexamination and thereafter refusing to terminate the proceeding. The Federal Circuit agreed. Under § 325(d), the Patent Office may reject a request "because the same or substantially the same prior art or arguments previously were presented to it." The Federal Circuit ruled that the Patent Office should have terminated the reexamination on that basis. In fact, rather than vacate and remand for consideration by the Patent Office, the Federal Circuit ruled that in these circumstances "it would be arbitrary and capricious for the Patent Office to do anything on remand other than terminate the reexamination." Therefore, the court vacated and remanded with instructions for the Patent Office to dismiss the reexamination.
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CISCO SYSTEMS, INC. 
