Info-Hold, Inc. v. Muzak, LLC, 783 F.3d 1365 (Fed. Cir. Apr. 24, 2015) (REYNA, Wallach, Taranto) (S.D. Ohio: Black) (3 of 5 stars)
Federal Circuit reverses summary judgment of no damages, vacates summary judgment of no induced infringement, and affirms claim construction.
Damages: The district court properly struck the plaintiff’s damages report where it relied on (i) the entire market value rule with no proof the patented feature drove demand and (ii) the 25% rule. But the court erred by subsequently granting summary judgment for a failure of proof on damages. Summary judgment is appropriate only if there is no genuine issue of material fact that zero is the only reasonable royalty, and “the exclusion of the patentee’s damages evidence is not sufficient to justify granting summary judgment.” Slip op. at 11. Here, other record evidence could be used to prove damages, such as deposition testimony from the defendant’s expert, a license of the asserted patent, the royalty paid under an agreement assigning the patent, and the profitability of the accused systems.
Induced Infringement: Issues of material fact on the defendant’s subjective belief regarding infringement (especially its willful blindness) precluded summary judgment. The plaintiff repeatedly contacted the defendant pre-suit regarding the patent, and the defendant’s general counsel asked questions about the functionality covered by the patent but never responded to follow-up communications despite having promised to do so.
Claim Construction: The phrase “when a caller is placed on hold” was correctly construed to mean “at the moment a caller is placed on hold.” The plaintiff’s position that this phrase means “during the period the caller was on hold” would read the word “placed” out of the claims.