In a case involving a product design modified to avoid the scope of a litigated patent, the U.S. Court of Appeals for the Federal Circuit agreed with the district court, concluding the accused infringement was more than “colorably different” from the product previously found to infringe and there was no contempt of the injunction in issue.  nCUBE Corporation v. SeaChange International, Inc., Case No. 12-1066 (Fed. Cir., Oct. 10, 2013) (Prost, J.).

The plaintiff, nCUBE, now known as ARRIS, owns a patent directed to delivering streamed video purchased online. In earlier litigation, a jury found that defendants’ accused ITV product infringed, and the district court entered a permanent injunction that enjoined SeaChange from using or selling its ITV product or “any devices not more than colorably different therefrom.”  After the jury verdict, SeaChange modified its ITV device.  By the time the injunction issued (more than four years later) SeaChange was on the market with its design around which it viewed as outside the scope of the litigated patent.

The plaintiff disagreed and filed a motion seeking to hold SeaChange in contempt of the permanent injunction.  The district court however, found that plaintiff failed to prove contempt by clear and convincing evidence.  ARRIS appealed.

Citing its 2011 en banc decision in TiVo v. EchoStar (IP Update, Vol. 14, No. 4) the Federal Circuit explained that “on a contempt motion, the party seeking to enforce the injunction bears the burden of proving by clear and convincing evidence both that the newly accused product is not more than colorably  different from the product found to infringe and that the newly accused product actually infringes.”     

The Court further explained that “in determining whether more than colorable differences are present the court focuses on those elements of the adjudged infringing products that the patentee previously contended, and proved, satisfy specific limitations of the asserted claims.”  In TiVo the Federal Circuit explained that: 

Where one or more of those elements previously found to infringe has been modified, or removed, the court must make an inquiry into whether that modification is significant. If those differences between the old and new elements are significant, the newly accused product as a whole shall be deemed more than colorably different from the adjudged infringing one, and the inquiry into whether the newly accused product actually infringes is irrelevant. Contempt is then inappropriate.  (Emphasis added.)

With respect to the colorable-differences prong of the TiVo analysis, ARRIS argued that that while the modified system no longer meets the “upstream physical address” limitation, the differences between the ClientID in the original ITV and the SessionID in the modified device are not significant and, therefore, no more than colorable. 

In reaching its conclusion of a failure to prove contempt, the district court noted that while “the ClientID in the modified system performs the same task as it did in the old system … it does so in a way that all parties agree is non-infringing.”  The district court also found that “ARRIS could not rely on the [new] SessionID [of the modified product] to meet this prong of TiVo because it was not identified at trial as meeting this limitation.” 

ARRIS contended that the district court erred by ignoring the “removed” language of the TiVo holding and failing to analyze whether removing the ClientID was a significant change to the system when the SessionID remains. 

The Federal Circuit disagreed, noting that the difference between the infringing and modified systems “represents a modification rather than a removal of the accused [Connection Table] element” and that in the modified device, the ClientID still performs the same relevant functions in both systems, but does so in a way that all parties admit puts the ClientID outside the claim.”  The Court emphasized that the determination of whether more than colorable differences are present requires the Court to focus “on those elements of the adjudged infringing products that the patentee previously contended, and proved, satisfy specific limitations of the asserted claims.”