Summary: CAFC affirms judgment of patent infringement, and validity. CAFC reverses finding of willful infringement and enhanced damages. CAFC remands on the issue of attorney’s fees due to a finding of an exceptional case.

Case: Lee v. Mike’s Novelties, Inc., No. 2013-1049 (Fed. Cir. Nov. 21, 2013) (non-precedential). On appeal from C.D. Cal. Before Dyk, Moore, and Wallach.

Procedural Posture: Defendant-accused infringer Mike’s Novelties appealed the district court’s judgment of infringement, validity, willfulness, and enhanced damages and attorney fees. CAFC affirmed in part, reversed in part, and remanded.

  • Claim Construction: The district court did not err in rejecting patentee-Lee’s proposed construction of the weight differential limitation of a claimed tobacco pipe that would have limited the claims to read on devices with turrets held stationary solely because of the weight differential. Based on the intrinsic evidence and a “comprising” claim term, infringement could not be avoided by adding a feature (a spring and/or pin) that contributed to the turret’s stability if the weight differential was nevertheless sufficient to keep the turret stationary.
  • Infringement: The district court did not err in permitting the jury to decide, without expert testimony, that Lee proved that the accused product met a limitation related to the weight differential between parts of the claimed device. The technology was easily understandable and did not require technical expertise or specialized knowledge. Based on credibility assessments of witnesses that offered competing testimony, the jury could reasonably have concluded that Mike’s Novelties sold a particular configuration of the accused product. The jury’s verdict of infringement was supported by substantial evidence.
  • Invalidity: Affirmed rejection of Defendant’s invalidity arguments, which included lack of best mode, obviousness and alleged public use. The Federal Circuit sustained the jury’s verdict of no invalidity.
  • Willful Infringement: The district court erred in finding willful infringement and, consequently, awarding enhanced damages because Mike’s Novelties defense related to alleged infringement of the weight differential limitation was not objectively unreasonable.
  • Attorney Fees: The district court did not clearly err in finding that Defendant’s bad faith settlement offers, bad faith conduct during discovery, and use of intimidating language constituted bad faith litigation tactics. Such tactics may support a finding of exceptional case, but the Federal Circuit remanded for the district court to determine whether Defendant’s litigation misconduct alone would make this case exceptional.