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Power Integrations, Inc. v. Fairchild Semiconductor International, Inc.

Where Claiming Inducement of a Class of Infringers, No Need to Prove Specific Inducement of Class Members’ Specific Infringements

Power Integrations, Inc. v. Fairchild Semiconductor International, Inc., (Fed. Cir. Dec. 12, 2016) (Prost, Schall, CHEN) (D. Del.: Stark) (3 of 5 stars)

Fed Cir part-affirms, part-reverses, part-vacates, and remands district court’s judgment in multi-patent case. The Fed Cir affirms the validity of two Power Integrations patents while vacating on induced infringement; the Fed Cir also held a third Power Integrations patent anticipated, reversing the district court. As to Fairchild’s patent, the Fed Cir affirmed on claim construction and non-obviousness, but reversed on infringement. The Fed Cir also vacated the permanent injunction against Fairchild.

Power Integrations’ ’851 and ’876 Patents: Substantial evidence supported the jury’s verdict of validity. The opinion rejects Fairchild’s argument that two references taught “frequency jittering” because the references only taught performing certain operations “after the fact,” and not at such a time as to actually reduce electromagnetic interference.

However, the district court’s jury instruction misstated the law of induced infringement. The instruction left the jury with the understanding that inducement liability could attach “even where [the accused inducer] does not successfully communicate with and induce a third-party direct infringer.” Slip op. at 23. Because a finding of induced infringement requires actual inducement, such instruction was improper. The jury verdict is vacated; however, the evidence was insufficient to warrant JMOL of no inducement for Fairchild, as there was some evidence that might allow a jury to find that Fairchild “took affirmative acts to induce third parties to import its products.” Slip op. at 28. The opinion also rejects Fairchild’s argument that Power Integrations had failed to prove a “nexus between Fairchild’s allegedly inducing acts and the acts of direct infringement” that were cited at trial. Id. at 30. Because Power Integrations was making an inducement argument targeted at a “class” of direct infringers, it was not necessary for it to muster “hard proof” as to a specific inducement aimed at a specific third party.

Power Integrations’ 605 Patent: The jury’s verdict that the ’605 patent was valid was unsupported by substantial evidence. At trial, Power Integrations’ expert conceded that certain operations described by the reference led to a current threshold increasing during the switch’s on time, which was all that the claims required.

Fairchild’s ’972 Patent: The opinion rejects Power Integrations’ argument that the district court construed the claim too broadly. The claim language was “sampling a voltage from the auxiliary winding of the transformer and a discharge time of the transformer;” the district court did not err in holding that this meant sampling a single voltage at a specific location (the auxiliary winding) and time (during discharge time). The opinion rejects Power Integrations’ argument that it should have required two samples (one of a “voltage,” and one of a “discharge time”). Substantial evidence thus supported the jury’s verdict that various claims had not been proved obvious, as the testimony from Fairchild’s expert was sufficient, particularly in view of Power Integrations’ “clear and convincing” burden.

The jury’s verdict that Power Integrations, though it did not literally infringe certain claims of the ’972 patent, nevertheless infringed under the doctrine of equivalents, was unsupportable. The claims in question required a “first” and “second” feedback signal, distinct from one another. Power Integrations had argued at trial that its product contained only a single feedback signal. In siding with Power Integrations on literal infringement, the jury necessarily embraced that argument. It could not then apply the doctrine of equivalents to vitiate the two-signal requirement of the claims.

Fairchild’s motion for a permanent injunction against Power Integrations: Fairchild’s appeal of the district court’s denial of its motion for a permanent injunction was mooted by the reversal of the infringement judgment.

The district court’s permanent Injunction against Fairchild: The district court’s grant of an injunction against Fairchild is vacated, as the present opinion “significantly reduce[s] the scope of Fairchild’s infringement liability in this case.” Slip op. at 49.

KEYWORDS: ANTICIPATION (YES); ANTICIPATION (NO); INDUCEMENT; CLAIM CONSTRUCTION; PERMANENT INJUNCTION; DOCTRINE OF EQUIVALENTS