Because the trial court incorrectly held RCT's patents unenforceable due to
inequitable conduct, this court reverses that holding and vacates the award of attorney
fees. We also vacate the trial court's grant of Microsoft's noninfringement and invalidity
motions as well as the grants of Microsoft's motions in limine. Finally, this court
remands with instructions to assign this case to a different judge for a proper
determination of validity and infringement on the merits.
To get the full flavor of what went on here, one needs to read the opinion, written by Judge Rader (with Judges
Newman and Friedman on the panel). This is a big money case; CNNMoney noted: An attorney for RCT said Friday that the company is seeking "in excess" of $ 500 million in damages.
Something very odd was going on at the district court level.
Zusha Elinson of The Recorder noted:
Coming down hard on [District Judge Manuel] Real's judicial skills, the Federal Circuit panel threw out Microsoft's 2006 win over Research Corporation Technologies in a patent infringement case. In its published opinion, the panel reversed Real's decision to declare RCT's patents unenforceable, tossed his orders that found the patents invalid and noninfringing -- and ordered that another judge take the case.
Terrence McMahon, the McDermott, Will & Emery partner who represented RCT before Real, said he was glad to get a new judge on the case.
"It was clear that he had a point a view and we disagreed with it -- we tried the case and he cut us off at every pass," McMahon said. "I've never had something like this in my whole career, and I hope I never do again."
"In sum, the trial court erred in ignoring the materiality prong and in misapplying the intent prong of the inequitable conduct test," Radar wrote.
Finally, the panel also tossed Real's exceptional case finding, which awarded attorneys fees to Microsoft's lawyers.
"A new day has dawned. Everything that Judge Real did has been erased," McMahon said.
A lawyer for Microsoft from Portland, Ore., firm Klarquist Sparkman did not return a phone call seeking comment. But in a statement, Microsoft said, "We look forward to going to trial for the first time and telling our story in court."
Real, 84, also did not return a phone call seeking comment.
In the Honda class action, Bonlender v. American Honda Motor Co. Inc., 07-55258, a 9th Circuit panel threw out Real's order certifying a nationwide class against the car company, saying the judge abused his discretion by certifying the class on his own "without making any findings regarding Rule 23's requirements for class certification."
The following comprises mere snippets on secondary points.
The CAFC wrote on scientific publication: Importantly, Dr. Mista and her coauthors published the K factor tests to the scientific community. Publication is an act inconsistent with an intent to conceal data from the USPTO.
Also, of the faulty analysis by the district court judge:
Indeed, these words are antonyms, but the distinction between pleasing
and annoying images does not make the K factor experiments material to the patented
technology, which does not refer to or rely upon K factors at all. The post-filing K factor
experiments were not intended to produce the most visually pleasing images but
instead test the strictness of Ulichney’s Principal Frequency Equation as the cutoff
In sum, the trial court completely ignored the materiality prong. Indeed the trial
court, in its sparse articulation of reasons for the decision, noted "I am not trying a
patent case I am trying a particular matter that has been presented to me having to do
with candor and good faith." Neglecting to consider both prongs of the analysis was
and then by
In addition to missing the materiality prong, the district court’s intent analysis was
clearly erroneous. The trial court, for instance, focused improperly on comments that
Dr. Parker made at trial regarding the purposes of the patent system. An inventor's
motives in applying for a patent or his views on the purposes of the patent system are
generally irrelevant to a proper determination of inequitable conduct. Dr. Parker is not
required to know or recite the purposes of the patent system. Moreover, although Dr.
Parker may likely not profit directly from the patent himself, even if he did hope for
remuneration, any financial reward does not alone show an intent to deceive the
Of consultations and patent filing:
To the contrary, Dr. Parker testified that he wanted to discuss the research with
Dr. Ulichney, but could not discuss confidential research before filing of the patent.
Accordingly, he waited until after filing to initiate the discussion. Indeed, Dr. Parker
noted that he had not disclosed the actual status of his research with Dr. Ulichney in an
effort to keep his research confidential. Nonetheless, an email from one scientist to
another scientist in a competitive field that does not disclose the actual status of
research is again hardly dispositive proof that the inventor was not in possession of the
invention at the time of filing. The court misinterpreted the exchange between Dr.
Parker and Dr. Ulichney to mean that Dr. Mista's blue noise mask research that had
been filed with the USPTO was nothing more than a premature "promissory note." It is
equally plausible that Dr. Parker was merely attempting to initiate scientific discussions
with Dr. Ulichney without disclosing the status of his research for reasons of
confidentiality. In the competitive environment of university research with potential
market applications, Dr. Parker's incomplete casual email would hardly indicate that an
invention already disclosed to the USPTO was a promissory note or a lie.
On the matter of re-assignment of the judge in this case:
This court evaluates a request to transfer to a different judge under the law of the
regional circuit. Eolas Techs., Inc. v. Microsoft Corp., 457 F.3d 1279, 1280 (Fed. Cir.
2006). The Ninth Circuit considers the following three factors: (1) whether the original
judge would reasonably be expected upon remand to have substantial difficulty in
putting out of his or her mind previously-expressed views or findings determined to be
erroneous or based on evidence that must be rejected, (2) whether reassignment is
advisable to preserve the appearance of justice, and (3) whether reassignment would
entail waste and duplication out of proportion to any gain in preserving the appearance
of fairness. McCalden v. Cal. Library Ass'n, 955 F.2d 1214, 1224 (9th Cir. 1990)
(quoting Davis & Cox v. Summa Corp., 751 F.2d 1507, 1523 (9th Cir. 1985)).
The CAFC noted: At the same time, this court must recognize that a pattern of
error based on previously-expressed views or findings may make it difficult for a trial
court to approach a remanded case with an open mind.
In terms of the arguments of "frivolous patent litigation" by the Coalition for Patent Reform,
one notes that the defense of inequitable conduct in this case appears to have been very thin.