LUMINARA WORLDWIDE loses on injunction issue at CAFC

The outcome was the vacating of the D. Minn. decision and remand.


Appellants Liown Electronics Co.; Shenzhen Liown
Electronics Co.; and Liown Technologies/Beauty Electronics,
LLC (collectively, “Liown”), and enjoined distributors
Boston Warehouse Trading Corp.; Abbott of England
(1981), Ltd.; BJ’s Wholesale Club., Inc.; Von Maur, Inc.;
Zulily, Inc.; Smart Candle, LLC; Tuesday Morning Corp.;
Ambient Lighting, Inc.; The Light Garden, Inc.; and
Central Garden & Pet Co. (collectively, “Distributors”)
appeal from the district court’s grant of a preliminary
injunction barring Liown from supplying Distributors
with artificial candle products that infringe Disney Enterprises,
Inc.’s U.S. Patent No. 8,696,166. We vacate and
remand for further proceedings.



Disney is involved:



The patents asserted in this case—the ’166 patent and
U.S. Patent Nos. 7,837,355; 8,070,319; and 8,534,869—
teach improved techniques for making the light from
artificial candles flicker like the flames of real candles.
These techniques were first developed for the “Haunted
Mansion” ride at Disneyland. Disney Enterprises, Inc., a
wholly-owned subsidiary of The Walt Disney Company, is
the owner of the asserted patents, which claim priority to
2008.



An issue



Liown argues that Candella does not have exclusionary
rights to the asserted patents because Disney retained
the right to freely license the technology to any
entity by creating new Affiliates.


As to joinder:


Because one purpose of the joinder requirement is to
protect the alleged infringer from multiple lawsuits, the
transfer of the right to sue for infringement is critical.
See Alfred E. Mann Found. for Sci. Research v. Cochlear
Corp., 604 F.3d 1354, 1361 (Fed. Cir. 2010) (explaining
that the right to sue is frequently “the most important
consideration”); Aspex Eyewear, 434 F.3d at 1342 (describing
the right to sue as “[a] key factor”). If the patentee
retains the right to sue, the infringer could face multiple
suits for the same alleged infringement—in one suit
defending itself against the patentee, and in another
defending itself against the exclusive licensee. To prevent
this, we require joinder of the patentee if it has retained
the right to sue for infringement.



Liown loses on standing:


We hold that Luminara has all substantial rights to
the patent and therefore it is not necessary to join Disney
Enterprises in this lawsuit. Thus, we reject the standing
arguments raised by Liown



But wins on the injunction issue:


Liown argues that the preliminary injunction was improperly
granted because there is a substantial question
of validity—namely, whether Disney Enterprises’ earlier
U.S. Patent No. 7,261,455 anticipates claim 1 of the ’166
patent. We agree.

Although Luminara alleges infringement of four patents
in this suit, claim 1 of the ’166 patent forms the sole
basis for the district court’s grant of a preliminary injunction.
Claim 1 recites (emphasis added):
A pendulum member for generating a flickering
flame effect, comprising:
a body with upper and lower portions;
a flame silhouette element extending outward
from the upper portion of the body; and
a hole in the body below the flame silhouette element,
wherein the hole is configured to receive a
flame support element such that the flame support
element passes through the hole and the body
is free to pivot when supported by the flame support
element.



The meaning of "free to pivot":


The ordinary meaning of “free to pivot” does not plainly
require either of these limitations. Pivoting includes
rotation around a single axis—for example, when a door
pivots on its hinges, a dancer turns on a pivot foot, or a
lever pivots on a fulcrum. And being “free to pivot” does
not require chaotic motion. (...)


Absent lexicography or disavowal, we do not depart
from the plain meaning of the claims. Thorner v. Sony
Computer Entm’t Am. LLC, 669 F.3d 1362, 1365 (Fed. Cir.
2012). The standards for finding lexicography and disavowal
are “exacting.” GE Lighting Sols., LLC v. AgiLight,
Inc., 750 F.3d 1304, 1309 (Fed. Cir. 2014). To act as a
lexicographer, a patentee must “clearly set forth a definition
of the disputed claim term” and “clearly express an
intent to redefine the term.” Thorner, 669 F.3d at 1365
(internal quotation marks omitted). Similarly, disavowal
requires that “the specification [or prosecution history]
make[] clear that the invention does not include a particular
feature.” SciMed Life Sys. Inc. v. Advanced Cardiovascular
Sys., Inc., 242 F.3d 1337, 1341 (Fed. Cir. 2001).
While such disavowal can occur either explicitly or implicitly,
it must be clear and unmistakable. See Trs. of Columbia
Univ. v. Symantec Corp., No. 2015-1146, 2016 WL
386068, at *2–3 (Fed. Cir. Feb. 2, 2016). We have found
disavowal or disclaimer based on clear and unmistakable
statements by the patentee that limit the claims, such as
“the present invention includes . . .” or “the present invention
is . . . ” or “all embodiments of the present invention
are . . . .” See, e.g., Regents of the Univ. of Minn. v. AGA
Med. Corp., 717 F.3d 929, 936 (Fed. Cir. 2013); Honeywell
Int’l, Inc. v. ITT Indus., Inc., 452 F.3d 1312, 1316–19
(Fed. Cir. 2006); SciMed Life Sys., Inc., 242 F.3d at 1343–
44. When a patentee “describes the features of the ‘present
invention’ as a whole,” he implicitly alerts the reader
that “this description limits the scope of the invention.”
Regents of the Univ. of Minn., 717 F.3d at 936.
At this preliminary stage, we see no definition and no
disavowal or disclaimer in the specification requiring
motion in four different ways or directions.