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Lack of Expert Leads to Reversal of Patent Case

Visit IMS ExpertServicesReprinted with permission.

This article by Bob Ambrogi, of IMS Expert Services, reports on how the ambiguous, objective nature of the legal definition of a "Person of Ordinary Skill in the Art" re patent interpretation was the basis for megacorp SAP losing an infringement lawsuit on appeal. It illustrates the importance of having competent, non-egotistical legal representation for what might otherwise be considered an open-and-shut case. In this instance, the "little guy" prevailed due to having the best legal team.

Note: IMS ExpertServices periodically sends me e-mails that highlight recent key court cases that can significantly affect the effectiveness of expert testimony, both for the plaintiff and for the defendant. I have no official affiliation with them other than to gratefully accept an invitation to repost articles I consider beneficial to RF Cafe visitors.

 

Lack of Expert Leads to Reversal of Patent Case

Posted by Robert Ambrogi on March 07, 2014

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In a complex patent infringement case involving a system for monitoring supply-chain components, one party's failure to call an expert witness required reversal of a summary judgment ruling that the patent was invalid, the Federal Circuit Court of Appeals has ruled.

Bob Ambrogi, IMS ExpertServices
Robert J. Ambrogi
is a Massachusetts lawyer who represents clients at the intersection of law, media and technology. A news media veteran, he is the only person ever to hold the top editorial positions at the two leading national U.S. legal newspapers, the National Law Journal and Lawyers Weekly USA. He is also internationally known for his writing and blogging about the Internet and technology.
Because the party challenging the so-called "means-plus-function" patent introduced no expert testimony to support its position, the lower court lacked sufficient evidence to rule on the patent's validity, the appellate panel held.

At issue in the case was a supply-chain patent owned by Elcommerce.com, Inc. It brought a lawsuit against SAP AG and SAP America, Inc., for infringement of the patent. SAP filed a counterclaim alleging that the patent was invalid and unenforceable.

Before trial, the lower court judge held a Markman hearing to consider the claims of the patent. The judge concluded that the claims were invalid because of indefiniteness. He entered summary judgment that the patent was invalid and that SAP had therefore not infringed it.

Understanding the 'Person of Ordinary Skill' in the Art

The type of patent at issue in this case involved what are known as means-plus-function claims. Claims of this type are governed by 35 U.S.C. § 112, which states in part: "An element in a claim for a combination may be expressed as a means or step for performing a specified function without the recital of structure, material, or acts in support thereof, and such claim shall be construed to cover the corresponding structure, material, or acts described in the specification and equivalents thereof."

In previous cases construing this statutory language, the Federal Circuit has held that a means-plus-function claim should be considered indefinite "if a person of ordinary skill in the art would be unable to recognize the structure in the specification and associate it with the corresponding function in the claim."

But how does a court decide what that "person of ordinary skill in the art" would recognize?

That was precisely the issue presented by the appeal in this case. At the Markman hearing, SAP offered no expert testimony or other evidence of what that person of ordinary skill would understand. Rather, it relied solely on its attorneys' arguments that the language of the patent lacked the requisite legal elements.

During the hearing, the lower court judge specifically asked SAP why it had presented no evidence of what a person of ordinary skill would understand. SAP's response was that it was not required to present such evidence. "We can simply point to the absence of structure [in the patent] and, if it's not there, it's not there," SAP's attorneys argued.

Expert Testimony Required

The lower court accepted this argument and entered summary judgment in SAP's favor. But the Federal Circuit ruled that the trial judge could not have properly reached this conclusion without expert testimony. Without such testimony in a technologically complex case, judges generally do not have the knowledge needed to construe the claim, the Circuit said.

"The burden was on SAP to prove by clear and convincing evidence that a person of ordinary skill in the field of the invention would be unable to recognize supporting structure and acts in the written description and associate it with the corresponding function in the claim," the court said in an opinion written by Circuit Judge Pauline Newman.

"While 'the person of ordinary skill in the art' is a legal construct, like 'the reasonable man,' and claim construction is ultimately a matter for the judges, it cannot be assumed that judges are persons of ordinary skill in all technological arts."

SAP wasn't successful in its argument that no expert testimony or other external evidence is ever required to show how a person of ordinary skill would understand the patent, the court said. Rather, there can be no blanket rule, because the adequacy of a particular description must be determined on a case-by-case basis. But in most cases, the court suggested, the trial judge cannot be expected to decide the issue without expert evidence.

"We do not of course hold that expert testimony will always be needed for every situation; but we do hold that there is no Federal Circuit or other prohibition on such expertise. … The district court persistently asked for evidence and was given none. Without more SAP cannot overcome the presumption of patent validity."

For this reason, the Federal Circuit concluded that the district court erred in granting summary judgment. "The burden was on SAP to prove its case, and in the absence of evidence provided by technical experts who meet the Daubert criteria there is a failure of proof," Judge Newman wrote. "Attorney argument is not evidence."

Circuit Judge S. Jay Plager joined in Judge Newman's opinion. Circuit Judge Evan J. Wallach filed a dissent. By holding that SAP was required to provide expert testimony to prove indefiniteness, he argued, the majority had contradicted its own precedent affirming the exclusion of expert testimony when there was a total absence of corresponding structure in the claim.

The case is Elcommerce.com v. SAP AG, Case No. 2011-1369 (Fed. Cir. Feb. 24, 2014).



This article was originally published in BullsEye, a newsletter distributed by IMS ExpertServices™. IMS Expert Services is the premier expert witness search firm in the legal industry, focused exclusively on providing custom expert witness searches to attorneys. To read this and other legal industry BullsEye publications, please visit IMS Expert Services' recent articles. For your next expert witness search, call us at 877-838-8464 or visit our website.

 

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Posted  March 12, 2014

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