international trade appeals miscellaneous and vaccine ......case, inquiry into the purposes served...

This publication brings you a digest of precedential cases decided last month by the United States Court of Appeals for the Federal Circuit.

International Trade AppealsApple Inc. v. International Trade Commission No. 2012-1338 (Fed. Cir. August 7, 2013) ................................................. 2 Ashley Furniture Industries, Inc. v. United States No. 2012-1196 (Fed. Cir. August 19, 2013) .......................................... 2 Itochu Building Products v. United StatesNo. 2013-1044 (Fed. Cir. August 19, 2013)....................................................... 3

Miscellaneous and Vaccine AppealsCarson v. Secretary of Health and Human Services No. 2010-5089 (Fed. Cir. August 28, 2013) ...................................... 4

Merit Systems Protection Board (MSPB) Appeals Gallo v. Department of Transportation, No. 2011-3094 (Fed. Cir. August. 5, 2013) .......................................................... 4Gargiulo v. Department of Homeland Security, No. 2012-3157 (Fed. Cir. August. 16, 2013) ............................................ 5Kaplan v. Conyers No. 2011-3207 (Fed. Cir. August. 20, 2013) ......................................................................................... 5

Patent and Trademark Appeals Cheese Systems, Inc. v. Tetra Pak Cheese & Powder Systems, Inc.No. 2012-1463, -1501 (Fed. Cir. August. 6, 2013) ..... 5 Aria Diagnostics, Inc. v. Sequenom, Inc. No. 2012-1531 (Fed. Cir. August. 9, 2013) ........................................................ 6 Skinmedica Inc. v. Histogen Inc. No. 2012-1560 (Fed. Cir. August 23, 2013) .................................................................... 6 Taurus IP, LLC v. DaimlerChrysler Corp. Nos. 2008-1462, -1463, -1464, -1465 (Fed. Cir. August. 9, 2013) ................... 7 Monolithic Power Systems, Inc., et al. v. O2 Micro International Ltd. No. 2012-1221 (Fed. Cir. August 13, 2013).......... 9 3M Innovative Properties Co., et al. v. Tredegar Corp. No. 2012-1241 (Fed. Cir. August 13, 2013) ............................... 10 Apple Inc. v. Samsung Electronics Co., Ltd., et al. Nos. 2012, 1600, 2013-1146 (Fed. Cir. August 23, 2013) ..................11Hamilton Beach Brands, Inc. v. Sunbeam Products, Inc. No. 2012-1581 (Fed. Cir. August 14, 2013) ............................ 13Aevoe Corp. v. AE Tech. Co. et al. No. 2012-1422 (Fed. Cir. August 29, 2013) ............................................................... 13University of Utah v. Max-Planck-Gesellschaft Zur Forderung Der Wissenschaften E.V. et al. No. 2012-1540, -1541, -1661 (Fed. Cir. August 19, 2013) ..................................................................................................................................... 14Rembrandt Vision Technologies, L.P. v. Johnson & Johnson Vision Care, Inc.No. 2012-1510(Fed. Cir. August 7, 2013) .................................................................................................................................................. 15Leo Pharmaceutical Products, Ltd. v. Teresa Stanek Rea, Acting Director, U.S. Patent & Trademark Office No. 2012-1520 (Fed. Cir. August. 12, 2013) ...................................................................................................................................... 15Trading Technologies Int’l, Inc. v. Open E Cry, LLC No. 2012-1583 (Fed. Cir. August. 30, 2013) .................................. 16

Veterans Appeals Kernea v. Shinseki No. 12-7142 (Fed. Cir. August 1, 2013) .............................................................................................. 17National Organization of Veterans’ Advocates, Inc. v. Secretary of Veterans Affairs No. 11-7191(Fed. Cir. August 5, 2013) .................................................................................................................................................. 17Middleton v. Shinseki No. 13-7014 (Fed. Cir. August 15, 2013) ...................................................................................... 18

To hear audio recordings of the oral arguments please click here.

September 2013 Vol. 17, No. 2

http://www.cafc.uscourts.gov/oral-argument-recordings/search/audio.html

International Trade Appeals

Apple Inc. v. International Trade CommissionNo. 2012-1338 (Fed. Cir. August 7, 2013)Opinion by Circuit Judge Moore

In Certain Mobile Devices, and Related Software Thereof (Inv. No. 337-TA-750), Complainant Apple Inc. filed a complaint at the U.S. International Trade Commission under Section 337 asserting that many of Respondent Motorola Mobility, Inc.’s smartphones and tablets infringed U.S. Patent Nos. 7,663,607 (’607 patent), 7,812,828 (’828 patent), and 5,379,430 (the ’430 patent), which are directed to touchscreens.

Administrative Law Judge Essex issued an Initial Determination on January 13, 2012 finding that Motorola did not violate Section 337. ALJ Essex determined that the ‘828 patent was valid, but that Motorola’s accused smartphones and tablets do not infringe the asserted claims of the ‘828 patent. The claim term “mathematically fitting an ellipse” was construed to require the method to perform “a mathematical process” whereby “an ellipse is actually fitted to the data,” and ALJ Essex found that Motorola’s products do not fit an ellipse to the electrode data. Although he found that Motorola’s accused smartphones and tablets literally infringed the asserted claims the ‘607 patent, ALJ Essex held that the claims were invalid for anticipation based on U.S. Patent No. 7,372,455 (Perski ’455) and obviousness based on a prior art reference describing the SmartSkin touchscreen system.

On March 16, 2012, the Commission issued its opinion reviewing-in-part and affirming the Initial Determination of no violation of Section 337 and terminated the investigation. On review, the Commission affirmed ALJ Essex’s finding of obviousness for the ‘607 patent in view of the SmartSkin prior art reference in combination with Japan Unexamined Patent Application Publication No. 2002-342033A to Jun Rekimoto. The Commission also found that Motorola had demonstrated by clear and convincing evidence that the asserted claims of the ‘607 patent are invalid for obviousness based on the ability of one of ordinary skill in the art to combine the disclosure in the SmartSkin prior art reference with other familiar elements. Apple appealed the Commission’s claim construction and noninfringement opinions for the ‘828 patent and its determinations of anticipation and obviousness for the ‘607 patent.

Apple argued at the Federal Circuit in Apple Inc. v. International Trade Commission that Perski ‘455 did not qualify as prior art because the priority application failed to provide written support for the relevant disclosures in Perski

‘455 and that Perski ‘455 did not disclose all features of the claims of the ‘607 patent. The Federal Circuit held that Perski ‘455 constituted prior art because the disclosure in the provisional application was sufficient to provide written support for Perski ‘455. However, the Federal Circuit found that Perski ‘455 failed to correctly incorporate by reference the teaching of a document required to anticipate Claim 10, and therefore, Claim 10 was found not to be anticipated by Perski ‘455.

As to the SmartSkin prior art reference, Apple argued on appeal that the Commission “improperly employed a hindsight analysis” and failed to evaluate the secondary considerations of nonobviousness presented by Apple. The Federal Circuit agreed and noted that it was “troubled by the ITC’s obviousness analysis” and that the Commission “never even mentioned, much less weighed as part of the obviousness analysis, the secondary consideration evidence.” The case was vacated and remanded for the Commission to consider Apple’s evidence related to secondary considerations of nonobviousness.

On infringement of the ‘828 patent, Apple argued on appeal that requiring calculation of the ellipse parameters after the ellipse has been fitted unnecessarily limits the claim. The Federal Circuit agreed with Apple and concluded that the plain language of the claim simply requires the software to “mathematically fit” the ellipse without implying a separate step of calculating the ellipse parameters. The Federal Circuit vacated the Commission’s finding of noninfringement and remanded the case for additional consideration of infringement of the ‘828 patent.

To read the full opinion click here.

Ashley Furniture Industries, Inc. v. United States No. 2012-1196 (Fed. Cir. August 19, 2013)Opinion by Circuit Judge Moore

The Court of Appeals for the Federal Circuit (“Federal Circuit”) affirmed the U.S. Court of International Trade’s (“CIT”) dismissal of complaints filed by Ashley Furniture, Inc., Ethan Allen Global, Inc., and Ethan Allen Operations, Inc. (“Appellants”), holding that Appellants were not Affected Domestic Producers (“ADPs”) within the meaning of the now-repealed Continued Dumping and Subsidy Offset Act (“Byrd Amendment”) and were therefore not entitled to compensation under that Act.

A U.S. furniture manufacturer and several labor unions filed a petition that led to an antidumping investigation of Chinese wooden bedroom furniture manufacturers. As part of the investigation, the International Trade Commission

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(“ITC”) issued a questionnaire to Appellants, domestic producers of wooden bedroom furniture, to which Appellants were required to respond. One of the questions asked, “Do you support or oppose the petition?” Ashley Furniture, Inc. answered “Oppose” and Ethan Allen answered “Take no position.” Later, when the ITC issued an antidumping duty order and prepared a list of ADPs eligible to receive a share of the antidumping duties under the Byrd Amendment, the ITC did not include Appellants because it determined that Appellants were not “interested parties in support of the petition” and therefore not ADPs.

The Federal Circuit held that its earlier decision in SKF USA, Inc. v. U.S. Customs & Border Protection, 556 F.3d 1337 (Fed. Cir. 2009) (“SKF”), in which it held that the Byrd Amendment’s requirement for petition support is not facially unconstitutional, disposed of Appellants’ facial First Amendment challenges. The Federal Circuit stated that the language of the Byrd Amendment statute, 19 U.S.C. § 1675c(b)(1)(A), “requires ‘support of the petition’ in order to obtain a distribution” and that “[a] producer meets that requirement when it ‘indicate[s] support . . . by letter or through questionnaire response.” The Federal Circuit held that “a producer who never indicates support for the petition by letter or through questionnaire response cannot be an ADP.” The Court noted that its later decision in PS Chez Sidney, L.L.C. v. U.S. Int’l Trade Comm’n, 684 F.3d 1374 (Fed. Cir. 2012) (“Chez Sidney”), which was decided after the CIT’s rulings on Appellants’ complaints, involved a different factual scenario. The producer in Chez Sidney received Byrd Amendment distributions because, although the producer answered “Take no position” to the support/oppose question in the final questionnaire, the producer indicated support for the petition in the preliminary questionnaire.


Itochu Building Products v. United StatesNo. 2013-1044 (Fed. Cir. August 19, 2013)Opinion by Circuit Judge Taranto

Domestic producers of softwood lumber products (collectivThis case concerns whether the exhaustion of administrative remedies is required before a party could challenge the United States Department of Commerce (“Commerce”)’s decision in court. Itochu Building Products (“Itochu”) asked Commerce to revoke part of an antidumping duty order applicable to imported steel nails at an early specified date. Itochu, nevertheless, failed to submit any comment following Commerce’s preliminary ruling that a later date would apply. After Commerce maintained its

position on the later effective date in its final ruling, Itochu challenged the ruling in the Court of International Trade (“CIT”). The CIT, relying on its discretionary authority under 28 U.S.C. § 2637(d), invoked the requirement of exhaustion of administrative remedies, and held that Itochu waived its objection to Commerce’s effective-date determination because it did not resubmit its comment after the preliminary ruling rejected its position. On appeal, the Court of Appeals for the Federal Circuit (“CAFC”) found that the CIT erred in requiring exhaustion in the present case and reversed its ruling as an abuse of discretion.

The CAFC found that the requirement of “appropriateness” under 28 U.S.C. § 2637(d) requires that the invocation of exhaustion serves some practical purpose when applied. To determine appropriateness in a particular case, inquiry into the purposes served and any harm caused by requiring such exhaustion is needed. Requiring exhaustion has been held inappropriate when pursuing an administrative challenge would clearly be futile, or when the issue is a “pure question of law”.

The CAFC held that no purpose was served by requiring Itochu to have resubmitted its effective-date argument after Commerce announced the preliminary ruling for two reasons. First, nothing in Commerce’s clear rejection of Itochu’s position, in either the preliminary or final ruling, amounted to any material consideration that Itochu had failed to address. Second, Commerce’s firm position on the effective-date issue strongly suggests that a resubmission by Itochu would have been futile. Meanwhile, the CAFC found that Itochu had a concrete interest in avoiding a substantial delay in obtaining a final agency decision that making such a pointless filing could have caused. Weighing the interests on both sides, the CAFC concluded that the CIT could not properly find it “appropriate” to invoke the exhaustion doctrine to bar consideration of Itochu’s challenge on the merits.

The CAFC further distinguished the present case from Corus Staal BV v. United States, 502 F.3d 1370 (Fed. Cir. 2007) (“Corus Staal”) in two respects: (1) unlike in Corus Staal where Commerce’s position reflected discretionary policy decisions, here, Commerce maintained that its position was mandated by statute; and (2) Commerce had not identified any new factual or legal argument that Itochu could have made, whereas in Corus Staal, Corus failed to submit factual or legal arguments in detail when it still had the opportunity.

For the foregoing reasons, the CAFC reversed the CIT’s decision dismissing Itochu’s challenge to Commerce’s effective-date determination for failure to exhaust administrative remedies, and remanded the case for further proceedings.




The aforementioned international trade case summaries were provided by Steptoe & Johnson. Contributing author: Laura Ardito.

Miscelleaneous and Vaccine Appeals

Carson v. Secretary of Health and Human ServicesNo. 2010-5089 (Fed. Cir. August 28, 2013)Opinion by Judge Wallach

The Federal Circuit affirmed the Court of Federal Claims’ decision affirming the Special Master’s decision dismissing Carson’s claim for compensation under the Vaccine Act as untimely filed. After being born on May 22, 1996, Kit Carson (“Carson”) received numerous vaccines in the first thirteen months of his life. At the time of his 18-month checkup, his doctor noted that he was behind in speech. At 24 months, his doctor evaluated his speech as delayed. By his three-year checkup in May 1999, his doctor classified Carson as having severe language delay and referred him to the Developmental Evaluation Center in Asheville, North Carolina. Kit Carson was diagnosed with autism spectrum disorder on April 26, 2001. On July 22, 2002, his parents (“Petitioners”) filed a petition for compensation under the Vaccine Act on his behalf. The Government moved to dismiss the petition as untimely, arguing that Petitioners filed their petition more than 36 months “after the date of the occurrence of the first symptom or manifestation of onset or of the significant aggravation” of his injury. The Special Master determined that the first symptom of autism spectrum disorder was recorded in May 1999 when Kit was classified as exhibiting speech delay. Thus, in order to be timely filed, the petition must have been filed by May of 2002. Petitioners appealed the Special Master’s decision to the Court of Federal Claims. The Claims Court sustained the decision. The appeal to the Federal Circuit followed. The Federal Circuit began its analysis with the text of the Vaccine Act. The Act provides that a petition for compensation may not be filed “after the expiration of 36 months after the date of occurrence of the first symptom or manifestation of onset or of the significant aggravation of such injury.” 42 U.S.C. § 300aa-16(a)(2). The Court then turned to its decision in Markovich v. Sec’y of Health & Human Services, 477 F.3d 1353 (Fed. Cir. 2007), in which it adopted an objective standard focusing on the “recognized standards of the medical profession at large” to determine when first symptoms occur for purposes of the Act. Op. at 5. The Court then noted that it was undisputed that Carson first demonstrated speech delay more than 36 months before

the petition was filed. Id. Petitioners argued that the medical community would not recognize speech delay as evidence of a vaccine injury because it was too vague and common of an occurrence to provide an objectively recognize symptom of vaccine injury. The Court disagreed, stating that the Special Master’s conclusion that Carson’s pediatrician’s observation of Carson’s “severe language delay” in May 1999 was an objectively recognizable symptom or manifestation was based on medical records and was not arbitrary and capricious. Id. at 6-7. The Court noted that the key question was not whether the condition was sufficient to support a diagnosis of autism, but whether the condition was a symptom or manifestation of onset of the alleged injury. Id. at 7. The Court further noted that it had previously explained that “first symptoms or manifestations of onset might include subtle symptoms that a petitioner would recognize only with the benefit of hindsight, after a doctor makes a definitive diagnosis of injury.” Id. at 8 (internal quotation marks omitted). The Court declined to decide whether the “first symptom need only be recognizable by the medical community with the benefit of hindsight,” or “whether the first symptom must be recognizable by the medical community as indicative of the alleged vaccine injury at the time the symptom occurs.” Id. at 8 n.4 (internal quotation marks omitted). Because the petition was not filed within 36 months of Carson’s first symptom, the petition was untimely. Accordingly, the Federal Circuit affirmed.


The aforementioned vaccine case summary was provided by Alsotn & Bird. Contributing author: Benn Wilson.

Merit Systems Protection Board (MSPB) Appeals

Gallo v. Department of Transportation, No. 2011-3094 (Fed. Cir. August 5, 2013)Opinion by Circuit Judge Linn

In this attorney fees case, the Federal Circuit held that it does not have authority to award fees under the Back Pay Act to employees of the Federal Aviation Administration (FAA) and therefore denied Ms. Gallo’s request for fees.

The court noted that, prior to 2012, the Back Pay Act did not apply to the FAA. In 2012, however, Congress passed an amendment to 49 U.S.C. § 40122 adding the language “Notwithstanding any other provision of law, retroactive to


April 1, 1996, the [Merit Systems Protection] Board shall have the same remedial authority over such employee appeals that it had as of March 31, 1996.” The court concluded that the amendment provided the Board, not the court, with the described remedial authority. “This language indicates no intention to allow this court to award attorney fees under the Back Pay Act against the FAA.” (emphasis in original).

To read the full opinion, click here.

Gargiulo v. Department of Homeland Security, No. 2012-3157 (Fed. Cir. August 16, 2013)Opinion by Circuit Judge Bryson

In this case involving the revocation of a security clearance, the Federal Circuit held that federal employees are entitled to notice of the reasons for a revocation or suspension of their security clearance and an opportunity to make a meaningful response regarding those reasons to someone in the agency with the authority to affect that decision. Specifically, the court held that these rights are found in 5 U.S.C. § 7513(b), not in the Due Process Clause of the Fifth Amendment. The court affirmed the final decision of the Merit Systems Protection Board (Board).


Kaplan v. ConyersNo. 2011-3207 (Fed. Cir. August 20, 2013) Opinion by Circuit Judge Wallach

In this en banc decision, the Federal Circuit held that the Merit Systems Protection Board (Board) cannot review an agency’s determinations concerning the eligibility of an employee to occupy a “sensitive” position, regardless of whether that sensitive position requires the employee to access classified information. The court reversed the Board’s decision that found the Board’s review to be limited only in cases involving security clearances.

The court found that Dep’t of the Navy v. Egan, 484 U.S. 518 (1988), which prohibits the Board from merits review of agency adverse actions based on the denial, revocation, and suspension of a security clearance, also extends to Board review of determinations involving an employee’s eligibility to occupy a sensitive position. The court found that Egan’s “rationale applies to all prediction of risk regarding national security.”


The aforementioned Merit Systems Protection Board

case summaries were provided by MSPB. Contributing author: Jeffrey Gauger.

Patent & Trademark Appeals

Cheese Systems, Inc. v. Tetra Pak Cheese & Powder Systems, Inc.

No. 2012-1463, -1501 (Fed. Cir. August 6, 2013)Opinion by Chief Judge Rader

In Cheese Systems, the Federal Circuit affirmed summary judgment that Cheese Systems, Inc. (“CSI”) infringed Tetra Pak’s ‘347 patent under the doctrine of equivalents and that CSI had not proven the patent was invalid as anticipated or obvious.

The ‘347 patent-at-issue is directed to a cheese-making vat. To make cheese, milk and other additives are combined in a vat. Prior to the invention, such vats were typically vertical vats in which agitator panels, driven by long shafts on a vertical axis, either cut or stirred a semi-solid “coagulum” of ingredients used to make cheese. The agitator panels were two-sided, with cutting edges on one side and stirring edges on the other. Because of inefficiencies in those vats, cheese makers began turning vertical vats horizontally on their sides so that the shafts lay on an axis parallel to the ground. Prior art taught that the shafts should turn in the same direction, or “co-rotate.” Co-rotation caused problems, however, which the ‘347 patent sought to solve with two improvements. It taught that the shafts should contra-rotate, and that the agitator panels should be arranged so that they would present either cutting or stirring sides to the shared space in between the shafts called the common volume. In that way, only cutting or stirring could occur at one time.

The accused CSI device contained two contra-rotating horizontal shafts that either cut or stirred the coagulum at one time. CSI argued that its agitator panels did not meet the “generally common plane” limitation, which the district court construed in part as requiring the panel to be “on the whole flat.” The Federal Circuit rejected the construction as too restrictive, and concluded that CSI’s agitator panels, having more than two cutting and stirring edges in a common plane, satisfied the limitation. On this issue, the Court reversed the district court’s denial of no literal infringement. In addition, the Court affirmed the district court’s determination that CSI’s vat satisfied the “agitator panel” limitation. And in affirming the lower court’s ruling that CSI’s vat satisfied the “horizontal” claim term, the Federal Circuit rejected CSI’s argument that the patent required the horizontal axes to be parallel to the ground, holding that in the art the “horizontal”



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claim term allowed some measure of incline. Concerning CSI’s invalidity defenses, the Federal

Circuit rejected CSI’s assertion that each of two prior art patents anticipated the ‘347 patent. The patents focused on problems inherent in co-rotation, and although they briefly mentioned contra-rotation, neither patent discussed re-orienting the agitator panels so that during contra-rotation only cutting or stirring occurred.

As for obviousness, the Federal Circuit rejected one of CSI’s prior-art combinations for the same reason it rejected the anticipation argument – the patents barely mentioned contra-rotation, and a person of skill would have viewed the patents as suggesting cutting and stirring simultaneously rather than re-orienting one shaft’s agitator panels so that only one or the other occurred at one time. The Court also affirmed the district court’s rejection of another combination, which in part relied on an Austrian patent that CSI’s expert could not translate. A figure in the patent the expert relied on to show that the patent taught contra-rotation was at best ambiguous.


Aria Diagnostics, Inc. v. Sequenom, Inc.No. 2012-1531 (Fed. Cir. August 9, 2013)Opinion by Chief Judge Rader

In Aria, on appeal from denial of a motion for preliminary injunction, the Federal Circuit vacated and remanded concluding that the district court had incorrectly construed the claims and improperly balanced the injunction factors.

The ’540 patent at issue is directed to methods for identifying fetal genetic defects by analyzing cffDNA obtained from a maternal blood sample. Such tests present fewer risks and had a more dependable rate of detection.

The Federal Circuit concluded that district court misconstrued the claim phrase “paternally inherited nucleic acid.” The trial court’s construction required that the father’s gene sequence be known in advance. The Federal Circuit disagreed. First, the Court noted that the claim language did not limit the term although it would have been easy to do so by explicitly including a “known in advance” limitation. Next, the Federal Circuit analyzed the specification and disagreed with the district court’s determination that a sentence in the specification provided support for the limitation. The Federal Circuit found no “clear lexicography or disavowal.” The Federal Circuit concluded that there was no intention to limit the claims to the examples, pointing to explicit language that the examples “do not in any way limit the scope of the invention.” In addition, at least one of the examples was not

limited to sequences known in advance to have come from the father. Finally, the Federal Circuit found that three events during prosecution that arguably related to construction of the phrase were ambiguous.

The Federal circuit also concluded that the district court incorrectly construed “amplifying” when it limited the term to amplifying only paternally inherited DNA. Rather, the court concluded that the correct construction allowed for the claim to read on methods that also amplified other DNA so long as the paternally inherited DNA was amplified. Once again, the Court found no support in the claims, specification, or prosecution history for the limitation imposed by the district court.

On the issue of whether the claims were directed to eligible subject matter, the Federal Circuit remanded for the district court to consider the Supreme Court’s ruling in Myriad.

The Federal Circuit also provided guidance to the district court regarding its analysis of the injunction factors on remand. The court addressed four reasons given by the district court for denial of the motion. In its guidance, the Federal Circuit indicated that: 1) the court could not assume that price erosion and loss of market share were reparable ; 2) the presence of other infringers does not negate irreparable harm; 3) the fact that the infringer might be put out of business was a factor to consider but did not control the balance of hardships; and 4) in assessing the public interest, Ariosa argued the injunction was contrary to the public interest because it marketed to a broader market including low-risk women, the court should consider that an expert organization warned against using cffDNA tests in low-risk women.


Skinmedica Inc. v. Histogen Inc.No. 2012-1560 (Fed. Cir. August 23, 2013)Opinion by Circuit Judge Prost

In Skinmedica, the Federal Circuit affirmed summary judgment of non-infringement based on a dispositive claim construction issue.

The two patents-at-issue generally concerned methods of producing dermatology products including conditioned cell culture mediums that could be used to treat wrinkles. For example, a conditioned cell culture medium composition could be a liquid that is incubated with cells and treated with nutritional compounds, metabolites, and proteins to help the cells grow. Each of the patents described different ways to grow cells in a monolayer, two-dimensional, or three-dimensional culture. The relevant claims recited “culturing



. . . cells in three dimensions.” The district court construed the claims to exclude

culturing using “beads,” which the district court equated with culturing in two dimensions based on the intrinsic evidence. The district court found that the inventors acted as their own lexicographers by consistently distinguishing beads from three-dimensional culturing in the specification. For example, the specification used the disjunctive “or” and the phrase “as opposed to” to contrast beads from three dimensional cultures. The only other reference to beads in the specification also explicitly described beads as two dimensional by stating “beads (i.e., two dimensions).” It was undisputed that the accused product used beads, therefore, the district court granted summary judgment of non-infringement on this basis.

On appeal, the Federal Circuit addressed the district court’s claim construction of the “culturing . . . cells in three dimensions” limitation. The Federal Circuit found no basis to disturb the district court’s construction. The majority agreed that the specification clearly showed that the inventor limited three-dimensional cultures to exclude beads, even without an express definition. The specification repeatedly distinguished culturing with beads from culturing in three dimensions. The Federal Circuit emphasized that the ordinary meaning of a claim term can be disclaimed through repeated and definitive remarks in the written description and described the leading cases finding such implicit disclaimers. Also, the Court noted that during prosecution the inventor distinguished anticipatory prior art by arguing that the medium produced by two-dimensional cultures was inferior and chemically distinct from the medium produced by three dimensional cultures. The Federal Circuit found that the scope of the claim was necessarily limited by the specification as well as the prosecution disclaimer, thus, the federal Circuit affirmed the summary judgment of non-infringement.


The aforementioned patent and trademark case summaries were provided by Jenner & Block. Contributing authors: Steve Trybus, inclusively;,Michael Babbit, Christopher Lay, and Chad Ray, respectively.

Taurus IP, LLC v. DaimlerChrysler Corp.Nos. 2008-1462, -1463, -1464, -1465 (Fed. Cir. August 9, 2013)Opinion by Circuit Judge Schall

In Taurus IP, LLC v. DaimlerChrysler Corporation, the Federal Circuit affirmed the district court’s (1) construction of the disputed claim terms, (2) judgment of

invalidity regarding two of the asserted claims, (3) judgment of noninfringement of the patent, and (4) award of damages based on the finding of an exceptional case. With respect to the alleged infringers’ counterclaim for breach of contract, the Federal Circuit affirmed (1) the district court’s denial of the motion to dismiss for lack of personal jurisdiction, (2) liability for breach of contract, (3) the district court’s award of attorney’s fees for the amount incurred prosecuting the breach of contract counterclaim, and (4) the imposition of evidentiary sanctions against the third party defendants for witness tampering. The Federal Circuit reversed the award of damages based on the attorney’s fees incurred defending against the patent suit.

Taurus IP, LLC (Taurus ) sued va r ious DaimlerChrysler Corporation (Chrysler) and Mercedes-Benz USA, Inc. (Mercedes) defendants alleging that their external websites infringed its patent (the DaimlerChrysler Patent Suit). Chrysler and Mercedes counterclaimed against Taurus for breach of contract and filed a contract claim against various third party defendants, including Orion IP, LLC (Orion) and Erich Spangenberg, who was the managing member of Taurus and the related third party defendant corporations (the Breach of Warranty Suit). The breach of contract claims alleged that, by filing the DaimlerChrysler Patent Suit, Taurus and the third party defendants breached various provisions, including the warranty provision, of a 2006 settlement agreement with Orion.

The patent at issue (the Taurus patent) claimed a computer system for managing product knowledge related to products offered for sale. Independent claim 16 recited a method for managing the product knowledge in which a data model, which establishes the relationship between data, is constructed from the input of data items and the user-defined relationships between the data items. The data is input into the computer system, user-defined relationship information is provided for a particular data item, and product knowledge is presented to a user based on the data model and the user-defined relationship. Taurus claimed that Chrysler and Mercedes’s external websites infringed claim 16 and four dependent claims by enabling visitors to their websites to configure a hypothetical vehicle, save that information, and identify a dealer with that configuration in stock.

In 2006, Chrysler and Orion entered into an agreement to settle Orion’s patent infringement suits against Chrysler and Mercedes. When it filed the 2006 suits, Orion had the rights to the Taurus patent, but did not assert those rights. Instead, Orion transferred the Taurus patent a few days after filing suit. The patent was eventually transferred to Taurus. Spangenberg was the managing member of Orion and Taurus and authorized the transfer to Taurus. In the settlement agreement’s warranty provision, Orion represented and warranted that “it has not assigned or otherwise transferred to


any other Person any rights to any causes of action, damages, or other remedies, or any Orion Patents, claims counterclaims or defenses, relating to the Litigation.” Chrysler and Mercedes claimed that Orion breached this provision by transferring the Taurus patent before it was asserted in the current DaimlerChrysler Patent Suit.

In the DaimlerChrysler Patent Suit, the district court, after construing several claim terms, granted summary judgment to Chrysler and Mercedes upon finding no infringement and that claim 16 and dependent claim 27 were invalid as anticipated by prior art. The district court found the case to be exceptional and awarded damages. In the Breach of Warranty Suit, the district court rejected the out of state third party defendants’ motion to dismiss for lack of personal jurisdiction and denied the third party defendants’ motion for summary judgment. A jury found breach of the warranty provision and the district court denied the third party defendants’ motion for judgment as a matter of law. The district court awarded damages to Chrysler and Mercedes and imposed sanctions on Orion and Spangenberg for pre-trial witness tampering. Taurus appealed the DaimlerChrysler Patent Suit and Orion and Spangenberg appealed the Breach of Warranty Suit.

The Federal Circuit affirmed the holdings in the DaimlerChrysler Patent Suit.

The district court properly construed the terms “user” and “user-defined relationship information.” The district court properly rejected Taurus’s proposed claim constructions because its proposed construction of “user” was improperly broad based on its context and its proposed construction of “user-defined relationship information” conflicted with the plain language of the claim.

The Federal Circuit affirmed summary judgment on invalidity because claims 16 and 27 were anticipated by prior art, a patent originally assigned to Trilogy Development Group, Inc. (the Trilogy patent). Taurus did not establish a date of invention earlier than the Trilogy patent filing date. “Appendix A,” filed with the Taurus patent, and the putative inventor’s testimony was insufficient to establish that the Taurus patent predated the Trilogy patent. While Appendix A included a creation date prior to the Trilogy patent filing date, it also had a modification date after the Trilogy filing date with no indication of what was modified. Taurus failed to establish that Appendix A included all of the limitations in claims 16 and 27 sufficient to show conception or represented reduction to practice of the entire process recited in those claims. The testimony of the putative inventor lacked corroboration, as required by case law to prove date of conception. Thus, the district court did not err in finding the Trilogy patent to be prior art. The district court properly found that the Trilogy patent anticipated the Taurus patent because the former disclosed every step recited in the latter

and Taurus failed to present any genuine issue of material fact regarding anticipation.

As to the not invalidated Taurus patent claims, the Federal Circuit affirmed the district court’s grant of summary judgment to Chrysler and Mercedes on the issue of infringement. Taurus did not raise any genuine issue of material fact and the district court did not err in its legal conclusion that the Chrysler and Mercedes websites did not fall within the Taurus patent claims based on the claim construction. Under the district court’s claim construction, the Taurus patent claimed a method in which users may create or edit rules governing the relationships between data items. In contrast, the Chrysler and Mercedes websites merely permitted visitors to submit data to be processed by predetermined rules. Taurus failed to establish that a visitor to the Chrysler and Mercedes websites could create or edit the data relationships, as required by the district court’s claim construction. Thus, the district court did not err in concluding that Taurus failed to show that the websites were practicing the limitations of the asserted claims.

The Federal Circuit affirmed the district court’s finding that the case was exceptional. Taurus’s infringement claim was objectively baseless because its proposed claim construction was unreasonably broad and unsupported by the written description. Moreover, the district court did not err in its implicit finding that Taurus knew the patent suit lacked a reasonable basis and was pursued and maintained in bad faith. The Taurus patent was directed at database administration, but the suit alleged infringement based on website visitors. Taurus continued the suit even after the claim terms were construed to include as “users” only those persons who could create and edit rules governing the relationships between data.

The Federal Circuit affirmed the holdings of the Breach of Warranty Suit, except it reversed the award of damages for the attorney’s fees incurred by Chrysler and Mercedes in defending against the DaimlerChrysler Patent Suit.

The district court properly found personal jurisdiction over Orion and Spangenberg, both out of state defendants, under the alter ego doctrine because Spangenberg controlled Taurus and Orion and used that control to assert the Taurus patent against Chrysler and Mercedes. Spangenberg exerted control over Taurus and Orion because he managed the companies and he oversaw and authorized many of the companies’ actions relevant to the suit, including entering into the 2006 settlement agreement, transferring the Taurus patent, and filing the DaimlerChrysler Patent Suit. Spangenberg sought to use Taurus as a means to assert the Taurus patent, which the settlement agreement arguably prohibited Orion from asserting, against Chrysler and Mercedes. Without jurisdiction over Orion, Chrysler and Mercedes would be unable to assert their counterclaim, a license-related defense

to the DaimlerChrysler Patent Suit, and the district court would be unable to provide the relief Chrysler and Mercedes sought. Thus, the Federal Circuit found the district court properly pierced the corporate veil to reach Spangenberg and reverse-pierced the corporate veil to reach from Spangenberg to Orion.

The Federal Circuit affirmed the district court’s denial of Orion and Spangenberg’s motions for summary judgment and judgment as a matter of law regarding the jury verdict finding breach of the warranty provision. The district court did not err in concluding that “relating to the [2006] Litigation” included causes of action involving the same facts and that the accused technology in the 2006 suits was identical to that accused in the DaimlerChrysler Patent Suit. Thus, there was no error in the district court’s denial of summary judgment. The Federal Circuit also found that the district court properly denied judgment as a matter of law because a reasonable juror could have found for Chrysler and Mercedes.

The Federal Circuit affirmed the award of attorney’s fees incurred by Chrysler and Mercedes in prosecuting their Breach of Warranty Suit. Attorney’s fees are available to prevailing parties in breach of contract suits under Texas statute, the law applicable under the contract. Orion and Spangenberg had no right to a jury trial on the issue of traditional attorney’s fees and expert testimony was not required under the relevant Texas statute.

The Federal Circuit reversed the award of damages, as measured by the attorney’s fees incurred by Chrysler and Mercedes in defending the DaimlerChrysler Patent Suit, for the Breach of Warranty Counterclaim. Chrysler and Mercedes only submitted evidence of the attorney’s fees in post-trial filings; they did not present evidence regarding damages to the jury. The post-trial filings cannot support an award of attorney’s fees as damages where, as in this breach of contract case, the substantive law requires damages to be proved at trial. Chrysler and Mercedes did not present sufficient evidence at trial to establish the award of damages. Thus, it was improper for the district court to award damages for the Breach of Warranty Counterclaim.

The Federal Circuit affirmed the district court’s imposition of evidentiary sanctions against Orion and Spangenberg for witness tampering. One of Spangenberg’s employees, Patrick Anderson, an attorney who formerly worked as a patent agent for Chrysler, contacted a potential Chrysler witness because Spangenberg suggested that the witness might commit perjury. The district court did not violate due process and did not abuse its discretion by imposing evidentiary sanctions based on this conduct.

The district court did not violate due process. Orion and Spangenberg had sufficient notice regarding potential

sanctions from Chrysler and Mercedes’s motions in limine and the evidentiary hearing on the issue. Orion and Spangenberg had an opportunity to be heard when they argued against sanctions and the district court discussed the issue with the parties at the evidentiary hearing.

The district court did not abuse its discretion in imposing sanctions where Spangenberg failed to erect an appropriate wall to preclude access to confidential information that Anderson had from working for Chrysler. Moreover, Orion and Spangenberg’s argument that contact with Chrysler’s witness was required by ethical obligations was unpersuasive. The ethical obligation to dissuade a client from potential perjury only applied to lawyers representing clients in a tribunal. Anderson was not representing Orion or Spangenberg in the Breach of Warranty Suit and had no obligation under the professional conduct rule. Thus, the district court did not abuse its discretion in imposing evidentiary sanctions against Orion and Spangenberg.


Monolithic Power Systems, Inc., et al. v. O2 Micro International Ltd.No. 2012-1221 (Fed. Cir. August 13, 2013)Opinion by Circuit Judge Prost

In Monolithic Power Systems, Inc. v. O2 Micro International Ltd., the Federal Circuit affirmed the district court’s decision finding this case exceptional under 35 U.S.C. § 285 and awarding attorney fees to Monolithic Power Systems, Inc. (MPS).

MPS and O2 Micro are competitors in the market for LED lighting controller circuits. In 2008, MPS filed a declaratory judgment action against O2 Micro for noninfringement and invalidity with respect to four O2 Micro patents. O2 Micro filed a complaint regarding the same patents at the International Trade Commission (ITC). The district court denied a motion to stay, but ordered that all discovery in the ITC apply in the district court action.

During the district court proceeding, O2 Micro provided a schematic printout as evidence of a February 1998 conception date, but MPS’s schematic expert proved that the schematic had been manually backdated. The district court agreed with MPS’s expert, and soon after, O2 Micro filed a covenant not to sue and moved to dismiss the case. In fact, O2 Micro and MPS have been embroiled in a series of litigation with the current case being the fifth one, and O2 Micro has repeatedly used the same tactic of granting a covenant not to sue and moving to dismiss once the case becomes unfavorable to it.


The district court dismissed the case with prejudice and awarded MPS approximately $8.5 million in attorney fees and costs, finding this case exceptional based on O2 Micro’s litigation misconduct and unprofessional behavior. The district court explained that O2 Micro withdrew its claims only after substantial litigation had taken place, causing a waste of substantial resources; they had also made various misrepresentations concerning the date of the schematic printout. A bulk of the awarded attorney fees was incurred during discovery in the ITC investigation, but the district court justified including this fee in the awarded attorney fees because O2 Micro had known that the ITC discovery would apply in the district court action, and it acknowledged that there was a significant overlap of issues between the two proceedings.

The Federal Circuit held that the district court did not err in finding this case exceptional based on O2 Micro’s litigation misconduct without making a finding of “bad faith.” The Federal Circuit noted that litigation misconduct and unprofessional behavior can suffice, by themselves, to make a case exceptional, and no additional finding of “bad faith” or “objectively baseless” litigation is required. The Federal Circuit further explained that O2 Micro engaged in litigation misconduct by its “modus operandi” of moving to dismiss the case by a unilateral covenant not to sue once the case starts going south, and in this time, only after the parties filed final pretrial submissions, causing a waste of substantial resources. The Federal Circuit also noted that O2 Micro’s misrepresentation concerning the schematic’s date constituted unprofessional behavior.

The Federal Circuit found that the district court did not abuse its discretion in awarding MPS the attorney fees incurred during discovery in the ITC investigation. O2 Micro argued, relying on a recent Supreme Court case, that the award of attorney fees under the exception clause should be limited to those fees that would not have been incurred but for the acts of misconduct, and since the discovery expense in this case would have been incurred regardless of the misconduct, it should not have been awarded. The Federal Circuit distinguished the current case from the Supreme Court case as the latter involved the allocation of fees between frivolous and nonfrivolous claims in a single lawsuit, whereas the former involves the allocation of fees in two separate, parallel proceedings, neither of which involves a frivolous claim. The Federal Circuit then concluded that, in view of the application of the ITC discovery in the district court action and the parties’ agreement to its dual use, the district court did not abuse its discretion in including the ITC discovery expense in the recoverable attorney fees.


3M Innovative Properties Co., et al. v. Tredegar Corp.No. 2012-1241 (Fed. Cir. August 13, 2013)Opinion by Circuit Judge Reyna

In 3M Innovative Properties Co. v. Tredegar Corp., the Federal Circuit addressed the Minnesota District Court’s claim constructions with regard to four disputed claim terms. For two of the disputed claim terms, the Federal Circuit affirmed the lower court’s construction but corrected analytical errors regarding the scope of one of those terms. For the other two disputed claim terms, the Federal Circuit vacated the lower court’s constructions.

The four patents-in-suit concerned the elastomeric film found in body-hugging areas of certain products, such as the side tabs of disposable diapers. The patents addressed problems due to the inflexibility of materials used in the prior art. The claims disclosed films that expand when stretched but recover their shape once stretching is complete. Keys to the inventions were the internal core and surrounding skin layers of the films and the micro-texturing created by folds between those layers when stretched. The two Krueger patents claimed a laminate film with “continuous” micro-texturing over the laminate’s skin layer. The two Hanschen patents claimed a laminate film in which the stretching portions of the skin layer are limited to “preferential activation zones,” with the adjacent regions of the skin layer remaining inelastic.

After claim construction in the district court, the parties stipulated to non-infringement. On appeal, the Federal Circuit resolved multiple claim construction disputes.

First, the Court found that the district court improperly narrowed the meaning of the term “continuous contact” because the patentee had amended it from “substantially continuous contact” during prosecution. The parties disputed whether the film layers exhibiting a certain type of failure, called “cohesive failure,” could be considered to be in “continuous contact.” Cohesive failure occurs when folds in the skin layer pull material away from the core layer so that the two distinct materials remain physically adhered, but with space created beneath the folds due to cracking within the core layer itself. The district court reasoned that by removing the word “substantially” from the claims, the patentee had surrendered any contact short of “full surface” contact, so film exhibiting cohesive failure would be excluded. The Federal Circuit ruled that this was error because the amendment during prosecution was not a “clear and unmistakable” disavowal of cohesive failure, and the patent’s written disclosure expressly described the cohesive failure embodiment as one variation of “continuous contact.” There was no basis, therefore, for not giving “continuous


contact” its plain and ordinary meaning, which would not exclude film layers exhibiting cohesive failure. The Federal Circuit affirmed the district court’s construction—defining “continuous contact” as “full surface contact”—but clarified that the definition must include cohesive failure.

Second, the district court construed “continuous microtextured skin layer over substantially the entire laminate” to require the microtexturing, rather than just the skin layer, to be substantially “continuous” across “substantially the entire surface of the skin layer,” and the Federal Circuit affirmed. Pointing to The Chicago Manual of Style for guidance, 3M argued that “continuous” modified only “skin layer,” not “microtexturing,” so that the skin layer only needed microtexturing in at least one single region. The Federal Circuit rejected this approach because it did not first consider how a skilled artisan would understand the term in context of the patent. Even if, as 3M argued, the phrase “continuously microtextured” would have better indicated that microtexturing was required over the entire laminate, a skilled artisan would understand from the written description that the microtexturing had to cover substantially the entire skin layer rather than be restricted to a single region.

Third, the district court incorrectly construed the term “preferential activation zone” to require that the areas of the laminate film that preferentially elongate to be both “predetermined” and “identifiable.” The district court relied on statements made by an examiner during reexamination suggesting that he understood the claim term to be narrower in scope than the plain meaning of the claims and statements in the written description would otherwise allow. This contrasted with statements made by the patentee during the original prosecution defining “preferential activation zone” broadly in a manner consistent with the claim language. On review, the Federal Circuit was “hesitant to rely too heavily on examiner statements over those of the patentee” and explained that “claim construction is not decided based on isolated statements of one skilled in the art.” The Federal Circuit reasoned that because the language in the claim itself provided context for ascertaining the definition of “preferential activation zone,” that definition should control “unless a narrower construction is required by the specification or prosecution history.” Because Tredegar provided no evidence of a disclaimer by 3M in the prosecution history, the district court erred in not deferring to the plain meaning of the claim language and the statements made in the written description. The Federal Circuit thus construed “preferential activation zone” to mean “selected area[s] of the multi-layer laminate which, when stretched will elongate to form an elastic zone before or to a greater extent than other areas of the laminate.”

Fourth, the district court erred by construing the

term “ribbon” to mean “a strip of film having a width of no more than one inch” even though the words of the claim and the written description were silent as to dimensions of the ribbon. Tredegar argued that without a width limitation the claims at issue would be “indefinite, so that the court should look to the prior art to provide such a limitation and cure “ribbon” of its vagueness. The district court adopted Tredegar’s approach. The Federal Circuit held that the court had misapplied the “indefiniteness” concept, which applies when “reasonable efforts at claim construction must result in a definition that does not provide sufficient particularity or clarity to inform a skilled artisan of the bounds of the claim.” The district court also violated “claim construction standards” by “exploring tangential prior art references to understand the meaning of the claims.” Because the ordinary usage of “ribbon” comported with its usage in the patent language, it was error to impose an artificial width requirement. The Federal Circuit construed the term simply as a “strip of film.”


The aforementioned patent and trademark case summaries were provided by Morrison & Foerster. Contributing authors: Kristin Yohannan, inclusively; Julie A. Nicholson, Ashley Boyoung Yeum, and Daniel A. Zlantik, respectively.

Apple Inc. v. Samsung Electronics Co., Ltd., et al.Nos. 2012, 1600, 2013-1146(Fed. Cir. August 23, 2013)Opinion by Judge Prost

In Apple, the Federal Circuit reversed the district court’s pre- and post-trial orders denying the parties’ motions to seal confidential exhibits, concluding that the district court applied the incorrect legal standard to documents attached to non-dispositive motions and that, in any event, the parties had shown “compelling reasons” sufficient to overcome the public’s interest in disclosure. Judge Prost wrote the unanimous opinion.

Apple brought suit against Samsung alleging infringement of several patents and trade dress embodied in smartphones and tablet computers,. Samsung then filed counterclaims alleging patent infringement by Apple. This litigation aroused extraordinary attention from the media and the district court granted broad access to the press throughout the proceedings.

Apple and Samsung filed numerous pre-trial motions accompanied by unopposed administrative motions to seal confidential exhibits, including documents containing product-specific financial data. After the district court denied


these motions without prejudice, the parties submitted revised motions supported by declarations detailing the measures taken to maintain confidentiality as well as the competitive harms that would result from disclosure of these documents. The parties also filed a joint stipulation agreeing, inter alia, to disclose certain financial information necessary to damages calculations at trial and not to challenge the sufficiency of the evidence introduced in support of one another’s damages calculations.

In its pre-trial order granting-in-part and denying-in-part these renewed motions (“August Order”), the district court concluded that Apple and Samsung failed to articulate “compelling reasons” that justified sealing documents containing their financial information. According to the district court, the parties failed to establish critical assumptions supporting their claims of competitive harm and did not establish how past profit and sales data could be used to predict future business plans. By contrast, the court found that the public’s interest in disclosure of this data was “substantial” because it was “essential to each party’s damages calculations.” The district court therefore ordered this information unsealed, but stayed its order pending appeal.

After a jury verdict substantially in Apple’s favor, Samsung moved to seal Apple market research reports lodged with its opposition to Apple’s motion for a permanent injunction and enhanced damages. Apple submitted a supporting declaration describing the measures employed to maintain the confidentiality of these reports as well as the advantages competitors would obtain from their disclosure. In a post-trial order (“November Order”), the district court concluded that Apple had not shown “compelling reasons” to seal these reports. According to the district court, Apple specifically failed to show that Samsung could not replicate the reports’ analysis and, moreover, competitors could infer Apple’s business plans by observing market data. The district court ordered these exhibits unsealed, but stayed this order pending appeal.

Apple and Samsung appealed the August Order, and Apple appealed the November Order, but neither party opposed the other’s requested relief. The Federal Circuit first considered whether it had jurisdiction to hear these appeals under the collateral order doctrine. Applying the three-factor test stated in Cohen v. Beneficial Indus. Loan Corp., 337 U.S. 541 (1949), the Federal Circuit concluded that the district court’s orders fell within the “narrow exception” to the final judgment rule because (1) they conclusively determined that the confidential information would be made public; (2) they addressed an important issue –the propriety of sealing court documents – that was separate from the merits; and (3) they could not be reviewed once the parties’ confidential information had been disclosed.

Turning to the merits, the Federal Circuit held that the district court erred by requiring the parties to show “compelling reasons” to seal documents attached to non-dispositive motions. For dispositive motions, the Ninth Circuit requires a showing of “sufficiently compelling reasons,” such as competitive harm, to overcome the “strong presumption in favor of access to court records.” However, confidential materials attached to non-dispositive motions may be sealed on a particularized showing of “good cause” under Federal Rule 26(c). Because many of the pre-trial motions underlying the August Order involved evidentiary issues, the Federal Circuit concluded that the district court’s failure to apply the “good cause” standard was legal error. The court further concluded that, regardless of the error, the parties met the more restrictive “compelling reasons” standard for all of the materials addressed on appeal.

With respect to the August Order, Apple and Samsung argued that the district court abused its discretion in refusing to seal their confidential financial information, which they equated with trade secrets. Apple and Samsung further argued that the public did not require access to the detailed information contained in the underlying documents because they had stipulated to rely only on less-detailed financial data to prove damages at trial. In response, amicus curiae The First Amendment Coalition claimed a strong public interest in disclosure, citing the case’s impact on the companies and associated financial risks for shareholders.

Balancing the interests that Apple and Samsung asserted in sealing their financial information against the public’s interest in disclosure, the Federal Circuit concluded that the district erred by refusing to seal the parties’ financial information. Although the Federal Circuit declined to decide whether this information qualified as trade secrets, the court found that suppliers could use confidential profit, cost, and margin data to extract benefits in contract negotiations, thereby placing Apple and Samsung at a competitive disadvantage. At once, the Federal Circuit found that the public had little interest in the information at issue, observing that the parties sought to seal only limited portions of documents containing the most sensitive financial information, that they agreed to rely on less-detailed information at trial, and that none of the underlying documents had been offered into evidence. Rejecting the argument of the amicus curiae, the court noted that shareholder and consumer interests in manufacturing and pricing decisions were irrelevant to the balancing test. Accordingly, the Federal Circuit concluded that the district court abused its discretion in the August Order.

With respect to the November Order, Apple argued that the district court had abused its discretion in refusing to seal nine market research reports, and the Federal Circuit agreed. The court found that these reports contained

that Hamilton Beach could make into a binding contract for sale by simple acceptance. The Federal Circuit also rejected Hamilton Beach’s argument that the claimed invention was not ready for patenting. Hamilton Beach contended that it was not able to perfect the invention until several months after the critical date, but the court concluded that the invention was nonetheless ready for patenting because Hamilton Beach’s engineers created a working prototype of the invention before the critical date, and had created CAD drawings, made presentations, and had other communications with its supplier that, taken together, were sufficiently precise to enable a person of ordinary skill to build the invention.


Aevoe Corp. v. AE Tech. Co. et al.No. 2012-1422(Fed. Cir. August 29, 2013)Opinion by Judge O’Malley

In Aevoe, the Federal Circuit dismissed an appeal of a modified injunction for lack of jurisdiction, finding that the modified injunction merely interpreted the original injunction, and that the time to appeal the original injunction had run. The district court originally granted a preliminary injunction against AE Tech Co. Ltd. (AE Tech) in January 2012, prohibiting AE Tech from selling a touch screen protector that was held to infringe a patent owned by Aevoe Corp. AE Tech was entitled to immediately appeal that injunction as an order “granting, continuing, modifying, refusing or dissolving injunctions, or refusing to dissolve or modify injunctions.” 28 U.S.C. § 1292(a)(1). Under the Federal Rules of Appellate Procedure, AE Tech had 30 days to file that appeal. Fed. R. App. Proc. 4(a)(1). AE Tech, however, did not appeal the January order. In May 2012, the district court concluded that AE Tech had violated the injunction with an alleged redesign. At that time, the court altered certain language in the injunction, stating that it also applies to any “colorable imitation” of the infringing touch screen protector. AE Tech appealed this further order, arguing that it was an appealable “modification” of the existing injunction under 28 U.S.C. § 1292(a)(1). The Federal Circuit disagreed, and held that the district court merely “clarified” the scope of the original injunction in its May 2012 order, and that there was “no modification that substantially changed the legal relationship between the parties.” Based on that finding, the Federal Circuit dismissed the appeal for lack of jurisdiction. The Federal Circuit also considered whether the addition of AE Tech’s distributor (the “S&F Defendants”) to

information that Apple’s competitors could not obtain anywhere else and that the district court’s reasoning failed to appreciate that publicly available market data did not reveal future product releases or marketing strategies. Noting that Apple had agreed to make public all information actually cited by the parties or the district court, the Federal Circuit concluded that other information in the reports was irrelevant to the public’s understanding of the case and that “mere curiosity about the parties’ confidential information” could not support disclosure “where that information is not central to a decision on the merits.” The Federal Circuit therefore reversed and remanded.


Hamilton Beach Brands, Inc. v. Sunbeam Products, Inc.No. 2012-1581(Fed. Cir. August 14, 2013)Opinion by Judge O’Malley

In Hamilton Beach, the Federal Circuit affirmed the district court’s grant of summary judgment that Hamilton Beach’s patent on its “Stay or Go” slow cooker was invalid under the on-sale bar.Hamilton Beach sued Sunbeam, one of its primary competitors in the market for small kitchen appliances, after Hamilton Beach was able to use a pending continuation application to obtain claims covering Sunbeam’s attempt to design around Hamilton Beach’s earlier-issued patent. While the parties disputed the effective filing date to which Hamilton Beach’s asserted claims were entitled, the Federal Circuit held that the dispute was immaterial because an embodiment of Hamilton Beach’s asserted claims was the subject of a commercial offer for sale more than one year before the earliest possible effective filing date, i.e., before the earliest alleged “critical date.” Specifically, Hamilton Beach issued a purchase order to its foreign supplier for manufacture of Stay or Go slow cookers. A few weeks later—and still more than a year before the earliest possible effective filing date for the asserted claims—the supplier confirmed that it had received the purchase order and would begin production after receiving Hamilton Beach’s “release,” i.e., its review and approval of the final product, as was contractually required before the supplier was permitted to ship product. Hamilton Beach argued that this “release” did not occur until after the critical date, and thus there could be no invalidating offer for sale. The Federal Circuit disagreed, holding that the supplier’s response that it was ready to fulfill the order upon Hamilton Beach’s “release” was an offer for sale for purposes of 35 U.S.C. § 102(b)’s on-sale bar because it was an offer



Mass officials. The officials moved to dismiss the revised complaint on the grounds that the case was still within the Supreme Court’s original and exclusive jurisdiction because U. Mass was a real party in interest, that U. Utah’s claims were barred by sovereign immunity, and that U. Utah failed to name U. Mass as an indispensable party. The district court denied the motion, and the defendants appealed. The Federal Circuit observed at the outset that state universities typically enjoy sovereign immunity and generally may not be sued for patent infringement or forced to defend the validity or infringement of any assigned patent in a declaratory judgment action. This case required the Court to examine the legal complexities that arise when state universities are opposite one another in a patent dispute. The Federal Circuit first noted that the complaint, at least on its face, presented a dispute between U. Utah and citizens of Massachusetts, which appeared to compel the Supreme Court’s original but not exclusive jurisdiction under 28 U.S.C. § 1251(b)(3). The Federal Circuit further noted that the Supreme Court maintained original and exclusive jurisdiction under Section 1251(a) if U. Mass was the real party in interest. Addressing the Second Circuit’s guidance in a split decision upon which the district court relied and also taking a wider view of the Supreme Court’s existing caselaw, the Federal Circuit determined that a state has no “core sovereign interests” in inventorship, that an order by the district court will not require or restrain U. Mass from acting, and that the district court was fully capable of granting the relief U. Utah requested without U. Mass’s presence in the suit. While certain of U. Mass’s interests may be affected by the district court’s decision, the Federal Circuit stated that the district court’s order would not deplete the state treasury, compel U. Mass to act, or instruct U. Mass on how to comply with state law. The Federal Circuit thus concluded that U. Mass was not a real party in interest and that the suit therefore was not a conflict between states that was subject to the Supreme Court’s original and exclusive jurisdiction. The Federal Circuit also affirmed the district court’s conclusion that U. Mass was not an indispensable party and that its absence from the suit did not require dismissal under Fed. R. Civ. P. 19(b). The Court noted that patent owners are not automatically indispensable parties under the Rule and agreed with the district court’s consideration of the Rule 19(b) factors—that U. Mass’s interests were adequately represented by the named defendants, that an order directing the U.S. Patent and Trademark Office to correct inventorship would not be insufficient in the absence of U. Mass from the suit, etc. Judge Moore dissented. Characterizing the dispute at issue as one “between two state universities over who owns a valuable patent portfolio,” she criticized the majority’s “core sovereign interests” test as being at odds with the

the May order constituted a modification of the injunction. The S&F Defendants were not joined as defendants until March 2012, but were on notice of the January injunction within a week of its original issuance. Because the original injunction was directed to “any party that had notice of the injunction and was selling the barred products,” the Federal Circuit concluded that it was “beyond debate” that the S&F Defendants fell within the express language of the original injunction. Thus, the Federal Circuit held, the addition of the S&F Defendants to the new injunction merely clarified and did not modify the original injunction. Accordingly, the Federal Circuit concluded that there was also no jurisdiction over an appeal from the S&F Defendants.


The aforementioned patent and trademark case summaries were provided by Munger, Tolles, & Olsen. Contributing authors: Gregory Stone, Keith Hamilton, Adam Lawton, and Peter Gratzinger, inclusively.

University of Utah v. Max-Planck-Gesellschaft Zur Forderung Der Wissenschaften E.V. et al.No. 2012-1540, -1541, -1661(Fed. Cir. August 19, 2013)Opinion by Circuit Judge Reyna

The Federal Circuit affirmed the district court’s ruling that a dispute over patent inventorship between the University of Utah (“U. Utah”) and officials from the University of Massachusetts (“U. Mass”) was not a conflict between states that was subject to the Supreme Court’s original and exclusive jurisdiction under 28 U.S.C. § 1251(a). The Federal Circuit also affirmed the district court’s finding that U. Mass was not an indispensable party under Fed. R. Civ. P. 19(b) and that U. Mass’s absence from the suit did not require its dismissal. The underlying dispute concerned the proper inventorship of patents covering RNA interference (“RNAi”) technology. U. Utah believed that one of its professors, who by contract assigned to U. Utah all patent rights arising from her work, was the sole or joint inventor of the technology. A U. Mass researcher, however, applied for and was granted the patents. U. Utah initially brought suit in district court against the assignees of the patents, including U. Mass, and sought among other things the correction of inventorship under 35 U.S.C. § 256. U. Mass moved to dismiss the complaint, arguing that the dispute between U. Utah and U. Mass was a conflict between states that was within the exclusive and original jurisdiction of the Supreme Court and thus was improperly brought in district court. U. Utah subsequently amended its complaint by replacing U. Mass with four U.


under Federal Rule of Evidence 702 because nothing in the record established the reliability of the testing methodology that he testified to at trial. The court also granted judgment as a matter of law that JJVC did not infringe as Dr. Beebe’s stricken testimony was the only evidence that Rembrandt advanced at trial to prove infringement by the accused lenses.

Following Eleventh Circuit law, Judge Moore, writing for the panel, held the failure of Dr. Bebe to disclose the testing methodology he actually employed until cross-examination at trial was not harmless, violated Rule 26 of the Federal Rules of Civil Procedure governing the required content of expert reports, and thus exclusion was warranted. JJVC prepared its noninfringement defense based on the Shore D Testing methodology disclosed in Dr. Bebe’s expert report. JJVC opted to challenge that methodology rather than introduce competing expert testimony. Nothing during the litigation alerted JJVC to the possibility that Dr. Bebe would alter his testimony, and his changed testimony was both substantive and substantial.


Leo Pharmaceutical Products, Ltd. v. Teresa Stanek Rea, Acting Director, U.S. Patent & Trademark OfficeNo. 2012-1520(Fed. Cir. August. 12, 2013)Opinion by Chief Judge Rader

The Federal Circuit reversed the Patent and Trademark Office’s Board of Patent Appeals and Interferences’ (“BPAI’s”) finding that Leo Pharmaceutical’s U.S. Patent No. 6,753,013 (“the ’013 patent”) covering the “storage stable and non-aqueous” combination of vitamin D, corticosteroid, and a solvent, such as polyoxypropylene 15 stearyl ether (“POP–15–SE”), for the topical treatment of skin conditions, such as psoriasis, was obvious over three prior art references: U.S. Patent No. 4,083,974 (“Turi”); U.S. Patent No. 4,610,978 (“Dikstein”); and WO 94/13353 (“Serup”). The Court further reversed the BPAI’s finding that the “unexpected results” claimed by Leo Pharmaceuticals were not unexpected because Turi “provided explicit reason to use POP–15–SE as a solvent” to those of ordinary skill in the art. Before the ’013 patent, vitamin D and corticosteroid could not be combined in a topical cream due to their divergent pH requirements for optimum stability in a non-aqueous composition. Turi, filed in 1977, discloses pharmaceutical compositions comprising a steroid contained within the POP–15–SE solvent, but it does not teach the using vitamin D or POP–15–SE as a solvent to allow “vitamin D and corticosteroid to coexist.” Dikstein, filed in 1984, discloses dermatological compositions, including creams, ointments, and lotions, comprising a vitamin D analog and

placement in Section 1251(a) of “all controversies” between states within the Supreme Court’s original and exclusive jurisdiction. She disagreed with the majority’s assertion that an order by the district court would not require or restrain U. Mass from acting, noting instead that a judgment in favor of U. Utah will prevent U. Mass from exploiting the patents and the claimed technology. Judge Moore also stated that U. Mass was an indispensable party in the suit because its interests were not identical to those of the named defendants, citing the possibility that the named defendants might settle with U. Utah in a manner that reduces U. Mass’s rights.


The aforementioned patent and trademark case summary was provided by Jones Day. Contributing authors: Richard J. Johnson and Daniel T. O’Brien.

Rembrandt Vision Technologies, L.P. v. Johnson & Johnson Vision Care, Inc.No. 2012-1510(Fed. Cir. August 7, 2013)Opinion by Circuit Judge Moore

The Federal Circuit affirmed (1) the district court’s exclusion of the plaintiff’s, i.e., Rembrandt’s, expert’s trial testimony regarding his findings on defendant’s, i.e., Johnson & Johnson Vision Care’s (“JJVC’s”), accused contact lenses and (2) the district court’s JMOL ruling of non-infringement. The district court adopted the parties’ agreed construction of “soft gas permeable contact lens” as “a contact lens having a Hardness (Shore D) less than five.” To prove that JJVC’s accused contact lenses had a Shore D Hardness of less than five, plaintiff’s expert, Dr. Thomas Bebe, Jr., provided an expert report that indicated he performed a Shore D Hardness test by stacking 24 of the accused lenses around a stainless steel ball and then probing the lenses to 2.54mm in thickness. He confirmed during his direct examination at trial that he performed the steel ball test. On cross-examination, Dr. Bebe testified he did not follow the testing procedures as outlined in his expert report. He testified he performed the Shore D Hardness testing by cutting the accused lenses into quarters, stacking the lens quarters on a flat surface, and then probing them to at least 6mm in thickness in conformance with industry standards for Shore D Hardness testing. These procedures were not disclosed in Dr. Bebe’s expert report. Dr. Bebe claimed his expert report’s disclosure of the wrong Shore D Hardness test procedure was a “typo.

The district court struck Dr. Beebe’s testimony under Federal Rules of Civil Procedure 26 and 37 because his expert report was “woefully deficient” to support his trial testimony. The court also excluded Dr. Beebe’s testimony



TT from asserting the ’055 patent against software products that include certain display functions. The district court premised both holdings on deference to the Federal Circuit’s prior decision in Trading Technologies International, Inc. v. eSpeed, Inc., 595 F.3d 1340 (Fed. Cir. 2010) (“eSpeed”), which considered two related patents from TT’s portfolio, including U.S. Patent 6,772,132 (the “’132 patent”). Judge Lourie concluded eSpeed does not control the issues presented in this appeal, and the district court’s rulings based on that case were incorrect.

The ’411, ’768, ’374, and ’055 patents disclose software used for electronic trading on a commodities exchange and claim priority to the ’132 patent. The ’411, ’768, and ’374 patents all arose from a series of continuation applications stemming from the parent ’132 patent and share a common written description with the ’132 patent. The ’055 patent however issued from a continuation-in-part application and contains “substantial new matter” relative to the original written description of the ’132 patent.

In eSpeed, TT argued the claim term “static display” of vertical commodities prices in the claims of the ’132 patent could be automatically re-centered. The Federal Circuit disagreed and adopted the district court’s construction of the term as “a display of prices comprising price levels that do not change positions unless a manual re-centering command is received,” based on the disclosures in the patent’s specification and file history. The claims and specification reveal the static display does not move and is re-centered only in response to a manual mouse click on the screen. The applicant moreover argued the same in the prosecution history in response to an indefiniteness rejection from the PTO. Subsequently, TT removed the term “static” from the claims of the then pending patent applications for the ’411, ’768, and ’374 patents. Therefore, unlike the ’132 patent at issue in eSpeed, the ’411, ’768, and ’374 patents claim trading methods and software without limitation to a “static” price column display.

The continuation-in-part application of the ’055 patent added new matter to the specification that disclosed the static display is “movable” by, for example, “automatically centering” the display with respect to a static axis (“A trader may use automatic positioning to always have a visual reference of where the market is trading . . . . In addition, automatic positioning may be used in conjunction with manual positioning.” ’055 patent col. 26 ll. 30–37). The claims of the ’055 patent likewise recite steps that include displaying “a static price axis” and “automatically repositioning the static price axis on the graphical user interface.” Id. col. 34 ll. 15–67. By their terms, the claims of the ’055 patent thus require a “static price axis” capable of re-centering via automatic, versus manual, commands.

Instead of considering TT’s removal of the term

a corticosteroid. Dikstein teaches that vitamin D can treat psoriasis and that corticosteroids have side effects, but it does not teach using vitamin D to treat the side effects of corticosteroids. Serup, filed in 1993, describes a composition containing a vitamin D analog and a steroid. Serup further teaches the use of vitamin D analogs to treat skin atrophy, a well-known side effect of steroid treatment. Serup does not address any storage stability concerns associated with this combination, and its example compositions are all aqueous. Even though the BPAI found that Turi did not teach using POP–15–SE as a solvent to allow “vitamin D and corticosteroid to coexist,” the Board nonetheless concluded that “the reason for utilizing the solvent does not have to be the same reason [the solvent] was employed by the inventors.” Chief Judge Rader, writing for the panel, opined that the claims of the ’013 patent were not obvious in view of the fact the prior art did not solve the storage stability problem of vitamin D and corticosteroids, a problem the prior art did not recognize and was not solved for over a decade after the last relevant prior art reference was published; rather, the prior art consistently taught away from claimed invention. He further wrote that where the prior art, at best, gives only general guidance as to the particular form of the claimed invention or how to achieve it, relying on an obvious-to-try theory to support an obviousness finding is impermissible. The patent’s objective indicia of nonobviousness weighed against a finding that the ’013 patent was invalid for obviousness, where unexpected results showed that the claimed storage stability of the non-aqueous combination of vitamin D, corticosteroid, and POP–15–SE were much greater the prior art predicted, the patent holder’s ointment was the first FDA-approved drug to combine vitamin D and corticosteroids into a single formulation for topical application, and decades passed between the publication dates of the prior art and the claimed invention.


Trading Technologies Int’l, Inc. v. Open E Cry, LLCNo. 2012-1583(Fed. Cir. August. 30, 2013)Opinion by Circuit Judge Lourie

The Federal Circuit, in an opinion written by Circuit Judge Lourie, reversed and remanded the district court’s summary judgment that (i) the asserted claims of Trading Technologies’ (“TT’s”) U.S. Patents 7,676,411 (the “’411 patent”), 7,693,768 (the “’768 patent”), 7,904,374 (the “’374 patent”), and 7,685,055 (the “’055 patent”) are invalid for failure to comply with the written description requirement of 35 U.S.C. § 112; and (ii) prosecution history estoppel bars


The Veterans Court disagreed with Kernea, finding that the Board of Veterans’ Appeals had properly determined that the governing regulation prohibited claims of “hypothetical entitlement” and that Kernea had not raised any specific claims of CUE. Kernea appealed.The U.S. Court of Appeals for the Federal Circuit acknowledged that that similar cases had already ruled that there was no “hypothetical entitlement” for DIC claims as the regulation banning them could be applied retroactively; however, this specific issue had not come before the circuit court as of yet. It continued that the Princess Cruises factors for whether a regulation could be applied retroactively should be applied here, as it had done in the similar cases. Addressing the first Princess Cruises factor – the nature and extent of the change in the law – the circuit court found that the state of the law was in a time of flux before Kernea applied for EDIC, but by the time Kernea had applied, the Federal Circuit had held that the VA could construe the statutory language to bar “hypothetical entitlement” claims. Thus, this factor weighed against Kernea. The second factor – the degree of connection between the operation of the new rule and a relevant past event – also weighed against Kernea. The Federal Circuit held that there was nothing Kernea would have done differently had she known of the effect of the rule that was finalized in 2005. With regard to the final factor – familiar considerations of fair notice, reasonable reliance, and settled expectations – the circuit court also found that the weight was against Kernea. It noted that the state of the law was already against Kernea at the time that she filed her claim, and she had no reason to believe that the law would suddenly change in her favor. Therefore, since all three Princess Cruises factors were against Kernea, the circuit court affirmed the retroactive applicability of the regulation to her case and the Veterans Court’s denial on this basis. The circuit court also held that it did not have jurisdiction to hear Kernea’s CUE claims, as it was a factual issue.


National Organization of Veterans’ Advocates, Inc. v. Secretary of Veterans AffairsNo. 11-7191(Fed. Cir. August 5, 2013)Opinion by Circuit Judge Plager

The National Organization of Veterans’ Advocates, Inc. (NOVA) petitioned the U.S. Court of Appeals for the Federal Circuit on September 9, 2011, to review a rule promulgated by the Department of Veterans Affairs. While the petition was being reviewed, it became clear to all parties that the regulation had not been properly promulgated

“static” from the claims of the ’411, ’768, and ’374 patents, the district court relied entirely on the eSpeed decision in granting summary judgment against TT. Accordingly, Judge Lourie opined the eSpeed decision did not apply and that remand was required for the district court to consider in the first instance whether the claims drawn to a non-“static” display satisfied the written description requirement.

Regarding the ’055 patent, Judge Lourie ruled the new matter added to the specification and the new claim language warranted reversal of the district court’s summary judgment. He found the ’055 patent’s specification adequately supported the patent’s claim language, and the district court erred by not considering the new matter and claims in its analysis. Moreover, Judge Lourie ruled the prosecution history estoppel from the ’132 patent did not apply to the ’055 patent due to the new matter added to the ’055 patent’s specification and its subsequent new claims.


The aforementioned patent and trademark case summaries were provided by Winstron and Strawn, LLP. Contributing author: Peter J. Corcoran III.

Veterans Appeals

Kernea v. ShinsekiNo. 12-7142 (Fed. Cir. August 1, 2013)Opinion by Circuit Judge Prost

Widow Flora L. Kernea (Kernea) appealed a decision by the U.S. Court of Appeals for Veterans Claims (Veterans Court), affirming the denial of enhanced dependency and indemnity compensation (EDIC).Donald E. Kernea, Kernea’s husband, died on February 23, 1969, as a result of complications from his service-connected diabetes. At the time of his death, Mr. Kernea had been in receipt of a 100% rating for diabetes for less than four years. Several months after Mr. Kernea’s death, Kernea applied for and was granted dependency and indemnity compensation (DIC). Thirty-four years later, Kernea applied for EDIC, which requires that the veteran was receiving a 100% rating for at least eight years prior to his death, or that he had been entitled to receive such compensation. Kernea argued that her husband had been “entitled to receive” a 100% rating for the last eight years of his life, that several rating decisions issued during Mr. Kernea’s lifetime contained clear and unmistakable error (CUE), and that she was entitled based on a “hypothetical entitlement” theory.



drug. Moreover, the Veterans Court held that Middleton’s condition was not closer to the 40% rating, as he did not meet the actual requirements for a 40% rating. Middleton appealed, arguing that the term “insulin” should be more generally construed to a need for “insulin” and not that he needed to actually inject it. The Secretary disagreed, arguing that the plain language of the regulation should be controlling. The U.S. Court of Appeals for the Federal Circuit agreed with the Secretary. It stated the regulatory language was clear and that the VA knew how to specify if a certain drug was necessary. Moreover, the Federal Circuit held that this specific diagnostic code had successive, cumulative criteria that required that all of the criteria be met in order to obtain the higher rating. This was in contrast to other diagnostic codes, where a veteran could be potentially eligible for one or the other, and therefore 38 C.F.R. § 4.7 would apply. Therefore, the circuit court affirmed the Veterans Court’s decision.


The aforementioned veterans appeals case summaries were provided by The Paralyzed Veterans of America. Contributing author: Linda Blauhut.

and steps were supposedly taken by the VA to stop the enforcement of the regulation. However, it also became clear to the circuit court that the VA was not actually taking the proffered steps to stop the enforcement of the regulation. The Federal Circuit issued an order to the Government to show cause why sanctions should not be ordered, or in the alternative, for the Government to provide a plan explaining how it intended to rectify the problem and explain why sanctions would be unnecessary. In response, the Government provided a detailed remedial plan and requested that sanctions not be imposed. The plan stated that the VA would mail a notice to every affected claimant, would provide each affected claimant with a new hearing and the opportunity to submit new evidence, and would provide for a joint motion to remand if the prior Board decision had applied the illegal rule and the decision had been appealed to the U.S. Court of Appeals for Veterans Claims or the U.S. Court of Appeals for the Federal Circuit. The Federal Circuit and NOVA agreed that the plan was acceptable. Additionally, the circuit court held that sanctions were not necessary at this time but that it would retain jurisdiction of the matter until all harms to affected claimants have been remedied.


Middleton v. Shinseki No. 13-7014 (Fed. Cir. August 15, 2013)Opinion by Circuit Judge Lourie

Birdeye L. Middleton (Middleton) appealed a decision by the U.S. Court of Appeals for Veterans Claims (Veterans Court), affirming the denial of a rating in excess of 20% for service connection for diabetes.Middleton honorably served for twenty-six years. He was granted service connection for diabetes mellitus in July 2002, and granted a 20% rating. In 2008, Middleton requested an increased rating, but the Regional Office denied this claim. Middleton appealed, and was provided with a Compensation & Pension examination in 2009. The examiner found Middleton was treated with three oral hypoglycemic agents and a daily injection of Byetta, which is not insulin. The Board of Veterans’ Appeals denied Middleton’s claim, finding that he did not meet the criteria for a 40% rating because he did not use insulin to regulate his diabetes. Middleton appealed, arguing that his Byetta injection was analogous to requiring insulin, and he should therefore be entitled to the higher rating. The Veterans Court disagreed, stating the plain language of the regulation required that the veteran inject “insulin” and not a substitute or analogous

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