Digest of Global Traffic Techs. LLC V. Morgan, Nos. 2014-1537, 2014-1566 (Fed. Cir. June 4, 2015) (precedential). On appeal from D. Minn. Before Dyk, O’Malley, and Taranto.
Procedural Posture: Appellants-defendants appealed final judgment of willful infringement. CAFC affirmed-in-part, reversed-in-part, and remanded.
- Claim Construction: The Federal Circuit found that appellants’ arguments regarding the construction of the “map of allowed approaches” term were waived because they had failed to raise them before the district court. Accordingly, the district court’s construction of the term according to its “plain meaning” was proper.
- Infringement: The Federal Circuit found that appellants’ arguments regarding indirect infringement were waived because they failed to present them in the required judgment as a matter of law motions in the district court. Further, even if not waived, the Federal Circuit found that appellants’ arguments were without merit because appellee had presented sufficient evidence that the accused infringers had affirmative knowledge of the patent-in-suit, had no reasonable non-infringement defense, and had willfully blinded themselves to their infringement.
- Willful Infringement: The district court erred in applying the wrong standard to the first prong of its willful infringement analysis. In particular, the Federal Circuit found that the district court improperly considered the accused infringer’s knowledge of the patent-in-suit. The first prong is an objective inquiry into whether the accused infringer acted “despite an objectively high likelihood that its actions constituted infringement of a valid patent,” and requires analysis of all of the accused infringer’s non-infringement and invalidity defenses. Because appellants’ defenses during litigation were objectively reasonable, the Federal Circuit found that appellee failed to prove the first prong of the willfulness test and reversed the district court’s award of enhanced damages.
- Marking: The Federal Circuit affirmed the jury’s finding that appellee had complied with 35 U.S.C § 287 (the “marking statute”) by marking the packaging of their product rather than the product itself. In particular, the finding was supported by evidence that the patented product contained multiple components that were separated once unpackaged, that some components were not in public view once installed, and that the marking used reflected industry custom.
- Expert Testimony: The district court properly denied appellants’ JMOL motion regarding the exclusion of appellee’s damages expert’s testimony. Appellants’ contended that appellee’s damages expert failed to consider price elasticity. However, appellee’s expert did testify on price elasticity, which was based on analysis in the expert’s report.
- Personal Liability: The district court properly denied appellant Morgan’s JMOL motion that he was not personally liable for infringement. The Federal Circuit found that Morgan, sole shareholder and director of defendant KME Enterprises, Inc., induced infringement through his personal actions and was therefore directly liable; it was not necessary to pierce the corporate veil to find Morgan derivatively liable for KME’s infringement.