No Estoppel for Grounds Not Raised in IPR, Where IPR Participation Was By Joinder
Network-1 Technologies, Inc. v. Hewlett-Packard Co., __ F.3d __ (Fed. Cir. Sept. 24, 2020) (PROST, Newman, Bryson) (E.D. Tex.: Schroeder) (3 of 5 stars)
Fed Cir vacates judgment of no infringement and judgment of validity. Network-1’s patent relates to automatic determination of whether remote equipment on a computer network is capable of accepting remote power over Ethernet.
Claim construction: The district court correctly construed the term “low level current,” and the opinion describes how the construction was supported by the specification. However the district court erred in construing “main power source” to cover DC power sources, and not AC power sources. The opinion describes how the specification does not express a preference for DC power sources. Reliance on expert testimony that receipt of AC power by a network device would render it operable was improper, and the opinion notes that the specification indicates that some devices might use AC power. Even if AC power rendered a device inoperable, “we have instructed that it is nonetheless improper to exclude only certain inoperable embodiments.” Op. at 15 (citing Cordis, 511 F.3d 1157 (Fed. Cir. 2008)). Because the AC power issue would not affect all embodiments, but only some, it was not a basis for limiting the claim.
Network-1 was prejudiced by the claim construction error. The jury’s verdict form did not indicate the basis for its decision, and the opinion reasons that HP had relied at least in part on the erroneous construction when arguing for no infringement.
Estoppel: The district court erred by entering judgment as a matter of law as to validity on estoppel grounds. Though HP had participated “as a party” in another petitioner’s IPR via joinder, joinder did not participate HP to “bring into the proceeding new grounds that were already instituted.” Op. at 18 (citing Facebook, No. 18-1400, 2020 WL 5267975 (Fed. Cir. Sept. 4, 2020)). Because § 315(e) imposes estoppel as to invalidity grounds that a party raised “or reasonably could have raised,” it did not apply to grounds HP was unable to raise with its joinder.
Claim broadening: The district court did not err in entering judgment that Network-1 had not improperly broadened one of its claims via reexamination. There was no dispute that the district court had construed independent claim 6 to require that two items be “physically separate” from one another. This was the same interpretation the claim had received in pre-reexamination litigation. That Network-1 had added dependent claims purporting to cover designs in which the two items were in “the same physical device” was not improper broadening because claim 6’s scope did not change. The opinion quotes Enzo, 780 F.3d 1149 (Fed. Cir. 2017): “[D]ependent claims cannot broaden an independent claim from which they depend.” Op. at 23. “[E]ven were dependent claims 15 and 16 broader than unamended, independent claim 6, the remedy would not be to find claim 6 invalid as broadened, but to invalidate added claims 15 and 16.” Id. (citing MBO Labs., 602 F.3d 1306 (Fed. Cir. 2010). ArcelorMittal France, 786 F.3d 885 (Fed. Cir. 2015), is not contrary because in that case there was no dispute that a reissue had led to broader claims. ArcelorMittal did not hold that a dependent claim added during reissue or reexamination may “broaden and therefore invalidate” an independent claim.
KEYWORDS: STATUTORY ESTOPPEL; IPR ESTOPPEL; CLAIM CONSTRUCTION; CLAIM BROADENING; REEXAMINATION; INFRINGEMENT; VALIDITY