The U.S. Court of Appeals for the Federal Circuit held that compliance with a mandatory or essential industry standard can support a finding of infringement, if the standard itself as drafted with the necessary specificity. Fujitsu Limited, v. Netgear Inc., Case No. 10-1045 (Fed. Cir., Sept. 20, 2010) (Moore, J.).
The plaintiffs—Fujitsu, LG, and Philips (collectively Fujitsu)—sued Netgear for infringement of three patents that were purported to be essential to two wireless networking standards: the IEEE 802.11 2007 standard (802.11) and the Wi-Fi Alliance Wireless Multi-Media Specification, Version 1.1 (WMM Specification). After claim construction, Fujitsu moved for summary judgment, arguing that because Netgear complied with the standard, Netgear necessarily infringed the asserted claims.
The district court denied the motion, holding that Fujitsu must show evidence of infringement for each accused product. Fujitsu appealed.
On appeal, Netgear argued that it is legally incorrect to compare claims to a standard rather than directly to accused products. Netgear also argued that a holding that practicing a standard infringes a patent would amount to an automatic conclusion of infringement against all future accused infringers, thus depriving later litigants a fair opportunity to prove that their products did not infringe.
Fujitsu pointed out that the Court has previously approved the use of standards in assessing infringement —although the cited cases resulted in a showing of non-infringement. Fujitsu also argued that judicial efficiency results when a standard provides the necessary level of specificity.
The Federal Circuit concluded that in certain circumstances a district court may rely on an industry standard to analyze infringement. For example, if, after construing the claims, the court determines that the scope of the claims includes any device that practices a particular standard, that finding can support a conclusion of infringement. The Court reasoned that when an accused product operates in accordance with a standard, comparing the claims to the standard is the same as comparing the claims to the product. As a defense, an accused infringer is free to either prove that the claims do not cover all implementations of the standard or to prove that it does not practice the standard.
The Court also held that public policy weights in favor of this approach and there would be no prejudice against future litigants. The Court reasoned that if two products undisputedly operate in the same manner (e.g., in accordance a mandatory standard), a finding of infringement against one should create a persuasive case against the other.
The Federal Circuit noted that in many instances an industry standard does not provide the level of specificity required to establish that compliance with standard would always result in infringement. The Court reiterated that the use of a standard to prove infringement is only appropriate when a patent covers every possible implementation of a standard.
Practice Note: Choosing an expert who not only understands the technology at issue but also the accused standard is now more important than ever.